DCIN (MM)

The attached proxy statement/prospectus is dated July 7, 2014 and is first being mailed to Digiplex stockholders on or about July 14, 2014.

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ABOUT THIS PROXY STATEMENT/PROSPECTUS

This document, which forms part of a registration statement on Form S-4 filed with the Securities and Exchange Commission by Carmike (File No. 333-196905), constitutes a prospectus of Carmike under Section 5 of the Securities Act of 1933, as amended with respect to the Carmike common stock to be issued to Digiplex stockholders pursuant to the merger agreement. This document also constitutes a proxy statement of Digiplex under Section 14(a) of the Securities Exchange Act of 1934, as amended. It also constitutes a notice of meeting with respect to the special meeting of Digiplex stockholders, at which Digiplex’s stockholders will be asked to consider and vote upon the proposal to approve and adopt the merger agreement.

Carmike has supplied all information contained or incorporated by reference in this proxy statement/prospectus relating to Carmike, and Digiplex has supplied all such information relating to Digiplex. Carmike and Digiplex have not authorized anyone to provide you with information that is different from what is contained in this proxy statement/prospectus.

You should rely only on the information contained in or incorporated by reference into this proxy statement/prospectus. No one has been authorized to provide you with information that is different from that contained in or incorporated by reference into this proxy statement/prospectus. This proxy statement/prospectus is dated July 7, 2014. You should not assume that the information contained in this proxy statement/prospectus is accurate as of any date other than that date. You should not assume that the information incorporated by reference into this proxy statement/prospectus is accurate as of any date other than the date of the incorporated document. Neither the mailing of this proxy statement/prospectus to Digiplex stockholders nor the issuance by Carmike of shares of common stock pursuant to the merger will create any implication to the contrary.

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Digital Cinema Destinations Corp.

250 East Broad Street

Westfield, New Jersey 07090

Notice of Special Meeting of Stockholders

Time: 2:00 p.m. (Eastern Time) on August 13, 2014

Place: The Rialto Theater, 250 East Broad Street, Westfield, New Jersey 07090.

Purposes:

1. To consider and vote on a proposal to approve and adopt the Agreement and Plan of Merger, dated as of May 15, 2014, as it may be amended from time to time, by and among Digital Cinema Destinations Corp, a Delaware corporation, Carmike Cinemas, Inc., a Delaware corporation, and Badlands Acquisition Corporation, a Delaware corporation, which is referred to as the “merger agreement” and a copy of which is attached as Annex A to the proxy statement/prospectus accompanying this notice.

2. To consider and vote upon a proposal to approve, on an advisory (non-binding) basis, the “golden parachute” compensation payments that will or may be paid by Digiplex to its named executive officers in connection with the merger.

3. To consider and vote upon a proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of the approval and adoption of the merger agreement.

This proxy statement/prospectus, including the annexes, contains further information with respect to the business to be transacted at the Digiplex special meeting. Digiplex will transact no other business at the special meeting except such business as may properly be brought before the special meeting or any adjournments thereof. Please refer to the proxy statement/prospectus of which this notice forms a part for further information with respect to the business to be transacted at the special meeting.

Record Date:

Only holders of record of Digiplex Class A common stock and Class B common stock at the close of business on July 2, 2014, which we refer to as the “record date”, are entitled to vote at the special meeting. As of the record date there were 7,214,076 shares of Digiplex Class A common stock outstanding and 849,000 shares of Digiplex Class B common stock outstanding. Each holder of shares of Digiplex Class A common stock is entitled to one vote for each share of Class A common stock held as of the record date, and each holder of shares of Digiplex Class B common stock is entitled to ten votes for each share of Class B common stock held as of the record date.

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Vote Required for Approval:

A majority of the voting power of the outstanding shares of Digiplex Class A common stock and Class B common stock, voting together as a single class, must be voted in favor of the approval and adoption of the merger agreement in order for the merger to be completed. Your vote is very important, regardless of the number of Digiplex shares you own, and a failure to vote your shares has the same effect as voting against the approval and adoption of the merger agreement.

All holders of Digiplex Class A common stock and Class B common stock are cordially invited to attend the special meeting in person. However, to assure your representation at the special meeting, please submit your proxy as promptly as possible by filling in the accompanying proxy card and returning it in the enclosed pre-addressed postage-paid envelope or by following the instructions on the proxy card to vote by telephone or Internet. The presence of a majority of the shares entitled to vote, present in person or represented by proxy, will constitute a quorum at the special meeting of stockholders.

Board of Directors’ Recommendation:

A special committee of Digiplex’s Board of Directors, consisting entirely of independent directors, has unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable and fair to and in the best interest of Digiplex and its stockholders and has recommended to the full Board of Directors of Digiplex that the full Board of Directors of Digiplex approve, adopt and authorize the merger, the merger agreement and the other transactions contemplated thereby.

The Digiplex Board of Directors, after considering various factors and with the unanimous recommendation of the special committee, has unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable and fair to and in the best interest of Digiplex and its stockholders. The Digiplex Board of Directors recommends that you vote FOR the approval and adoption of the merger agreement, FOR the advisory “golden parachute” compensation proposal and FOR the adjournment of the special meeting, if necessary, to solicit additional proxies.

Whether or not you plan to attend the special meeting, please promptly complete and return your proxy card in the enclosed envelope, or authorize the individuals named on your proxy card to vote your shares by calling the toll–free telephone number or by using the Internet as described in the instructions included with your proxy card.

By order of the Board of Directors,

/s/ A. Dale Mayo

A. Dale Mayo

Chairman and Chief Executive Officer

Westfield, New Jersey

Date: July 7, 2014

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SOURCES OF ADDITIONAL INFORMATION

This proxy statement/prospectus incorporates important business and financial information about Carmike from documents that are not included in or delivered with this proxy statement/prospectus. Documents relating to Carmike which are incorporated by reference are available from Carmike without charge. For a more detailed description of the information incorporated by reference into this proxy statement/prospectus, see “Where You Can Find More Information” on page 154.

Carmike will provide you with copies of such documents relating to Carmike without charge, following a request in writing or by telephone at the following address and telephone number:

Carmike Cinemas, Inc.

1301 First Avenue

Columbus, Georgia 31901

Attention: Investor Relations

(706) 576-3400

In addition, if you have any questions about the special meeting, the merger or this proxy statement/prospectus or need additional copies of this proxy statement/prospectus or need to obtain proxy cards or any other information relating to the proxy solicitation, please send your request in writing or by telephone to the following address and telephone number:

Digital Cinema Destinations Corp.

250 East Broad Street

Westfield, New Jersey 07090

Attention: Corporate Secretary

(908) 396-1360

If you would like to request documents, please do so before August 6, 2014, in order to receive them before the Digiplex special meeting.

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QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE MATTERS TO BE ADDRESSED AT THE DIGIPLEX SPECIAL MEETING

The following questions and answers are intended to address briefly some commonly asked questions regarding the merger and the matters to be addressed at the Digiplex special meeting. These questions and answers may not address all questions that may be important to you as a Digiplex stockholder. To better understand these matters, and for a description of the legal terms governing the merger, you should carefully read this entire proxy statement/prospectus, including the attached annexes, as well as the documents that have been incorporated by reference in this proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 154.

All references in this proxy statement/prospectus to “Carmike” refer to Carmike Cinemas, Inc., a Delaware corporation; all references in this proxy statement/prospectus to “Digiplex” refer to Digital Cinema Destinations Corp., a Delaware corporation; unless otherwise indicated or as the context requires, all references in this proxy statement/prospectus to “we” refer to Carmike and Digiplex collectively; all references in this proxy statement/prospectus to “Merger Sub” refer to Badlands Acquisition Corporation, a Delaware corporation and a wholly owned subsidiary of Carmike; and all references to the “merger agreement” refer to the Agreement and Plan of Merger, dated as of May 15, 2014, as it may be amended from time to time, by and among Digiplex, Carmike and Merger Sub, a copy of which is attached as Annex A to this proxy statement/prospectus.

Q: WHY AM I RECEIVING THIS PROXY STATEMENT/PROSPECTUS?

A: Carmike has agreed to acquire Digiplex under the terms of the merger agreement that is described in this proxy statement/prospectus. As a result, assuming the conditions to closing under the merger agreement are satisfied or waived, Merger Sub, a wholly owned subsidiary of Carmike, will be merged with and into Digiplex, with Digiplex continuing as the surviving corporation and a wholly owned subsidiary of Carmike.

Digiplex is holding a special meeting of stockholders, which we refer to as the “special meeting”, in order to obtain the stockholder approval necessary to approve and adopt the merger agreement.

At the special meeting, Digiplex stockholders will also be asked to approve, on an advisory (non-binding) basis, the “golden parachute” compensation payments that will or may be paid by Digiplex to its named executive officers in connection with the merger, referred to as the “‘golden parachute’ compensation proposal”, and to approve the adjournment of the special meeting, if necessary, to solicit additional proxies if there are insufficient votes to approve and adopt the merger agreement at the time of the special meeting, referred to as the “adjournment proposal”.

Carmike and Digiplex will be unable to complete the merger unless the Digiplex stockholder approval is obtained at the special meeting and the other conditions to completion of the merger set forth in the merger agreement are satisfied or waived. Neither the approval of the proposal to adjourn the special meeting, if necessary, nor the approval of the “golden parachute” compensation proposal is a condition to the obligations of Carmike and Digiplex to complete the merger.

We have included in this proxy statement/prospectus important information about the merger, the merger agreement (a copy of which is attached as Annex A), and the special meeting. You should read this information carefully and in its entirety. The enclosed voting materials allow you to vote your shares without attending the special meeting in person.

Q: WHAT WILL DIGIPLEX STOCKHOLDERS RECEIVE IN THE MERGER?

A: Upon completion of the merger, each issued and outstanding share of Digiplex Class A common stock and Class B common stock, except for any shares owned by Carmike, Merger Sub, Digiplex or any of their respective subsidiaries, will be converted into the right to receive 0.1775 shares of Carmike common stock, referred to as

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the “exchange ratio”, subject to potential reduction. For a description of potential adjustments to the exchange ratio, including an adjustment known as of the date of this proxy statement/prospectus, see “The Merger Agreement—Consideration to be Received in the Merger—Pipeline Transactions” on page 104. You will receive cash in lieu of any fractional shares of Carmike common stock that you would otherwise be entitled to receive under the merger agreement.

The market price of Carmike common stock will continue to fluctuate following the date of the special meeting on the merger proposal. Consequently, at the time of the special meeting, the value of the Carmike common stock Digiplex stockholders are entitled to receive under the merger agreement at the closing of the merger will not yet be determined. In addition, it is impossible to accurately predict the market price of Carmike common stock at the effective time of the merger and therefore impossible to accurately predict the value of the stock consideration that Digiplex stockholders will be delivered in the merger.

For a more detailed description of the consideration you will receive in the merger, including the potential reduction to the exchange ratio, see “The Merger Agreement—Consideration to be Received in the Merger” beginning on page 104.

Q: HOW WILL DIGIPLEX RESTRICTED STOCK UNITS BE TREATED IN THE MERGER?

A: Upon completion of the merger, each outstanding Digiplex restricted stock unit, whether or not vested, will be cancelled automatically, and the holder of any such restricted stock unit award will receive the number of shares of Carmike common stock equal to the product of the exchange ratio and the number of restricted stock units awarded under such restricted stock unit award subject to certain applicable tax withholdings.

For a more detailed description of the treatment of Digiplex restricted stock units in the merger, see “The Merger Agreement—Treatment of Digiplex Restricted Stock Unit Awards” beginning on page 105.

Q: HOW WAS THE MERGER CONSIDERATION TO BE PAID TO HOLDERS OF DIGIPLEX COMMON STOCK DETERMINED?

A: The merger consideration was determined as a result of arm’s length negotiations between the special committee of the Digiplex Board of Directors, which we refer to as the “special committee”, the Digiplex Board of Directors and Digiplex management, on the one hand, and the Carmike Board of Directors and Carmike management, on the other hand.

See “The Merger—Background of the Merger” beginning on page 75.

Q: WHAT WILL HAPPEN TO DIGIPLEX AS A RESULT OF THE MERGER?

A: If the merger is completed, Merger Sub will be merged with and into Digiplex, with Digiplex continuing as the surviving corporation and a wholly owned subsidiary of Carmike.

Q: WHY DID THE DIGIPLEX BOARD APPROVE THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING THE MERGER?

A: To review the Digiplex Board of Directors’ reasons for recommending and approving the merger agreement and the transactions contemplated by the merger agreement, including the merger, see “The Merger—Digiplex Board of Directors’ Recommendation” beginning on page 85.

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Q: HOW DOES THE DIGIPLEX BOARD RECOMMEND VOTING WITH RESPECT TO THE APPROVAL AND ADOPTION OF THE MERGER AGREEMENT, THE ADVISORY “GOLDEN PARACHUTE” COMPENSATION PROPOSAL, AND THE ADJOURNMENT PROPOSAL?

