An offering statement pursuant to Regulation A relating to these securities has been filed with the United States Securities and Exchange Commission. Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the offering statement filed with the United States Securities and Exchange Commission is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the offering statement in which such Final Offering Circular was filed may be obtained.

OFFERING CIRCULAR

Subject to Completion, January 10, 2018

2,165,000 SHARES OF CLASS A COMMON STOCK

This is the initial public offering of shares of Class A common stock of iPic Entertainment Inc.

We are offering 2,165,000 shares of our Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), at an offering price of $18.50 per share (the “Shares”) for an offering amount of $40,052,500 (the “Offering”). The Offering will terminate at the earliest of: (1) the date at which $40,052,500 of Shares has been sold, (2) the date which is one year after this Offering being qualified by the U.S. Securities and Exchange Commission (the “SEC” or the “Commission”), or (3) the date on which this Offering is earlier terminated by the Company in its sole discretion and for any reason (the “Termination Date”).

This Offering is being conducted on a “best efforts” basis without any minimum offering amount pursuant to Regulation A of Section 3(6) of the Securities Act of 1933, as amended (the “Securities Act”), for Tier 2 offerings. The Company currently intends to complete one closing of this Offering, once we have met the NASDAQ minimum listing requirements; however, we reserve the right to undertake one or more closings on a rolling basis even if we have not yet met the NASDAQ minimum listing requirements at such time. Even if we meet the minimum requirements for listing on NASDAQ, we may wait before terminating the Offering and commencing trading of our Class A Common Stock on NASDAQ in order to raise additional proceeds. Until we complete a closing, the proceeds for the Offering will be kept in an escrow account, except with respect to those investors using a BANQ online brokerage account. At a closing, the proceeds will be distributed to the Company and the associated Shares will be issued to the investors in such Shares. If there are no closings or if funds remain in the escrow account upon termination of this Offering without any corresponding closing, the investments for this Offering will be promptly returned to investors, without deduction and generally without interest. Wilmington Trust, N.A. will serve as the escrow agent. There is a 25 share minimum purchase requirement for investors. See “Plan of Distribution.”

Tripoint Global Equities, LLC has agreed to act as our lead managing selling agent, along with Roth Capital Partners, LLC acting as the Institutional Placement Book-Running Agent and Telsey Advisory Group LLC acting as a co-manager (collectively, the “Selling Agents”), to offer the Shares to prospective investors on a “best efforts” basis. In addition, the Selling Agents may engage one or more co-managing selling agents, sub selling agents or selected dealers. The Selling Agents are not purchasing the Shares, and are not required to sell any specific number or dollar amount of the Shares in the Offering.

We expect to commence the offer and sale of the Shares as of the date on which the offering statement of which this Offering Circular is a part (the “Offering Statement”) is qualified by the Commission. Prior to this Offering, there has been no public market for our Class A Common Stock. We have applied to list our Class A Common Stock on the NASDAQ Stock Market LLC (“NASDAQ”) under the symbol “IPIC.” We expect our Class A Common Stock to begin trading on NASDAQ upon consummation of the Offering.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, and, as such, may elect to comply with certain reduced reporting requirements for this Offering Circular and future filings after this Offering.

Investing in our Class A Common Stock involves a high degree of risk. See “Risk Factors” beginning on page 14 for a discussion of certain risks that you should consider in connection with an investment in our Class A Common Stock.

		Per Share			Total
Price to Public		$	18.50		$	40,052,500
Selling Agents Discounts and Commissions(1)		$	1.34		$	2,903,806
Proceeds, Before Expenses, to Us(2)		$	17.16		$	37,148,694

____________

(1)       We have agreed to reimburse certain expenses of our Selling Agents. Please refer to the section entitled “Plan of Distribution” in this Offering Circular for additional information regarding total compensation for the Selling Agents.

(2)       Assumes that all of the Shares are sold.

NO SALE MAY BE MADE TO YOU IN THIS OFFERING IF THE AGGREGATE PURCHASE PRICE YOU PAY IS MORE THAN 10% OF THE GREATER OF YOUR ANNUAL INCOME OR NET WORTH. DIFFERENT RULES APPLY TO ACCREDITED INVESTORS AND NON-NATURAL PERSONS. BEFORE MAKING ANY REPRESENTATION THAT YOUR INVESTMENT DOES NOT EXCEED APPLICABLE THRESHOLDS, WE ENCOURAGE YOU TO REVIEW RULE 251(d)(2)(i)(C) OF REGULATION A. FOR GENERAL INFORMATION ON INVESTING, WE ENCOURAGE YOU TO REFER TO www.investor.gov.

THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED HEREBY OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE BEING OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

For more information concerning the procedures of the Offering, please refer to “Plan of Distribution” beginning on page 121, including the sections “— Investment Limitations” and “— Procedures for Subscribing.”

This Offering Circular follows the disclosure format of Part I of Form S-1 pursuant to the general instructions of Part II(a)(1)(ii) of Form 1-A.

Lead Managing Selling Agent				Institutional Placement Book-Running Agent

Co-Manager

The date of this Offering Circular is ___________, 2018.

 

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS		iii
NON-GAAP FINANCIAL MEASURES		iv
OFFERING CIRCULAR SUMMARY		1
RISK FACTORS		14
THE TRANSACTIONS		36
USE OF PROCEEDS		43
CAPITALIZATION		44
DILUTION		46
DIVIDEND POLICY		47
UNAUDITED PRO FORMA AND PRO FORMA AS ADJUSTED CONSOLIDATED FINANCIAL STATEMENTS		48
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA		58
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		62
BUSINESS		76
MANAGEMENT		87
EXECUTIVE COMPENSATION		92
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS		102
PRINCIPAL STOCKHOLDERS		105
DESCRIPTION OF SECURITIES		107
DESCRIPTION OF INDEBTEDNESS		112
SHARES ELIGIBLE FOR FUTURE SALE		115
MATERIAL U.S. FEDERAL TAX CONSIDERATIONS FOR NON-U.S. HOLDERS OF OUR CLASS A COMMON STOCK		117
PLAN OF DISTRIBUTION		121
LEGAL MATTERS		128
EXPERTS		128
WHERE YOU CAN FIND MORE INFORMATION		128
FINANCIAL STATEMENTS		F-1

i

We are offering to sell, and seeking offers to buy, the Shares only in jurisdictions where such offers and sales are permitted. You should rely only on the information contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date, regardless of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular nor any sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by the federal securities laws.

Unless otherwise indicated, data contained in this Offering Circular concerning the hospitality, theater and restaurant markets and the other markets relevant to our operations are based on information from various public sources. Although we believe that these data are generally reliable, such information is inherently imprecise, and our estimates and expectations based on these data involve a number of assumptions and limitations. As a result, you are cautioned not to give undue weight to such data, estimates or expectations.

In this Offering Circular, unless the context indicates otherwise, references to “iPic,” “we,” the “Company,” “our” and “us” refer: (i) on or following the consummation of the Transactions, including this Offering, to iPic Entertainment Inc. and, unless otherwise stated or the context requires otherwise, all of its subsidiaries, including (a) iPic Gold Class Holdings LLC, which we refer to as “Holdings,” (b) iPic-Gold Class Entertainment, LLC, which we refer to as “iPic-Gold Class,” and (c) unless otherwise stated, all of iPic-Gold Class’s subsidiaries; and (ii) prior to the completion of the Transactions, including this Offering, to iPic-Gold Class and, unless otherwise stated or the context requires otherwise, all of its subsidiaries. References to “iPic Entertainment” refer to iPic Entertainment Inc.

In this Offering Circular, references to “Class A Common Stock” refer to our Class A common stock, par value $0.0001 per share; references to “Class B Common Stock” refer to our Class B common stock, par value $0.0001 per share; and references to “Common Stock” refer to our Class A Common Stock and our Class B Common Stock collectively.

In this Offering Circular, we refer to our iPic locations as “iPics,” “stores,” “locations,” “units,” and “iPic theaters.”

ii

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain of the statements in this Offering Circular constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “should,” “will” and “would” or the negatives of these terms or other comparable terminology, but the absence of these particular words does not mean that a statement is not forward-looking.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this Offering Circular, including in “Risk Factors” and elsewhere, identify important factors which you should consider in evaluating our forward-looking statements. These factors include, among other things:

•         our inability to successfully identify and secure appropriate sites and timely develop and expand our operations in existing and new markets;

•         our inability to optimize our theater circuit through new construction and transforming our existing theaters;

•         competition from other theater chains and restaurants;

•         our inability to operate profitably;

•         our dependence on a small number of suppliers for motion picture products;

•         our inability to manage fluctuations in attendance in the motion picture exhibition industry;

•         our inability to address the increased use of alternative film delivery methods or other forms of entertainment;

•         our ability to serve menu items that appeal to our guests and to avoid food safety problems;

•         our inability to obtain sufficient capital to open up new units, to renovate existing units and to deploy strategic initiatives;

•         our ability to address issues associated with entering into long-term non-cancelable leases;

•         our inability to protect against security breaches of confidential guest information;

•         our inability to manage our growth;

•         our inability to maintain sufficient levels of cash flow, or access to capital, to meet growth expectations;

•         our inability to manage our substantial level of outstanding debt;

•         our ability to continue as a going concern;

•         our failure to meet any operational and financial performance guidance we provide to the public; and

•         our ability to compete and succeed in a highly competitive and evolving industry.

Although the forward-looking statements in this Offering Circular are based on our beliefs, assumptions and expectations, taking into account all information currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained. Should one or more of the risks or uncertainties referred to above and elsewhere in this Offering Circular materialize, or should any of our assumptions prove to be incorrect, our actual results may vary in material and adverse respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.

iii

NON-GAAP FINANCIAL MEASURES

Certain financial measures presented in this Offering Circular, such as EBITDA, Adjusted EBITDA and Store-Level EBITDA are not recognized under accounting principles generally accepted in the United States, which we refer to as “GAAP.” We define these terms as follows:

•         “EBITDA” means, for any reporting period, net loss before interest, taxes, depreciation, and amortization,

•         “Adjusted EBITDA” is a supplemental measure of our performance and is also the basis for performance evaluation under our executive compensation programs. Adjusted EBITDA is defined as EBITDA adjusted for the impact of certain non-cash and other items that we do not consider in our evaluation of ongoing operating performance. These items include, among other things, equity-based compensation expense, pre-opening expenses, other income and loss on disposal of property and equipment, impairment of property and equipment as well as certain non-recurring charges. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of expenses that do not relate to our ongoing business performance.

•         “Store-Level EBITDA” is a supplemental measure of our performance which we believe provides management and investors with additional information to measure the performance of our locations, individually and as an entirety. Store-Level EBITDA is defined by us as EBITDA adjusted for pre-opening expenses, other income, loss on disposal of property and equipment, impairment of property and equipment non-recurring charges, and general and administrative expense. We use Store-Level EBITDA to measure operating performance and returns from opening new stores. We believe that Store-Level EBITDA is another useful measure in evaluating our operating performance because it removes the impact of general and administrative expenses, which are not incurred at the store level, and the costs of opening new stores, which are non-recurring at the store-level, and thereby enables the comparability of the operating performance of our stores for the periods presented. We also believe that Store-Level EBITDA is a useful measure in evaluating our operating performance within the entertainment and dining industry because it permits the evaluation of store-level productivity, efficiency and performance, and we use Store-Level EBITDA as a means of evaluating store financial performance compared with our competitors.

You are encouraged to evaluate the adjustments we have made to GAAP financial measures and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA and Store-Level EBITDA, you should be aware that in the future we may incur income and expenses that are the same as or similar to some of the adjustments in this Offering Circular.

EBITDA and Adjusted EBITDA are included in this Offering Circular because they are key metrics used by management and our board of directors to assess our financial performance. EBITDA and Adjusted EBITDA are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Store-Level EBITDA is utilized to measure the performance of our locations, both individually and in entirety.

EBITDA and Adjusted EBITDA are not GAAP measures of our financial performance or liquidity and should not be considered as alternatives to net income (loss) as a measure of financial performance or cash flows from operations as measures of liquidity, or any other performance measure derived in accordance with GAAP. Our presentation of Adjusted EBITDA and Store-Level EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Additionally, EBITDA and Adjusted EBITDA are not intended to be measures of free cash flow for management’s discretionary use, as they do not reflect tax payments, debt service requirements, capital expenditures, iPic openings and certain other cash costs that may recur in the future, including, among other things, cash requirements for working capital needs and cash costs to replace assets being depreciated and amortized. Management compensates for these limitations by relying on our GAAP results in addition to using EBITDA and Adjusted EBITDA supplementally. Our measures of EBITDA and Adjusted EBITDA are not necessarily comparable to similarly titled captions of other companies due to different methods of calculation.

iv

See “Offering Circular Summary — Summary Historical and Pro Forma Financial and Other Data — Non-GAAP Financial Measures” for a reconciliation of EBITDA, Adjusted EBITDA and Store-Level EBITDA to net loss for each of the periods presented.

v

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4

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The Offering

Issuer		iPic Entertainment Inc.
Securities offered		Class A Common Stock
Class A Common Stock offered by us in this Offering		2,165,000 shares
Class A Common Stock to be outstanding after this Offering		2,165,000 shares, assuming the maximum amount of shares are sold
Class B Common Stock to be outstanding after this Offering		10,220,629
Price per share of Class A Common Stock		$18.50
Minimum investment amount		25 shares at $18.50 per share, or $462.50
Voting rights		Holders of our Class A Common Stock and Class B Common Stock will vote together as a single class on all matters presented to stockholders for their vote or approval, except as otherwise required by law. Each share of Class A Common Stock and Class B Common Stock will entitle its holder to one vote per share on all such matters. See “Description of Securities.”
Voting power held by all holders of Class A Common Stock after giving effect to this Offering		17.5%
Voting power held by all holders of Class B Common Stock after giving effect to this Offering		82.5%
Ratio of shares of Class A Common Stock to LLC Interests		Our Amended and Restated Certificate of Incorporation and the Holdings LLC Agreement will require that (i) we at all times maintain a ratio of one LLC Interest owned by us for each share of Class A Common Stock issued by us (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities), and (ii) Holdings at all times maintain (x) a one-to-one ratio between the number of shares of Class A Common Stock issued by us and the number of LLC Interests owned by us and (y) a one-to-one ratio between the number of shares of Class B Common Stock owned by the Continuing iPic Equity Owners and the number of LLC Interests owned by the Continuing iPic Equity Owners. This construct is intended to result in the Continuing iPic Equity Owners having a voting interest in iPic Entertainment that is identical to the Continuing iPic Equity Owners’ percentage economic interest in Holdings. The Continuing iPic Equity Owners will own all of our outstanding Class B Common Stock.

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10

Summary Historical and Pro Forma Financial and Operating Data

$ in thousands, except share and per share data

		Six Months Ended								Year Ended								Pro Forma
		June 30, 2017				June 30, 2016				December 31, 2016				December 31, 2015				Six Months Ended June 30, 2017				Year Ended December 31, 2016
Statement of Operations data:
Revenues
Food and beverage		$	37,701			$	29,115			$	64,363			$	53,025			$	37,701			$	64,363
Theater			30,780				25,948				57,459				45,866				30,780				57,459
Other			893				284				2,994				997				893				2,994
Total revenues			69,375				55,348				124,816				99,889				69,375				124,816
Operating expenses
Cost of food and beverage			10,307				7,762				17,377				14,614				10,307				17,377
Cost of theater			12,283				10,169				22,108				18,709				12,283				22,108
Operating payroll and benefits			18,906				14,488				32,141				25,918				18,906				32,141
Occupancy expenses			8,766				8,334				17,104				13,073				8,766				17,104
Other operating expenses			12,164				9,015				24,781				16,183				12,164				24,781
General and administrative expenses			7,011				5,842				14,220				12,471				9,421				17,649
Depreciation and amortization expense			9,570				7,232				16,019				11,819				9,570				16,019
Pre-opening expenses			1,632				870				4,395				3,666				1,632				4,395
Impairment of property and equipment			3,332				—				—				—				3,332				—
Loss on disposal of property and equipment			8				60				88				211				8				88
Operating expenses			83,979				63,773				148,234				116,665				86,388				151,662
Operating loss			(14,604	)			(8,425	)			(23,418	)			(16,777	)			(17,014	)			(26,847	)
Other income (expense)
Interest income (expense), net			(7,782	)			(5,259	)			(10,718	)			(7,891	)			(6,937	)			(9,139	)
Other income			5				—				—				—				5				—
Total other income (expense)			(7,777	)			(5,259	)			(10,718	)			(7,891	)			(6,932	)			(9,139	)
Net loss before income tax expense			(22,382	)			(13,684	)			(34,136	)			(24,668	)			(23,946	)			(35,986	)
Income tax expense			43				30				87				61				43				87
Net loss		$	(22,425	)		$	(13,715	)		$	(34,223	)		$	(24,729	)		$	(23,989	)		$	(36,072	)
Less: Net loss attributable to non-controlling interest		$	—			$	—			$	—			$	—			$	(19,719	)		$	(29,651	)
Net loss attributable to iPic Entertainment Inc.		$	(22,425	)		$	(13,715	)		$	(34,223	)		$	(24,729	)		$	(4,270	)		$	(6,421	)
Net loss per share of Class A Common Stock
Basic																		$	(1.97	)		$	(2.97	)
Diluted																		$	(1.97	)		$	(2.97	)
Weighted average number of shares of Class A Common Stock outstanding
Basic																			2,165,000				2,165,000
Diluted																			2,165,000				2,165,000
Non-GAAP financial measures:
EBITDA(1)		$	(5,029	)		$	(1,193	)		$	(7,399	)		$	(4,958	)		$	(7,438	)		$	(10,827	)
Adjusted EBITDA(1)		$	(62	)		$	(263	)		$	932			$	(1,081	)		$	(62	)		$	932
Store-Level EBITDA(1)		$	6,949			$	5,579			$	15,152			$	11,390			$	6,949			$	15,152

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RISK FACTORS

Before you decide to purchase shares of our common stock, you should understand the high degree of risk involved. You should consider carefully the following risks and other information in this Offering Circular, including our pro forma and historical financial statements and related notes. If any of the following risks actually occur, our business, financial condition and operating results could be adversely affected. As a result, the trading price of our common stock could decline, perhaps significantly.

Risks Related to Our Business and Industry

Our long-term success is highly dependent on our ability to successfully identify and secure appropriate sites and timely develop and expand our operations in existing and new markets.

One of the key means of achieving our growth strategies will be through opening and operating new iPic locations on a profitable basis for the foreseeable future. We must identify target markets where we can enter or expand, taking into account numerous factors such as the location, demographics, traffic patterns and information gathered from our various contacts. We may not be able to open our planned new iPic locations within budget or on a timely basis, if at all, given the uncertainty of these factors, which could adversely affect our business, financial condition and results of operations. As we operate more iPic locations, our rate of expansion relative to the size of our location base will eventually decline.

The number and timing of new units opened during any given period may be negatively impacted by a number of factors including, without limitation:

•         the identification and availability of attractive sites for new iPic locations and the ability to negotiate suitable lease terms;

•         the lack of development and overall decrease in commercial real estate due to a macroeconomic downturn;

•         recruitment and training of qualified personnel in the local market;

•         our ability to obtain all required governmental permits, including zonal approvals, on a timely basis;

•         our ability to control construction and development costs of new units;

•         competition in new markets, including competition for appropriate sites;

•         failure of the landlords to timely deliver real estate to us;

•         the proximity of potential sites to an existing iPic, and the impact of cannibalization on future growth;

•         anticipated commercial, residential and infrastructure development near our new iPic locations; and

•         the cost and availability of capital to fund construction costs and pre-opening expenses.

Accordingly, we cannot assure you that we will be able to successfully expand as we may not correctly analyze the suitability of a location or anticipate all of the challenges imposed by expanding our operations. Our growth strategy and the substantial investment associated with the development of each new location may cause our operating results to fluctuate and be unpredictable or adversely affect our profits. In addition, as has happened when other restaurant concepts have tried to expand, we may find that our concept has limited appeal in new markets or we may experience a decline in the popularity of our concept in the markets in which we operate. If we are unable to expand in existing markets or penetrate new markets, our ability to increase our revenues and profitability may be materially harmed or we may face losses.

Optimizing our theater circuit through new construction and the transformation of our existing theaters is subject to delay and unanticipated costs.

The availability of attractive site locations for new theater construction is subject to various factors that are beyond our control. These factors include:

•         local conditions, such as scarcity of space or increase in demand for real estate, demographic changes and changes in zoning and tax laws; and

•         competition for site locations from both theater companies and other businesses.

14

We typically require 24 to 36 months from the time we reach an agreement with a landlord to when a new theater opens. In addition, improving our existing theaters is subject to substantial risks such as difficulty obtaining permits, landlord approvals and new types of operating licenses (e.g. liquor licenses). We may also experience cost overruns from delays or other unanticipated costs in both new construction and facility improvements. Furthermore, our new sites and transformed locations may not perform to our expectations.

Our failure to manage our growth effectively could harm our business and operating results.

Our growth plan includes a significant number of potential new iPic locations. Our existing management systems, financial and management controls and information systems may not be adequate to support our planned expansion. Our ability to manage our growth effectively will require us to continue to enhance these systems, procedures and controls and to locate, hire, train and retain management and operating personnel, particularly in new markets. We may not be able to respond on a timely basis to all of the changing demands that our planned expansion will impose on management and on our existing infrastructure, or be able to hire or retain the necessary management and operating personnel, which could harm our business, financial condition or results of operations. These demands could cause us to operate our existing business less effectively, which in turn could cause deterioration in the financial performance of our existing units. If we experience a decline in financial performance, we may decrease the number of or discontinue new openings, or we may decide to close units that we are unable to operate in a profitable manner.

Our theaters and restaurants operate in highly competitive environments.

The motion picture exhibition industry is fragmented and highly competitive with no significant barriers to entry. Our theaters are subject to varying degrees of competition in the geographic areas in which we operate. Competitors may be national circuits, regional circuits or smaller independent exhibitors. Moviegoers are generally not brand conscious and usually choose a theater based on its location, the films showing there, showtimes and its amenities. Competition among theater exhibition companies is often intense with respect to the following factors:

•         Attracting patrons. The competition for patrons is dependent upon factors such as the availability of popular motion pictures, the location and number of theaters and screens in a market, the comfort and quality of the theaters and pricing. Many of our competitors have sought to increase the number of screens that they operate and provide a more luxurious experience by enhancing food and beverage options and installing recliner seating. Certain of the larger theater chains, such as AMC and Regal, have been converting some of their existing theaters to include in-theater dining and recliner seating, often at the same price or a marginally higher price than their traditional theaters. Should other theater operators in our markets choose to implement these or other initiatives, the performance of our theaters may be significantly and negatively impacted.

•         Licensing motion pictures. We believe that the principal competitive factors with respect to film licensing include licensing terms, number of seats and screens available for a particular picture, revenue potential and the location and condition of an exhibitor’s theaters.

•         New sites and acquisitions. We must compete with exhibitors and others in our efforts to locate and acquire attractive new and existing sites for our iPic units. There can be no assurance that we will be able to acquire such new sites or existing theaters at reasonable prices or on favorable terms. Moreover, some of these competitors may be stronger financially than we are. As a result of the foregoing, we may not succeed in acquiring theaters or may have to pay more than we would prefer to make an acquisition.

•         Multiple competitors for both out-of-home and in-home entertainment. The theatrical exhibition industry faces competition from other forms of out-of-home entertainment, such as concerts, amusement parks and sporting events and from other distribution channels for filmed entertainment, such as cable television, pay-per-view, video on demand, subscription based video streaming services, such as Netflix, Amazon Prime and Hulu, and home video systems and from other forms of in-home or on-the-go entertainment.

•         New marketing approaches. Many of our competitors have partnered with MoviePass Inc. (“MoviePass”), a subscription-based movie ticketing service. For a monthly fee of $9.95, MoviePass subscribers can attend one movie per day at no additional cost. MoviePass’ growing popularity may negatively impact our theaters by providing patrons with a cheaper alternative to paying each time they go to the movies.

•         New technology. New innovations and technology will continue to impact our industry. If we are unable to respond to or invest in future technology and the changing preferences of our customers, we may not be able to compete with other exhibitors or other entertainment venues, which could also adversely affect our results of operations.

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Like the motion picture exhibition industry, the restaurant industry is fragmented and highly competitive with no significant barriers to entry. We compete in the restaurant industry with multi-unit national, regional and locally-owned and/or operated limited-service restaurants and full-service restaurants. Many of our competitors offer breakfast, lunch and dinner, as well as dine-in, carry-out and delivery services. Many of our competitors have existed longer than we have and may have a more established market presence, better locations and greater name recognition nationally or in some of the local markets in which we operate or plan to operate.

We face significant competition for restaurant guests, and our inability to compete effectively may affect our traffic, iPic sales and store-level operating profit margins.

We rely on our food and beverage service for a majority of our revenue. The restaurant industry is intensely competitive with many well-established companies that compete directly and indirectly with us with respect to food quality, service, price and value, design and location. Some of our competitors have significantly greater financial, marketing, personnel and other resources than we do. In addition, many of our competitors have greater name recognition nationally or in some of the local markets in which we have or plan to have an iPic. Any inability to successfully compete with the restaurants in our markets will place downward pressure on our guest traffic and may prevent us from increasing or sustaining our revenues and profitability.

New iPic locations, once opened, may not be profitable; recently, our comparable-store sales have declined; and the performance of our units that we have experienced in the past may not be indicative of future results.

Our results have been, and in the future may continue to be, significantly impacted by the timing of new location openings (often dictated by factors outside of our control), including landlord delays, associated pre-opening expenses and operating inefficiencies, as well as changes in our geographic concentration due to the opening of new units. We typically incur the most significant portion of pre-opening expenses associated with a given location within the six months preceding the opening. Our experience has been that labor and operating costs associated with a newly opened location for the first several months of operation are materially greater than what can be expected after that time, both in aggregate dollars and as a percentage of sales. Our new units commonly take 16 to 20 weeks to reach planned operating expense levels due to inefficiencies typically associated with new openings, including the training of new personnel, new market learning curves, inability to hire sufficient qualified staff and other factors. We may incur additional costs in new markets, particularly for transportation and distribution, which may impact the profitability of those units. Accordingly, the volume and timing of new openings may have a material adverse impact on our profitability.

In recent periods, our comparable-store sales have declined, as have those of certain of our competitors. Specifically, in the six months ended June 30, 2017 as compared to the six months ended June 30, 2016, our comparable-store sales declined by $1.6 million. This was partly due to the fact that there were relatively few successful movie releases during the first six months of calendar year 2017. In the year ended December 31, 2016 as compared to the year ended December 31, 2015, our comparable-store sales declined by $6.2 million. This was partly due to the fact that there was a material increase in the percentage of the motion picture industry’s 2016 total box-office receipts that stemmed from children’s or animated films that do not generally appeal to our more adult clientele. For 2016, industry reports noted that approximately 50% of industry sales from 2016’s Top-15 grossing films were from children’s or animated films (as opposed to 18% of industry sales from 2015’s Top-15 grossing films coming from children’s or animated films).

Although we target specified operating and financial metrics, new units may not meet these targets or may take longer than anticipated to do so. Any new location we open may not be profitable or achieve operating results similar to those of our existing units, which could adversely affect our business, financial condition or results of operations.

We may not achieve the expected benefits and performance from strategic theater acquisitions.

In any acquisition, we expect to benefit from cost savings through, for example, the reduction of overhead and theater level costs, and from revenue enhancements resulting from the acquisition. However, there can be no assurance that we will be able to generate sufficient cash flow from these acquisitions to service any indebtedness incurred to finance such acquisitions or realize any other anticipated benefits, nor can there be any assurance that our profitability will be improved by any one or more acquisitions. Any acquisition may involve operating risks, such as:

•         the difficulty of assimilating and integrating the acquired operations and personnel into our current business;

•         the potential disruption of our ongoing business;

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•         the diversion of management’s attention and other resources;

•         the possible inability of management to maintain uniform standards, controls, procedures and policies;

•         the risks of entering markets in which we have little or no experience;

•         the potential impairment of relationships with employees;

•         the possibility that any liabilities we may incur or assume may prove to be more burdensome than anticipated; and

•         the possibility that the acquired theaters do not perform as expected.

We have no control over distributors of the films and our business may be adversely affected if our access to motion pictures is limited or delayed.

We rely on distributors of motion pictures, over whom we have no control, for the films that we exhibit. Major motion picture distributors are required by law to offer and license film to exhibitors, including us, on a film-by-film and theater-by-theater basis. Consequently, we cannot assure ourselves of a supply of motion pictures by entering into long-term arrangements with major distributors, but must compete for our licenses on a film-by-film and theater-by-theater basis. Our business depends on maintaining good relations with these distributors, as this affects our ability to negotiate commercially favorable licensing terms for first-run films or to obtain licenses at all. With only seven distributors representing approximately 90% of the U.S. box office in 2016, there is a high level of concentration in the industry. Our business may be adversely affected if our access to motion pictures is limited or delayed because of deterioration in our relationships with one or more distributors, or for some other reason. To the extent that we are unable to license a popular film for exhibition in our theaters, our operating results may be materially adversely affected.

We depend on motion picture production and performance.

Our ability to operate successfully depends upon the availability, diversity and appeal of motion pictures, our ability to license motion pictures and the performance of such motion pictures in our markets. Our revenues are dependent upon the timing and popularity of film releases by distributors. The most marketable films are usually released during the summer and the calendar year-end holiday seasons. Therefore, our business is subject to significant seasonal fluctuations, with higher attendance and revenues generally occurring during the summer months and holiday seasons. We license first-run motion pictures, the success of which has increasingly depended on the marketing efforts of the major motion picture studios. Poor performance of, or any disruption in the production of these motion pictures (including by reason of a strike or lack of adequate financing), or a reduction in the marketing efforts of the major motion picture studios, could hurt our business and results of operations. Conversely, the successful performance of these motion pictures, particularly the sustained success of any one motion picture, or an increase in effective marketing efforts of the major motion picture studios, may generate positive results for our business and operations in a specific quarter or year that may not necessarily be indicative of, or comparable to, future results of operations. Given the relatively small number of theaters and screens that we operate (particularly when compared to our larger competitors), if a major motion picture studio decides to delay the release of a first-run motion picture from one quarter to a subsequent quarter, that could have a material adverse effect on our results of operations in the earlier quarter. As movie studios rely on a smaller number of higher grossing “tent pole” films, there may be increased pressure for higher film licensing fees. In addition, a change in the type and breadth of movies offered by motion picture studios may adversely affect the demographic base of moviegoers. As a result of the foregoing factors, our results of operations may vary significantly from quarter to quarter and from year to year.

The motion picture exhibition industry has experienced fluctuations in attendance during recent years.

The U.S. motion picture exhibition industry has been subject to periodic short-term increases and decreases in attendance and box office revenues. According to the Motion Picture Association of America, attendance at movies in the United States and Canada was 1.32 billion during 2016 and 2015 and 1.27 billion during 2014. During the past ten years, attendance at movies in the United States and Canada has ranged from a high of 1.42 billion in 2009 to a low of 1.27 billion in 2014. We expect the cyclical nature of the U.S. motion picture exhibition industry to continue for the foreseeable future, and any decline in attendance could materially adversely affect our results of operations. To offset any decrease in attendance, we plan to offer products unique to the motion picture exhibition industry, such as specially selected alternative programming and a luxury in-theater dining experience. We cannot assure you, however, that our offering of such content and services will offset any decrease in attendance that the industry may experience.

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An increase in the use of alternative film delivery methods or other forms of entertainment may drive down our attendance and limit our ticket prices.

We compete with other film delivery methods, including network, syndicated cable and satellite television and DVDs, as well as video-on-demand, pay-per-view services, video streaming and downloads via the Internet. We also compete for the public’s leisure time and disposable income with other forms of entertainment, including sporting events, amusement parks, live music concerts and live theater. An increase in the popularity of these alternative film delivery methods and other forms of entertainment could reduce attendance at our theaters, limit the prices we can charge for admission and materially adversely affect our business and results of operations.

Our results of operations may be impacted by shrinking video release windows.

Over the last decade, the average video release window, which represents the time that elapses from the date of a film’s theatrical release to the date a film is available on DVD or similar on-demand release to an important downstream market, has decreased from approximately six months to approximately three to four months. If patrons choose to wait for a DVD release, video streaming or other home entertainment options rather than attend a theater for viewing the film, it may materially adversely impact our business and results of operations, financial condition and cash flows. Several major film studios have tested premium video-on-demand products released in homes approximately simultaneously with a movie’s theatrical debut, which threatened the length of the release window. Additionally, for the past several years, Amazon Studios has been producing and acquiring original movies for theatrical release with video streaming available just four to eight weeks after their theatrical debut. We cannot assure you that the release window, which is determined by the film studios, will not shrink further or be eliminated altogether, which could have a material adverse impact on our business and results of operations.

Our continued success depends in part on the continued popularity of our menu and the experience we offer guests.

Consumer tastes, nutritional and dietary trends, traffic patterns and the type, number, and location of competing restaurants often affect the restaurant business and our competitors may react more efficiently and effectively to those conditions. In addition, some of our competitors in the past have implemented programs that provide price discounts on certain menu offerings, and they may continue to do so in the future. If we are unable to continue to compete effectively, our traffic, sales and store-level operating profit margins could decline and our business, financial condition and results of operations would be materially adversely affected.

Food safety and food-borne illness incidents could adversely affect guests’ perception of our brand, result in lower sales and increase operating costs.

Food safety is a top priority and we dedicate substantial resources to help ensure that our guests enjoy safe, quality food products. However, food-borne illnesses and other food safety issues have occurred in the food industry in the past, and could occur in the future. A negative report or negative publicity, whether or not related to one of our iPic locations, may have an adverse impact on demand for our food and could result in decreased guest traffic to our units. A decrease in guest traffic to our iPic locations as a result of these health concerns or negative publicity could materially harm our brand, reputation, business, financial condition and results of operations.

Furthermore, our reliance on third-party food suppliers and distributors increases the risk that food-borne illness incidents could be caused by factors outside of our control and that multiple iPic locations would be affected. We cannot ensure that all food items will be properly maintained during transport throughout the supply chain and that our employees will identify all products that may be spoiled and should not be used. If our guests become ill from food-borne illnesses, we could be forced to temporarily close some units. Furthermore, any instances of food contamination, whether or not at iPic, could subject us or our suppliers to a food recall pursuant to the United States Food and Drug Administration’s recently enacted Food Safety Modernization Act.

Restaurant companies have been the target of class action lawsuits and other proceedings that are costly, divert management attention and, if successful, could result in our payment of substantial damages or settlement costs.

Our business is subject to the risk of litigation by employees, guests, suppliers, licensees, stockholders or others through private actions, class actions, administrative proceedings, regulatory actions or other litigation. The outcome of litigation, particularly class action and regulatory actions, is difficult to assess or quantify. In recent years, restaurant companies have been subject to lawsuits, including class action lawsuits, alleging violations of federal and state laws regarding

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workplace and employment matters, discrimination and similar matters. A number of these lawsuits have resulted in the payment of substantial damages by the defendants. Similar lawsuits have been instituted from time to time alleging violations of various federal and state wage and hour laws regarding, among other things, employee meal deductions, overtime eligibility and failure to pay for all hours worked. Along those lines, a class action lawsuit was recently filed against us in California state court asserting failure to pay minimum wage, pay overtime wages, provide meal breaks and rest periods, and provide accurate itemized wage statements with respect to certain workers.  Because the case is new and we are not yet even due to respond to the complaint in the lawsuit, it is premature to determine whether this particular case would have a material impact on our business or results of operations. See “Business — Legal Proceedings.”

Occasionally, our guests file complaints or lawsuits against us alleging that we are responsible for some illness or injury they suffered at or after a visit to one of our locations, including actions seeking damages resulting from food-borne illness or accidents at our locations. We are also subject to a variety of other claims from third parties arising in the ordinary course of our business, including contract claims.

Regardless of whether any claims against us are valid or whether we are liable, claims may be expensive to defend and may divert time and money away from our operations. In addition, they may generate negative publicity, which could reduce guest traffic and sales. Although we maintain what we believe to be adequate levels of insurance to cover any of these liabilities, insurance may not be available at all or in sufficient amounts with respect to these or other matters. A judgment or other liability in excess of our insurance coverage for any claims or any adverse publicity resulting from claims could materially adversely affect our business and results of operations.

Our plans to open new units, and the ongoing need for capital expenditures at our existing units, require us to expend capital.

Our growth strategy depends on opening new units, which will require us to use cash flows from operations and a portion of the net proceeds of this Offering. We cannot assure you that cash flows from operations and the net proceeds of this Offering will be sufficient to allow us to implement our growth strategy. If this cash is not allocated efficiently among our various projects, or if any of these initiatives prove to be unsuccessful, we may experience reduced profitability and we could be required to delay, significantly curtail or eliminate planned openings, which could have a material adverse effect on our business, financial condition, results of operations and the price of our common stock.

In addition, as our units mature, our business will require capital expenditures for the maintenance, renovation and improvement of existing units to remain competitive and maintain the value of our brand standard. This creates an ongoing need for capital, and, to the extent we cannot fund capital expenditures from cash flows from operations, funds will need to be borrowed or otherwise obtained. If we cannot access the capital we need, we may not be able to execute on our growth strategy, take advantage of future opportunities or respond to competitive pressures.

If the costs of funding new units or renovations or enhancements at existing iPic locations exceed budgeted amounts, and/or the time for building or renovation is longer than anticipated, our financial condition and results of operations could be materially adversely affected.

We are subject to risks associated with leasing property subject to long-term non-cancelable leases.

We do not own any real property and all of our iPic locations are located in leased premises. The leases for our units generally have initial terms of 15 to 25 years and typically provide for two to four renewal options in five-year increments as well as for rent escalations.

Generally, our leases are net leases that require us to pay our share of the costs of real estate taxes, utilities, building operating expenses, insurance and other charges in addition to rent. We generally cannot cancel these leases. Additional sites that we lease are likely to be subject to similar long-term non-cancelable leases. If we close a unit, we nonetheless may be obligated to perform our monetary obligations under the applicable lease, including, among other things, payment of the base rent for the balance of the lease term. In addition, as each of our leases expire, we may fail to negotiate renewals, either on commercially acceptable terms or at all, which could cause us to close units in desirable locations.

As of June 30, 2017, we were a party to operating leases associated with our iPic locations and administrative offices requiring future minimum lease payments of $5.6 million for the remainder of 2017 and approximately $361.8 million thereafter, which minimum lease commitments are not reflected as liabilities on our consolidated balance sheet. We depend on cash flows from operations to pay our lease expenses and to fulfill our other cash needs. If our business does not generate sufficient cash flow from operating activities and sufficient funds are not otherwise available to us from borrowings under the Non-Revolving Credit Facility (as defined in “Description of Indebtedness”) or other sources, we may not be able to service our lease expenses or fund our other liquidity and capital needs, which would have a material adverse effect on our business, our results of operations and our financial condition.

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Our substantial debt could materially adversely affect our operations and prevent us from satisfying those debt obligations.

We have a significant amount of debt. As of June 30, 2017, we had outstanding $187.6 million of indebtedness, which consisted of $136.7 million under our Non-Revolving Credit Facility and $50.9 million of unsecured subordinated notes to related parties. As of June 30, 2017, we also had approximately $367.5 million of undiscounted rental payments under operating leases (with initial base terms generally between 15 to 25 years). While all of the unsecured subordinated notes to related parties will be repaid or cancelled in connection with this Offering, the amount of our remaining indebtedness and lease and other financial obligations could have important consequences to you. For example, it could:

•         increase our vulnerability to general adverse economic and industry conditions;

•         limit our ability to obtain additional financing in the future for working capital, capital expenditures, dividend payments, acquisitions, general corporate purposes or other purposes;

•         require us to dedicate a substantial portion of our cash flow from operations to the payment of lease rentals and principal and interest on our indebtedness, thereby reducing the funds available to us for operations and any future growth or other business opportunities;

•         limit our planning flexibility for, or ability to react to, changes in our business and the industry; and

•         place us at a competitive disadvantage with competitors who may have less indebtedness and other obligations or greater access to financing.

If we fail to make any required payment under our Non-Revolving Credit Facility or to comply with any of the financial and operating covenants contained therein, we would be in default. Lenders under our Non-Revolving Credit Facility could then vote to accelerate the maturity of the indebtedness under the Non-Revolving Credit Facility and foreclose upon the property that is pledged to secure the Non-Revolving Credit Facility, which property includes substantially all the assets of iPic-Gold Class and its wholly-owned subsidiaries, together with 100% of the equity interests of iPic-Gold Class. Other creditors might then accelerate other indebtedness. If the lenders under the Non-Revolving Credit Facility accelerate the maturity of the indebtedness thereunder, we might not have sufficient assets to satisfy our obligations under the Non-Revolving Credit Facility or our other indebtedness. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources.”