A: The Digiplex Board of Directors, after considering various factors and with the unanimous recommendation of the special committee, has unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable and fair to and in the best interest of Digiplex and its stockholders, and unanimously recommends that you vote FOR the proposal to approve and adopt the merger agreement.

The Digiplex Board of Directors also unanimously recommends that Digiplex stockholders vote FOR the advisory “golden parachute” compensation proposal and FOR the adjournment proposal.

See “The Merger—Digiplex Board of Directors’ Recommendation” beginning on page 85.

Q: WHAT EQUITY STAKE WILL DIGIPLEX STOCKHOLDERS HOLD IN CARMIKE IMMEDIATELY FOLLOWING THE MERGER?

A: Based on the number of shares of Carmike common stock and Digiplex Class A common stock and Class B common stock expected to be issued and outstanding as of the closing of the merger, and assuming an exchange ratio of 0.1775 shares of Carmike common stock, holders of shares of Digiplex common stock as of immediately prior to the closing of the merger will hold approximately 6% in the aggregate, of the issued and outstanding shares of Carmike common stock immediately following the closing of the merger, as determined on a fully-diluted basis.

Q: WHAT CONDITIONS MUST BE SATISFIED TO COMPLETE THE MERGER?

A: Neither Carmike nor Digiplex is required to complete the merger unless a number of conditions to closing of the merger as set out in the merger agreement are either satisfied or waived, including (a) Digiplex stockholder approval and adoption of the merger agreement, (b) the authorization for listing on The NASDAQ Stock Market of the shares of Carmike common stock issuable in connection with the merger, (c) the receipt of a notice of effectiveness from the Securities and Exchange Commission, which we refer to as the “SEC”, with respect to the registration statement on Form S-4 of which this proxy statement/prospectus is a part, (d) the receipt of any required governmental approvals, and (e) the absence of any governmental statute, rule, executive order or regulation which prohibits the completion of the merger or any order or injunction preventing the completion of the merger.

Completion of the merger is also dependent upon the accuracy of the representations and warranties of the parties (subject to certain exceptions and materiality standards), material compliance of the parties with their obligations under the merger agreement, and delivery of a customary opinion from each party’s counsel that the merger will qualify as a tax-free reorganization for federal income tax purposes.

Carmike’s obligation to complete the merger is also conditioned on, among other things, (i) the redemption by Digiplex of all outstanding shares of Digiplex’s Series B preferred stock, (ii) Carmike’s acquisition of the entire ownership interest held by Digiplex’s joint venture partner in Start Media/Digiplex, LLC, (iii) the absence of any material security breach at Digiplex or its subsidiaries, (iv) the receipt of certain third party consents, (v) the cancellation or termination of certain third party agreements, (vi) the absence of a material adverse change to the net debt and working capital amounts set forth in Digiplex’s balance sheet dated December 31, 2013, and (vii) the termination of, and taking of certain corrective actions with respect to, Digiplex’s 401(k) plan.

Q: WHEN DO YOU EXPECT THE MERGER TO BE COMPLETED?

A: Carmike and Digiplex are working to complete the merger as quickly as possible, and we anticipate that the merger will be completed during the third quarter of 2014. However, the merger is subject to various conditions

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which are described in more detail in this proxy statement/prospectus, and it is possible that factors outside the control of both companies could result in the merger being completed at a later time, or not at all. See “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 111.

Q: WHAT HAPPENS IF THE MERGER IS NOT COMPLETED?

A: If the merger is not completed, Digiplex stockholders will not receive any consideration for their shares of Digiplex Class A common stock or Class B common stock in connection with the merger. Instead, Digiplex will remain an independent public company, and the Digiplex Class A common stock will continue to be listed and traded on The NASDAQ Capital Market. Under specified circumstances, Digiplex may be required to pay Carmike a termination fee of $1,228,935 or an amount equal to Carmike’s transaction expenses (up to a specified cap in certain circumstances) if the merger agreement is terminated because Digiplex decides to pursue another acquisition transaction. For further discussion of the termination rights and these fees and expense reimbursement provisions, see “The Merger Agreement—Termination” beginning on page 115 and “The Merger Agreement—Termination Fees” beginning on page 116.

Q: WHAT ARE THE MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER TO DIGIPLEX STOCKHOLDERS?

A: The closing of the merger is conditioned upon the receipt by each of Carmike and Digiplex of an opinion from its respective tax counsel that the merger will constitute a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the “Code” for United States federal income tax purposes and that Digiplex, Carmike and Merger Sub will each be a party to that reorganization within the meaning of Section 368(b) of the Code for such purposes.

Assuming the merger constitutes a reorganization, subject to the limitations and qualifications described in “The Merger—United States Federal Income Tax Consequences of the Merger,” Digiplex stockholders will not recognize gain or loss for United States federal income tax purposes on the exchange of shares of Digiplex common stock for shares of Carmike common stock (except to the extent they receive cash in lieu of a fractional share of Carmike common stock).

For a more detailed discussion of the material United States federal income tax consequences of the transaction, see “The Merger—United States Federal Income Tax Consequences of the Merger” beginning on page 101.

The tax consequences of the merger for any particular Digiplex stockholder will depend on that stockholder’s particular facts and circumstances. Accordingly, Digiplex stockholders are urged to consult their tax advisors to determine the tax consequences of the merger to them, including estate, gift, state, local or non-United States tax consequences of the merger.

Q: ARE DIGIPLEX STOCKHOLDERS ENTITLED TO APPRAISAL RIGHTS?

A: No. Under Delaware law, Digiplex stockholders are not entitled to exercise appraisal rights in connection with the merger.

Q: WHAT DO I NEED TO DO NOW?

A: Carefully read and consider the information contained in and incorporated by reference into this proxy statement/prospectus, including its annexes. Whether or not you expect to attend the special meeting in person, please submit a proxy to vote your shares as promptly as possible so that your shares may be represented and voted at the special meeting.

Your vote is very important, regardless of the number of shares you own, and we encourage you to vote your shares promptly.

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Q: WHEN AND WHERE WILL DIGIPLEX STOCKHOLDERS MEET?

A: Digiplex will hold a special meeting of its stockholders on August 13, 2014, at the Rialto Theater, 250 East Broad Street, Westfield, New Jersey 07090, at 2:00 p.m. Eastern Time.

For more details of the special meeting of stockholders see “Information about the Special Meeting of Digiplex Stockholders” beginning on page 120.

Q: WHO IS ENTITLED TO VOTE AT THE SPECIAL MEETING?

A: The record date for the special meeting is July 2, 2014. Only Digiplex stockholders of record at the close of business on that date are entitled to attend and vote at the special meeting or any adjournment thereof. The only classes of stock that can be voted at the meeting are Digiplex Class A common stock and Class B common stock.

Q: WHO MAY ATTEND THE SPECIAL MEETING?

A: Digiplex stockholders of record as of the close of business on July 2, 2014, or their duly appointed proxies, may attend the meeting. “Street name” holders (those whose shares are held through a broker, bank or other nominee) should bring a copy of an account statement reflecting their ownership of Digiplex common stock as of the record date. If you are a “street name” holder and you wish to vote at the special meeting, you must also bring a proxy from the record holder (your broker, bank or other nominee) of the shares of Digiplex common stock authorizing you to vote at the special meeting. We intend to limit attendance to stockholders as of the record date. All stockholders should bring photo identification. Cameras, recording devices, and other electronic devices are not permitted at the special meeting. Registration will begin at 1:00 p.m., Eastern Time.

Q: HOW MANY VOTES DO I HAVE?

A: Each holder of shares of Digiplex Class A common stock is entitled to one vote for each share of Class A common stock held as of the record date, and each holder of shares of Digiplex Class B common stock is entitled to ten votes for each share of Class B common stock held as of the record date. As of the record date there were 7,214,076 shares of Digiplex Class A common stock outstanding and 849,000 shares of Digiplex Class B common stock outstanding.

Q: HOW MANY VOTES MUST BE REPRESENTED IN PERSON OR BY PROXY AT THE SPECIAL MEETING TO HAVE A QUORUM?

A: The presence of a majority of the shares entitled to vote, present in person or represented by proxy, will constitute a quorum at the special meeting of stockholders.

Q: HOW DO I VOTE IF MY SHARES ARE REGISTERED DIRECTLY IN MY NAME?

A: If you own shares of Digiplex common stock in your own name, you are an “owner of record.” This means that you may use the enclosed proxy card to tell the persons named as proxies how to vote your shares of Digiplex common stock. If you fail to vote, the proxies cannot vote your shares of Digiplex common stock at the Digiplex special meeting. If you are an owner of record then you have four voting options:

1. Internet . You can vote over the Internet by accessing the website at www.proxyvote.com and following the instructions on the website. Internet voting is available 24 hours a day. If you vote over the Internet, do not return your proxy card.

2. Telephone . You can vote by telephone by calling the toll-free number 1-800-690-6903 in the United States, Canada or Puerto Rico on a touch-tone phone. You will then be prompted to enter the control number printed on your proxy card and to follow the subsequent instructions. Telephone voting is available 24 hours a day. If you vote by telephone, do not return your proxy card.

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3. Mail . You can vote by mail by simply completing, signing, dating and mailing your proxy card in the postage-paid envelope included with this proxy statement/prospectus.

4. In Person . You may come to the Digiplex special meeting and cast your vote there. The Digiplex Board of Directors recommends that you vote by proxy even if you plan to attend the Digiplex special meeting. “Street name” holders (those whose shares are held through a broker, bank or other nominee) should bring a copy of an account statement reflecting their ownership of Digiplex common stock as of the record date. If you are a “street name” holder and you wish to vote at the special meeting, you must also bring a proxy from the record holder (your broker, bank or other nominee) of the shares of Digiplex common stock authorizing you to vote at the special meeting

Digiplex requests that Digiplex stockholders complete and sign the accompanying proxy and return it to Digiplex as soon as possible in the enclosed postage–paid envelope. When the accompanying proxy is returned properly executed, the shares of Digiplex stock represented by it will be voted at the special meeting in accordance with the instructions contained on the proxy card.

Q: HOW DO I VOTE IF MY SHARES ARE HELD IN THE NAME OF MY BROKER (STREET NAME)?

A: If your shares are held by your broker, bank or other nominee, often referred to as held in “street name,” you will receive a form from your broker, bank or other nominee seeking instruction as to how your shares should be voted. You should contact your broker, bank or other nominee with questions about how to provide or revoke your instructions.

Q: WHAT VOTE IS REQUIRED TO APPROVE AND ADOPT THE MERGER AGREEMENT?

A: Approval and adoption of the merger agreement will require the affirmative vote of a majority of the voting power of the outstanding shares of Digiplex Class A common stock and Class B common stock, voting together as a single class.

Q: WHAT VOTE IS REQUIRED TO APPROVE THE “GOLDEN PARACHUTE” COMPENSATION PROPOSAL?

A: Approval, on an advisory (non-binding) basis, of the “golden parachute” compensation proposal requires affirmative vote of a majority of the voting power of the Digiplex Class A common stock and Class B common stock present in person or represented by proxy at the special meeting.

Q: WHAT VOTE IS REQUIRED TO APPROVE THE ADJOURNMENT PROPOSAL?

A: Approval of the adjournment proposal requires the affirmative vote of a majority of the voting power of the Digiplex Class A common stock and Class B common stock present in person or represented by proxy at the special meeting.

Q: WHAT IS “GOLDEN PARACHUTE” COMPENSATION AND WHY AM I BEING ASKED TO VOTE ON IT?

A: The SEC has adopted rules that require Digiplex to seek an advisory (non-binding) vote on “golden parachute” compensation. “Golden parachute” compensation is certain compensation that is tied to or based on the merger and that will or may be paid by Digiplex to its named executive officers in connection with the merger.

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Q: WHAT HAPPENS IF THE “GOLDEN PARACHUTE” COMPENSATION PROPOSAL IS NOT APPROVED?

A: Approval of the “golden parachute” compensation proposal is not a condition to completion of the merger. The vote is an advisory vote and is not binding. If the merger is completed, Digiplex may pay “golden parachute” compensation to its named executive officers in connection with the merger even if Digiplex stockholders fail to approve the “golden parachute” compensation proposal.

Q: HAVE ANY STOCKHOLDERS ALREADY AGREED TO ADOPT AND APPROVE THE MERGER AGREEMENT?