Limitations on the availability of capital may prevent deployment of strategic initiatives.

Our key strategic initiatives, including future upgrades of our Generation I and Generation II locations into our latest Generation III furniture, fixture and equipment, require significant capital expenditures to implement. Our net capital expenditures aggregated approximately $57.9 million for the year ended December 31, 2016 and $11.4 million for the year ended December 31, 2017. For calendar year 2018, we estimate that our gross cash outflows for capital expenditures will be approximately $15 million to $20 million, inclusive of $1 million to $5 million expected to be supplied in the form of tenant improvement financing. Over the subsequent three years, we estimate that our gross cash outflows for capital expenditures will be approximately $75 million to $85 million, inclusive of $30 million to $35 million expected to be supplied in the form of tenant improvement financing. Actual capital expenditures for calendar year 2018 and for the subsequent years may differ materially from our estimates. The lack of available capital resources due to business performance or other financial commitments could prevent or delay the deployment of innovations in our theaters and restaurants. We may have to seek additional financing or issue additional securities to fully implement our growth strategy. We cannot be certain that we will be able to obtain new financing on favorable terms, or at all. In addition, covenants under our existing indebtedness limit our ability to incur additional indebtedness, and the performance of any additional or improved theaters and restaurants may not be sufficient to service the related indebtedness that we are permitted to incur.

The agreements governing our indebtedness contain covenants that may limit our ability to take advantage of certain business opportunities advantageous to us.

The agreements governing our indebtedness contain various covenants that limit our ability to, among other things:

•         incur or guarantee additional indebtedness;

•         pay dividends or make other distributions to our stockholders;

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•         make restricted payments;

•         incur liens;

•         engage in transactions with affiliates; and

•         enter into business combinations.

These restrictions could limit our ability to obtain future financing, make acquisitions or needed capital expenditures, withstand economic downturns in our business or the economy in general, conduct operations or otherwise take advantage of business opportunities that may arise.

We have a limited operating history which provides limited reference for you to evaluate our ability to achieve our business objectives.

We were formed in September 2010. Since we have a limited operating history, we are subject to the risks and uncertainties associated with early stage companies and have historically operated at a loss. Accordingly, you will have a limited basis on which to evaluate our ability to achieve our business objectives. As of the date hereof, we have 16 locations and have an additional four locations under construction. Our financial condition, results of operations and our future success will, to a significant extent, depend on our ability to continue to open restaurants and theaters throughout the United States and internationally and to achieve economies of scale. We cannot assure you that more restaurants and theaters can be opened on terms favorable to us or at all, or that if we open those restaurants and theaters, we will be able to operate our expanded business profitably. If we fail to achieve our business objectives, then we may not be able to realize our expected revenue growth, maintain our existing revenue levels or operate at a profit. Even if we do realize our business objectives, our business may not be profitable in the future.

We have had significant financial losses in previous years.

Historically, we have had operating losses, negative cash flows from operations and working capital deficiencies. For the years ended December 31, 2015 and 2016, and for the six months ended June 30, 2017, we reported net losses of $24.7 million, $34.2 million and $22.4 million, respectively. We expect to have significant net losses and negative cash flow for at least the next several years, as we incur additional costs and expenses for the continued development of new iPic locations. Whether, and when, the Company can attain profitability and positive cash flows from operations is uncertain. If we experience losses in the future, we may be unable to meet our payment obligations on our existing indebtedness, while attempting to expand our theater circuit and withstand competitive pressures or adverse economic conditions.

Our sales growth and ability to achieve profitability could be adversely affected if comparable-store sales decline or are less than we expect.

Comparable-store sales are a year-over-year comparison of sales at iPic locations open at the end of the period which have been open for at least 12 months prior to the start of such quarterly period. It is a key performance indicator used within the industry and is indicative of acceptance of our initiatives as well as local economic and consumer trends. The level of comparable-store sales will affect our sales growth and will continue to be a critical factor affecting our ability to generate profits because the profit margin on comparable-store sales is generally higher than the profit margin on new store sales. Our ability to increase comparable-store sales depends in part on our ability to successfully implement our initiatives to build sales. It is possible such initiatives will not be successful, and that we will not achieve our target comparable-store sales growth or that our comparable-store sales could decline, which may cause a decrease in sales growth and ability to achieve profitability that could materially adversely affect our business, financial condition and results of operations.

Our results of operations are subject to fluctuations due to the timing of new iPic location openings and the relatively small number of iPic locations currently in operation.

The timing of new iPic location openings may result in significant fluctuations in our quarterly performance. We typically incur most cash pre-opening expenses for a new iPic within the six months immediately preceding, and the month of, the iPic’s opening. In addition, the labor and operating costs for a newly opened iPic during the first three to six months of operation are materially greater than what can be expected after that time, both in aggregate dollars and as a percentage of revenues. Additionally, a portion of a current year new location capital expenditures is related to iPic

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locations that are not expected to open until the following year. Due to these substantial up-front financial requirements to open new iPic locations, the investment risk related to any single iPic is much larger than that associated with many other restaurants or entertainment venues.

Similarly, with respect to revenues, there is some ramp-up time following the opening of a new iPic during which time revenues from that particular location have not yet achieved what is to be expected once the location has been open for a period of three years. This will affect our revenues during periods when we open up one or more new iPic locations.

Furthermore, because we currently operate at only 16 locations, a problem at any one location may have a significant impact on our results of operations from period to period. For example, Hurricane Harvey negatively impacted our location in Houston, TX and Hurricane Irma negatively impacted our locations in Miami, FL and Boca Raton, FL, during the three months ended September 30, 2017.

The impact that general economic, political and social conditions in the United States have on consumer discretionary spending could materially adversely affect our business and financial performance.

Our success depends on general economic, political and social conditions and the willingness of consumers to spend money at restaurants and movie theaters. Any significant decrease in consumer confidence, or periods of economic slowdown or recession, could lead to a curtailing of discretionary spending, which in turn could reduce our revenues and results of operations and materially adversely affect our financial position. Our business is dependent upon consumer discretionary spending and therefore is affected by consumer confidence as well as the future performance of the United States economy. As a result, our results of operations are susceptible to economic slowdowns and recessions. Increases in job losses, home foreclosures, energy prices, investment losses in the financial markets, personal bankruptcies, credit card debt and home mortgage and other borrowing costs, declines in housing values and reduced access to credit, among other factors, may result in lower levels of customer traffic to our iPic locations, a decline in consumer confidence and a curtailing of consumer discretionary spending. We believe that consumers generally are more willing to make discretionary purchases during periods in which favorable economic conditions prevail. If economic conditions worsen, whether in the United States or in the communities in which our iPic locations are located, we could see deterioration in customer traffic or a reduction in the average amount customers spend in our iPic locations.

Geopolitical events, including the threat of domestic terrorism, gun violence or cyber-attacks, could cause people to avoid our theaters or other public places where large crowds are in attendance. For example, in the United States over the past several years, there have been several high-profile incidents involving shootings at movie theaters. In addition, due to our concentration in certain markets, natural or man-made disasters such as hurricanes, earthquakes, severe weather conditions, local strikes or increases in energy prices in those markets could adversely affect our overall results of operations.

Should we choose to expand internationally, the risks of doing business internationally could lower our revenues, increase our costs, reduce our profits or disrupt our business.

In the future, we may choose to open up iPic locations outside of the United States. If we should decide to expand internationally, we will become subject to the risks of doing business outside the United States, including:

•         changes in foreign currency exchange rates or currency restructurings and hyperinflation or deflation in the countries in which we choose to operate;

•         the imposition of restrictions on currency conversion or the transfer of funds or limitations on our ability to repatriate non-U.S. earnings in a tax effective manner;

•         the presence and acceptance of varying levels of business corruption in international markets;

•         the ability to comply with, or impact of complying with, complex and changing laws, regulations and policies of foreign governments that may affect investments or operations, including foreign ownership restrictions, import and export controls, tariffs, embargoes, intellectual property, licensing requirements and regulations, increases in taxes paid and other changes in applicable tax laws;

•         the difficulties involved in managing an organization doing business in many different countries;

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•         the ability to comply with, or impact of complying with, complex and changing laws, regulations and economic and political policies of the U.S. government, including U.S. laws and regulations relating to economic sanctions, export controls and anti-boycott requirements;

•         increases in anti-American sentiment and the identification of the licensed brand as an American brand;

•         the effect of disruptions caused by severe weather, natural disasters, outbreak of disease or other events that make travel to a particular region less attractive or more difficult; and

•         political and economic instability.

Any or all of these factors may materially adversely affect the performance of our iPic locations located in international markets. In particular, a potential international iPic location may be located in a volatile region that is subject to geopolitical and sociopolitical factors that pose risk to our business operations. In addition, the economy of any region in which our iPic locations are located may be adversely affected to a greater degree than that of other areas of the country or the world by certain developments affecting industries concentrated in that region or country. While these factors and the impact of these factors are difficult to predict, any one or more of them could materially lower our revenues, increase our costs, reduce our profits or disrupt our business.

Our recurring operating losses, members’ deficit, and working capital deficit have raised substantial doubt regarding our ability to continue as a going concern.

We have sustained recurring operating losses since our inception. In addition, we had a members’ deficit, and a working capital deficit at December 31, 2016 and June 30, 2017, which raise substantial doubt about our ability to continue as a going concern. The perception of our ability to continue as a going concern may make it more difficult for us to obtain financing for the continuation of our operations and could result in the loss of confidence by investors, suppliers and employees. Our consolidated financial statements for all periods have been prepared assuming we will continue as a going concern. As discussed in the notes to those consolidated financial statements, our continuation as a going concern is dependent upon our ability to generate sufficient cash from operations, which is subject to achieving our operating plans, and the continued availability of funding sources. Historically, our main sources of funding have been the Non-Revolving Credit Facility, financing provided by the landlords at certain of our newly-developed locations, and funding from members. To date, we have not generated sufficient cash flows from operations to further access the Non-Revolving Credit Facility without additional equity infusions. We admitted new members in April 2017 and November 2017 that provided capital in the form of equity and debt of approximately $12,000,000 and $4,000,000, respectively.

As of June 30, 2017 and December 31, 2016, management has concluded that there was substantial doubt about our ability to continue as a going concern. Our independent registered public accounting firm also included explanatory going concern language in their report accompanying our audited consolidated financial statements for the year ended December 31, 2016, included elsewhere in this Offering Circular.

It is not possible at this time for us to predict with assurance the potential success of our business. The revenue and income potential of our business and operations are unknown. We are uncertain whether the proceeds from this Offering will be sufficient to fund our operations to achieve profitability and positive cash flows. These uncertainties cast doubt upon our ability to continue as a going concern. If we cannot continue as a viable entity, we may be unable to continue our operations and you may lose some or all of your investment in our common stock.

If our cash flows prove inadequate to service our debt and provide for our other obligations, we may be required to refinance all or a portion of our existing debt or future debt at terms unfavorable to us.

Our ability to make payments on and refinance our debt and other financial obligations and to fund our capital expenditures and acquisitions will depend on our ability to generate substantial operating cash flow. This will depend on our future performance, which will be subject to prevailing economic conditions and to financial, business and other factors beyond our control. In addition, our notes require us to repay or refinance those notes when they come due. If our cash flows were to prove inadequate to meet our debt service, rental and other obligations in the future, we may be required to refinance all or a portion of our existing or future debt, on or before maturity, to sell assets or to obtain additional financing. We cannot assure you that we will be able to refinance any of our indebtedness, including our Non-Revolving Credit Facility, sell any such assets or obtain additional financing on commercially reasonable terms or at all. The terms of the agreements governing our indebtedness restrict, but do not prohibit us from incurring additional indebtedness. If we are in compliance with the financial covenants set forth in the Non-Revolving Credit

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Facility and our other outstanding debt instruments, we may be able to incur substantial additional indebtedness. If we incur additional indebtedness, the related risks that we face may intensify.

We may suffer future impairment losses and theater and other closure charges.

The opening of new theaters by certain of our competitors has drawn audiences away from some of our older theaters. In addition, demographic changes and competitive pressures have caused some of our theaters to become unprofitable. Since not all theaters are appropriate for our new initiatives, we may have to close certain theaters or recognize impairment losses related to the decrease in value of particular theaters. We review long-lived assets, including intangibles, for impairment as part of an ongoing process and whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. Deterioration in the performance of our theaters could require us to recognize additional impairment losses and close additional theaters, which could have a material  adverse effect on the results of our operations. We continually monitor the performance of our theaters, and factors such as changing consumer preferences for filmed entertainment and our inability to sublease vacant retail space could negatively impact operating results and result in future closures, sales, dispositions and significant theater and other closure charges prior to expiration of underlying lease agreements.

We may not be able to adequately protect our intellectual property, which, in turn, could harm the value of our brands and adversely affect our business.

Our ability to implement our business plan successfully depends in part on our ability to further build brand recognition using our trademarks, service marks, trade dress, proprietary information and other intellectual property, including our name and logos and the unique character and atmosphere of our iPic locations. We rely on trademark, copyright, and trade secret laws, as well as license agreements, nondisclosure agreements, and confidentiality and other contractual provisions to protect our intellectual property. Nevertheless, our competitors may develop a similar character and atmosphere, menu items and concepts, and adequate remedies may not be available in the event of an unauthorized use or disclosure of our trade secrets and other intellectual property.

The success of our business depends on our continued ability to use our existing trademarks and service marks to increase brand awareness and further develop our brand in the markets in which we operate. We have registered and applied to register trademarks and service marks in the United States. We may not be able to adequately protect our trademarks and service marks, and our competitors and others may successfully challenge the validity and/or enforceability of our trademarks and service marks and other intellectual property. We have several patents issued, as well as several pending patent applications in the United States. Such patent applications are subject to the review by and normal course prosecution before the U.S. Patent and Trademark Office, which may result in the application’s revision or non-approval. As a result, we may not be able to adequately protect the inventions covered by these patent applications, and our competitors and others may benefit as a result of their publication. The steps we have taken to protect our intellectual property in the United States may not be adequate. In addition, should we choose to expand internationally, the laws of some foreign countries do not protect intellectual property to the same extent as the laws of the United States.

If our efforts to maintain and protect our intellectual property are inadequate, or if any third party misappropriates, dilutes or infringes on our intellectual property, the value of our brands may be harmed, which could have a material adverse effect on our business and might prevent our brands from achieving or maintaining market acceptance.

We may also from time to time be required to institute litigation to enforce our trademarks, service marks and other intellectual property. Such litigation could result in substantial costs and diversion of resources and could negatively affect our sales, profitability and prospects regardless of whether we are able to successfully enforce our rights.

Third parties may assert that we infringe, misappropriate or otherwise violate their intellectual property and may sue us for intellectual property infringement. Even if we are successful in these proceedings, we may incur substantial costs, and the time and attention of our management and other personnel may be diverted in pursuing these proceedings. If a court finds that we infringe a third party’s intellectual property, we may be required to pay damages and/or be subject to an injunction. With respect to any third party intellectual property that we use or wish to use in our business (whether or not asserted against us in litigation), we may not be able to enter into licensing or other arrangements with the owner of such intellectual property at a reasonable cost or on reasonable terms.

Our business could be adversely affected if we incur legal liability.

We are subject to, and in the future may become a party to, a variety of litigation or other claims and suits that arise from time to time in the ordinary course of our business. Regardless of the merits of the claims, the cost to defend

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current and future litigation may be significant, and such matters can be time-consuming and divert management’s attention and resources. The results of litigation and other legal proceedings are inherently uncertain, and adverse judgments or settlements in some or all of these legal disputes may result in materially adverse monetary damages, penalties or injunctive relief against us. Any claims or litigation, even if fully indemnified or insured, could damage our reputation and make it more difficult to compete effectively or to obtain adequate insurance in the future.

While we maintain insurance for certain potential liabilities, such insurance does not cover all types and amounts of potential liabilities and is subject to various exclusions as well as caps on amounts recoverable. Even if we believe a claim is covered by insurance, insurers may dispute our entitlement to recovery for a variety of potential reasons, which may affect the timing and, if they prevail, the amount of our recovery.

Our business is subject to risks related to our sale of alcoholic beverages.

We serve alcoholic beverages at all of our locations. Alcoholic beverage control regulations generally require our locations to apply to a state authority and, in certain locations, county or municipal authorities for a license that must be renewed annually and may be revoked or suspended for cause at any time. Alcoholic beverage control regulations relate to numerous aspects of daily operations of our locations, including minimum age of patrons and employees, hours of operation, advertising, trade practices, wholesale purchasing, other relationships with alcohol manufacturers, wholesalers and distributors, inventory control and handling, storage and dispensing of alcoholic beverages. Any future failure to comply with these regulations and obtain or retain licenses could materially adversely affect our business, financial condition and results of operations.

We are also subject in certain states to “dram shop” statutes, which generally provide a person injured by an intoxicated person the right to recover damages from an establishment that wrongfully served alcoholic beverages to the intoxicated person. We carry liquor liability coverage as part of our existing comprehensive general liability insurance. Recent litigation against restaurant chains has resulted in significant judgments and settlements under dram shop statutes. Because these cases often seek punitive damages, which may not be covered by insurance, such litigation could have a material adverse impact on our business, results of operations or financial condition. Regardless of whether any claims against us are valid or whether we are liable, claims may be expensive to defend and may divert time and resources away from operations and hurt our financial performance. A judgment significantly in excess of our insurance coverage or not covered by insurance could have a material adverse effect on our business, results of operations or financial condition.

Shortages or interruptions in the supply or delivery of food products could adversely affect our operating results.

We are dependent on frequent deliveries of food products that meet our exact specifications. Shortages or interruptions in the supply of food products caused by problems in production or distribution, inclement weather, unanticipated demand or other conditions could adversely affect the availability, quality and cost of ingredients, which would adversely affect our operating results.

Disruption of our relationships with various vendors could substantially harm our business.

We rely on our relationships with several key studios in the operations of our business. These relationships include:

•         Paramount Pictures/Dreamworks

•         Sony Pictures

•         20th Century Fox

•         Universal Film Exchanges

•         Walt Disney Studio Pictures

•         Warner Brothers

Although our senior management has long-standing relationships with each of these vendors, we could experience deterioration or loss of any of our vendor relationships, which would significantly disrupt our operations until an alternative source is secured.

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We are subject to substantial government regulation, which could entail significant cost.

We are subject to various federal, state and local laws, regulations and administrative practices affecting our business, and we must comply with provisions regulating health and sanitation standards, equal employment, environmental, and licensing for the sale of food and, in some theaters, alcoholic beverages. Our new theater openings could be delayed or prevented or our existing theaters could be impacted by difficulties or failures in our ability to obtain or maintain required approvals or licenses. Changes in existing laws or implementation of new laws, regulations and practices could have a significant impact on our business. A significant portion of our theater level employees are part time workers who are paid at or near the applicable minimum wage in the theater’s jurisdiction. Increases in the minimum wage, such as those that occurred in 18 states on January 1, 2018, and implementation of reforms requiring the provision of additional benefits will increase our labor costs.

The restaurant industry is subject to extensive federal, state, local and international laws and regulations. The development and operation of restaurants depend to a significant extent on the selection and acquisition of suitable sites, which are subject to building, zoning, land use, environmental, traffic and other regulations and requirements. We are subject to licensing and regulation by state and local authorities relating to health, sanitation, safety and fire standards and the sale of alcoholic beverages. We are subject to laws and regulations relating to the preparation and sale of food, including regulations regarding product safety, nutritional content and menu labeling. We are subject to federal, state, and local laws governing employment practices and working conditions. These laws cover wage and hour practices, labor relations, paid and family leave, workplace safety, and immigration, among others. The myriad of laws and regulations being passed at the state and local level creates unique challenges for a multi-state employer as different standards apply to different locations, sometimes with conflicting requirements. We must continue to monitor and adapt our employment practices to comply with these various laws and regulations.

Provisions in the Affordable Care Act require restaurant companies such as ours to disclose calorie information on their menus and to make available more detailed nutrition information upon request; however, regulations implementing those statutory provisions have been delayed until May 2018. We do not expect to incur any material costs from compliance with these provisions, but cannot anticipate any changes to guest behavior resulting from the implementation of this portion of the law, which could have an adverse effect on our sales or results of operations.

We are subject to laws relating to information security, privacy, cashless payments and consumer credit, protection and fraud. An increasing number of governments and industry groups have established data privacy laws and standards for the protection of personal information, including social security numbers, financial information (including credit card numbers), and health information. Compliance with these laws and regulations can be costly, and any failure or perceived failure to comply with those laws or any breach of our systems could harm our reputation or lead to litigation, which could adversely affect our financial condition.

Our theaters that sell alcohol require each location to apply to a state authority and, in certain locations, county or municipal authorities for a license that must be renewed annually and may be revoked or suspended for cause at any time. Alcoholic beverage control regulations relate to numerous aspects of daily operations of our locations, including the minimum age of patrons and employees, hours of operation, advertising, trade practices, wholesale purchasing, other relationships with alcohol manufacturers, wholesalers and distributors, inventory control and handling, storage and dispensing of alcoholic beverages. We are also subject in certain states to “dram shop” statutes, which generally provide a person injured by an intoxicated person the right to recover damages from an establishment that wrongfully served alcoholic beverages to the intoxicated person. We may decide not to obtain liquor licenses in certain jurisdictions due to the high costs associated with obtaining liquor licenses in such jurisdictions.

We operate locations throughout the United States and are subject to the environmental laws and regulations of those jurisdictions, particularly laws governing the cleanup of hazardous materials and the management of properties. We might in the future be required to participate in the cleanup of a property that we lease, or at which we have been alleged to have disposed of hazardous materials from one of our locations. In certain circumstances, we might be solely responsible for any such liability under environmental laws, and such claims could be material.

Our theaters must comply with Title III of the Americans with Disabilities Act of 1990 (“ADA”). Compliance with the ADA requires that public accommodations “reasonably accommodate” individuals with disabilities and that new construction or alterations made to “commercial facilities” conform to accessibility guidelines unless “structurally impracticable” for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, and an award of damages to private litigants or additional capital expenditures to remedy such noncompliance, any of which could have a material adverse effect on our operations and financial condition.

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The impact of current laws and regulations, the effect of future changes in laws or regulations that impose additional requirements and the consequences of litigation relating to current or future laws and regulations, or an insufficient or ineffective response to significant regulatory or public policy issues, could negatively impact our cost structure, operational efficiencies and talent availability, and therefore have a material adverse effect on our results of operations. Failure to comply with the laws and regulatory requirements of federal, state and local authorities could result in, among other things, revocation of required licenses, administrative enforcement actions, fines and civil and criminal liability. Compliance with these laws and regulations can be costly and can increase our exposure to litigation or governmental investigations or proceedings.

We depend on key personnel for our current and future performance.

Our current and future performance depends to a significant degree upon the retention of our senior management team and other key personnel. The loss or unavailability to us, or damage to the reputation, of any member of our senior management team or a key employee — including, without limitation, Mr. Hamid Hashemi, our founder, President and CEO — could have a material adverse effect on our business, financial condition and results of operations. We believe that our future success will depend on our continued ability to attract and retain highly skilled and qualified personnel. There is a high level of competition for experienced, successful personnel in our industry. We cannot assure you that we would be able to locate or employ qualified replacements for senior management or key employees on acceptable terms.

We rely on our information systems to conduct our business, and any failure to protect these systems against security breaches or failure of these systems themselves could materially adversely affect our business, results of operations and liquidity and could result in litigation and penalties. Additionally, if these systems fail or become unavailable for any significant period of time, our business could be materially harmed.

The efficient operation of our business is dependent on computer hardware and software systems. Among other things, these systems collect and store certain personal information from customers, vendors and employees and process customer payment information. Our mobile application allows patrons to purchase tickets, select seats and order food and beverage. Our information systems and the sensitive data they are designed to protect are vulnerable to security breaches by computer hackers, cyber terrorists and other cyber attackers, and employees exceeding their authorized access. We rely on security measures and technology typical of our industry to securely maintain confidential and proprietary information maintained on our information systems, and we rely on our third party vendors to take appropriate measures to protect the confidentiality of the information on those information systems. However, these measures and technology may not adequately prevent security breaches. Our information systems may become unavailable or fail to perform as anticipated for any reason, including viruses, loss of power or human error. Any significant interruption or failure of our information systems or those maintained by our third party vendors or any significant breach of security could materially adversely affect (i) our reputation with our customers, vendors and employees, (ii) our brand name, and (iii) our business, results of operations and financial condition. Any of the foregoing could result in litigation against us or the imposition of penalties. A significant interruption, failure or breach of the security of our information systems or those of our third party vendors could also require us to expend significant resources to upgrade the security measures and technology that guard sensitive data against computer hackers, cyber terrorists and other cyber attackers. We maintain cyber risk insurance coverage to protect against such risks, however, there can be no assurance that such coverage will be adequate.

Changes in privacy laws could adversely affect our ability to market our products effectively.

Our cinemas rely on a variety of direct marketing techniques, including email marketing. Any expansion on existing and/or new laws and regulations regarding marketing, solicitation or data protection could adversely affect the continuing effectiveness of our email and other marketing techniques and could result in changes to our marketing strategy which could adversely impact our attendance levels and revenues.

Risks Relating to Our Organizational Structure

Our principal asset after the completion of this Offering will be our interest in Holdings, and Holdings’s principal asset will be its interest in iPic-Gold Class, and, accordingly, we will depend on distributions that iPic-Gold Class makes to Holdings and that Holdings makes to us to pay our taxes and expenses. iPic-Gold Class’s ability to make such distributions may be subject to various limitations and restrictions.

Upon the consummation of this Offering, we will be a holding company and will have no material assets other than our ownership of LLC Interests of Holdings, which is itself a holding company that will have no material assets other than

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its ownership of limited liability company interests of iPic-Gold Class. As such, we will have no independent means of generating revenue or cash flow, and our ability to pay our taxes and operating expenses or declare and pay dividends in the future, if any, will be dependent upon the financial results and cash flows of iPic-Gold Class and its subsidiaries and distributions we receive indirectly from iPic-Gold Class. There can be no assurance that our subsidiaries will generate sufficient cash flow to directly or indirectly distribute funds to us or that applicable state law and contractual restrictions, including negative covenants in our debt instruments, will permit such distributions.

Both Holdings and iPic-Gold Class will continue to be treated as pass-through entities for U.S. federal income tax purposes and, as such, will not be subject to any entity-level U.S. federal income tax. Instead, taxable income will be allocated to holders of LLC Interests, including us. Accordingly, we will incur income taxes on our allocable share of any net taxable income of Holdings. Under the terms of the Holdings LLC Agreement, Holdings will be obligated to make tax distributions to holders of LLC Interests, including us. In addition to tax expenses, we will also incur expenses related to our operations, which we expect could be significant. We intend, as the sole manager of Holdings, which is itself the sole managing member of iPic-Gold Class, to cause iPic-Gold Class to make cash distributions to Holdings out of which (i) Holdings will make cash distributions to the owners of LLC Interests, in an amount sufficient to fund all or part of their tax obligations in respect of taxable income allocated to them and (ii) Holdings will make cash payments to us in an amount sufficient to cover our other expenses. However, Holdings’s and iPic-Glass Class’s ability to make such distributions and payments may be subject to various limitations and restrictions, such as restrictions on distributions that would either violate any contract or agreement to which Holdings or iPic-Gold Class is then a party, including debt agreements, or any applicable law, or that would have the effect of rendering either Holdings or iPic-Gold Class insolvent. If we do not have sufficient funds to pay tax or other liabilities or to fund our operations, we may have to borrow funds, which could materially adversely affect our liquidity and financial condition and subject us to various restrictions imposed by any such lenders. See “The Transactions — Holdings LLC Agreement — Distributions.” In addition, if neither Holdings nor iPic-Gold Class has sufficient funds to make distributions, our ability to declare and pay cash dividends will also be restricted or impaired. See “— Risks Relating to This Offering and Ownership of Our Common Stock” and “Dividend Policy.”

Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our results of operations and financial condition.

We are subject to taxation by U.S. federal, state and local tax authorities, and we may in the future be subject to taxation by foreign tax authorities. As a result, our tax liabilities will be affected by the allocation of expenses to differing jurisdictions. Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including:

•         changes in the valuation of our deferred tax assets and liabilities;

•         expected timing and amount of the release of any tax valuation allowances;

•         tax effects of stock-based compensation;

•         changes in tax laws, regulations or interpretations thereof; or

•         future earnings being lower than anticipated in countries where we have lower statutory tax rates and higher than anticipated earnings in countries where we have higher statutory tax rates.

In addition, we may be subject to audits of our income, sales and other transaction taxes by U.S. federal, state and local taxing authorities, and we may in the future be subject to audits by foreign taxing authorities. Outcomes from these audits could have an adverse effect on our operating results and financial condition.

If we were deemed to be an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”), as a result of our direct ownership of Holdings and our indirect ownership of iPic-Gold Class, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business.

Under Sections 3(a)(1)(A) and (C) of the 1940 Act, a company generally will be deemed to be an “investment company” for purposes of the 1940 Act if (i) it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities or (ii) it engages, or proposes to engage, in the business of investing, reinvesting, owning, holding or trading in securities and it owns or proposes to acquire

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investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. We do not believe that we are an “investment company,” as such term is defined in either of those sections of the 1940 Act.

iPic Entertainment will be the sole manager of Holdings, and Holdings will be the sole managing member of iPic-Gold Class. As a result, we will indirectly control and operate iPic-Gold Class. On that basis, we believe that our interest in iPic-Gold Class is not an “investment security” as that term is used in the 1940 Act. However, if we were to cease participation in the management of iPic-Gold Class, our interest in iPic-Gold Class could be deemed an “investment security” for purposes of the 1940 Act.

We, Holdings and iPic-Gold Class intend to conduct our operations so that we will not be deemed an investment company. However, if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure and our ability to transact with affiliates, could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business.

iPic is controlled by the Continuing iPic Equity Owners, whose interests may differ from those of our public stockholders.

Immediately following this Offering and the application of net proceeds from this Offering, the Continuing iPic Equity Owners will control approximately 82.5% of the combined voting power of our common stock through their ownership of Class B Common Stock. The Continuing iPic Equity Owners will, for the foreseeable future, have significant influence over our corporate management and affairs, and will be able to control virtually all matters requiring stockholder approval. The Continuing iPic Equity Owners are able to, subject to applicable law, elect a majority of the members of our board of directors and control actions to be taken by us and our board of directors, including amendments to our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws and approval of significant corporate transactions, including mergers and sales of substantially all of our assets. The directors so elected will have the authority, subject to the terms of our indebtedness and applicable rules and regulations, to issue additional stock, implement stock repurchase programs, declare dividends and make other decisions. It is possible that the interests of the Continuing iPic Equity Owners may in some circumstances conflict with our interests and the interests of our other stockholders, including you. For example, the Continuing iPic Equity Owners may have different tax positions from us that could influence their decisions regarding whether and when to dispose of assets, and whether and when to incur new or refinance existing indebtedness. In addition, the determination of future tax reporting positions, the structuring of future transactions and the handling of any future challenges by any taxing authority to our tax reporting positions may take into consideration these Continuing iPic Equity Owners’ tax or other considerations, which may differ from the considerations of us or our other stockholders.

In addition, certain of the Continuing iPic Equity Owners are in the business of making or advising on investments in companies and hold, and may from time to time in the future acquire, interests in or provide advice to businesses that directly or indirectly compete with certain portions of our business or the business of our suppliers. Our Amended and Restated Certificate of Incorporation will provide that, to the fullest extent permitted by law, none of the Continuing iPic Equity Owners or any director who is not employed by us or his or her affiliates will have any duty to refrain from engaging in a corporate opportunity in the same or similar lines of business as us. The Continuing iPic Equity Owners may also pursue acquisitions that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.

Fluctuations in our tax obligations and effective tax rate and realization of our deferred tax assets may result in volatility of our operating results.

We are subject to income taxes in various U.S. jurisdictions. We record tax expense based on our estimates of future payments, which may include reserves for uncertain tax positions in multiple tax jurisdictions, and valuation allowances related to certain net deferred tax assets. At any one time, many tax years may be subject to audit by various taxing jurisdictions. The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these issues. We expect that throughout the year there could be ongoing variability in our quarterly tax rates as events occur and exposures are evaluated.

In addition, our effective tax rate in a given financial statement period may be materially impacted by a variety of factors including but not limited to changes in the mix and level of earnings, varying tax rates in the different jurisdictions in which we operate, fluctuations in the valuation allowance or by changes to existing accounting rules or regulations.

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Further, tax legislation may be enacted in the future which could negatively impact our current or future tax structure and effective tax rates.

We are subject to complex taxation and could be subject to changes in our tax rates, the adoption of new U.S. or international tax legislation or exposure to additional tax liabilities.

We are subject to many different forms of taxation in the U.S. and, should we expand internationally, we will also be subject to different forms of taxation in those foreign jurisdictions where we operate. The tax authorities may not agree with the determinations that we made and such disagreements could result in lengthy legal disputes and, ultimately, in the payment of substantial amounts for tax, interest and penalties, which could have a material impact on our results. Additionally, current economic and political conditions make tax rates in any jurisdiction, including the U.S., subject to significant change. Our future effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation. If the Company’s effective tax rates were to increase, or if the ultimate determination of the Company’s taxes owed in the U.S. or foreign jurisdictions is for an amount in excess of amounts previously accrued, the Company’s operating results, cash flows, and financial condition could be adversely affected.

Recently enacted changes to the U.S. tax laws may have a material adverse impact on our business or financial condition.

On December 20, 2017, the U.S. House of Representatives and the U.S. Senate each voted to approve the Tax Cut and Jobs Act and, on December 22, 2017, President Trump signed the Tax Cut and Jobs Act into law. The Tax Cut and Jobs Act includes provisions that, among other things, reduce the U.S. corporate tax rate, introduce a deduction for certain income earned through pass-through entities, introduce a capital investment deduction, limit the interest deduction, limit the use of net operating losses to offset future taxable income, and make extensive changes to the U.S. international tax system, including the taxation of the accumulated foreign earnings. The limitation on the use of net operating losses to offset future taxable income could result in iPic Entertainment’s being required to pay cash taxes or Holdings’s being required to make tax distributions in an earlier year than would be the case under existing law. In addition, the limitation on the interest deduction could result in the deferral of interest deductions on a portion of our indebtedness to subsequent years (in which our interest deductions would also be subject to limitation and potential deferral), which could materially increase iPic Entertainment’s liability for taxes or the amount of tax distributions Holdings would be required to make in any affected years. Other provisions of the Tax Cut and Jobs Act, such as the reduction in the U.S. corporate tax rate and the capital investment deduction, could have the effect of reducing the amount of taxes to which iPic Entertainment would otherwise have been subject or the amount of tax distributions Holdings would otherwise be required to make in a particular taxable year. The Tax Cut and Jobs Act is complex and far-reaching and we cannot predict the resulting impact its enactment will have on us.

Risks Relating to this Offering and Ownership of Our Common Stock

There is no existing market for our common stock, and we do not know if one will develop to provide you with adequate liquidity to sell our common stock at prices equal to or greater than the price you paid in this Offering. Downward pressure on the stock price could encourage short-selling.

Prior to this Offering, there has not been a public market for our common stock. While we have applied for the listing of our Class A Common Stock on NASDAQ, there can be no assurance that our Class A Common Stock will be quoted or will continue to be quoted on NASDAQ or that a meaningful, consistent and liquid trading market will develop. As a result, our stockholders may not be able to sell or liquidate their holdings in a timely manner or at the then-prevailing trading price of our Class A Common Stock. The initial public offering price for the shares will be determined by negotiations between us and the Selling Agents and may not be indicative of prices that will prevail in the trading market, and the value of our common stock may decrease from the initial public offering price.

In particular, several other companies that have recently completed initial public offerings pursuant to Regulation A have experienced significant stock price declines following their initial public offerings and short sales in the market may have contributed to these stock price declines. Short selling is a technique used by a stockholder to take advantage of an anticipated decline in the price of a security. Short selling occurs when an individual borrows shares from an investor through a broker and then sells those borrowed shares at the current market price. To the extent the stock price declines, the short seller profits when the stock price falls because he or she can repurchase the stock at a lower price and pay

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back the person from whom he or she borrowed, thereby making a profit. A significant number of short sales within a relatively short period of time can create downward pressure on the market price of a security. Therefore, if there are significant short sales of our common stock following this Offering, the trading price of our common stock could decline materially, which could cause any of our existing stockholders to sell their shares thereby creating further downward pressure on the trading price of our common stock. It is not possible to predict how much the trading price of our common stock may decline in the event any such short selling occurs, but you could lose all or part of your investment.

The market price of our common stock may be highly volatile, and you may not be able to resell your shares at or above the initial public offering price.

The trading price of our common stock could be volatile, and you can lose all or part of your investment. The following factors, in addition to other factors described in this “Risk Factors” section and elsewhere in this Offering Circular, may have a significant impact on the market price of our common stock:

•         announcements of innovations or new services by us or our competitors;

•         any adverse changes to our relationship with our customers or suppliers;

•         variations in the costs of products that we use in our restaurants or theaters;

•         announcements concerning our competitors or the restaurant and movie theater industry in general;

•         achievement of expected sales and profitability;

•         supply or distribution shortages;

•         adverse actions taken by regulatory agencies with respect to our services or the products we use;

•         actual or anticipated fluctuations in our quarterly or annual operating results;

•         changes in financial estimates or recommendations by securities analysts;

•         trading volume of our common stock;

•         sales of our common stock by us, our executive officers and directors or our stockholders in the future;

•         general economic and market conditions and overall fluctuations in the U.S. equity markets; and

•         changes in accounting principles.

In addition, broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance, and factors beyond our control may cause our stock price to decline rapidly and unexpectedly.

We may be subject to securities litigation, which is expensive and could divert management attention.

Our share price may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Litigation of this type could result in substantial costs and diversion of management’s attention and resources, which could adversely impact our business. Any adverse determination in litigation could also subject us to significant liabilities.

Immediately following the consummation of this Offering, the Continuing iPic Equity Owners will have the right to have their LLC Interests redeemed pursuant to the terms of the Holdings LLC Agreement.

After this Offering, we will have an aggregate of 87,614,371 shares of Class A Common Stock authorized but unissued, including approximately 10,220,629 shares of Class A Common Stock issuable upon redemption of LLC Interests that will be held by the Continuing iPic Equity Owners. Holdings will enter into the Holdings LLC Agreement and, subject to certain restrictions set forth therein and as described elsewhere in this Offering Circular, the Continuing iPic Equity Owners will be entitled to have their LLC Interests redeemed for shares of our Class A Common Stock. We cannot predict the size of future issuances of our Class A Common Stock or the effect, if any, that future issuances and sales of shares of our Class A Common Stock may have on the market price of our Class A Common Stock. Sales

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or distributions of substantial amounts of our Class A Common Stock, including shares issued in connection with an acquisition, or the perception that such sales or distributions could occur, may cause the market price of our Class A Common Stock to decline.

Investors purchasing common stock in this Offering will experience immediate and substantial dilution as a result of this Offering and future equity issuances.

If you purchase shares of our common stock in this Offering, you will incur immediate and substantial dilution in the book value of your stock, because the price that you pay will be substantially greater than the net tangible book value (deficit) per share of the shares you acquire. As a result, you will pay a price per share that substantially exceeds the book value of our assets after subtracting our liabilities. The pro forma net tangible book value (deficit) per share, calculated as of June 30, 2017 and after giving effect to the Offering (based on the initial public offering price of $18.50 per share and after deducting selling agents discounts and commissions and estimated offering expenses payable by us), is $(3.16). Investors purchasing common stock in this Offering will experience an immediate and substantial dilution of $21.66 per share, based on the initial public offering price of $18.50 per share. To the extent outstanding options are ultimately exercised, there will be further dilution to investors in this Offering. In addition, if the Selling Agents exercise their warrants to purchase additional shares, or if we issue additional equity securities in the future, investors purchasing common stock in this Offering will experience additional dilution.

As a result of this dilution, investors purchasing stock in this Offering may receive significantly less than the purchase price paid in this Offering in the event of liquidation. See “Dilution.”

Sales of a substantial number of shares of our common stock in the public market by our existing stockholders could cause our stock price to fall.

Sales of a substantial number of shares of our common stock in the public market or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities. Substantially all of our existing stockholders are subject to lock-up agreements with the Selling Agents that restrict the stockholders’ ability to transfer shares of our common stock for 180 days following the latest date that the Commission declares the Offering Statement of which this Offering Circular forms a part qualified, subject to certain exceptions. The lock-up agreements limit the number of shares of common stock that may be sold immediately following this Offering. After this Offering, we will have 12,385,629 outstanding shares of Common Stock based on the number of shares outstanding as of January 5, 2018.