A: Yes. Carmike has entered into a voting agreement, which is attached as Annex B to this proxy statement/prospectus, with A. Dale Mayo, Digiplex’s Chairman and Chief Executive Officer, who holds shares of Digiplex Class A and Class B common stock representing approximately 54% of the outstanding voting power of Digiplex. Pursuant to this voting agreement, Mr. Mayo agreed, among other things, to vote a portion of his shares equal to 39.5% of the outstanding voting power of Digiplex FOR the adoption and approval of the merger agreement and the other transactions contemplated by the merger agreement and against, among other things, alternative business combination transactions. In the event that Digiplex’s Board of Directors changes its recommendation that Digiplex’s stockholders adopt the merger agreement, Mr. Mayo will only be required to vote shares representing 33% of the outstanding voting power in favor of such matters.

In addition, pursuant to the voting agreement, Mr. Mayo has agreed to vote a portion of his shares equal to 39.5% of the outstanding voting power of Digiplex FOR the advisory “golden parachute” compensation proposal and FOR the adjournment proposal.

For more details of the voting agreement see “The Merger—Voting Agreement” beginning on page 97.

Q: WHAT IF I ABSTAIN FROM VOTING?

A: If you attend the special meeting or send in your signed proxy card, but abstain from voting on any proposal, your shares will still be counted for purposes of determining whether a quorum exists. If you abstain from voting on any proposal at the special meeting, it will have the same effect as a vote AGAINST such proposals.

Q: WILL MY SHARES BE VOTED IF I DO NOT SIGN AND RETURN MY PROXY CARD OR VOTE OVER THE INTERNET, BY TELEPHONE OR IN PERSON?

A: If you are a registered stockholder and do not sign and return your proxy card or vote over the Internet, by telephone or in person, your shares will not be voted at the special meeting and will not be counted for purposes of determining whether a quorum exists.

If your shares are held in “street name” and you do not issue instructions to your broker, bank or other nominee, your broker, bank or other nominee may vote your shares at its discretion on routine matters, but may not vote your shares on non-routine matters. All of the proposals in this proxy statement/prospectus are non-routine matters. Accordingly, if your shares are held in “street name” and you do not issue instructions to your broker, bank or other nominee, your shares will not be voted at the special meeting and will not be counted for purposes of determining whether a quorum exists.

If you fail to complete, sign, date and return your proxy card by mail, or vote via the Internet, by telephone or in person, it will have the same effect as a vote AGAINST the proposal to approve and adopt the merger agreement, but will have no effect on the other proposals.

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Q: CAN I CHANGE MY VOTE AFTER I SUBMIT MY PROXY?

A: Yes. You may change your vote at any time before your proxy is voted at the Digiplex special meeting of stockholders. You may do this in one of four ways:

1. By sending a notice of revocation to the Digiplex Corporate Secretary, dated as of a later date than the date of the proxy and received prior to the special meeting;

2. By sending a completed proxy card bearing a later date than your original proxy card and mailing it so that it is received prior to the special meeting;

3. By logging on to the Internet website specified on your proxy card in the same manner you would to submit your proxy electronically or by calling the telephone number specified on your proxy card, in each case if you are eligible to do so and following the instructions on the proxy card; or

4. By attending the special meeting of stockholders and voting in person.

Your attendance alone will not revoke any proxy.

Written notices of revocation and other communications about revoking Digiplex proxies should be addressed to:

Digital Cinema Destinations Corp.

250 East Broad Street

Westfield, New Jersey 07090

Attention: Corporate Secretary

(908) 396-1360

If your shares are held in street name, you should follow the instructions of your broker regarding the revocation of proxies.

Once voting on a particular matter is completed at the Digiplex special meeting, a Digiplex stockholder will not be able to revoke its proxy or change its vote as to that matter.

Q: DO I NEED TO DO ANYTHING WITH MY DIGIPLEX COMMON STOCK CERTIFICATES NOW? SHOULD I SEND IN MY STOCK CERTIFICATES WITH MY PROXY CARD?

A: No. After the merger is completed, if you hold certificates representing shares of Digiplex common stock, the exchange agent for the merger will send you a letter of transmittal and instructions for exchanging your shares of Digiplex common stock for the merger consideration. Upon surrender of the certificates along with the executed letter of transmittal and other required documents described in the instructions or otherwise required by the exchange agent in accordance with the merger agreement, you will receive the shares of Carmike common stock contemplated by the merger agreement.

Q: WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE SET OF PROXY MATERIALS?

A: This means you own shares of Digiplex common stock that are registered under different names or are in more than one account. For example, you may own some shares directly as a stockholder of record and other shares through a broker or you may own shares through more than one broker. In these situations, you will receive multiple sets of proxy materials. You must vote, sign and return all of the proxy cards or follow the instructions for any alternative voting procedure on each of the proxy cards that you receive in order to vote all of the shares you own. Each proxy card you receive comes with its own prepaid return envelope. If you submit your proxy by mail, make sure you return each proxy card in the return envelope that accompanies that proxy card.

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Q: WHO WILL COUNT THE VOTES?

A: A representative from Broadridge Investor Communication Solutions Inc. will serve as the inspector of election.

Q: CAN I PARTICIPATE IF I AM UNABLE TO ATTEND THE SPECIAL MEETING?

A: If you are unable to attend the meeting in person, we encourage you to complete, sign, date and return your proxy card or to vote over the Internet or by telephone. The special meeting will not be broadcast telephonically or over the Internet.

Q: WHERE CAN I FIND THE VOTING RESULTS OF THE SPECIAL MEETING?

A: Digiplex intends to announce preliminary voting results at the special meeting and publish final results in a Current Report on Form 8-K that will be filed with the SEC following the special meeting. All reports that Digiplex files with the SEC are publicly available when filed.

Q: ARE THERE ANY RISKS THAT I SHOULD CONSIDER IN DECIDING WHETHER TO VOTE FOR APPROVAL OF THE MERGER?

A: Yes. You should read and carefully consider the risk factors set forth in the section of this proxy statement/prospectus entitled “Risk Factors” beginning on page 30. You also should read and carefully consider the risk factors of Carmike which are incorporated by reference into this proxy statement/prospectus. See “Risk Factors—Risks Relating to the Merger” beginning on page 30 and “Where You Can Find More Information” beginning on page 154 and the risk factors of Digiplex set forth in the section entitled “Risk Factors—Risks Relating to Digiplex’s Business” beginning on page 49.

Q: IS CONSUMMATION OF THE MERGER CONTINGENT UPON APPROVAL BY THE HOLDERS OF CARMIKE STOCK?

A: No. A vote of holders of Carmike’s capital stock is not required to approve the merger.

Q: WHAT HAPPENS IF I SELL MY SHARES OF DIGIPLEX COMMON STOCK BEFORE THE SPECIAL MEETING?

A: The record date is earlier than both the date of the special meeting and the anticipated effective date of the merger. If you transfer your shares of Digiplex common stock after the record date but before the special meeting, you will, unless the transferee requests a proxy, retain your right to vote at the special meeting but will transfer the right to receive the merger consideration to the person to whom you transfer your shares. In order to receive the merger consideration, Digiplex stockholders must hold their shares through the effective date of the merger.

Q: IF THE MERGER IS COMPLETED, WHEN CAN I EXPECT TO RECEIVE THE MERGER CONSIDERATION FOR MY SHARES OF DIGIPLEX COMMON STOCK?

A: When you can expect to receive the merger consideration for your shares of Digiplex common stock will depend on whether your shares are certificated shares or book-entry shares.

1. Book-Entry Shares : Each holder of record of one or more book-entry shares of Digiplex common stock whose shares will be converted into the right to receive the merger consideration will automatically, upon the effective date of the merger, be entitled to receive, and Carmike will cause the exchange agent to deliver to such holder as promptly as practicable after the effective date of the merger, the merger consideration to which such holder is entitled under the merger agreement. Holders of book-entry shares will not be required to deliver a certificate or an executed letter of transmittal to the exchange agent in order to receive the merger consideration. See “The Merger Agreement—Procedures for Exchange of Certificates” beginning on page 105.

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2. Certificated Shares : As soon as practicable after the effective date of the merger, Carmike will cause the exchange agent to mail to each holder of certificated shares of Digiplex common stock a letter of transmittal and instructions for use in effecting the exchange of Digiplex common stock for the merger consideration. After receiving the proper documentation (including the stock certificates) from a holder of Digiplex common stock, the exchange agent will deliver to such holder the merger consideration to which such holder is entitled under the merger agreement. More information on the documentation that a holder of Digiplex common stock is required to deliver to the exchange agent may be found under the section entitled “The Merger Agreement—Procedures for Exchange of Certificates” beginning on page 105.

Q: IF I AM A DIGIPLEX STOCKHOLDER, WHO CAN HELP ANSWER MY QUESTIONS?

A: If you have any questions about the merger or the special meeting, or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card, you should contact Digital Cinema Destinations Corp., 250 East Broad Street, Westfield, New Jersey 07090, (908) 396-1360.

Q: WHERE CAN I FIND MORE INFORMATION ABOUT CARMIKE AND DIGIPLEX?

A: You can find more information about Carmike and Digiplex from the various sources described under the section “Where You Can Find More Information” beginning on page 154.

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RISK FACTORS

By voting in favor of the proposal to approve and adopt the merger agreement and the transactions contemplated thereby, including the merger, Digiplex stockholders will be choosing to invest in Carmike common stock. An investment in Carmike common stock involves risk. In addition to the other information contained in or incorporated by reference into this proxy statement/prospectus, you should carefully consider the following risk factors in deciding whether to vote in favor of the proposal to approve and adopt the merger agreement. You should also carefully consider the risk factors of Carmike incorporated by reference into this proxy statement/prospectus, beginning on page 15 of Carmike’s Annual Report on Form 10-K for the year ended December 31, 2013 (see “Where You Can Find More Information” beginning on page 154) and the risk factors of Digiplex set forth in the section entitled “—Risks Relating to Digiplex’s Business” beginning on page 49. In addition to the risks set forth below, new risks may emerge from time to time and it is not possible to predict all risk factors, nor can Carmike or Digiplex assess the impact of all factors on the merger and the combined company following the merger or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in or implied by any forward-looking statements.

Risks Relating to the Merger

Because the market price of Carmike common stock will fluctuate, you cannot be sure of the market value of the Carmike common stock that you will receive in the merger.

Each share of Digiplex common stock you own will be converted into the right to receive 0.1775 shares of Carmike common stock, subject to potential downward adjustment. For a description of potential adjustments to the exchange ratio, including an adjustment known as the date of this proxy statement/prospectus, see “The Merger Agreement—Consideration to be Received in the Merger—Pipeline Transactions”. The price of Carmike common stock you receive may vary from the price of Carmike common stock on the date the merger was announced, and may differ on the date that this document is mailed to Digiplex stockholders and on the date of the meeting of Digiplex stockholders.

Stock price changes may result from a variety of factors, including general market and economic conditions, changes in the values and perceptions of companies in the movie exhibition industry generally, and changes in Carmike’s business, operations and prospects. Many of these factors are beyond Carmike’s control. Accordingly, at the time of the special meeting, you will not necessarily know or be able to calculate the exact value of the shares of Carmike common stock you will receive upon completion of the merger. It is impossible to accurately predict the market price of Carmike common stock at the effective time of the merger and therefore impossible to accurately predict the value of the stock consideration that Digiplex stockholders will be delivered in the merger.

The number of shares of Carmike common stock payable as consideration to Digiplex stockholders is subject to a potential downward adjustment and may not be finally determined until after Digiplex stockholders have voted on the merger.

The number of shares of Carmike common stock payable as consideration to Digiplex stockholders is subject to downward adjustment prior to the effective time of the merger if any Pipeline Transaction is terminated prior to the effective time of the merger or does not expressly provide pursuant to its terms for a closing date for the Pipeline Transactions at least forty-five days following the effective time of the merger. The maximum downward adjustment to the exchange ratio is equal to 0.014 in the aggregate.

For a more complete summary of this potential downward adjustment, see “The Merger Agreement—Consideration to be Received in the Merger—Pipeline Transactions” beginning on page 104.

On June 30, 2014 one of the pending Pipeline Transactions became a Terminated Pipeline Transaction. Based on the value assigned by Digiplex and Carmike at the time of the execution of the merger agreement, this resulted in a downward adjustment of the exchange ratio by 0.001, from 0.1775 to 0.1765.

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The issuance of Carmike common stock in connection with the merger could decrease the market price of Carmike common stock.

At the completion of the merger, Carmike expects to issue up to approximately 1.5 million shares of Carmike common stock, or approximately 6% of the number of shares of Carmike common stock outstanding as of the date of this proxy statement/prospectus, to Digiplex stockholders. The issuance of the Carmike common stock may result in fluctuations in the market price of Carmike common stock, including a stock price decline.

Closing of the merger is subject to many conditions, and if these conditions are not satisfied or waived the merger will not be completed.

Consummation of the merger is subject to a number of conditions as set forth in the merger agreement that must be satisfied or waived, including (a) the approval of Digiplex’s stockholders, (b) the authorization for listing on the NASDAQ of the shares of Carmike common stock issuable in connection with the merger, (c) the receipt of a notice of effectiveness from the SEC with respect to the registration statement on Form S-4 of which this proxy statement/prospectus is a part, (d) the expiration or termination of applicable waiting periods under the HSR Act, (e) the receipt of any required governmental approvals, and (f) the absence of any governmental statute, rule, executive order or regulation which prohibits the completion of the merger or any order or injunction preventing the completion of the merger.

Closing of the merger is also dependent upon the accuracy of the representations and warranties of the parties (subject to certain exceptions and materiality standards), material compliance of the parties with their obligations under the merger agreement, and delivery of a customary opinion from each party’s counsel that the merger will qualify as a tax-free reorganization for federal income tax purposes.

For a more complete summary of the conditions that must be satisfied or waived prior to completion of the merger, see “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 111.

There can be no assurance that the conditions to closing of the merger will be satisfied or waived or that the merger will be consummated.

Digiplex will be subject to business uncertainties and certain operating restrictions until consummation of the merger.

Uncertainty about the effect of the merger on employees and other Digiplex stakeholders may have an adverse effect on Digiplex and consequently on the combined company following the merger. These uncertainties could disrupt Digiplex’s business and cause suppliers, partners and stakeholders that deal with Digiplex to defer entering into contracts with Digiplex or making other decisions concerning Digiplex or seek to change or cancel existing business relationships with Digiplex. The uncertainty and difficulty of integration could also cause key employees of Digiplex to lose motivation or to leave their employment. In addition, the merger agreement restricts Digiplex from making certain acquisitions and taking other specified actions until the merger occurs without the consent of Carmike. These restrictions may prevent Digiplex from pursuing attractive business opportunities that may arise prior to the completion of the merger. Digiplex may also become subject to lawsuits and may be subject to adverse judgments related to the merger that may prevent the merger from being completed or from being completed within the expected timeframe. See “The Merger Agreement—Conduct of Business Pending the Merger” beginning on page 107 for a description of the restrictive covenants to which Digiplex is subject.

Failure to achieve expected benefits of the merger and integrate Digiplex’s operations with Carmike’s could adversely affect Carmike following the completion of the merger and the market price of Carmike common stock .

Although Carmike expects to realize strategic, operational and financial benefits as a result of the merger, Carmike cannot be certain whether, and to what extent, such benefits will be achieved in the future. In particular,

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the success of the merger will depend on achieving efficiencies and cost savings, and no assurances can be given that Carmike will be able to do so. In addition, in order to obtain the benefits of the merger, Carmike must integrate Digiplex’s operations and such integration may be complex and the failure to do so quickly and effectively may negatively affect Carmike’s earnings.

The market price of Carmike common stock may decline as a result of the merger if the integration of Carmike and Digiplex is unsuccessful, takes longer than expected or fails to achieve financial benefits to the extent anticipated by financial analysts or investors, or the effect of the merger on Carmike’s financial results is otherwise not consistent with the expectations of financial analysts or investors.

Carmike may be unable to retain Digiplex personnel successfully after the merger is completed.

The success of the merger will depend in part on Carmike’s ability to retain the talents and dedication of certain key professionals currently employed by Digiplex. It is possible that these employees might decide not to remain with Digiplex while the merger is pending or with the combined company after the merger is consummated. If key employees terminate their employment, or insufficient numbers of employees are retained to maintain effective operations, the combined company’s business activities might be adversely affected, management’s attention might be diverted from successfully integrating Digiplex’s operations to hiring suitable replacements, and the combined company’s business might suffer. In addition, Carmike and Digiplex might not be able to locate suitable replacements for any key employees that leave either company or offer employment to potential replacements on reasonable terms.

The merger agreement limits Digiplex’s ability to pursue alternatives to the merger.

The merger agreement contains provisions that limit Digiplex’s ability to discuss competing third-party proposals to acquire all or a significant part of Digiplex. In addition, Digiplex may be required to pay a termination fee of $1,228,935 or an amount equal to Carmike’s transaction expenses (up to a specified cap in certain circumstances) if the merger agreement is terminated because Digiplex decides to pursue another acquisition transaction. These provisions might discourage a potential competing acquiror that might have an interest in acquiring all or a significant part of Digiplex from considering or proposing that acquisition even if it were prepared to pay a higher per share market price than that proposed in the merger, or might result in a potential competing acquiror proposing to pay a lower per share price to acquire Digiplex than it might otherwise have proposed to pay.

Certain Digiplex directors and executive officers have interests in the merger that are different from, or in addition to, their interests as stockholders.

Digiplex executive officers and Carmike negotiated the terms of the merger agreement. The Digiplex and Carmike boards of directors approved the merger agreement and the Digiplex Board of Directors recommended that its stockholders vote to adopt the merger agreement. The Digiplex Board of Directors’ approval of the merger agreement was based in part on the recommendation of a special committee of the Digiplex Board of Directors, consisting of all the independent directors of Digiplex. In considering these facts and the other information in this proxy statement/prospectus, you should be aware that certain Digiplex directors and executive officers have interests in the merger other than their interests as stockholders. Each of the Digiplex Board of Directors and the special committee of the Digiplex Board of Directors was aware of these interests at the time it approved the merger. These interests may cause Digiplex’s directors and executive officers to view the merger proposal differently and more favorably than you may view it. See “The Merger—Interests of Digiplex’s Directors and Executive Officers in the Merger” beginning on page 97 for more information.

Digiplex stockholders will have a reduced ownership and voting interest after the merger and will exercise less influence over management.

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Carmike common stock will become a stockholder of Carmike with a percentage ownership in the combined company that is much smaller than the stockholder’s percentage ownership of Digiplex. In fact, it is expected that the former stockholders of Digiplex as a group will own approximately 6% of the outstanding shares of Carmike immediately after the merger. Because of this, Digiplex’s stockholders will have less influence on the management and policies of the combined company than they now have on the management and policies of Digiplex.

The shares of Carmike common stock to be received by Digiplex stockholders as a result of the merger will have different rights from the shares of Digiplex common stock.

Upon completion of the merger, Digiplex stockholders will become Carmike stockholders and their rights as stockholders will be governed by the certificate of incorporation and bylaws of Carmike. The rights associated with Digiplex common stock are different than the rights associated with Carmike common stock. See “Comparison of Rights of Carmike and Digiplex Stockholders” beginning on page 138.

The merger agreement may be terminated in accordance with its terms and the merger may not be consummated.

Either Carmike or Digiplex may terminate the merger agreement under certain circumstances, including, among other reasons, if the merger is not completed by the termination date (as defined in the merger agreement). In addition, if the merger agreement is terminated under certain circumstances specified in the merger agreement,

Digiplex may be required to pay a termination fee of $1,228,935 or an amount equal to Carmike’s transaction expenses (up to a specified cap in certain circumstances), including in the event Digiplex terminates the merger agreement to pursue another acquisition transaction. See “The Merger Agreement—Termination” beginning on page 115 for a more complete discussion of the circumstances under which the merger agreement could be terminated.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement/prospectus, including information included or incorporated by reference in this proxy statement/prospectus, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as “may,” “will,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target,” “forecast,” and other words and terms of similar meaning. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. Carmike and Digiplex caution readers that any forward-looking statement is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statement.

Such forward-looking statements include, but are not limited to, statements regarding:

With respect to these forward-looking statements, Carmike and Digiplex have made assumptions regarding, among other things:

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Further, Carmike and Digiplex’s businesses are subject to a number of general risks that would affect any such forward-looking statements including, among others:

Such risks and other factors that may impact management’s assumptions are more particularly described, with respect to Carmike, in Carmike’s filings with the SEC, including under the caption “Risk Factors” beginning on page 15 of Carmike’s Annual Report on Form 10-K for the year ended December 31, 2013, and, with respect to Digiplex, under the heading “Information about Digiplex—Risks Relating to Digiplex’s Business” in this proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 154 for a list of the documents incorporated by reference into this proxy statement/prospectus.

The information contained in this proxy statement/prospectus speaks as of the date hereof, or in the case of a document incorporated by reference, as of the date of that document, and neither Carmike nor Digiplex have or undertake any obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.

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INFORMATION ABOUT DIGIPLEX

Business

Digiplex

Digital Cinema Destinations Corp., which we refer to as “Digiplex”, was incorporated in Delaware on July 29, 2010 to own and operate businesses in the movie exhibition industry sector. At June 17, 2014, Digiplex operated 20 theaters with an aggregate of 194 screens. A chart of all these theaters appears under “Theater Operations.”

Before Digiplex’s initial public offering in April 2012, it operated three theaters with a total of 19 screens. Digiplex used a portion of the initial public offering proceeds to acquire five theaters (54 screens) in Pennsylvania. Thereafter, Digiplex acquired a 12-screen theater in Lisbon Connecticut with a portion of the proceeds of a secured debt financing and, in December, 2012, together with Start Media, LLC (“Start Media”), Digiplex formed a joint venture, Start Media/Digiplex, LLC (“JV”), a Delaware limited liability company, that has acquired assets of or assumed operating leases for an additional nine theaters with 92 screens.

Digiplex, both separately and through JV, operated 18 theaters with a total of 178 screens as of June 30, 2013, and 20 theaters with a total of 192 Digiplex’s screens as of March 31, 2014. The operating results of each movie theater business have been included in Digiplex’s results of operations from the respective acquisition or lease commencement dates. In May 2014, Digiplex took occupancy of one theater with 12 auditoriums and is currently outfitting that theater.

Digiplex is the sole and exclusive operator and manager of each JV theater. Digiplex has determined that JV is a variable interest entity, which we refer to as a “VIE”, and Digiplex is the primary beneficiary of JV’s operations. Therefore, Digiplex has included JV’s operating results in Digiplex’s consolidated financial statements.

Digiplex manages its business under one reportable segment: theater exhibition operations.

Digiplex’s executive offices are at 250 East Broad Street, Westfield, New Jersey 07090. Digiplex’s telephone number is (908) 396-1360, and Digiplex’s fax number is (908) 396-1361. Digiplex maintains a corporate website at www.digiplexdest.com.

Industry Overview and Trends

The U.S. motion picture exhibition industry is a mature business that has historically maintained long-term growth in revenues. Between 2001 and 2012, total box office revenues in the United States grew from $8.1 billion of revenues in 2001 to $10.9 billion in 2013. Against this background of growth in revenues, the U.S. motion picture exhibition industry experienced periodic growth and contraction. Digiplex expects the cyclical nature of the U.S. motion picture exhibition industry to continue for the foreseeable future.

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The following table represents the results of surveys and reports published by the Motion Picture Association of America outlining the historical trends in U.S. box office performance for the 13- year period from 2001 through 2013.

According to the source Box Office Mojo , 2013 U.S. box office sales approximated $10.9 billion, compared to $10.8 billion in 2012, an increase of 0.8%. Attendance in 2013 was 1.34 billion, a decrease of 1.3% from 2012. According to Box Office Mojo , year-to-date U.S. box office sales through June 2, 2014 approximated $4.2 billion, compared to approximately $4.1 billion for the same period in 2013, an increase of 2.6%.

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Digiplex believes its theaters appeal to a diverse group of patrons because, to the extent the number of screens in a theater allow, Digiplex offers a wide selection of films and convenient show times, targeted to the demographics of the surrounding population. In addition, most of Digiplex’s theaters feature state-of-the-art amenities such as immersive wall-to-wall and silver 3D screens, digital stereo surround-sound, computerized ticketing systems, comfortable seating with cup holders, and enhanced interiors and exteriors.

Digiplex also believes that its theaters have been enhanced with the installation of digital projection platforms, and that operating digital theaters will enable Digiplex to generate incremental revenue from differentiated motion picture formats, such as digital 3D, generate additional revenue from exhibition of alternative content offerings and provide greater flexibility in scheduling Digiplex’s programming content, which Digiplex expects will enhance the utilization of its seating capacity. All 194 of Digiplex’s screens, including one IMAX screen, are digitally equipped. Digiplex’s total cost of the digital platforms it has purchased to date is $6.9 million.

Digiplex’s theaters are operated with improved economic performance on a same theater basis by increasing revenues per square foot and reducing the cost per patron of operations. Digiplex varies auditorium seating capacities within a single theater, allowing it to exhibit films on a more cost effective basis for a longer period of time by shifting films to smaller auditoriums in the theater to meet changing attendance levels. In addition, since Digiplex operates multi-screen facilities, it realizes significant operating efficiencies as compared to single screen theaters by having common box office, concessions, projection and lobby and restroom facilities, which enables Digiplex to spread some of its costs, such as payroll, advertising and rent, over a higher revenue base. Digiplex staggers movie show times to reduce staffing requirements and lobby congestion and to provide more desirable parking and traffic flow patterns. Digiplex also actively monitors ticket sales in order to quickly recognize surges in demand, which enables it to add seating capacity quickly and efficiently with the use of its networked digital projection platforms and theater management software. In addition, Digiplex offers various forms of convenient ticketing methods, themed gift cards and e-gift cards. Digiplex believes that operating a theater circuit with the use of state of the art software technology, remote surveillance, and modern management methods will enhance its economic performance.