The shares of Class A Common Stock issued in this Offering will be freely tradable without restriction under the Securities Act, except for any shares of our Class A Common Stock that may be held or acquired by our directors, executive officers and other affiliates, as that term is defined in the Securities Act, which will be restricted securities under the Securities Act. Restricted securities may not be sold in the public market unless the sale is registered under the Securities Act or an exemption from registration is available.

We and each of our directors, executive officers and holders of substantially all of our outstanding common stock, which collectively will hold 82.5% of our outstanding common stock after giving effect to the sale of the maximum shares in this Offering, have agreed with the Selling Agents, subject to certain exceptions, not to dispose of or hedge any shares of common stock or securities convertible into or exchangeable for, or that represent the right to receive, shares of common stock during the period from the date of this Offering Circular continuing through the date 180 days following the latest date that the Commission declares the Offering Statement of which this Offering Circular forms a part qualified, except with the prior written consent of TriPoint, and except, in our case, that we will be allowed to take the actions described above after 120 days in the event that the closing price of the shares of Class A Common Stock exceeds the per share price to public of the Offering for each of at least 10 consecutive trading days. See “Plan of Distribution.” In addition, shares issued or issuable upon exercise of options or warrants vested as of the expiration of the lock-up period will be eligible for sale at that time. Sales of stock by these stockholders could have a material adverse effect on the trading price of our Class A Common Stock. All of our shares of Common Stock outstanding as of the date of this Offering Circular may be sold in the public market by existing stockholders following the expiration of the applicable lock-up period, subject to applicable limitations imposed under federal securities laws.

We intend to file one or more registration statements on Form S-8 under the Securities Act to register all shares of Class A Common Stock issued or issuable upon exercise of outstanding options under our stock plans and outstanding IPO RSUs. Any such Form S-8 registration statements will automatically become effective upon filing. Accordingly, shares registered under such

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registration statements will be available for sale in the open market following the expiration of the applicable lock-up period, upon exercise of options vested at such time.

Moreover, after this Offering, holders of an aggregate of 7,432,377 shares of our common stock will have rights, subject to certain conditions such as the 180-day lock-up arrangement described above, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders. Registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act, except for shares held by our affiliates. Any sales of securities by these stockholders could have a material adverse effect on the trading price of our common stock.

In the future, we may also issue additional securities if we need to raise capital, which could constitute a material portion of our then-outstanding shares of common stock.

If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our markets, or if they adversely change their recommendations or publish negative reports regarding our business or our stock, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our markets or our competitors. We do not have any control over these analysts and we cannot provide any assurance that analysts will cover us or provide favorable coverage. If any of the analysts who may cover us adversely change their recommendation regarding our stock, or provide more favorable relative recommendations about our competitors, our stock price could decline. If any analyst who may cover us were to cease coverage of our Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Our management will have broad discretion over the use of the proceeds we receive in this Offering and might not apply the proceeds in ways that increase the value of your investment.

Our management will have broad discretion over the use of the net proceeds from this Offering and you will be relying on their judgment in applying these proceeds. Our management might not apply our net proceeds in ways that ultimately increase the value of your investment.

We intend to cause iPic-Gold Class to use the proceeds that it receives from this Offering as follows: (i) to pay fees and expenses other than the selling agents discounts and commissions of approximately $1,200,000 in connection with this Offering and the Transactions, and (ii) to use approximately $35.9 million for general corporate purposes, including opening new iPic locations and renovating existing iPic locations. If we sell all of the Shares offered in this Offering, we believe that the net proceeds of this Offering, together with our current resources, will allow us to fund our operations for at least the next 12 months.

Our management might not be able to yield a significant return, if any, on any investment of these net proceeds. You will not have the opportunity to influence our decisions on how to use our net proceeds from this Offering.

Because we do not intend to declare cash dividends on our shares of common stock in the foreseeable future, stockholders must rely on appreciation of the value of our common stock, if any, for any return on their investment.

We currently anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends in the foreseeable future. As a result, we expect that only appreciation of the price of our common stock, if any, will provide a return to investors in this Offering for the foreseeable future. See “Dividend Policy.”

The requirements of being a public company, including compliance with the reporting requirements of the Exchange Act and the requirements of the Sarbanes-Oxley Act and NASDAQ, may strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.

As a public company, we will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the corporate governance standards of the Sarbanes-Oxley Act of 2002, (the “Sarbanes-Oxley Act”), and NASDAQ. As a result, we will incur significant legal, accounting and other costs that we did not incur as a private company. These requirements will place a strain on our management, systems and resources and we will incur significant legal, accounting, insurance and other expenses that we have not incurred as a private

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company. The Exchange Act will require us to file annual, quarterly and current reports with respect to our business and financial condition within specified time periods and to prepare a proxy statement with respect to our annual meeting of stockholders. The Sarbanes-Oxley Act will require that we maintain effective disclosure controls and procedures and internal controls over financial reporting. NASDAQ will require that we comply with various corporate governance requirements. To maintain and improve the effectiveness of our disclosure controls and procedures and internal controls over financial reporting and comply with the Exchange Act and NASDAQ requirements, significant resources and management oversight will be required. This may divert management’s attention from other business concerns and lead to significant costs associated with compliance, which could have a material adverse effect on us and the price of our common stock.

We also expect that it could be difficult and will be significantly more expensive to obtain directors’ and officers’ liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers. Advocacy efforts by stockholders and third parties may also prompt even more changes in governance and reporting requirements. We cannot predict or estimate the amount of additional costs we may incur or the timing of these costs.

We have identified material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.

We have identified material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. Specifically, we do not have an effective control environment because we do not have formalized internal control policies and procedures. We have also identified material weaknesses related to our lack of adequate review of complex accounting matters, improperly designed period end financial reporting controls, and improperly designed information technology controls.

We are implementing measures designed to improve our internal control over financial reporting to remediate these material weaknesses, including controls designed to require reviews of complex areas in a timely manner. In addition, we are designing and implementing improved processes and internal controls throughout the organization, including enhancing our control environment and redesigning and implementing controls over information technology and our period end financial reporting process such as formalizing our internal control documentation and strengthening supervisory reviews by our management. While we are designing, documenting and implementing improved processes and internal controls, we cannot predict the success of such measures or the outcome of our assessment of these measures at this time. We can give no assurance that additional material weaknesses or significant deficiencies in our internal control over financial reporting will not be identified in the future. Our failure to implement and maintain effective internal control over financial reporting could result in errors in our financial statements that could result in a restatement of our consolidated financial statements or cause us to fail to meet our reporting obligations.

We will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting for the first fiscal year beginning after the effective date of this offering. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting. Our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting until our first annual report required to be filed with the SEC following the date which is the later of the date we are an accelerated filer or a large accelerated filer, and the date we are no longer an “emerging growth company,” as defined in the JOBS Act. We will be required to disclose changes made in our internal control and procedures on a quarterly basis. To comply with the requirements of being a public company, we may need to undertake various actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff. We have begun the costly and challenging process of compiling the system and processing documentation necessary to perform the evaluation needed to comply with Section 404, when applicable, and we may not be able to complete our evaluation, testing and any required remediation in a timely fashion.

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Our Amended and Restated Certificate of Incorporation and our Amended and Restated Bylaws contain provisions that make it more difficult to effect a change in control of the company.

Our Amended and Restated Certificate of Incorporation and our Amended and Restated Bylaws to be effective upon the closing of this Offering will contain provisions that could have the effect of rendering more difficult or discouraging an acquisition deemed undesirable by our board of directors. Our corporate governance documents will include provisions that:

•         authorize blank check preferred stock, which could be issued with voting, liquidation, dividend and other rights superior to our common stock;

•         limit the liability of, and provide indemnification to, our directors and officers;

•         limit the ability of our stockholders to call and bring business before special meetings and to take action by written consent in lieu of a meeting;

•         require advance notice of stockholder proposals and the nomination of candidates for election to our board of directors;

•         require that directors only be removed from office for cause; and

•         limit the determination of the number of directors on our board and the filling of vacancies or newly created seats on the board to our board of directors then in office.

Further, we are subject to the anti-takeover provisions of section 203 of the Delaware General Corporation Law, which prohibits us from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in a prescribed manner. The application of section 203 could have the effect of delaying or preventing a change of control that could be advantageous to the stockholders.

These provisions of our charter documents and Delaware law, alone or together, could delay or deter hostile takeovers and changes in control or changes in our management. Any provision of our Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our common stock if they are viewed as discouraging takeover attempts in the future.

Our Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us.

Our Amended and Restated Certificate of Incorporation provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, employees or agents, (iii) any action asserting a claim against us arising under the DGCL or (iv) any action asserting a claim against us that is governed by the internal affairs doctrine. By becoming a stockholder in our Company, you will be deemed to have notice of and have consented to the provisions of our Amended and Restated Certificate of Incorporation related to choice of forum. The choice of forum provision in our Amended and Restated Certificate of Incorporation may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us.

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THE TRANSACTIONS

Prior to the consummation of this Offering and the organizational transactions described below, the business and operations of the Company were conducted through iPic-Gold Class. iPic Entertainment was incorporated as a Delaware corporation on October 18, 2017 to serve as the issuer of the Class A Common Stock offered hereby. Holdings was formed as a Delaware limited liability company on December 22, 2017 to hold the equity interests in iPic-Gold Class. iPic Entertainment will be the sole manager of Holdings, and Holdings will be the sole managing member of iPic-Gold Class immediately following the completion of the Transactions.

Prior to the Transactions, the only members of iPic Gold Class were the Original iPic Equity Owners. iPic-Gold Class was treated as a partnership for U.S. federal income tax purposes and, as such, was not subject to any U.S. federal entity-level income taxes. Rather, taxable income or loss was included in the U.S. federal income tax returns of iPic-Gold Class’s members.

Transactions

Immediately prior to or in connection with the closing of this Offering, we and the Original iPic Equity Owners will consummate the following organizational transactions:

•         all of the membership interests in iPic-Gold Class will be contributed by the Original iPic Equity Owners to Holdings in exchange for all of the membership interests in Holdings (the “LLC Interests”), following which iPic-Gold Class will be 100% owned and controlled by Holdings;

•         we will amend and restate the limited liability company agreement of Holdings (the “Holdings LLC Agreement”), to, among other things, provide for the organizational structure described below under “Organizational Structure Following this Offering”

•         we will amend and restate the limited liability company agreement of iPic-Gold Class to appoint Holdings as the sole managing member of iPic-Gold Class and reflect iPic-Gold Class’s status as a wholly-owned subsidiary of Holdings;

•         certain of the Original iPic Equity Owners will transfer the LLC Interests that they hold in Holdings to certain direct or indirect members of such Original iPic Equity Owners. The recipients of these LLC Interests, together with the Original iPic Equity Owners that did not transfer any of the LLC Interests that they held in Holdings, are collectively referred to herein as the “Continuing iPic Equity Owners”;

•         we will amend and restate iPic Entertainment’s Certificate of Incorporation to, among other things, (i) provide for Class A Common Stock and Class B Common Stock and (ii) issue shares of Class B Common Stock to the Continuing iPic Equity Owners, on a one-to-one basis with the number of LLC Interests they own, for nominal consideration;

•         we will issue up to 2,165,000 shares of our Class A Common Stock to the purchasers in this Offering in exchange for net proceeds of up to approximately $37.15 million, assuming the shares are offered at $18.50 per share, after deducting selling agents discounts and commissions but before offering expenses payable by us;

•         we will use all of the net proceeds from this Offering to purchase newly-issued LLC Interests from Holdings at a purchase price per interest equal to net proceeds, before expenses, to us per share of Class A Common Stock, collectively representing 17.5% of Holdings’s outstanding LLC Interests;

•         Holdings will transfer to iPic-Gold Class the proceeds Holdings receives from the sale of LLC Interests to iPic Entertainment;

•         iPic-Gold Class will use the proceeds it receives from Holdings as follows: (i) to pay fees and expenses other than the selling agents discounts and commissions of approximately $1.2 million in connection with this Offering and the Transactions, and (ii) to use approximately $35.9 million for general corporate purposes, including opening new iPic locations and renovating existing iPic locations. See “Use of Proceeds”;

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•         the Continuing iPic Equity Owners will continue to own the LLC Interests that they owned prior to this Offering and will have no economic interest in iPic Entertainment despite their ownership of Class B Common Stock (where “economic interests” means the right to receive any distributions or dividends, whether cash or stock, in connection with common stock);

•         assuming that all of the LLC Interests of the Continuing iPic Equity Owners are redeemed or exchanged for newly-issued shares of Class A Common Stock on a one-for-one basis, such Continuing iPic Equity Owners would own 10,220,629 shares of iPic Entertainment’s Class A Common Stock, representing approximately 82.5% of the combined voting power of our Common Stock, immediately following the closing of this Offering; and

•         iPic Entertainment will enter into the Registration Rights Agreement with certain of the Continuing iPic Equity Owners.

For a description of the terms of the Registration Rights Agreement, see “Description of Securities — Registration Rights.”

Organizational Structure Following this Offering

Immediately following the completion of the Transactions, including this Offering:

•         iPic Entertainment will be a holding company and the principal asset of iPic Entertainment will be LLC Interests of Holdings;

•         Holdings will be a holding company and will own 100% of the limited liability company interests of, and control, iPic-Gold Class, subject to the pledge of such limited liability company interests to secure the obligations under the Non-Revolving Credit Facility as described in “Description of Indebtedness”;

•         iPic Entertainment will be the sole manager of Holdings, and Holdings will be the sole managing member of iPic-Gold Class. iPic Entertainment will, therefore, directly or indirectly control the business and affairs of, and conduct its day-to-day business through, iPic-Gold Class and its subsidiaries;

•         iPic Entertainment’s Amended and Restated Certificate of Incorporation and the Holdings LLC Agreement will require that (i) we at all times maintain a ratio of one LLC Interest owned by us for each share of Class A Common Stock issued by us (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities), and (ii) Holdings at all times maintain (x) a one-to-one ratio between the number of shares of Class A Common Stock issued by us and the number of LLC Interests owned by us and (y) a one-to-one ratio between the number of shares of Class B Common Stock owned by the Continuing iPic Equity Owners and the number of LLC Interests owned by the Continuing iPic Equity Owners;

•         iPic Entertainment will own LLC Interests representing 17.5% of the economic interest in Holdings;

•         the purchasers in this Offering (i) will own 2,165,000 shares of Class A Common Stock, representing approximately 17.5% of the combined voting power of the Common Stock, (ii) will own 100.0% of the economic interest in iPic Entertainment and (iii) through iPic Entertainment’s ownership of LLC Interests, indirectly will hold (applying the percentages in the preceding clause (ii) to iPic Entertainments percentage economic interest in Holdings) approximately 17.5% of the economic interest in Holdings; and

•         the Continuing iPic Equity Owners will own (i) LLC Interests, representing 82.5% of the economic interest in Holdings, and (ii) through their ownership of Class B Common Stock, approximately 82.5% of the combined voting power of the Common Stock. Following this Offering, each LLC Interest held by the Continuing iPic Equity Owners will be redeemable, at the election of such members, for, at iPic Entertainment’s option, newly-issued shares of Class A Common Stock on a one-for-one basis or a cash payment equal to a volume weighted average market price of one share of Class A Common Stock for each LLC Interest redeemed (subject to customary adjustments, including for stock splits, stock dividends and reclassifications). In the event of such election by a Continuing iPic Equity Owner, iPic Entertainment may, at its option, instead effect a direct exchange of cash or Class A Common Stock for such LLC Interests in lieu of such a redemption. Any such redemption or exchange is required to be in accordance with the terms of the Holdings LLC Agreement. When a Continuing iPic Equity Owner’s LLC Interests are redeemed or exchanged, iPic Entertainment will cancel a number of shares of Class B Common Stock held by such Continuing iPic Equity Owner equal to the number of LLC Interests of such Continuing iPic Equity Owner that were redeemed or exchanged. The decisions made by iPic Entertainment will be made by its board of directors, which will include directors who hold LLC Interests or are affiliated with holders of LLC Interests and may include such directors in the future. See “The Transactions — Holdings LLC Agreement.”

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Immediately following this Offering, although we will have a minority economic interest in Holdings, we will have the sole voting interest in, and control the management of, Holdings and, indirectly, iPic-Gold Class. As a result, we will consolidate both Holdings and iPic-Gold Class in our consolidated financial statements and will report non-controlling interests related to the LLC Interests held by the Continuing iPic Equity Owners on our consolidated financial statements. iPic Entertainment will have a board of directors and executive officers, but will have no other employees. All of our employees and their functions are expected to reside at iPic-Gold Class and its subsidiaries.

As a result of our ownership structure, we generally expect to obtain an increase in our share of the tax basis of assets owned indirectly by Holdings when the Continuing iPic Equity Owners exchange their LLC Interests or such LLC Interests are redeemed for Class A Common Stock or for cash. These basis increases may have the effect of reducing the amounts that we would otherwise pay in the future to various tax authorities. Our structure does not contemplate a tax receivable agreement. Therefore, any tax benefits realized from this arrangement will inure to our benefit. There can be no assurance that we will generate sufficient taxable income to utilize any such tax benefits.

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The following diagram shows our organizational structure after giving effect to the Transactions, including this Offering:

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Holdings LLC Agreement

We will operate our business through Holdings, which will in turn operate our business through iPic-Gold Class and its subsidiaries. In connection with the completion of this Offering, we and the Original iPic Equity Owners will enter into Holdings’s amended and restated limited liability company agreement, which we refer to as the “Holdings LLC Agreement.” The operations of Holdings, and the rights and obligations of the holders of LLC Interests, will be set forth in the Holdings LLC Agreement.

Appointment as Manager. Under the Holdings LLC Agreement, we will become a member and the sole manager of Holdings. As the sole manager, we will be able to control all of the day-to-day business affairs and decision-making of Holdings without the approval of any other member. As such, we, through our officers and directors, will be responsible for all operational and administrative decisions of Holdings. Holdings will be the sole managing member of iPic-Gold Class. iPic Entertainment will, therefore, indirectly control the business and affairs of iPic-Gold Class and of iPic-Gold Class’s subsidiaries. Pursuant to the terms of the Holdings LLC Agreement, we cannot, under any circumstances, be removed as the sole manager of Holdings except at our election.

Compensation; Expense Reimbursement. iPic Entertainment will not be entitled to compensation for our services as manager of Holdings. We will be entitled to receive reimbursement, pursuant to that certain Expense Reimbursement Agreement, to be entered into in connection with the Transactions, by and among iPic-Gold Class, Holdings and iPic Entertainment, from either Holdings or iPic-Gold Class for fees and expenses incurred by us, including (i) all expenses associated with this Offering, (ii) reasonably customary corporate, securities and administrative costs associated with being a public company, (iii) losses, claims, damages, liabilities, costs, fees and expenses incurred in connection with any indemnification or expense reimbursement required by applicable law or by any of our organizational documents or an indemnification agreement; (iv) losses, claims, damages, liabilities, costs, fees and expenses incurred in connection with any indemnification obligations under the Registration Rights Agreement; (v) any franchise taxes paid or payable by us and any income taxes paid or payable by us as a result of receiving amounts pursuant to the Expense Reimbursement Agreement; (vi) any costs, fees and expenses payable or reimbursable to any members of our Board of Directors; (vii) to the extent paid by us, any salary, benefits, fees, expenses or other compensation paid to any of our officers or employees; and (viii) any other costs, fees, expenses or similar expenditures reasonably incurred by us.

Exchange of Membership Interests. On December 22, 2017, iPic Gold Class Holdings LLC was formed as a Delaware limited liability company. Prior to this Offering, the Original iPic Equity Owners will contribute their membership interests in iPic-Gold Class in exchange for membership units in Holdings, which we refer to as “LLC Interests.” Certain of the Original iPic Equity Owners will transfer their LLC Interests to certain direct or indirect members of such Original iPic Equity Owners. The recipients of these LLC Interests, together with the Original iPic Equity Owners that did not transfer any of their LLC Interests, are collectively referred to herein as the “Continuing iPic Equity Owners.” The iPic-Gold Class LLC Agreement will be amended and restated to reflect its status as a wholly-owned subsidiary of Holdings and will appoint Holdings as the sole managing member of iPic-Gold Class. The Holdings LLC Agreement will also include a requirement that one LLC Interest can be acquired with the net proceeds received in the Offering from the sale of each share of our Class A Common Stock. Each LLC Interest will entitle the holder to a pro rata share of the net profits and net losses and distributions of Holdings.