Digiplex has implemented best management practices in each of its theaters, including daily, weekly and monthly management reports generated for each theater, and Digiplex maintains active communication between the theaters and corporate management. Digiplex uses these management reports and communications to closely monitor admissions and concessions revenues, as well as accounting, payroll and workforce information necessary to manage its theater operations effectively and efficiently. For any theaters Digiplex may acquire in the future, it would implement similar best management practices in such theaters.

Digiplex seeks experienced theater managers and requires new theater managers to complete a comprehensive training program on-site within the theaters and at its corporate headquarters and with its digital hardware and software vendors. The program is designed to encompass all phases of theater operations, including Digiplex’s operating philosophy, policies, procedures and standards. Digiplex’s mission statement is posted in its corporate offices and in every theater.

In addition, Digiplex has implemented quality assurance programs in all of its theaters to maintain clean, comfortable and well maintained facilities. To maintain quality and consistency within Digiplex’s theater circuit, its managers regularly inspect each theater. Digiplex also operates a “mystery shopper” program, which involves unannounced visits by unidentified customers who report on and rate the quality of service, film presentation and cleanliness at individual theaters.

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Digiplex has also implemented a loss prevention program in all of its theaters. Digiplex also maintains camera systems in its common areas and in various auditoriums through which its management can monitor theater operations.

Digitalization

The U.S. motion picture exhibition industry began its transition to digital projection technology in 2005 led by members of Digiplex’s management team while they were employed by Cinedigm Digital Cinema Corp., which we refer to as “Cinedigm”. Digital projection technology provides filmmakers the ability to showcase imaginative works of art exactly as they were intended, with incredible realism and detail and in a range of up to 35 trillion colors. Because digital features are not susceptible to scratching and fading, digital presentations will always remain clear and sharp every time they are shown. A digitally produced or digitally converted movie can be distributed to theaters via satellite, physical media, or fiber optic networks. The digitized movie is stored on a central computer/server, known as a library management server, which stores and “serves” it to a digital projector for programming each screening of the movie and, due to its format, enables efficient movement of films and other content between auditoriums within a theater as demand increases or decreases for each film.

Digital projection also allows the presentation of 3D content and alternative programming such as live and pre-recorded concert events, the opera, ballet, sports programs and special live events. Fifty-seven films released world-wide during 2011 were available in 3D format and at least forty-five 3D films were released during 2012, excluding 3D alternative content events. Three-dimensional technology offers a premium experience with crisp, bright, ultra-realistic images that immerse the patron into a film. A premium is generally charged for a 3D presentation. Digiplex believes alternative entertainment presents a largely untapped resource for increased business.

The conversion of the theater projection systems in Digiplex’s theaters to digital platforms and the selective installation of 3D digital projection systems allows Digiplex to offer its patrons premium 3D movie and all-digital format experiences featuring alternative programming such as sports, concerts, opera, ballet and video games, which Digiplex expects to generate incremental revenue and cash flows. Digiplex is optimistic regarding the benefits of digital cinema primarily as it relates to future growth associated alternative programming and 3D content and are pleased to see continued support of 3D film products by the major motion picture studios as well as increased availability of special events such as concerts, opera and sports.

Alternative Programming

Digiplex believes that the traditional movie house model is inherently inefficient because of the daily demand curve, which Digiplex believes results in seating only 10% to 15% of capacity overall, and less than 5% from Monday to Thursday. Digiplex believes that all movies need not play five shows per day, seven days a week, but rather at specific show times targeted to specific audiences, and alternative programming can be shown during specific times that match audience demand. Typically, Digiplex will present alternative programming during non-peak hours. Digiplex believes that matching alternative content with audience demand, as cable and television stations do, is important and will allow Digiplex to fill seats during times that are traditionally slow for theaters.

Digiplex believes that providing alternative content, made possible as a result of digital projection platforms, will result in increased utilization of its theaters and higher theater level cash flow. Alternative programming currently available includes sports, music, opera, ballet, lectures, religious content and video games. Digiplex expects that alternative content will vary with customer taste and that the offerings will increase as the potential uses are expanded.

For example, Digiplex’s customers will be able to see events occurring throughout the world, at times in live 3D, at a fraction of the ticket price of attending a major sporting event in person. Sports content can include events such as the World Cup, all-star games, the NCAA basketball finals, major college football bowl games, and Digiplex believes, eventually, the World Series and the Super Bowl.

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Alternative programming can be as diverse as the ballet from the Bolshoi and opera from the Metropolitan Opera, to rock concerts and sporting events from around the world, which may be taking place in different geographical regions, or even, if local, may be sold out. Digiplex’s customers will be able to experience larger than life images of these events, in full digital stereo sound, with exceptionally comfortable seating at more convenient locations.

Digiplex also believes that corporate, religious; trade and professional organizations may find that using its theaters as meeting places is an efficient way to satisfy their organizations’ goals. Tapping the potential of alternative programming could lead to use of Digiplex’s theaters in auctions and fundraisers, as well as for other events.

Properly programmed and marketed, Digiplex believes that alternative programming, including live events, which may be shown in a 3D format, provide excellent opportunities for additional revenue, and Digiplex expects to use alternative programming as part of its business strategy. For those theaters that Digiplex operated for the entire 2013 fiscal year, approximately 3% of Digiplex’s box office revenues were attributable to alternative programming for the 12-months ended June 30, 2013. Digiplex’s goal has been to seek to increase revenues from alternative programming through relationships with existing and new alternative content providers, and by exploiting rights to alternative programming obtained through Digiplex’s joint venture with Nehst Media Enterprises, DigiNext LLC, which we refer to as “DigiNext”, or other sources that have the potential to provide revenues from ancillary distribution channels in addition to traditional theatrical releases.

On March 14, 2011 Digiplex entered into an agreement with National Cine Media, LLC (“NCM”) for alternative programming provided through its Fathom network. NCM operates the largest digital in-theater network in North America and utilizes its in-theater digital content network to distribute pre-feature advertising, cinema and lobby advertising, and entertainment (alternative) programming. Under Digiplex’s agreement with NCM, Digiplex receives 50% of the “net box office” receipts realized from presenting alternative content at Digiplex’s theaters as provided to Digiplex by NCM. “Net box office” receipts are defined as the gross revenues realized from admissions to a program of alternative content, reduced by taxes and other charges and out-of-pocket expenses, including payments to the creator of the alternative content or film rent. Under this agreement, Digiplex has the option of selecting alternative content made available by NCM through its Fathom network, and Digiplex has booked events, including boxing events, concerts and performances of the Metropolitan Opera from this source. Digiplex’s agreement with NCM is not exclusive.

In addition to NCM, Digiplex also presents alternative programming provided by its DigiNext joint venture, Emerging Pictures, Screenvision, Specticast, JAAS Media, and Cinedigm. Digiplex’s agreements with DigiNext, Emerging Pictures and Cinedigm provide for revenue sharing, pursuant to which Digiplex retains 50% to 60% of “net box office” receipts. Under the DigiNext joint venture, Digiplex not only receives revenues from attendance at its theaters, but also shares in revenues from any theatrical releases in non-Digiplex theaters and from other ancillary distribution channels, including DVDs, Video on Demand, paid TV, and possible international distribution channels.

In August 2013, Digiplex entered into a one-year agreement with Screenvision (subject to renewal) pursuant to which Digiplex offers alternative content programs to Screenvision that Digiplex believes are suitable for national theatrical release. If Screenvision approves a program for theatrical distribution to its customers, Digiplex shares in the net box office receipts of non-Digiplex exhibitors who show the programs.

Most alternative content programs are priced at a premium over movie ticket prices. During the calendar year 2013, Digiplex exhibited 122 alternative content programs in one or more of its theaters, excluding DigiNext films and films that were shown as part of a film series.

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Digital Cinema Implementation

Digiplex has converted all the screens in its theaters to digital projection platforms. This conversion has been supervised by Digiplex’s chief technology officer. The majority of the digital cinema projectors that Digiplex has installed have been purchased from Barco, Inc., which we refer to as “Barco”. Digiplex has executed an equipment warranty and support agreement with Barco, under which Barco provides warranty coverage and technical support for digital projector equipment that Digiplex has purchased from Barco.

All motion picture distributors encourage conversion of theaters to digital projection platforms, not only because of the improved quality of the presentation, but also because of the cost savings to the distributors as a result of not having to print and deliver actual physical film prints to motion picture exhibitors. For digital projection equipment installed prior to December 31, 2012, to help exhibitors finance the cost of conversion to digital projection, all distributors must pay fees to exhibitors based on films presented on approved digital projection platforms, which are referred to as virtual print fees.

Under the virtual print fee program, motion picture exhibitors receive a fee from motion picture distributors for each movie shown on approved digital projection equipment. These fees are paid on a quarterly basis until the earlier of ten years from date the approved digital projection equipment in a particular theater is installed or the date the exhibitor has recovered its out-of-pockets costs, including any financing costs, for the digital conversion. The virtual print fee is tracked and paid with respect to each approved digital projection system. As part of Digiplex’s acquisition process of theaters, Digiplex has sought to receive the benefit of any virtual print fees paid by motion picture distributors to theaters that it acquires.

The virtual print fee program for new installations of digital projection systems expired on December 31, 2012. The expiration of the virtual print fee program did not, however, expire with respect to prior installations of approved digital projection equipment, and Digiplex will continue receiving virtual print fees with respect to its approved digital projection systems and any approved digital projection systems that Digiplex may acquire until the earlier of ten years or its recoupment of out-of-pocket costs for the digital conversion.

Digiplex has entered agreements with a subsidiary of Cinedigm and with Christie Digital Systems USA, Inc. pursuant to which those entities collect virtual print fees from distributors on Digiplex’s behalf. Digiplex estimates collections from virtual print fees will range from $8,000 to $10,000 per screen per year through the earlier of ten years or Digiplex’s recovery of its out-of-pocket costs for the digital conversions. Digiplex records the virtual print fees it collects as an offset to its film rent expense.

In addition to relying on virtual print fees, and depending on working capital requirements, Digiplex may acquire digital projection equipment using its working capital. Digiplex may also seek financing for digital conversions to the extent such financing is available to Digiplex on acceptable terms. Digiplex will determine the most efficient method of payment for the equipment on a theater-by-theater basis.

Acquisitions

Digiplex’s acquisition policy has been to acquire theaters that provide significant opportunities for improved financial performance through its business model. Digiplex typically attempts to acquire cash flow positive theaters in strategic markets, convert them to a digital format (if necessary) and proactively program and market alternative programming in addition to running 2D and 3D movies. By marketing Digiplex’s theaters as entertainment destinations, Digiplex expects to realize increased cash flow from 3D films and alternative programming, increased attendance, increased concessions and sponsorship, and advertising revenues.

In addition to converting Digiplex’s theaters into state-of-the-art entertainment destinations, Digiplex’s strategy is founded on selective theater acquisitions that meet its strategic and financial criteria.

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On December 31, 2010, Digiplex acquired all the assets constituting the Rialto and the Cranford theaters for an aggregate purchase price of $1.828 million, which consisted of $1.2 million in cash, the issuance of 250,000 shares of Digiplex’s Series A preferred stock valued $0.5 million, and an earn out valued at $0.1 million. During the year ended June 30, 2013, Digiplex reduced the earn-out liability by $0.1 million based on the actual revenues of the theaters, and no further amounts are due. As part of this acquisition, Digiplex entered into leases for each of the Rialto and Cranford theaters for an initial ten year term, each with four five-year renewal options. These leases provide for the payment of base rent plus additional rent based on a percentage of Digiplex’s gross revenues at these theaters.

On February 17, 2011, Digiplex acquired all the assets constituting the Bloomfield 8 theater for $0.1 million. As part of this acquisition, Digiplex assumed and amended the lease for the theater, which has an initial term expiring on June 30, 2021 and one five- year renewal option. The amended lease provides for the payment of additional rent based on a percentage of Digiplex’s gross revenue at the theater.

On April 20, 2012, Digiplex acquired certain of the assets constituting the Cinema Centers theaters. Digiplex did not assume any liabilities of Cinema Centers, all of which were retained by the seller. The aggregate purchase price for the Cinema Centers assets that Digiplex acquired consisted of $11.0 million in cash paid at closing, a short-term note of $1.0 million due September, 2012, which we refer to as the “Cinema Centers Note”, and the issuance of 335,000 shares of Digiplex’s Class A common stock.

In addition, Digiplex assumed the leases associated with the five Cinema Centers theaters that had expiration dates, taking into account renewal options, of between approximately ten and thirty years from the 2012 acquisition date. Three of these leases provide for the payment of additional rent based on a percentage of Digiplex’s gross revenue at the theater in excess of specified thresholds.

On September 29, 2012, Digiplex acquired certain assets and assumed certain liabilities of the Lisbon theater, with 12 screens located in Lisbon, Connecticut, from a third party seller for a purchase price of $6.7 million, which consisted of a cash payment of $6.0 million, a capital lease liability of $0.1 million, and the fair value of an earn-out liability based upon forecasted financial results over a 12- month period following the closing, which Digiplex initially recorded at a fair value of $0.5 million.

On December 21, 2012, JV completed the purchases of substantially all the assets, which we refer to as the “UltraStar Acquisitions”, of seven movie theaters (six of which are located in California and one of which is near Phoenix, Arizona), with an aggregate of 74 fully digital screens, from seven sellers affiliated with one another, which we refer to as the “UltraStar Sellers”, for an aggregate purchase price (as finalized in March 2013 for post-closing adjustments) of approximately $13.1 million, consisting of $8.1 million in cash, 887,623 shares of Digiplex’s Class A common stock, and capital lease liabilities of $0.3 million. The fair value of the 887,623 shares issued was $4.7 million, based on the trading prices of the Digiplex Class A common stock on the acquisition dates, less a 10% discount for restrictions on the sale of the stock. The JV assumed certain capital leases and service contracts related to theater equipment. All other liabilities were retained by the sellers.

On January 1 and February 1, 2013, JV entered into operating leases, directly with landlords, for a three screen theater in Sparta, NJ and a 16 screen theater in Solon, Ohio, respectively, for no purchase prices.

On July 19, 2013, JV acquired substantially all the assets of a six screen movie theater in Torrington, Connecticut for a purchase price consisting of $0.2 million in cash, 73,770 shares of Digiplex’s Class A common stock (valued at $5.89 per share, including a 10% discount for trading restrictions), and assumption of a note payable to NEC Financial Services in the approximate amount of $0.2 million relating to the theater’s digital equipment. Simultaneously, Digiplex entered into a 10-year lease for the theater premises (with four option terms of five years each) with an affiliate of the seller. The shares issued to seller are subject to a 180 day lock-up agreement and further restrictions beyond that point which, absent Digiplex’s consent, limit the seller’s ability to sell shares during any 30-day period to 10 percent of the aggregate shares issued to that seller.

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Each JV theater is operated by Digiplex under a management agreement and, therefore, the operating results of those theaters are included in the consolidated operating results of Digiplex for the year ended June 30, 2013, and for the nine months ended March 31, 2014, from the respective acquisition or lease commencement dates.

On December 19, 2013, Digiplex acquired an eight screen movie theater in Mechanicsburg, Pennsylvania and on March 21, 2014, acquired a seven screen theater in Bel Air, MD. Both theaters were acquired from affiliates of Flagship theaters. The combined purchase prices for these theaters were $1.828 million in cash and 412,330 shares of Digiplex Class A common stock. In each instance, Digiplex assumed the leases associated with the theaters which have terms, including renewal options, of 25 and 7 years, respectively. The Mechanicsburg lease provides for the payment of additional rent based upon a percentage of Digiplex’s gross revenue at the theater.

Digiplex has entered into asset purchase agreements, subject to the satisfactory completion of due diligence and certain other conditions, for the acquisitions of the following additional theaters with an aggregate of 49 screens: an eight screen theater in Lansing, Illinois; a ten screen theater in Londonderry, New Hampshire; a five screen theater in Pigeon Forge, Tennessee; a ten screen theater in Sarver, Pennsylvania; and a sixteen screen theater in Springfield, Massachusetts.

On February 12, 2014, JV sold the Mission Valley theater that it had purchased from an UltraStar entity in December 2012 after discussions with UltraStar regarding the post-acquisition performance of that theater and the ability of the landlord to terminate the lease with little notice. The theater was sold back to the UltraStar for 361,599 shares of Digiplex Class A common stock and $38,000 in cash.

Joint Venture—Start Media / Digiplex

Since the formation of JV in December 2012, Digiplex has contributed 961,393 shares of Digiplex’s Class A common stock, and Start Media has contributed approximately $10.4 million in cash to date. These capital contributions were used for the UltraStar Acquisitions, the Torrington theater acquisition (in July 2013), and to fund anticipated capital expenditures for the JV-owned theaters. Digiplex’s and Start Media’s respective ownership interests in JV are based upon their respective aggregate capital contributions. On May 15, 2014, Digiplex, Start Media and Carmike entered into an agreement pursuant to which Carmike will purchase, on the effective date of the merger, all Start Media’s interests in the JV, and Start Media’s warrants to purchase 500,000 shares of Digiplex Class A common stock will be cancelled, for $10,977,574.

JV is managed by a four person board of managers, two of whom Digiplex designates and two of whom are designated by Start Media. A majority vote is required for JV actions. At March 31, 2014, Digiplex and Start Media owned 34% and 66% of the equity of JV, respectively.

JV has a first right of refusal to acquire any theaters which Digiplex wishes to acquire, except for any theaters within a ten mile radius of existing Digiplex owned theaters. If JV does not exercise its right of first refusal, Digiplex has the right to make the acquisition independently. The right of first refusal does not apply to or restrict Digiplex’s ability to manage theaters owned by unaffiliated third-parties. Digiplex has entered into agreements with JV (the “Management Agreements”) to manage each theater JV has acquired and receives 5% of the total annual revenues of the JV theaters’ operations as management fees. Management fees earned by Digiplex during the fiscal year ended June 30, 2013 were $0.5 million. JV records these fees as general and administrative expenses, and Digiplex records an offset to general and administrative expenses. These fees are eliminated in consolidation.

Under the Management Agreements, Digiplex has full day-to-day authority to operate the theaters owned by JV including: staffing, banking, content selection, vendor selection and all purchasing decisions. Digiplex is required to submit an annual operating budget to JV for each fiscal year ending June 30 for approval by the JV board of managers. In the event of any disagreements regarding the budget, there are dispute resolution procedures contained in the operating agreement, which we refer to as “JV Operating Agreement”.

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The membership interests in JV are denominated by membership units. Start Media will receive additional membership units in consideration for any further capital contributions as additional capital is required, based on the fair market value of JV determined under a formula set forth in the JV Operating Agreement, which we refer to as the “Formula”. Digiplex has a right, but not the obligation, to contribute additional capital to JV, which under certain circumstances may be made by the issuance and delivery of shares of Digiplex’s Class A common stock to sellers of theaters acquired by JV, and thereby acquire additional membership units based on the Formula, provided that its percentage interest does not exceed 50% as the result of its acquisition of additional units.

Distributions of JV cash flow from operations will be made to the members at such time as determined by the JV board of managers. Start Media is entitled to a 6% preferred return on its capital contributions made from time to time, after which Digiplex receives a 6% preferred return on its capital contributions. Thereafter, distributions of cash flow from operations will be made pro rata in accordance with the respective membership units of the members. In the case of liquidating distributions, Start Media will receive a 6% preferred return on and the return of its capital contributions prior to Digiplex’s receipt of a 6% preferred return on and the return of its capital contributions, with further distributions pro rata to the respective membership units of the members. Digiplex and Start Media have agreed not to transfer their membership interests, except for certain permitted transfers, for a three-year period and any subsequent transfers of membership interests are subject to the right of JV and the other member to acquire the interests on such terms as a third party is willing to do so. In the event Digiplex experiences a change in control, as defined in the JV Operating Agreement, Start Media has a right to require Digiplex to acquire its membership interest in JV.

Digiplex is considered the primary beneficiary of the JV because it controls the operation of each JV owned theater on a day-to-day basis in all material respects, including: the selection of content, all staffing decisions, all cash management and paying vendors, financial reporting, obtaining all necessary permits, insurances, and to plan and perform capital improvements, to the extent such expenditures do not exceed certain levels as specified in the Management Agreements. Digiplex is also the guarantor of six of the nine leases entered into with third party landlords in the JV-owned theaters, and is using its brand name to promote the theaters. Because JV is a VIE, and Digiplex is deemed the primary beneficiary, Digiplex has consolidated the operations of JV.

Net loss attributable to the non-controlling interest on the statement of operations represents the portion of net loss attributable to the economic and legal interest in JV held by Start Media.

In January 2013, JV entered into an agreement to pay a third party $450,000 as an advisory fee for services rendered in connection with the formation of the JV and related agreements. Digiplex and Start Media each agreed to fund half of the fee to the JV as a capital contribution and the JV has in turn paid the advisory fee in twelve monthly installments.

Film Exhibition

Evaluation of Film. Digiplex licenses films on a film-by-film and theater-by-theater basis. Negotiations with the film distributors are handled for Digiplex by Cinema Services, to whom Digiplex pays a monthly flat fee. The economic terms of Digiplex’s licenses of films from film distributors are substantially similar to those made available to theaters in other theater chains. The license fees vary from picture to picture and are at varying percentages of net box office revenue depending on the nature and success of the film and the duration of the film’s exhibition at Digiplex’s theaters.

Digiplex selects the films that it presents at its theaters, and prior to selecting a film, Digiplex evaluates the prospects for upcoming films. Criteria Digiplex considers for each film may include cast, producer, director, genre, budget, comparative film performances and various other market factors. Successful licensing depends greatly upon the motion picture exhibitor’s knowledge of trends and historical film preferences of the residents in markets served by each theater, as well as the availability of commercially successful motion pictures. Digiplex

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selects the films it exhibits based on a demographic survey Digiplex conducts at each of its theaters, which includes such items as ethnicity, age of the potential audience and economic strata of the proximate geographic area.

For alternative content, Digiplex handles the booking with in-house personnel, who select, negotiate the license terms of and book its alternative content programs.

Access to Film Product. Films are licensed from film distributors owned by major production companies and from independent film distributors that distribute films for smaller production companies. Often, film distributors establish geographic licensing zones and allocate each available film to one theater within that zone. Digiplex’s theaters are in “free zones” which do not contain such restrictions. Digiplex expects that most of the theaters that it acquires in the future will also be in free zones.

Film Rental Fees. Film licenses typically specify rental fees or formulas by which rental fees may be calculated. The primary formulas used are the “sliding scale” formula, a “firm term” formula and a “review or settlement formula.” Under a sliding scale formula, the distributor receives a percentage of the box office receipts using a pre-determined and mutually agreed upon film rental template. This formula establishes film rental predicated on box office performance and is the predominant formula used by Digiplex to calculate film rental fees. Under the firm term formula, a specified percentage of the box office receipts are to be remitted to the distributor. Lastly, under the review or settlement method, distributor receives a negotiated percentage of the box office receipts to be paid upon completion of the theatrical engagement.

Duration of Film Licenses. The duration of Digiplex’s film licenses is negotiated for Digiplex by Cinema Services on a film-by-film basis. In the case of alternative content, licenses are negotiated for Digiplex by its in-house alternative content booking personnel. The terms of Digiplex’s license agreements depend on the performance of each film or alternative content program. Marketable movies that are expected to have high box office admission revenues will generally have longer license terms than movies with more uncertain performance and popularity.

Relationship with Distributors. Many distributors provide quality first-run movies to the motion picture exhibition industry. For fiscal 2013 and the first nine month of fiscal 2014, six major film distributors accounted for approximately 76% and 78% of Digiplex’s admissions revenues, respectively. Of the six major film distributors, three and four of them accounted for more than 10% of admissions revenues for fiscal 2013 and such nine-month period of fiscal 2014, respectively. No single film distributor accounted for more than 17% of admissions revenues in either period. Digiplex licenses films from each of the major distributors through Digiplex’s relationship with Cinema Services, and Digiplex believes that its relationships with Cinema Services and the distributors are good. From year to year, the revenues attributable to individual distributors will vary widely depending upon the number and popularity of films that each one distributes.

Concessions

Digiplex also generates revenue from concession sales in its theaters. Digiplex generated approximately 29% and 28% of its total revenues from concessions sales for fiscal 2013 and the first nine months of fiscal 2014, respectively. Digiplex emphasizes prominent and appealing concession stations designed for rapid and efficient service. Digiplex continually seeks to increase concessions sales by improving product mix and through expansion of its concession offerings, introducing special promotions from time-to-time and offering employee training and incentive programs to up-sell and cross-sell products.

Digiplex generally does not have concession supply contracts, but have excellent relationships with many concession vendors and have developed an efficient concession purchasing and distribution supply chain. Digiplex’s management negotiates directly with vendors for many of its concession items to obtain competitive prices and to ensure adequate supplies. Digiplex acquired most of its concessions to date from Continental

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Concession Supply, Inc., which distributes products for many concession vendors, and who Digiplex believes has provided it with fair pricing. Digiplex also have a multi-year contract with Coca-Cola Refreshments USA, Inc. for the supply of syrup, equipment and beverages.