Purchase of LLC Interests. We intend to use the net proceeds received from this Offering to purchase newly-issued LLC Interests from Holdings at a purchase price per interest equal to the net proceeds, before expenses, to us per share received from the sale of Class A Common Stock. The Holdings LLC Agreement will require that when shares of Class A Common Stock are sold in this Offering (or in any subsequent public offering) at a price per share that is lower than the price per share for which such shares of Class A Common Stock are sold to the public in this Offering (or in any subsequent public offering, as applicable) after taking into account selling agents’ discounts and commissions or brokers’ fees and commissions, Holdings will reimburse iPic Entertainment for such discount by treating the discount as an additional capital contribution made by iPic Entertainment to Holdings and increasing iPic Entertainment’s capital account by the amount of such discount.

Distributions. The Holdings LLC Agreement will require “tax distributions,” as that term is defined in the Holdings LLC Agreement, to be made by Holdings to its “members,” as that term is defined in the Holdings LLC Agreement. Tax distributions will be made quarterly to each member of Holdings, including us, based on such member’s allocable share of the cumulative net taxable income of Holdings multiplied by the highest combined U.S. federal, state and local income tax rate applicable to an individual or, if higher, a corporation, resident in the state of Florida, and taking into account such factors considered relevant by the manager, determined in the sole discretion of the manager. The tax

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rate used to determine tax distributions will apply regardless of the actual final tax liability of any such member. Tax distributions will also be made only to the extent that all previous distributions to such member for the relevant period were less than the tax distributions that such member would have been entitled to receive for such period as calculated in the manner described above. Tax distributions to iPic Entertainment Inc. will be increased to the extent its “assumed tax liability,” as that term is defined in the Holdings LLC Agreement, is less than the amount iPic Entertainment Inc. is required to pay in U.S. federal, state and local income taxes, as determined by the manager in good faith. To the extent that each member of Holdings would otherwise be entitled to less than its “percentage interest,” as that term is defined in the Holdings LLC Agreement, of the aggregate tax distributions to be paid by Holdings on any given date (including as a result of the immediately preceding sentence), the tax distributions to such member shall be increased to ensure that all such distributions be made pro rata in accordance with such member’s percentage interest. The Holdings LLC Agreement will also allow for distributions to be made by Holdings to its members on a pro rata basis out of “distributable cash,” as that term is defined in the Holdings LLC Agreement. We expect Holdings may make distributions out of distributable cash periodically to the extent permitted by the agreements governing our indebtedness and necessary to enable us to cover our operating expenses and other obligations, including our tax liability, as well as to make dividend payments, if any, to the holders of our Class A Common Stock.

LLC Interest Redemption Right. The Holdings LLC Agreement provides a redemption right to the Continuing iPic Equity Owners which entitles them to have their LLC Interests redeemed, at the election of each such person, for, at our option, as determined by or at the direction of our board of directors, which will include directors who hold LLC Interests or are affiliated with holders of LLC Interests and may include such directors in the future, newly-issued shares of our Class A Common Stock on a one-for-one basis or a cash payment equal to a volume weighted average market price of one share of Class A Common Stock for each LLC Interest redeemed (subject to customary adjustments, including for stock splits, stock dividends and reclassifications). If we decide to make a cash payment, the Continuing iPic Equity Owner has the option to rescind its redemption request within a specified time period. Upon the exercise of the redemption right, the redeeming member will surrender its LLC Interests to Holdings for cancellation. If the redemption is to be fulfilled with cash from an issuance of Class A Common Stock or with shares of our Class A Common Stock, the Holdings LLC Agreement requires that we contribute such cash or shares of our Class A Common Stock to Holdings in exchange for an amount of newly-issued LLC Interests in Holdings that will be issued to us equal to the number of LLC Interests redeemed from the Continuing iPic Equity Owner. Holdings will then distribute the cash (whether from an issuance of Class A Common Stock or another source) or shares of our Class A Common Stock to such Continuing iPic Equity Owner to complete the redemption. In the event of such election by a Continuing iPic Equity Owner, we may, at our option, instead effect a direct exchange of cash or our Class A Common Stock for such LLC Interests in lieu of such a redemption. Whether by redemption or exchange, we are obligated to ensure that at all times the number of LLC Interests that we own equals the number of shares of Class A Common Stock issued by us (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities).

Issuance of LLC Interests Upon Exercise of Options or Issuance of Other Equity Compensation. Upon the exercise of options issued by us, or the issuance of other types of equity compensation by us (such as the issuance of restricted or non-restricted stock, payment of bonuses in stock or settlement of stock appreciation rights in stock), we will be required to acquire from Holdings a number of LLC Interests equal to the number of shares of Class A Common Stock being issued in connection with the exercise of such options or issuance of other types of equity compensation. When we issue shares of Class A Common Stock in settlement of stock options granted to persons that are not officers or employees of Holdings or its subsidiaries, we will make, or be deemed to make, a capital contribution to Holdings equal to the aggregate value of such shares of Class A Common Stock, and Holdings will issue to us a number of LLC Interests equal to the number of shares of Class A Common Stock we issued. When we issue shares of Class A Common Stock in settlement of stock options granted to persons that are officers or employees of Holdings or its subsidiaries, we will be deemed to have sold directly to the person exercising such award a portion of the value of each share of Class A Common Stock equal to the exercise price per share, and we will be deemed to have sold directly to Holdings (or the applicable subsidiary of Holdings) the difference between the exercise price and market price per share for each such share of Class A Common Stock. In cases where we grant other types of equity compensation to employees of Holdings or its subsidiaries, on each applicable vesting date we will be deemed to have sold to Holdings (or such subsidiary) the number of vested shares at a price equal to the market price per share, Holdings (or such subsidiary) will deliver the shares to the applicable person, and we will be deemed to have made a capital contribution to Holdings equal to the purchase price for such shares in exchange for an equal number of LLC Interests.

Maintenance of one-to-one ratio of shares of Class A Common Stock and LLC Interests owned by iPic Entertainment. Our Amended and Restated Certificate of Incorporation and the Holdings LLC Agreement will require that (i) we at all

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times maintain a ratio of one LLC Interest owned by us for each share of Class A Common Stock issued by us (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities), and (ii) Holdings at all times maintain (x) a one-to-one ratio between the number of shares of Class A Common Stock issued by us and the number of LLC Interests owned by us and (y) a one-to-one ratio between the number of shares of Class B Common Stock owned by the Continuing iPic Equity Owners and the number of LLC Interests owned by the Continuing iPic Equity Owners. This construct is intended to result in the Continuing iPic Equity Owners having a voting interest in iPic Entertainment that is identical to the Continuing iPic Equity Owners’ percentage economic interest in Holdings.

Transfer Restrictions. The Holdings LLC Agreement generally does not permit transfers of LLC Interests by members, subject to limited exceptions. Any transferee of LLC Interests must assume, by operation of law or written agreement, all of the obligations of a transferring member with respect to the transferred units, even if the transferee is not admitted as a member of Holdings.

Dissolution. The Holdings LLC Agreement provides that the unanimous consent of all members holding voting units will be required to voluntarily dissolve Holdings. In addition to a voluntary dissolution, Holdings will be dissolved upon a change of control transaction under certain circumstances, as well as upon the entry of a decree of judicial dissolution or other circumstances in accordance with Delaware law. Upon a dissolution event, the proceeds of a liquidation will be distributed in the following order: (i) first, to pay the expenses of winding up Holdings; (ii) second, to pay debts and liabilities owed to creditors of Holdings, other than members; (iii) third, to pay debts and liabilities owed to members; and (iv) fourth, to the members pro-rata in accordance with their respective percentage ownership interests in Holdings (as determined based on the number of LLC Interests held by a member relative to the aggregate number of all outstanding LLC Interests).

Confidentiality. Each member will agree to maintain the confidentiality of Holdings’s confidential information. This obligation excludes information independently obtained or developed by the members, information that is in the public domain or otherwise disclosed to a member, in either such case not in violation of a confidentiality obligation or disclosures required by law or judicial process or approved by our chief executive officer.

Indemnification and Exculpation. The Holdings LLC Agreement provides for indemnification of the manager, members and officers of Holdings and their respective subsidiaries or affiliates. To the extent permitted by applicable law, Holdings will indemnify us, as its sole manager, its tax matters representative, its authorized officers, its other employees and agents from and against any losses, liabilities, damages, costs, expenses, fees or penalties incurred by any acts or omissions of these persons, provided that the acts or omissions of these indemnified persons are not the result of fraud, intentional misconduct or a violation of the implied contractual duty of good faith and fair dealing, or any iPic standard of conduct permitted under applicable law.

We, as the sole manager, the tax matters representative, and the authorized officers and other employees and agents of Holdings will not be liable to Holdings, its members or their affiliates for damages incurred by any acts or omissions of these persons, provided that the acts or omissions of these exculpated persons are not the result of fraud, or intentional misconduct.

Amendments. The Holdings LLC Agreement may be amended with the consent of the members holding a majority of the voting units then outstanding; provided, however, that if, as of any date of determination, a majority of the voting units are then held by the sole manager or any affiliates controlled by the sole manager, then the Holdings LLC Agreement may be amended with the consent of the sole manager together with members (other than the sole manager and its controlled affiliates) holding a majority of the voting units (excluding voting units held by the sole manager) then outstanding. In addition, the sections of the Holdings LLC Agreement dealing with the management of Holdings and with dissolution may be amended only with the prior written consent of the sole manager, which consent may be given or withheld in the sole manager’s sole discretion.

iPic-Gold Class LLC Agreement

Immediately prior to or in connection with the closing of this Offering, we and the Original iPic Equity Owners will amend and restate the limited liability company agreement of iPic-Gold Class to appoint Holdings as the sole managing member of iPic-Gold Class and reflect iPic-Gold Class’s status as a wholly-owned subsidiary of Holdings.  iPic-Gold Class’s amended and restated limited liability company agreement will contain standard provisions for a single-member limited liability company.

42

USE OF PROCEEDS

We are offering 2,165,000 shares of our Class A Common Stock, at an offering price of $18.50 per share, resulting in estimated net proceeds to us from this Offering, after deducting selling agents’ discounts and commissions, and estimated offering expenses payable by us, of approximately $35.9 million. Our management team will have broad discretion over the uses of the net proceeds of this Offering.

We intend to use the net proceeds that we receive from this Offering to purchase newly-issued LLC Interests from Holdings at a purchase price per interest equal to the net proceeds, before expenses, to us per share of Class A Common Stock. Holdings will transfer to iPic-Gold Class the proceeds Holdings receives from the sale of LLC Interests to iPic Entertainment.

We intend to cause iPic-Gold Class to use the proceeds that it receives from Holdings as follows: (i) to pay fees and expenses other than the selling agents discounts and commissions of approximately $1.2 million  in connection with this Offering and the Transactions, and (ii) to use approximately $35.9 million for general corporate purposes, including opening new iPic locations and renovating existing iPic locations. Pending their use, iPic-Gold Class may invest the balance of the net proceeds to us from this Offering in short-term, investment-grade, interest-bearing instruments and U.S. government securities.

The expected use of net proceeds from this Offering represents our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve and change. The amounts and timing of our actual expenditures, specifically with respect to working capital, may vary significantly depending on numerous factors. As a result, our management will retain broad discretion over the allocation of the net proceeds from this Offering.

If we sell all of the Shares offered in this Offering, we believe that the net proceeds of this Offering, together with our current resources, will allow us to fund our operations for at least the next 12 months. In the event we do not sell all of the Shares offered in this Offering, we may seek additional financing from other sources in order to support the intended use of proceeds indicated above. If we secure additional equity funding, investors in this Offering would be diluted. In all events, there can be no assurance that additional financing would be available to us when desired or needed and, if available, on terms acceptable to us.

43

CAPITALIZATION

The following table sets forth our cash and cash equivalents, and our capitalization, as of June 30, 2017, as follows:

•         of iPic-Gold Class and its subsidiaries on an actual basis;

•         of iPic Entertainment and its subsidiaries on a pro forma basis to give effect to the Transactions (other than the sale and issuance of shares of our Class A Common Stock by us in this Offering), including (i) the elimination of existing members’ contributions of $34.2 million in consolidation of iPic-Gold Class into the consolidated financial statements of iPic Entertainment Inc. and (ii) the issuance of shares of Class B Common Stock to the Continuing iPic Equity Owners on an assumed one-to-one basis with the number of LLC interests they own, for nominal consideration; and

•         of iPic Entertainment and its subsidiaries on a pro forma as adjusted basis to give effect to the Transactions, including our issuance and sale in this Offering of the maximum amount of Shares, at the price to the public of $18.50 per share, resulting in net proceeds to us of approximately $35.9 million, giving effect to (i) the estimated selling agents’ discounts and commissions and (ii) the estimated offering expenses payable by us.

For more information, please see “The Transactions,” “Use of Proceeds” and “Unaudited Pro Forma and Pro Forma As Adjusted Consolidated Financial Statements” elsewhere in this Offering Circular. You should read this information in conjunction with our consolidated financial statements and the related notes thereto appearing elsewhere in this Offering Circular and the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other financial information contained in this Offering Circular.

		As of June 30, 2017
		Actual				Pro Forma				Pro Forma As Adjusted
Cash and cash equivalents(1)		$	3,895,338			$	3,895,338			$	39,844,032
Indebtedness:
Non-Revolving Credit Facility(2)		$	136,708,191			$	154,708,191			$	154,708,191
Note Payable			50,855,598				—				—
Total indebtedness			187,563,789				154,708,191				154,708,191
Members’ deficit and Stockholders’ equity:
Members’ equity			34,155,816				—				—
Class A common stock, par value $0.0001 per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, no shares issued and outstanding, pro forma; 100,000,000 shares authorized, 2,165,000 shares issued and outstanding, pro forma as adjusted			—				—				217
Class B common stock, par value $0.0001 per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, issued and outstanding, pro forma; 25,000,000 shares authorized, 10,000,000 issued and outstanding, pro forma as adjusted			—				1,000				1,000
Preferred stock, par value $0.0001 per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, no shares issued and outstanding, pro forma and pro forma as adjusted			—				—				—
Additional paid-in capital			—				(11,011,931	)			24,936,546
Accumulated deficit			(140,715,335	)			(1,605,025	)			(1,605,025	)
Total members’ deficit			(106,559,519	)			—				—
Total stockholders’ equity attributable to iPic Entertainment Inc.			—				(12,615,956	)			23,332,737
Noncontrolling interest			—				(58,260,204	)			(58,260,204	)
Total members’/stockholders’ equity (deficit)			(106,559,519	)			(70,876,160	)			(34,927,466	)
Total capitalization		$	81,004,270			$	83,832,031			$	119,780,725

44

____________

(1)      Neither the Pro Forma nor the Pro Forma As Adjusted columns give effect to an additional $2.5 million that we expect Regal/Atom Holdings, LLC, one of the holders of LLC Interests of iPic-Gold Class, to invest in us within 10 business days following the consummation of this Offering pursuant to the terms of the Subscription Agreement that they entered into with us on April 21, 2017 when they made their initial investment.  For more information, see “Certain Relationships and Related Party Transactions — Additional Investment by Regal/Atom Holdings, LLC.”

(2)      Pro Forma and Pro Forma As Adjusted columns reflect an additional advance of $18.0 million under the Non-Revolving Credit Facility to be utilized by the Company to repay outstanding principal and accrued interest on subordinated notes to a related party. See “Description of Indebtedness — Notes Payable to Related Parties.”

The table above excludes (unless stated otherwise above):

•         1,600,000 shares of Class A Common Stock under our 2017 Equity Incentive Plan which was adopted on December 21, 2017 (as described in “Executive Compensation — 2017 Equity Incentive Plan”), of which (i) 955,300 shares of Class A Common Stock are issuable upon the exercise of stock options granted on December 21, 2017 at an exercise price of $18.13 per share and (ii) 644,700 shares of Class A Common Stock are reserved for future issuance, and any additional shares that become available under our 2017 Equity Incentive Plan pursuant to provisions thereof that automatically increase the share reserve under the plan each year, as more fully described in the section titled “Executive Compensation — 2017 Equity Incentive Plan;”

•         10,220,629 shares of Class A Common Stock reserved as of the closing date of this Offering for future issuance upon redemption or exchange of LLC Interests by the Continuing iPic Equity Owners;

•         483,864 shares of Class A Common Stock subject to outstanding RSU awards;

•         up to 47,630 shares of Class A Common Stock issuable upon the exercise of the Selling Agents’ Warrants, exercisable at $23.125 per share; and

•         220,629 shares of Class B Common Stock issued in November 2017 to a new iPic Equity Owner.

To the extent such stock options or warrants are hereafter exercised, or awards made under such equity compensation plan result in the issuance of additional shares of our Common Stock, there will be further dilution to our investors in this Offering.

45

DILUTION

Dilution in net tangible book value per share to new investors is the amount by which the offering price paid by the purchasers of the shares of Class A Common Stock sold in this Offering exceeds the pro forma net tangible book value per share of Common Stock after this Offering. Net tangible book value per share is determined at any date by subtracting our total liabilities from the total book value of our tangible assets and dividing the difference by the number of shares of Common Stock deemed to be outstanding at that date.

The pro forma net tangible book value of our Common Stock as of June 30, 2017 was approximately $(110.1) million, or $(11.01) per share (but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017 at a price of $18.13 per unit). After giving the effect to the sale of 2,165,000 shares of our Class A Common Stock in this Offering at the price to the public of $18.50 per share and after deducting the selling agents’ discounts and commissions and estimated offering expenses payable by us, the pro forma net tangible book value would be approximately $(38.4) million, or $(3.16) per share. This represents an immediate increase in net tangible book value of $7.85 per share to existing stockholders and an immediate dilution of $21.77 per share to new investors purchasing shares of Common Stock in this Offering. The following table illustrates this substantial and immediate per share dilution to new investors.

Assumed initial public offering price per share						$	18.50
Pro forma net tangible book value (deficit) per share before giving effect to this Offering		$	(11.01	)
Increase per share attributable to the sale of Common Stock in this Offering(1)			7.85
Pro forma net tangible book value (deficit) per share after giving effect to this Offering							(3.16	)
Dilution per share to new investors(2)						$	21.66

____________

(1)      After deducting the selling agents’ commissions and estimated expenses payable by us in this Offering.

(2)      Dilution is determined by subtracting pro forma net tangible book value (deficit) per share after giving effect to this Offering from the initial public offering price per share paid by a new investor.

The following table sets forth, as of June 30, 2017, assuming the sale of 2,165,000 shares of our Class A Common Stock offered for sale in this Offering, the total number of shares previously issued and sold to existing investors (but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017 at a price of $18.13 per unit), the total consideration paid for the foregoing (factoring in certain capital account adjustments in the case of the Continuing iPic Equity Owners) and the average price per share. As the table shows, new investors purchasing shares of Common Stock may in certain circumstances pay an average price per share substantially higher than the average price per shares paid by our existing stockholders.

		Units/Shares Purchased					Total Consideration						Average Price
		Number		Percent			Amount			Percent			Per Share
Continuing iPic Equity Owners		10,000,000		82.2	%		$	73,618,494		64.8	%		$	7.36
New investors		2,165,000		17.8	%		$	40,052,500		35.2	%		$	18.50
Total		12,165,000		100.0	%		$	113,670,994		100.0	%

The discussion and the tables above exclude shares of Class B Common Stock, because holders of the Class B Common Stock are not entitled to distributions or dividends, whether cash or stock, from iPic. The number of shares of our Class A Common Stock outstanding after this Offering as shown in the tables above is based on the number of shares outstanding as of June 30, 2017, after giving effect to the Transactions, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, and excludes (a) 1,600,000 shares of Class A Common Stock under our 2017 Equity Incentive Plan (as described in “Executive Compensation — 2017 Equity Incentive Plan”), of which (i) 955,300 shares of Class A Common Stock are issuable upon the exercise of stock options granted on December 21, 2017 at an exercise price of $18.13 per share and (ii) 644,700 shares of Class A Common Stock are reserved for future issuance, and any additional shares that become available under our 2017 Equity Incentive Plan pursuant to provisions thereof that automatically increase the share reserve under the plan each year, as more fully described in the section titled “Executive Compensation — 2017 Equity Incentive Plan;” (b) 483,864 shares of Class A Common Stock subject to outstanding RSU awards; and (c) up to 47,630 shares of Class A Common Stock issuable upon the exercise of the Selling Agents’ Warrants, exercisable at $23.125 per share.