In Theater Advertising

Digiplex also recognizes revenue from in-theater advertising that it exhibits at its theaters. This advertising is sold and coordinated by NCM. Under Digiplex’s advertising agreement with NCM, which Digiplex executed in March 2011, Digiplex receives 50% of net revenue (gross revenue collected less refunds and similar disbursements) realized from the sale of all forms of advertising at its theaters provided to Digiplex by NCM, subject to a minimum guaranteed payment to Digiplex of $0.17 per customer per year. The advertising revenue is collected for Digiplex by NCM pursuant to its contract with NCM.

Management Information Systems

Digiplex makes extensive use of information technology for the management of its business, its theaters, and other revenue generating operations. Digiplex has deployed software and hardware solutions that provide for enhanced capabilities and efficiencies within its theater operations. Digiplex’s revenue streams generated by attendance and concession sales are fully supported by information technology systems to monitor cash flow and to detect fraud and shrinkage in its concessions inventory.

Digiplex’s information technology solutions enable it to sell gift cards and to redeem those gift cards at Digiplex’s theater box offices and concession stands. Digiplex also sells tickets remotely by using its Internet ticketing partner, MovieTickets.com, and Digiplex’s website. Digiplex can sell tickets for current and future shows from its box office, concession stands and the Internet to reduce lines during peak periods.

Digiplex has entered into an Exhibitor Management Services Agreement, which we refer to as the “EMS”, with Cinedigm, pursuant to which Digiplex has licensed the use of Cinedigm’s state-of-the-art EMS back office management system and related support services on a non-exclusive basis. Digiplex believes this system facilitates its addition of theaters to its business. The EMS system provides integrated “back office” functionality related to information from Digiplex’s ticketing systems, its box office receipts, accounting, ticketing systems, revenue tracking, and payments and settlements with its distributors. The scheduling feature of the EMS system supports the coordination needed to properly allocate Digiplex’s screens between film showings, while also ensuring that movie audiences view the intended advertising. The sales and attendance information collected by the EMS system is used directly for film booking and settlement, and it is the primary source of data for Digiplex’s financial systems. Digiplex also relies on “point-of-sale” software that it licenses from Omniterm to operate Digiplex’s back office management systems, and on other software licensed from Cinedigm to manage digital equipment in Digiplex’s theaters.

Digiplex expects to continue to update its technology to improve services to its patrons and provide information to its management, allowing them to operate Digiplex’s theaters efficiently.

Marketing and Advertising

To market Digiplex’s theaters, Digiplex has developed a marketing strategy founded on the release of information through press releases, its website, social media (including Facebook, Twitter, YouTube) and limited print advertising to inform Digiplex’s patrons of film selections and show times. Digiplex currently uses each of these forms of advertising at its existing theaters and ticket sales are received through MovieTickets.com and Digiplex’s website, in addition to the theater point-of-sale terminals. Digiplex may also employ special interactive marketing programs for specific films and concession items. Digiplex’s movie patrons are also able to

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find its film selections and show times through various third party websites and search engines. In addition to Digiplex’s marketing and advertising efforts, Digiplex relies on film distributors to organize and finance multimedia advertising campaigns for major film releases. Alternative content that Digiplex presents may be sponsored by local or national concerns which advertise the events or programs in order to advertise their products or services.

As of August 2013, Digiplex implemented a frequent moviegoer loyalty program in each of its markets, and members will be eligible for specified awards, such as discounted or free concession items and ultimately a free movie ticket at the highest reward levels, based on purchases made at Digiplex’s theaters. In addition, Digiplex seeks to develop patron loyalty through a number of other marketing programs such as a summer children’s film series, cross-promotional ticket redemptions and promotions within local communities. Digiplex has provided incentives for its customers to sign on for its weekly newsletters to enable Digiplex to notify them of the new alternative programming.

Insurance

Digiplex maintains property insurance with respect to its operations that covers its theaters. Digiplex also maintains business interruption insurance. Digiplex does not maintain key person insurance. Digiplex believes that its insurance coverage is customary for similar operations in its industry. However, Digiplex cannot assure you that its existing insurance policies are sufficient to protect Digiplex from all losses and liabilities that it may incur.

Employees

As of May 31, 2014, Digiplex employed approximately 660 employees, of whom 52 were full-time employees and 595 were hourly theater personnel. Of Digiplex’s full time employees, 33 are theater management personnel, and 19 are corporate management and staff. None of Digiplex’s employees are covered by collective bargaining agreements. Digiplex believes it has good relations with its employees.

Seasonality

Digiplex’s revenues are usually seasonal, coinciding with the timing of releases of motion pictures by the major distributors. Generally, motion picture studios release the most marketable motion pictures during the summer and holiday seasons. The unexpected emergence of a hit film during other periods can alter the traditional trend. The timing of movie releases can have a significant effect on Digiplex’s results of operations, and the results of one fiscal quarter are not necessarily indicative of results for the next fiscal quarter or any other fiscal quarter. The seasonality of motion picture exhibition, however, has become less pronounced as motion picture studios are releasing motion pictures somewhat more evenly throughout the year.

Competition

The motion picture exhibition industry is highly competitive. Motion picture exhibitors generally compete on the basis of the following competitive factors:

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Digiplex has several competitors in its markets, which vary substantially in size from small independent exhibitors to large national chains, such as Regal Entertainment Group, AMC Entertainment Inc. and Cinemark USA, Inc. Some of Digiplex’s competitors are substantially larger and have substantially more resources than Digiplex does, which may give them a competitive advantage over Digiplex. Digiplex’s theaters are, and those that it may acquire will be, subject to varying degrees of competition in the regions in which they operate. Digiplex’s competitors, including newly established motion picture exhibitors and existing theater chains, may build new theaters or screens in areas in which Digiplex operates or will operate in the future, which may result in increased competition and excess capacity in those areas. If this occurs, it may have an adverse effect on Digiplex’s business and results of operations. Based on the expertise of Digiplex’s senior management, however, Digiplex believes that it will be able to generate economies of scale and operating efficiencies that will allow Digiplex to compete effectively with its competitors.

In addition to competition for its existing theater operations, Digiplex may face competition from other motion picture exhibitors and other buyers when trying to acquire additional theaters. Many of Digiplex’s competitors are well established and have extensive experience in identifying and effecting acquisitions. Many of these competitors possess greater technical, human and other resources than Digiplex does and Digiplex’s financial resources will be relatively limited when contrasted with those of many of these competitors. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target theaters.

Digiplex also competes with other motion picture distribution channels, including home video and DVD, cable television, broadcast television and satellite, pay-per-view services and downloads and streaming video via the Internet. Other technologies such as video on demand could also have an adverse effect on Digiplex’s business and results of operations. However, in general, when motion picture distributors license their products to the motion picture exhibition industry, they refrain from licensing those motion pictures to other distribution channels for a period of time, commonly called the theatrical release window. In addition, Digiplex competes for the public’s leisure time and disposable income with other forms of entertainment, including sporting events, concerts, live theater and restaurants.

Regulation

The distribution of motion pictures is in large part regulated by federal and state antitrust laws and has been the subject of numerous antitrust cases. Consent decrees effectively require major film distributors to offer and license films to exhibitors, including Digiplex, on a film-by-film and theater-by-theater basis. Consequently, exhibitors cannot assure themselves of a supply of films by entering into long-term arrangements with major distributors, but must negotiate for licenses on a film-by-film basis.

Digiplex’s theaters must comply with Title III of the ADA to the extent that such properties are “public accommodations” or “commercial facilities” as defined by the 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, an award of damages to private litigants and additional capital expenditures to remedy such non-compliance. Digiplex believes that it is in compliance with all current applicable regulations relating to accommodations for the disabled. Digiplex intends to comply with all future regulations which apply to Digiplex in this regard. Digiplex’s business strategy has included acquiring additional theaters, and in pursuing this strategy, Digiplex may incur capital expenditures to remedy any non-compliance in theaters that Digiplex acquires; however, Digiplex cannot predict whether such compliance will require it to expend substantial funds.

Digiplex’s theater operations are also subject to federal, state and local laws governing such matters as wages, working conditions, citizenship and health and sanitation and environmental protection requirements. Digiplex believes that it is in compliance with all relevant laws and regulations.

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Risks Relating to Digiplex’s Business

Digiplex will need substantial additional funding to accomplish its business strategy and may be unable to raise capital on terms favorable to Digiplex or at all, which could increase Digiplex’s financing costs, dilute your ownership interests, affect Digiplex’s business operations or force Digiplex to delay, reduce or abandon its business strategy.

Digiplex’s business strategy is to create an all-digital national footprint by selectively pursuing multi-screen theater acquisition opportunities that meet its strategic and financial criteria, with upgrades to digital platforms as necessary. To successfully implement this strategy, Digiplex will need to raise substantial additional funds. Digiplex’s ability to fund potential theater acquisitions and capital expenditures for theater digitalization, expansion or renovation will require a significant amount of cash, the availability of which depends on many factors beyond Digiplex’s control, including:

Digiplex cannot predict when, if ever, its operations will generate sufficient cash flows to fund its capital investment requirements. Until they do, Digiplex will be required to finance its cash needs through public or private equity offerings, bank loans or other debt financing, or otherwise. There can be no assurance that financing for future theater acquisitions and capital expenditures for theater digitalization, expansion or renovation will be available on terms favorable to Digiplex or at all, which could force Digiplex to delay, reduce or abandon its growth strategy, increase its financing costs, or both.

Digiplex may incur additional debt, if such financing is available to it, in order to expand its business. Additional funding from debt financings may make it more difficult for Digiplex to operate its business because it would need to make principal and interest payments on the indebtedness and may be obligated to abide by restrictive covenants contained in the debt financing agreements, which may, among other things, limit Digiplex’s ability to make business and operational decisions and pay dividends. Furthermore, raising capital through public or private sales of equity to finance acquisitions or expansion could cause earnings or ownership dilution to your shareholding interests in Digiplex.

Digiplex cannot assure you that its business will generate sufficient cash flow from operations, that currently anticipated revenue growth will be realized or that future capital will be available for Digiplex to fund its capital expenditure needs.

Digiplex may not benefit from its business strategy of acquiring and operating multi-screen theaters.

Digiplex’s business strategy is to acquire and operate multi-screen theaters. In any acquisition, Digiplex expects to benefit from cost savings through, for example, the reduction of overhead and theater level costs, and from revenue enhancements resulting from the acquisition. There can be no assurance, however, that Digiplex will be able to realize any anticipated benefits or that its profitability will be improved by any one or more acquisitions. Any acquisition may involve operating risks, such as:

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Digiplex has incurred net losses since inception, and it cannot assure you that it will be profitable in the future.

Digiplex incurred net losses of $5.3 and $2.0 million for the fiscal years ended June 30, 2013 and 2012, respectively, and had an accumulated deficit of $9.9 million as of March 31, 2014. Digiplex cannot assure you that it will become profitable for the fiscal year ending June 30, 2014 or in any other future period. Further, Digiplex cannot be certain that it will be able to execute its business strategy of acquiring and operating multi-screen theaters on a profitable basis. As a result, Digiplex cannot assure you that it will be able to attain or increase profitability on a quarterly or annual basis. If Digiplex is unable to effectively acquire theaters and manage the risks and difficulties facing its business as it encounters them, its business, financial condition and results of operations may suffer.

Digiplex has a limited operating history which provides limited reference for you to evaluate Digiplex’s ability to achieve its business objectives.

Since Digiplex has a limited operating history, it is subject to the risks and uncertainties associated with early stage companies and has historically operated at a loss. Accordingly, you will have a limited basis on which to evaluate Digiplex’s ability to achieve its business objectives. Digiplex was formed in July 2010 without any operating business. As of May 31, 2014, Digiplex has acquired a total of 21 theaters. Digiplex plans to continue carrying out its acquisition strategy of acquiring theaters. Digiplex’s financial condition, results of operations and its future success will, to a significant extent, depend on its ability to continue to acquire theaters throughout the United States and to achieve economies of scale. Digiplex cannot assure you that more acquisitions can be consummated on terms favorable to Digiplex or at all, or that if it achieves those acquisitions it will be able to operate its expanded business profitably. If Digiplex fails to achieve its business objectives, then it may not be able to realize its expected revenue growth, maintain its existing revenue levels or operate at a profit. Even if Digiplex does realize its business objectives, its business may not be profitable in the future.

Digiplex expects to incur long-term lease and debt obligations, which may restrict its ability to fund current and future operations and that may restrict its ability to enter into certain transactions.