46

DIVIDEND POLICY

Except as described in the following paragraph, we currently intend to retain all available funds and any future earnings for use in the operation of our business, and therefore iPic Entertainment does not currently expect to pay any cash dividends on its Class A Common Stock. Holders of iPic Entertainment Class B Common Stock are not entitled to participate in any dividends declared by iPic Entertainment’s board of directors. Any future determination to pay dividends to holders of Class A Common Stock will be at the discretion of iPic Entertainment’s board of directors and will depend upon many factors, including our results of operations, financial condition, capital requirements, restrictions in iPic-Gold Class’s debt agreements and other factors that iPic Entertainment’s board of directors deems relevant. iPic Entertainment is a holding company whose principal asset will be LLC interests of Holdings, which will own 100% of the limited liability company interests of, and control, iPic Gold Class. Accordingly, substantially all of iPic Entertainment’s operations are indirectly carried out by iPic-Gold Class and its subsidiaries. Additionally, under the Non-Revolving Credit Facility, iPic-Gold Class is currently restricted from paying cash dividends, and we expect these restrictions to continue in the future, which may in turn limit iPic Entertainment’s ability to pay dividends on its Class A Common Stock. iPic Entertainment’s ability to pay dividends may also be restricted by the terms of any future credit agreement or any future debt or preferred equity securities of iPic Entertainment or its subsidiaries.

Holdings is required to make tax distributions to its members under certain circumstances provided in the Holdings LLC Agreement. Any such tax distributions are required to be made pro rata in accordance with the members’ percentage interests in Holdings and, accordingly, it is possible that iPic Entertainment will receive tax distributions in excess of the amount required for iPic Entertainment to pay its applicable tax liabilities. In such case, iPic Entertainment may pay dividends out of all or a portion of such excess cash. However, there can be no assurance as to the timing or amount of any tax distributions from Holdings or whether such tax distributions will be in excess of iPic Entertainment’s applicable tax liabilities, and iPic Entertainment is not required to pay dividends out of any such excess cash.

See “Risk Factors — Risks Relating to this Offering and Ownership of Our Common Stock — Because we do not intend to declare cash dividends on our shares of common stock in the foreseeable future, stockholders must rely on appreciation of the value of our common stock for any return on their investment.”

47

UNAUDITED PRO FORMA AND PRO FORMA AS ADJUSTED
CONSOLIDATED FINANCIAL STATEMENTS

The following are the unaudited pro forma and pro forma as adjusted consolidated financial statements of iPic-Gold Class Entertainment, LLC and its subsidiaries. The unaudited pro forma consolidated statement of operations information for the year ended December 31, 2016 and the six months ended June 30, 2017 was prepared as if the transactions described under “The Transactions” and this Offering had taken place on January 1, 2016. The unaudited pro forma and pro forma as adjusted consolidated balance sheet information as of June 30, 2017 was prepared as if the transactions described under “The Transactions” and this Offering had taken place on June 30, 2017. See “The Transactions.”

The column labeled “Pro Forma” reflects the Transactions (other than the sale and issuance of shares of our Class A Common Stock by us in this Offering as described in Note (7) below), including (i) the refinancing of one of the existing notes payable — related parties into the long-term debt related party, (ii) the use of the 5% qualified subordinated debt and demand note to satisfy the members’ capital call, (iii) the elimination of existing members’ contributions of $34.2 million in consolidation of iPic-Gold Class into the consolidated financial statements of iPic Entertainment Inc., (iv) the extension of the long-term debt — related party for an additional three years until September 29, 2023 and (v) the issuance of shares of Class B Common Stock to the Continuing iPic Equity Owners on an assumed one-to-one basis with the number of LLC interests they own, for nominal consideration.

The column labeled “Pro Forma As Adjusted” reflects the net effect on cash of the receipt of proceeds of approximately $35.9 million from this Offering, based on an assumed sale of 2,165,000 shares of Class A Common Stock at an assumed initial public offering price of $18.50 per share, which is the price set forth on the cover page of this Offering Circular, net of selling agents’ discounts and commissions, and estimated offering expenses payable by us.

Neither the Pro Forma nor the Pro Forma As Adjusted financial statements give effect to an additional $2.5 million that we expect Regal/Atom Holdings, LLC, one of the holders of LLC Interests of iPic-Gold Class, to invest in us within 10 business days following the consummation of this Offering pursuant to the terms of the Subscription Agreement that they entered into with us on April 21, 2017 when they made their initial investment.  For more information, see “Certain Relationships and Related Party Transactions — Additional Investment by Regal/Atom Holdings, LLC.”

The Pro Forma and Pro Forma As Adjusted adjustments above are based upon available information and certain assumptions that management believes are reasonable, factually supportable, directly attributable to either the Transactions or this Offering, and, in connection with Pro Forma and Pro Forma As Adjusted adjustments related to the consolidated statement of operations, expected to have a continuing impact on our results of operations. Adjustments that are based on fair value of the shares are calculated using the assumed initial public offering price of $18.50 per share.

We believe that the Pro Forma and Pro Forma As Adjusted consolidated financial statements provide a helpful perspective to better understand our results of operations and our financial position. The unaudited Pro Forma and Pro Forma As Adjusted consolidated financial statements and accompanying notes should be read together with our consolidated financial statements and related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Offering Circular.

The unaudited Pro Forma and Pro Forma As Adjusted consolidated financial statements presented are based upon available information and certain assumptions that we believe are reasonable under the circumstances. The unaudited Pro Forma and Pro Forma As Adjusted consolidated financial statements do not purport to represent what our results of operations or financial position would have been had the Transactions or this Offering actually occurred on the date or as of the date specified, nor do they purport to project our results of operations for any future period.

48

UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
As of June 30, 2017

		iPic-Gold Class Entertainment, LLC Actual				Transaction Adjustments(9)					Pro Forma				Initial Public Offering Adjustments				Pro Forma As Adjusted
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	3,895,338			$					$	3,895,338			$	35,948,694	(7)		$	39,844,032
Accounts receivable			2,706,208									2,706,208								2,706,208
Inventories			1,185,312									1,185,312								1,185,312
Prepaid expenses			1,206,877									1,206,877								1,206,877
Total current assets			8,993,735									8,993,735				35,948,694				44,942,429
Property and equipment, net			147,956,581									147,956,581								147,956,581
Convertible note receivable			250,000									250,000								250,000
Deposits			218,821									218,821								218,821
Total assets		$	157,419,137				—				$	157,419,137			$	35,948,694			$	193,367,831
Liabilities and Equity (Deficit)
Accounts payable		$	7,125,698			$					$	7,125,698			$				$	7,125,698
Accrued expenses			1,521,142									1,521,142								1,521,142
Accrued interest			1,594,110				(1,272,001	)(3)				322,109								322,109
Accrued payroll			2,189,720									2,189,720								2,189,720
Accrued insurance			165,825									165,825								165,825
Taxes payable			1,455,619									1,455,619								1,455,619
Deferred revenue			5,896,811									5,896,811								5,896,811
Deposits and other current liabilities			370,997									370,997								370,997
Total current liabilities			20,319,922				(1,272,001	)				19,047,921				—				19,047,921
Long-term debt – related party			136,708,191				18,000,000	(2)				154,708,191	(10)							154,708,191
Notes payable to related parties			50,855,598				(15,000,000	)(2)				—								—
							(35,855,598	)(3)
Deferred rent			51,309,135									51,309,135								51,309,135
Accrued interest – long-term			4,785,810				1,532,037	(1)				3,230,050								3,230,050
							(3,000,000	)(2)
							(87,797	)(3)
Total liabilities			263,978,656				(35,683,359	)				228,295,297								228,295,297
Commitments and Contingencies
Equity (Deficit)
Class A common stock, $0.0001 par value per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, no shares issued and outstanding, pro forma;100,000,000 shares authorized, 2,165,000 shares issued and outstanding, pro forma as adjusted			—				—					—				217	(7)			217
Class B common stock, $0.0001 par value per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, issued and outstanding, pro forma; 25,000,000 shares authorized, 10,000,000 shares issued and outstanding, pro forma as adjusted			—				1,000	(5)				1,000				—				1,000
Preferred stock, par value $0.0001 per share; no shares authorized, issued and outstanding, actual; 10,000,000 shares authorized, no shares issued and outstanding, pro forma and pro forma as adjusted			—				—					—				—				—
Members’ contributions			34,155,816				(71,371,212	)(5)				—				—				—
							37,215,396	(3)
Additional paid-in capital							71,370,212	(5)				(11,011,931	)			35,948,477	(7)			24,936,546
							50,848,232	(5)
							9,016,997	(4)
							(142,247,372	)(6)
Accumulated deficit			(140,715,335	)			142,247,372	(6)				(1,605,025	)							(1,605,025	)
							7,411,972	(6)
							(1,532,037	)(1)
							(9,016,997	)(4)
Total members’/stockholders’ equity attributable to iPic Entertainment Inc.			(106,559,519	)			93,943,563					(12,615,956	)			35,948,694				23,332,737
Non-controlling interests							(50,848,232	)(5)				(58,260,204	)(8)							(58,260,204	)
							(7,411,972	)(6)
Total equity (deficit)			(106,559,519	)			35,683,359					(70,876,160	)			35,948,694				(34,927,466	)
Total liabilities and equity (deficit)		$	157,419,137			$	—				$	157,419,137			$	35,948,694			$	193,367,831

See accompanying notes to unaudited pro forma consolidated balance sheet

49

Notes to Unaudited Pro Forma Consolidated Balance Sheet

(1)      Reflects the additional accrued interest expense required to record the minimum interest payable on the 10.5% qualified subordinated debt notes payable — related party, to be refinanced through additional borrowings from the long-term debt — related party. The amount is non-recurring in nature and therefore has not been included in the unaudited pro forma consolidated statements of operations.

(2)      Reflects the refinancing of one of the original member’s notes payable of $15.0 million, plus minimum interest payable on those notes of $3.0 million through additional borrowings under the Non-Revolving Credit Facility. See “Description of Indebtedness — Notes Payable to Related Parties.”

(3)      Reflects the use of the 5% qualified subordinated debt and demand note plus accrued interest, to satisfy the members’ capital call in accordance with the debt agreements prior to the Transactions.

(4)      On December 21, 2017, iPic-Gold Class adopted the iPic-Gold Class Entertainment, LLC 2017 Equity Incentive Plan (the “2017 Equity Incentive Plan”), under which equity awards may be made in respect of 1,600,000 units of iPic-Gold Class in the form of options, restricted units, unit appreciation rights, dividend equivalent rights, unit awards and performance-based awards. It is expected that in connection with the Transactions, the 2017 Equity Incentive Plan will be migrated to iPic Entertainment and any awards granted under the 2017 Equity Incentive Plan will be converted into options to acquire Class A Common Stock of iPic Entertainment. On December 21, 2017, iPic-Gold Class granted 955,300 options with an exercise price of $18.13 per share to our named executive officers and certain other employees under the 2017 Equity Incentive Plan as part of the Transactions (the “IPO Options”). Approximately 10,400 of the IPO Options are expected to become fully vested upon the closing of this Offering and the remaining IPO Options are expected to vest over either a three-year period or four-year period, in each case, commencing on the date of grant.

On December 6, 2017, iPic Entertainment entered into restricted stock unit award agreements (the “IPO RSU Agreements”) with each of our named executive officers and certain other key members of management pursuant to which recipients will be entitled to receive an award of stock-settled restricted stock units (the “IPO RSUs”) in an aggregate dollar amount of approximately $9.0 million. The IPO RSU Agreements provide that each grantee will be entitled to receive a number of IPO RSUs equal to the quotient of (a) each such grantee’s “Aggregate Grant Amount” (set forth in each grantee’s IPO RSU Agreement) divided by (b) the initial public offering price. Pursuant to the IPO RSU Agreements, the IPO RSUs are expected to settle in full on a settlement date as set forth in the IPO RSU Agreement (the “Settlement Date”), regardless of whether the recipient remains employed with iPic Entertainment or any of its subsidiaries through the Settlement Date. The IPO RSUs vest immediately upon the closing of this Offering. The IPO RSUs and the IPO Options that will become fully vested in connection with the closing of this Offering are non-recurring in nature and, as such, have not been included as an adjustment in the unaudited pro forma consolidated statements of operations.

(5)      As a C corporation, we will no longer record members’ equity in the consolidated balance sheet. To reflect the C corporation structure of our equity, we will separately present the value of our common stock, additional paid-in capital and retained earnings. The portion of members’ equity associated with additional paid-in capital was estimated as the remainder of capital contributions we have received less amounts attributed to the par value of common stock and the amount allocated to the non-controlling interests (see Note (8)).

(6)      Reflects the Transactions (other than the sale and issuance of shares of our Class A Common Stock by us in this offering as described in Note (7) below), including (i) the elimination of existing members’ contributions of $34.2 million in consolidation of iPic-Gold Class Entertainment, LLC into the consolidated financial statements of iPic Entertainment Inc. and (ii) the issuance of shares of Class B Common Stock to the Original iPic Equity Owners on an assumed one-to-one basis with the number of LLC interests they own, for nominal consideration, for pro forma presentation only. Upon completion of the Transactions, iPic Entertainment Inc. will become the sole manager of Holdings, which will be the sole managing member of iPic-Gold Class. Accordingly, although we will have a minority economic interest in Holdings, we will have the sole voting interest in, and control the management of, Holdings and, indirectly, iPic-Gold Class. As a result, we will consolidate both Holdings and iPic-Gold Class in our consolidated financial statements and will report non-controlling interests related to the LLC Interests held by the Continuing iPic Equity Owners on our consolidated balance sheet.

50

(7)      Reflects the net effect on cash of the receipt of proceeds of $35,948,694 from the offering, based on an assumed sale of 2,165,000 shares of Class A Common Stock at an assumed initial public offering price of $18.50 per share, which is the price set forth on the cover page of this Offering Circular, net of selling agents discounts and commissions and estimated offering expenses payable by us. A $1.00 increase or decrease in the assumed initial public offering price of $18.50 per share would increase or decrease the net proceeds we receive from this offering by approximately $2.2 million, assuming the number of shares offered by us as set forth on the cover page of this Offering Circular remains the same and after deducting offering expenses. Each increase (decrease) of 100,000 shares in the number of shares of Class A Common Stock offered by us would increase (decrease) the amount of our cash, total assets and total members’/stockholders’ equity by approximately $1.72 million, assuming an initial public offering price of $18.50 per share, which is the price set forth on the cover page of this Offering Circular, after deducting selling agents discounts and commissions and estimated offering expenses payable by us.

(8)      After this Offering and the Transactions, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, iPic Entertainment Inc.’s only material asset will be the ownership of 17.8% of the LLC Interests and sole voting interest in Holdings, which will have the sole voting interest in iPic-Gold Class. Following this Offering and the Transactions, iPic Entertainment Inc.’s only business will be to act as the sole manager of Holdings and indirectly as manager of iPic-Gold Class. As a result of this voting interest and control, as well as the obligation to absorb losses of, and receive benefits from, iPic-Gold Class that could be significant, we have determined that, after the Transactions, iPic-Gold Class will be a variable interest entity and that we will be the primary beneficiary of iPic-Gold Class. Therefore, pursuant to ASC 810 Consolidation, we will consolidate the financial results of iPic-Gold Class into our consolidated financial statements. The LLC interests of the Continuing iPic Equity Owners will be accounted for as a non-controlling interest in iPic Entertainment Inc.’s consolidated financial statements’ after this Offering. Immediately following this Offering, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, the non-controlling interest of iPic-Gold Class Entertainment, LLC will represent 82.2% of the outstanding LLC interests calculated as follows (in thousands):

		Units		Percentage
Interest in iPic-Gold Class Entertainment, LLC held by iPic Entertainment Inc.		2,165,000		17.8	%
Non-controlling interests in iPic-Gold Class Entertainment, LLC held by the Members		10,000,000		82.2	%
		12,165,000		100.0	%

 (9)    Due to the uncertainty in the amount and timing of future exchanges of LLC interests, the unaudited pro forma consolidated financial information assumes that no exchanges of interests have occurred and therefore no increases in tax basis in Holdings’s assets or other tax benefits that may be realized thereunder have been assumed in the unaudited pro forma consolidated financial information. For financial reporting purposes, we will assess the tax attributes of Holdings in accordance with ASC 740, Income Taxes, 740-10-30-5 to determine if it is more likely than not that we will realize any deferred tax assets.

(10)   The maturity date on the credit facility will be extended by three years to September 2023 as part of the Transactions.

51

UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2017

		iPic-Gold Class Entertainment, LLC Actual				Transaction Adjustments				Pro Forma				Initial Public Offering Adjustments			Pro Forma As Adjusted
Revenues
Food and beverage		$	37,701,277			$				$	37,701,277			$			$	37,701,277
Theater			30,780,031								30,780,031							30,780,031
Other			893,257								893,257							893,257
Total revenues			69,374,565								69,374,565							69,374,565
Operating expenses
Cost of food and beverage			10,307,096								10,307,096							10,307,096
Cost of theater			12,283,222								12,283,222							12,283,222
Operating payroll and benefits			18,905,551								18,905,551							18,905,551
Occupancy expenses			8,765,827								8,765,827							8,765,827
Other operating expenses			12,163,590								12,163,590							12,163,590
General and administrative expenses			7,011,499				2,409,227	(1)			9,420,726							9,420,726
Depreciation and amortization expense			9,570,107								9,570,107							9,570,107
Pre-opening expenses			1,632,194								1,632,194							1,632,194
Impairment of property and equipment			3,332,000								3,332,000							3,332,000
Loss on disposal of property and equipment			7,857								7,857							7,857
Operating expenses			83,978,943				2,409,227				86,388,170							86,388,170
Operating loss			(14,604,378	)			(2,409,227	)			(17,013,605	)						(17,013,605	)
Other income (expense)
Interest income (expense), net			(7,782,227	)			845,066	(5)			(6,937,161	)						(6,937,161	)
Other income			5,000								5,000							5,000
Total other income (expense)			(7,777,227	)			845,066				(6,932,161	)						(6,932,161	)
Net loss before income tax expense			(22,381,605	)			(1,564,161	)			(23,945,766	)			—			(23,945,766	)
Income tax expense			43,400				—	(2)			43,400							43,400
Net loss			(22,425,005	)			(1,564,161	)			(23,989,166	)			—			(23,989,166	)
Less: Net income (loss) attributable to non-controlling interest							(19,719,094	)(3)			(19,719,094	)						(19,719,094	)
Net loss attributable to iPic Entertainment Inc.		$	(22,425,005	)			18,154,933			$	(4,270,072	)		$	—		$	(4,270,072	)
Net loss per share of Class A Common Stock
Basic										$	(1.97	)(4)					$	(1.97	)
Diluted										$	(1.97	)					$	(1.97	)
Weighted average number of shares of Class A Common Stock outstanding
Basic											2,165,000							2,165,000
Diluted											2,165,000							2,165,000

See accompanying notes to unaudited pro forma consolidated statements of operations

52

Notes to Unaudited Pro Forma Consolidated Statements of Operations

(1)      On December 21, 2017, iPic-Gold Class adopted the 2017 Equity Incentive Plan, under which equity awards may be made in respect of 1,600,000 units of iPic-Gold Class in the form of options, restricted units, unit appreciation rights, dividend equivalent rights, unit awards and performance-based awards. It is expected that in connection with the Transactions, the 2017 Equity Incentive Plan will be migrated to iPic Entertainment and any awards granted under the 2017 Equity Incentive Plan will be converted into options to acquire Class A Common Stock of iPic Entertainment. On December 21, 2017, iPic-Gold Class granted 955,300 options with an exercise price of $18.13 per share to our named executive officers and certain other employees under the 2017 Equity Incentive Plan as part of the Transactions (the “IPO Options”). Approximately 10,400 of the IPO Options are expected to become fully vested upon the closing of this Offering and the remaining IPO Options are expected to vest over either a three-year period or four-year period, in each case, commencing on the date of grant. The grant date fair value of the stock option awards were determined using the Black-Scholes valuation model using the following assumptions.

Expected volatility		33.96	%
Risk-free interest rate		2.26	%
Expected term in years		6-7 years
Dividend rate		0	%
Forfeiture Rate		5.25	%

The options vest over a 4 year period beginning within six months of the Transactions. Since the first tranche will vest in less than 1 year, the stock compensation expense for the options has been included based on the vesting of each tranche which results in higher expense in the first 6 months.

On December 6, 2017, iPic Entertainment entered into restricted stock unit award agreements (the “IPO RSU Agreements”) with each of our named executive officers and certain other key members of management pursuant to which recipients will be entitled to receive an award of stock-settled restricted stock units (the “IPO RSUs”) in an aggregate dollar amount of approximately $9.0 million. The IPO RSU Agreements provide that each grantee will be entitled to receive a number of IPO RSUs equal to the quotient of (a) each such grantee’s “Aggregate Grant Amount” (set forth in each grantee’s IPO RSU Agreement) divided by (b) the initial public offering price. Pursuant to the IPO RSU Agreements, the IPO RSUs are expected to settle in full on a settlement date as set forth in the IPO RSU Agreement (the “Settlement Date”), regardless of whether the recipient remains employed with iPic Entertainment or any of its subsidiaries through the Settlement Date. The IPO RSUs vest immediately upon the closing of this Offering. The IPO RSUs and the IPO Options that will become fully vested in connection with the closing of this Offering are non-recurring in nature and, as such, have not been included as an adjustment in the unaudited pro forma consolidated statement of operations. The expected grant date fair value of the restricted stock unit awards is based on the fair value on the grant date.

(2)      Following this Offering and the Transactions, iPic Entertainment Inc. will be subject to U.S. federal income taxes, as well as state and local taxes, which will be an allocable share of any net taxable income of Holdings. As a result, the pro forma statements of operations reflect an adjustment to provide for corporate income taxes at our estimated effective rate of (0.18)% for the six months ended June 30, 2017 which includes provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state and local jurisdiction.

The Company recognized an income tax benefit on its share of pre-tax book income, exclusive of the non-controlling interests, of $0.1 million for the six months ended June 30, 2017.

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The provision for income taxes from operations differs from the amount of income tax computed by applying the applicable U.S. statutory federal income tax rate to income before provision for income taxes as follows:

		June 30, 2017
Federal statutory rate		35.00	%
Rate benefit from flow-through entity		(28.77	)
Partnership outside basis difference		(6.41	)
State tax		0.19
Valuation allowance		(0.19	)
Pro forma effective tax rate		(0.18	)%

Tax rules generally require that pre-transaction built-in-gains are allocated back to the historical limited liability company members. Our effective tax rate includes a rate benefit attributable to the fact that, after the Transactions, approximately 82.2% of iPic Entertainment Inc.’s earnings will not be subject to corporate level taxes as the applicable income tax expense will be incurred by, and be the obligation of, the members of Holdings holding the non-controlling interests. Thus, the pro forma effective tax rate on the portion of income attributable to iPic Entertainment Inc. is expected to be (0.18)% for the six months ended June 30, 2017.

(3)      After this Offering and the Transactions, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, iPic Entertainment Inc.’s only material asset will be the ownership of 17.8% of the LLC Interests and sole voting interest in Holdings, which will have the sole voting interest in iPic-Gold Class. The LLC interests of the Continuing iPic Equity Owners will be accounted for as a non-controlling interest in iPic Entertainment Inc.’s consolidated financial statements after this offering. Immediately following this Offering, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, the non-controlling interest of iPic-Gold Class Entertainment, LLC will represent 82.2% of the outstanding LLC Interests.

(4)      Pro forma basic income per share is computed by dividing the net income available to Class A Common Stockholders by the weighted-average number of shares of Class A Common Stock outstanding during the period. Pro forma diluted net income per share is computed by adjusting the net income available to Class A Common Stockholders and the weighted-average number of shares of Class A Common Stock outstanding to give effect to potentially dilutive securities. Shares of Class B Common Stock do not participate in earnings of iPic Entertainment Inc. As a result, the shares of Class B Common Stock are not considered participating securities and are not included in the weighted-average shares outstanding for purposes of computing pro forma net income per share. Class B stockholders can convert their membership interests in the LLC to Class A Common Stock in iPic Entertainment Inc. maintaining a one-to-one ratio; therefore the equivalent number of Class A shares could be issued in exchange for the Class B stockholders’ membership interests in Holdings. That potential conversion would not result in dilutive shares as LLC Interests held by iPic Entertainment Inc. would increase in the same ratio as the share increase.

(5)      Reflects the reduction of interest expense based on the use of the 5% qualified subordinated debt and demand note plus accrued interest, to satisfy the members’ capital call in accordance with the debt agreements prior to the Transactions.

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UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Year Ended December 31, 2016

		iPic-Gold Class Entertainment, LLC Actual				Transaction Adjustments				Pro Forma				Initial Public Offering Adjustments		Pro Forma As Adjusted
Revenues
Food and beverage		$	64,362,624			$					64,362,624						64,362,624
Theater			57,459,010								57,459,010						57,459,010
Other			2,994,063								2,994,063						2,994,063
Total revenues			124,815,697								124,815,697						124,815,697
Operating expenses
Cost of food and beverage			17,376,509								17,376,509						17,376,509
Cost of theater			22,108,200								22,108,200						22,108,200
Operating payroll and benefits			32,141,337								32,141,337						32,141,337
Occupancy expenses			17,104,225								17,104,225						17,104,225
Other operating expenses			24,780,648								24,780,648						24,780,648
General and administrative expenses			14,220,451				3,428,871	(1)			17,649,322						17,649,322
Depreciation and amortization expense			16,019,403								16,019,403						16,019,403
Pre-opening expenses			4,394,515								4,394,515						4,394,515
Loss on disposal of property and equipment			88,462								88,462						88,462
Operating expenses			148,233,750				3,428,871				151,662,621						151,662,621
Operating loss			(23,418,053	)			(3,428,871	)			(26,846,924	)					(26,846,924	)
Other income (expense)
Interest income (expense), net			(10,718,272	)			1,579,578	(5)			(9,138,694	)					(9,138,694	)
Total other income (expense)			(10,718,272	)			1,579,578				(9,138,694	)					(9,138,694	)
Net loss before income tax expense			(34,136,325	)			(1,849,293	)			(35,985,618	)					(35,985,618	)
Income tax expense			86,801				—	(2)			86,801						86,801
Net loss			(34,223,126	)			(1,849,293	)			(36,072,419	)					(36,072,419	)
Less: Net loss attributable to non-controlling interest							(29,651,528	)(3)			(29,651,528	)					(29,651,528	)
Net loss attributable to iPic Entertainment Inc.		$	(34,223,126	)			27,802,235			$	(6,420,891	)				$	(6,420,891	)
Net loss per share of Class A Common Stock
Basic										$	(2.97	)(4)				$	(2.97	)
Diluted										$	(2.97	)				$	(2.97	)
Weighted average number of shares of Class A Common Stock outstanding
Basic											2,165,000						2,165,000
Diluted											2,165,000						2,165,000

See accompanying notes to unaudited pro forma consolidated statements of operations

55

Notes to Unaudited Pro Forma Consolidated Statements of Operations

(1)      On December 21, 2017, iPic-Gold Class adopted the 2017 Equity Incentive Plan, under which equity awards may be made in respect of 1,600,000 units of iPic-Gold Class in the form of options, restricted units, unit appreciation rights, dividend equivalent rights, unit awards and performance-based awards. It is expected that in connection with the Transactions, the 2017 Equity Incentive Plan will be migrated to iPic Entertainment and any awards granted under the 2017 Equity Incentive Plan will be converted into options to acquire Class A Common Stock of iPic Entertainment. On December 21, 2017, iPic-Gold Class granted 955,300 options with an exercise price of $18.13 per share to our named executive officers and certain other employees under the 2017 Equity Incentive Plan as part of the Transactions (the “IPO Options”). Approximately 10,400 of the IPO Options are expected to become fully vested upon the closing of this Offering and the remaining IPO Options are expected to vest over either a three-year period or four-year period, in each case, commencing on the date of grant. The grant date fair value of the stock option awards were determined using the Black-Scholes valuation model using the following assumptions.

Expected volatility		33.96	%
Risk-free interest rate		2.26	%
Expected term in years		6-7 years
Dividend rate		0	%
Forfeiture rate		5.25	%

The options vest over a 4 year period beginning within six months of the Transactions. Since the first tranche will vest in less than 1 year, the stock compensation expense for the options has been included based on the vesting of each tranche which results in higher expense in the first 6 months.

On December 6, 2017, iPic Entertainment entered into restricted stock unit award agreements (the “IPO RSU Agreements”) with each of our named executive officers and certain other key members of management pursuant to which recipients will be entitled to receive an award of stock-settled restricted stock units (the “IPO RSUs”) in an aggregate dollar amount of approximately $9.0 million. The IPO RSU Agreements provide that each grantee will be entitled to receive a number of IPO RSUs equal to the quotient of (a) each such grantee’s “Aggregate Grant Amount” (set forth in each grantee’s IPO RSU Agreement) divided by (b) the initial public offering price. Pursuant to the IPO RSU Agreements, the IPO RSUs are expected to settle in full on a settlement date as set forth in the IPO RSU Agreement (the “Settlement Date”), regardless of whether the recipient remains employed with iPic Entertainment or any of its subsidiaries through the Settlement Date. The IPO RSUs vest immediately upon the closing of this Offering. The IPO RSUs and the IPO Options that will become fully vested in connection with the closing of this Offering are non-recurring in nature and, as such, have not been included as an adjustment in the unaudited pro forma consolidated statement of operations. The expected grant date fair value of the restricted stock unit awards is based on the fair value on the grant date.

(2)      Following this Offering and the Transactions, iPic Entertainment Inc. will be subject to U.S. federal income taxes. In addition to state and local taxes, with respect to its allocable share of any net taxable income of Holdings. As a result, the pro forma statements of operations reflect an adjustment to provide for corporate income taxes at our estimated effective rate of (0.24)% for the year ended December 31, 2016 which includes provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state and local jurisdiction.

The Company recognized an income tax expense on its share of pre-tax book income, exclusive of the non-controlling interests, of $0.1 million on for the year ended December 31, 2016.

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The provision for income taxes from operations differs from the amount of income tax computed by applying the applicable U.S. statutory federal income tax rate to income before provision for income taxes as follows:

		December 31, 2016
Federal statutory rate		35.00	%
Rate benefit from flow-through entity		(28.77	)
Partnership outside basis difference		(6.47	)
State tax		0.28
Valuation allowance		(0.28	)
Pro forma effective tax rate		(0.24	)%

Tax rules generally require that pre-transaction built-in-gains are allocated back to the historical limited liability company members. Our effective tax rate includes a rate benefit attributable to the fact that, after the Transactions, approximately 82.2% of iPic Entertainment Inc.’s earnings will not be subject to corporate level taxes as the applicable income tax expense will be incurred by, and be the obligation of, the members of Holdings holding the non-controlling interests. Thus, the pro forma effective tax rate on the portion of income attributable to iPic Entertainment Inc. is expected to be (0.24)% for the year ended December 31, 2016.

(3)      After this Offering and the Transactions, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, iPic Entertainment Inc.’s only material asset will be the ownership of 17.8% of the LLC Interests and sole voting interest in Holdings, which will have the sole voting interest in iPic-Gold Class. The LLC interests of the Continuing iPic Equity Owners will be accounted for as a non-controlling interest in iPic Entertainment Inc.’s consolidated financial statements after this Offering. Immediately following this Offering, but not giving effect to the issuance of 220,629 membership units of iPic-Gold Class which were issued in November 2017, the non-controlling interest of iPic-Gold Class Entertainment, LLC will represent 82.2% of the outstanding LLC Interests.

(4)      Pro forma basic income per share is computed by dividing the net income available to Class A Common Stockholders by the weighted-average number of shares of Class A Common Stock outstanding during the period. Pro forma diluted net income per share is computed by adjusting the net income available to Class A Common Stockholders and the weighted-average number of shares of Class A Common Stock outstanding to give effect to potentially dilutive securities. Shares of Class B Common Stock do not participate in earnings of iPic Entertainment Inc. As a result, the shares of Class B Common Stock are not considered participating securities and are not included in the weighted-average shares outstanding for purposes of computing pro forma net income per share. Class B stockholders can convert their membership interests in the LLC to Class A Common Stock in iPic Entertainment Inc. maintaining a one-to-one ratio; therefore the equivalent number of Class A shares could be issued in exchange for the Class B stockholders’ membership interests in Holdings. That potential conversion would not result in dilutive shares as LLC Interests held by iPic Entertainment Inc. would increase in the same ratio as the share increase.

(5)      Reflects the reduction of interest expense based on the use of the 5% qualified subordinated debt and demand note plus accrued interest, to satisfy the members’ capital call in accordance with the debt agreements prior to the Transactions.

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SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following table presents the selected historical consolidated financial data for iPic-Gold Class Entertainment, LLC and its subsidiaries. iPic-Gold Class Entertainment, LLC, a wholly-owned subsidiary of iPic Gold Class Holdings LLC, is the predecessor of the issuer, iPic Entertainment Inc., for financial reporting purposes. The selected consolidated statement of operations data for the years ended December 31, 2015 and December 31, 2016 and the selected consolidated balance sheet data as of December 31, 2015 and December 31, 2016 are derived from the audited consolidated financial statements of iPic-Gold Class Entertainment, LLC and its subsidiaries included elsewhere in this Offering Circular. The selected consolidated statements of operations data for the six months ended June 30, 2016 and June 30, 2017, and the selected consolidated balance sheet data as of June 30, 2017 are derived from the unaudited condensed consolidated financial statements of iPic-Gold Class Entertainment, LLC and its subsidiaries included elsewhere in this Offering Circular. In the opinion of our management, such unaudited financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the results for those periods.

The results of operations for the periods presented below are not necessarily indicative of the results to be expected for any future period and the results for any interim period are not necessarily indicative of the results that may be expected for a full year. The information set forth below should be read together with the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and the consolidated financial statements and the accompanying notes included elsewhere in this Offering Circular.

The selected historical financial data of iPic Entertainment Inc. have not been presented as iPic Entertainment Inc. is a newly incorporated entity, has had no business transactions or activities to date and had no assets or liabilities during the periods presented in this section. The selected historical financial and other data of iPic Gold Class Holdings LLC have not been presented below, as iPic Gold Class Holdings LLC is a holding company with no operations and no assets other than its ownership of all of the membership interests of iPic-Gold Class Entertainment, LLC.

58

Selected Historical and Pro Forma
Financial and Operating Data

$ in thousands, except share and per share data

		Six Months Ended								Year Ended								Pro Forma
		June 30, 2017				June 30, 2016				December 31, 2016				December 31, 2015				Six Months Ended June 30, 2017				Year Ended December 31, 2016
Revenues
Food and beverage		$	37,701			$	29,115			$	64,363			$	53,025			$	37,701			$	64,363
Theater			30,780				25,948				57,459				45,866				30,780				57,459
Other			893				284				2,994				997				893				2,994
Total revenues			69,375				55,348				124,816				99,889				69,375				124,816
Operating expenses
Cost of food and beverage			10,307				7,762				17,377				14,614				10,307				17,377
Cost of theater			12,283				10,169				22,108				18,709				12,283				22,108
Operating payroll and benefits			18,906				14,488				32,141				25,918				18,906				32,141
Occupancy expenses			8,766				8,334				17,104				13,073				8,766				17,104
Other operating expenses			12,164				9,015				24,781				16,183				12,164				24,781
General and administrative expenses			7,011				5,842				14,220				12,471				9,421				17,649
Depreciation and amortization expense			9,570				7,232				16,019				11,819				9,570				16,019
Pre-opening expenses			1,632				870				4,395				3,666				1,632				4,395
Impairment of property and equipment			3,332				—				—				—				3,332				—
Loss on disposal of property and equipment			8				60				88				211				8				88
Operating expenses			83,979				63,773				148,234				116,665				86,388				151,662
Operating loss			(14,604	)			(8,425	)			(23,418	)			(16,777	)			(17,013	)			(26,847	)
Other income (expense)
Interest income (expense), net			(7,782	)			(5,259	)			(10,718	)			(7,891	)			(6,937	)			(9,139	)
Other income			5				—				—				—				5				—
Total other income (expense)			(7,777	)			(5,259	)			(10,718	)			(7,891	)			(6,932	)			(9,139	)
Net loss before income tax expense			(22,382	)			(13,684	)			(34,136	)			(24,668	)			(23,945	)			(35,986	)
Income tax expense			43				30				87				61				43				87
Net loss		$	(22,425	)		$	(13,715	)		$	(34,223	)		$	(24,729	)		$	(23,989	)		$	(36,072	)
Less: Net loss attributable to non-controlling interest		$	—			$	—			$	—			$	—			$	(19,719	)		$	(29,651	)
Net loss attributable to iPic Entertainment Inc.		$	(22,425	)		$	(13,715	)		$	(34,223	)		$	(24,729	)		$	(4,270	)		$	(6,421	)
Net loss per share
Basic																		$	(1.97	)		$	(2.97	)
Diluted																		$	(1.97	)		$	(2.97	)
Weighted average number of shares outstanding
Basic																			2,165,000				2,165,000
Diluted																			2,165,000				2,165,000
Non-GAAP financial measures
EBITDA(1)		$	(5,029	)		$	(1,193	)		$	(7,399	)		$	(4,958	)		$	(7,439	)		$	(10,827	)
Adjusted EBITDA(1)		$	(62	)		$	(263	)		$	932			$	(1,081	)		$	(62	)		$	932
Store-Level EBITDA(1)		$	6,949			$	5,579			$	15,152			$	11,390			$	6,949			$	15,152

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Consolidated Balance Sheet

$ in thousands

		As of June 30, 2017				As of December 31, 2016				As of December 31, 2015
Cash and cash equivalents		$	3,895			$	4,653			$	8,182
Total current assets			8,994				12,777				14,114
Total assets			157,419				177,448				141,421
Total current liabilities			20,320				29,958				28,105
Long-term debt and deferred rent			188,017				178,049				123,056
Total liabilities			263,979				271,369				201,119
Accumulated deficit			(140,715	)			(118,290	)			(84,067	)
Total members’/stockholders’ deficit			(106,560	)			(93,921	)			(59,698	)
Total liabilities and members’/stockholders’ deficit			157,419				177,448				141,421

____________

(1)      For more information as to how we define and calculate EBITDA, Adjusted EBITDA and Store-level EBITDA and why we believe such measures are appropriate measures of operating performance, see “Non-GAAP Financial Measures.”

The following is a reconciliation of EBITDA, Adjusted EBITDA and Store-Level EBITDA to net loss for each of the periods indicated:

$ in thousands

		Six Months Ended								Year Ended								Pro Forma
		June 30, 2017				June 30, 2016				December 31, 2016				December 31, 2015				Six Months Ended June 30, 2017				Year Ended December 31, 2016
Net loss		$	(22,425	)		$	(13,715	)		$	(34,223	)		$	(24,729	)		$	(23,989	)		$	(36,072	)
Plus:
Interest expense			7,782				5,259				10,718				7,891				6,937				9,139
Income tax expense			43				30				87				61				43				87
Depreciation and amortization expense			9,570				7,232				16,019				11,819				9,570				16,019
EBITDA			(5,029	)			(1,193	)			(7,399	)			(4,958	)			(7,439	)			(10,827	)
Plus:
Pre-opening expenses(1)			1,632				870				4,395				3,666				1,632				4,395
Other income(2)			(5	)			—				—				—				(5	)			—
Impairment of property and equipment(3)			3,332				—				—				—				3,332				—
Loss on disposal of property and equipment(4)			8				60				88				211				8				88
Non-recurring charges(5)			—				—				3,848				—				—				3,848
Stock-based compensation expense(6)			—				—				—				—				2,409				3,429
Adjusted EBITDA			(62	)			(263	)			932				(1,081	)			(62	)			932
Plus:
General and administrative expense(7)			7,011				5,842				14,220				12,471				7,011				14,220
Store-Level EBITDA		$	6,949			$	5,579			$	15,152			$	11,390			$	6,949			$	15,152

____________

(1)      “Pre-opening expenses” shall mean all expenses incurred in preparation of an iPic location opening, to the extent not capitalized nor amortized in accordance with GAAP.

(2)      “Other income” consists of a loss incurred on the disposition of certain fixed assets.

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(3)      “Impairment of property and equipment” represents an impairment charge incurred at the Scottsdale, AZ location after evaluating the ongoing value of property and equipment at this location.

(4)      “Loss on disposal of property and equipment” represents the loss incurred on the disposition of certain obsolete property and equipment

(5)      “Non-recurring charges” represents expenses incurred in connection with a litigation matter that was settled in 2016.

(6)      “Stock-based compensation expense” is a non-cash charge in the amount of the expense associated with equity awards given to employees as part of their compensation package, taken over the vesting period of the equity awards.

(7)      When calculating Store-Level EBITDA, “general and administrative expense” is added back to Adjusted EBITDA, as corporate overhead expenses are not allocated to our locations.

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