In order to effect Digiplex’s business plan, Digiplex expects to incur long-term debt service obligations and long-term lease obligations, which may occur in the near term or long term. Digiplex expects to assume outstanding or execute new operating leases for theaters in connection with any acquisition that it may consummate. In addition, Digiplex may finance future theater acquisitions through debt financing, provided that such financing is available to Digiplex on acceptable terms. Specifically, Digiplex has in the past and continues to engage in discussion regarding such potential debt financing. Any lease or debt obligations Digiplex has incurred to date or will incur in the future will pose risk to you by:

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Digiplex’s ability to make scheduled payments of principal and interest with respect to any indebtedness it incurs will depend on its ability to generate positive cash flows and on its future financial results. Digiplex’s ability to generate positive cash flows is subject to general economic, financial, competitive, regulatory and other factors that are beyond its control. Digiplex cannot assure you that it will generate cash flows at levels sufficient to enable it to pay existing or future indebtedness. If Digiplex cash flows and capital resources are insufficient to fund future lease and debt service obligations, it may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional capital or restructure or refinance indebtedness. Digiplex may not be able to take any of these actions, and these actions may not be successful or permit Digiplex to meet any scheduled debt service obligations and these actions may be restricted under the terms of any debt agreements.

If Digiplex fails to make any required payment under the agreements governing its leases and indebtedness or fails to comply with the financial and operating covenants contained in them, Digiplex would be in default, and as a result, its debt holders would likely have the ability to require that Digiplex immediately repay its outstanding indebtedness and the lenders under any existing or future secured credit facility could terminate their commitments to lend Digiplex money and foreclose against the assets securing Digiplex’s borrowings. Digiplex could be forced into bankruptcy or liquidation, which could result in the loss of your investment. The acceleration of Digiplex’s indebtedness under one agreement may permit acceleration of indebtedness under other agreements that contain cross-default and cross-acceleration provisions. If Digiplex’s indebtedness is accelerated, Digiplex may not be able to repay any future indebtedness or borrow sufficient funds to refinance it. Even if Digiplex is able to obtain new financing, it may not be on commercially reasonable terms or on terms that are acceptable to Digiplex. If Digiplex’s debt holders require immediate payment, Digiplex may not have sufficient assets to satisfy its obligations under its indebtedness.

Digiplex may face intense competition in its business strategy of acquiring theaters.

Digiplex may have difficulty identifying suitable acquisition candidates. Even if Digiplex does identify appropriate candidates, it anticipates significant competition from other motion picture exhibitors and other buyers when trying to acquire these candidates, and Digiplex cannot assure you that it will be able to acquire identified candidates at reasonable prices or on favorable terms. Many of Digiplex’s competitors are well established and have significant experience in identifying and effecting acquisitions. Many of these competitors possess greater technical, human and other resources than Digiplex does and its financial resources will be relatively limited when contrasted with those of many of these competitors. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target theaters. Because of this competition, Digiplex cannot assure you that it will be able to successfully compete for attractive theater acquisitions. In addition, while Digiplex believes that there are numerous potential target theaters that it can acquire, Digiplex’s ability to compete in acquiring certain sizable target theaters will be limited by its available financial resources. As a result of competition, Digiplex may not succeed in acquiring suitable candidates or may have to pay more than it would prefer to make an acquisition. If Digiplex cannot identify or successfully acquire suitable acquisition candidates, it may not be able to successfully expand its operations and the market price of its securities could be adversely affected particularly since acquisitions are an important part of Digiplex’s strategy.

Resources could be wasted in researching acquisitions that are not consummated.

It is anticipated that the investigation of each specific target theater and the negotiation, drafting, and execution of relevant agreements, disclosure documents, and other instruments will require substantial time and attention and substantial costs for accountants, attorneys and others. In addition, Digiplex may opt to make down

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payments or pay exclusivity or similar fees in connection with structuring and negotiating an acquisition. If a decision is made not to complete a specific acquisition, the costs incurred up to that point in connection with the abandoned transaction, potentially including down payments or exclusivity or similar fees, would not be recoverable. Furthermore, even if an agreement is reached relating to a specific target business, Digiplex may fail to consummate the transaction for any number of reasons, including those beyond Digiplex’s control. Any such event will result in a loss to Digiplex of the related costs incurred, which could adversely affect subsequent attempts to locate and acquire other theaters.

Digiplex is subject to uncertainties related to digital cinema, including insufficient financing to obtain digital projectors and insufficient supply of digital projectors.

Some of Digiplex’s competitors began a roll-out of digital projection equipment for exhibiting feature films during 2006 and most exhibitors plan to continue domestic roll-out of digital cinema until it is completed. However, significant obstacles may exist that impact such a roll-out plan and Digiplex’s ability to convert the theaters it acquires to digital projection platforms, including the availability of financing, the cost of digital projectors and the supply of projectors by manufacturers. Digiplex cannot assure you that it will be able to obtain sufficient additional financing to be able to purchase and/or lease the number of digital projectors Digiplex will require or that the manufacturers will be able to supply the volume of projectors needed for the worldwide roll-out that is now ongoing in Digiplex’s industry. As a result, Digiplex’s ability to deploy digital equipment in the theaters it acquires could be delayed. Accordingly, the availability of financing, the cost of digital projection systems and manufacturer limitations may delay Digiplex’s deployment of digital platforms.

Digiplex may not be able to obtain sufficient or compelling alternative content.

Digiplex’s ability to present alternative programming depends on the availability, diversity and appeal of alternative content and customer taste. This varies from geographic region to region. Poor performance of, or any disruption in the production or supply of alternative content could hurt Digiplex’s business and results of operations. In addition, the type of alternative content offered to Digiplex may not be accepted by the demographic base of movie-goers in Digiplex’s theaters.

The “virtual print fee” program expired on December 31, 2012, and Digiplex will no longer be able to use such fees to finance its purchases of digital projection equipment.

With respect to digital platforms installed prior to December 31, 2012, virtual print fees are provided to motion picture exhibitors from movie distributors, to encourage and assist exhibitors in the conversion to digital projection platforms, by effectively lowering the film rent expense that exhibitors pay to the movie distributors. The virtual print fee program provides that all distributors pay virtual print fees on a quarterly basis to motion picture exhibitors based on films scheduled by the exhibitors on approved digital projection platforms until the earlier of ten years from date the digital systems in a particular theater are installed or the date the exhibitor has recovered its out-of-pockets costs, including any financing charges, for the digital conversion. The virtual print fee program expired for new installations of digital projection systems made after December 31, 2012. Digiplex will continue receiving virtual print fees for approved digital projection systems installed prior to December 31, 2012.

As a result of the expiration of the virtual print fee program, Digiplex will need to finance installations of digital projection platforms from other sources. Digiplex may seek to reduce its proposed purchase price, offer a lower purchase price, seek other concessions with respect to any theater that it seeks to acquire which has not been previously converted to a digital projection system prior to the discontinuance of the virtual print fee program, or may limit its acquisitions to theaters that have already converted to digital. Digiplex cannot assure you, however, that it will be able to secure the financing that it may require or that it will be able to obtain the proposed purchase price reductions or other concessions.

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Disruption of Digiplex’s relationships with various vendors could substantially harm Digiplex’s business.

Digiplex relies on its relationships with several vendors in the operations of its business. These relationships include:

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

Deterioration in Digiplex’s relationships with any of the major film distributors could adversely affect its access to commercially successful films and could adversely affect its business and results of operations.

Digiplex’s business depends to a significant degree on maintaining good relationships with the major film distributors that license films to Digiplex’s theaters. Cinema Services handles negotiations with motion picture distributors on Digiplex’s behalf. Deterioration in Digiplex’s relationships with any of the major film distributors could adversely affect its access to commercially successful films and adversely affect its business and results of operations. Since the distribution of motion pictures is in large part regulated by federal and state antitrust laws and has been the subject of numerous antitrust cases, Digiplex cannot ensure a supply of motion pictures by entering into long-term arrangements with major distributors. Rather, Digiplex must compete for licenses on a film-by-film and theater-by-theater basis and is required to negotiate licenses for each film and for each theater individually.

Digiplex relies on software it licenses from Cinedigm to operate its accounting systems and a failure of this system could harm Digiplex’s business.

Digiplex depends on Cinedigm’s EMS back office management software system to operate the accounting functions of its business. A substantial system failure could temporarily restrict and limit its internal accounting functions. In addition, Digiplex relies on EMS to track theater invoices and to generate operating reports to analyze film performance and theater profitability. The EMS system is also an intricate part of Digiplex’s financial reporting process and provides Digiplex with information that, together with Digiplex’s other financial software program, allows Digiplex to prepare its periodic financial reports. Disruption in, changes to, or a system failure of the EMS system could result in the loss of important data, and increase Digiplex’s expenses.

Digiplex relies on “point-of-sale” software that it licenses from Omniterm Data Technology Ltd., which we refer to as “Omniterm”, to operate its back office management systems and a failure of this system could harm Digiplex’s business.

Digiplex depends on Omniterm’s point-of-sale software to operate its point-of-sale transactions, including issuing tickets to patrons at its theaters and selling concessions. A substantial system failure could restrict and limit Digiplex’s ability to issue tickets timely to its patrons, sell concessions and could reduce the attractiveness

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of its services and cause its patrons to visit other theaters. In addition, Digiplex also will rely on Omniterm to transmit data to Digiplex’s EMS software to generate operating reports, analyze film performance and theater profitability, and generate information to quickly detect theft. Disruption in, changes to, or a system failure of the Omniterm system could result in the loss of important data, and increase Digiplex’s expenses.

Digiplex depends on its senior management.

Digiplex’s success depends upon the retention of its senior management, including A. Dale Mayo, Digiplex’s chairman and chief executive officer, Chuck Goldwater, Digiplex’s senior vice president, Jeff Butkovsky, Digiplex’s chief technology officer, and Brian D. Pflug, Digiplex’s chief financial officer. In particular, Digiplex relies on the relationships in the motion picture exhibition industry that Mr. Mayo has fostered in his 25-year career in the industry. Digiplex cannot assure you that it would be able to find qualified replacements for the individuals who make up its senior management if their services were no longer available. The loss of services of one or more members of Digiplex’s senior management team could have a material adverse effect on Digiplex’s business, financial condition and results of operations. The loss of any member of senior management could adversely affect Digiplex’s ability to effectively pursue its business strategy.

Compensation may be paid to Digiplex’s senior management regardless of Digiplex’s profitability which may affect its operating results.

Digiplex has entered into employment agreements with each member of its senior management team. Mr. Mayo, Digiplex’s chairman and chief executive officer, is entitled to periodic salary increases as well as bonuses based on Digiplex’s consolidated gross revenues and regardless of whether Digiplex operates at a profit or loss. Each of Digiplex’s other executive officers is entitled to bonuses, as determined by Digiplex’s Board of Directors. Increases in compensation paid to Digiplex senior management would increase Digiplex’s expenses, affect its results of operations and might make it more difficult for Digiplex to achieve profitable operations.

If Digiplex does not comply with the Americans with Disabilities Act of 1990, it could be subject to litigation.

Movie theaters must comply with Title III of the Americans with Disabilities Act of 1990, referred to as the “ADA,” and analogous state and local laws. Compliance with the ADA requires among other things that public facilities “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. If Digiplex fails to comply with the ADA, remedies could include imposition of injunctive relief, fines, awards for damages to private litigants and additional capital expenditures to remedy non-compliance. Imposition of significant fines, damage awards or capital expenditures to cure non-compliance could adversely affect Digiplex’s business and operating results.

Digiplex depends on motion picture production and performance.

As a motion picture exhibitor, Digiplex’s ability to operate successfully depends upon the availability, diversity and appeal of motion pictures, Digiplex’s ability to license motion pictures and the performance of such motion pictures in its theaters. Digiplex licenses 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 Digiplex’s business and results of operations. In addition, a change in the type and breadth of movies offered by motion picture studios may not be accepted by the demographic base of moviegoers.

The motion picture exhibition industry has experienced declines trend 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. Digiplex expects the cyclical nature of the U.S. motion picture exhibition industry to continue for the foreseeable future, and a decline in attendance could adversely affect Digiplex’s

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results of operations. To offset any decrease in attendance, Digiplex plans to offer products unique to the motion picture exhibition industry, such as 3D films and specially selected alternative programming. Digiplex cannot assure you, however, that its offering of such content will offset any decrease in attendance that the industry may experience.

Digiplex’s business is subject to significant competitive pressures.

Digiplex faces varying degrees of competition from other motion picture exhibitors with respect to licensing films and attracting patrons. In those areas where real estate is readily available, there are few barriers preventing competing companies from opening theaters near one of Digiplex’s existing or future theaters. Many of Digiplex’s competitors have substantially more resources than Digiplex does and may therefore have a competitive advantage over Digiplex.

An increase in the use of alternative film delivery methods, which may be enhanced if traditional release windows are shortened, may drive down movie theater attendance and reduce ticket prices.

Digiplex competes with other movie delivery vehicles, including cable television, downloads and streaming video via the Internet, in-home video and DVD, satellite and pay-per-view services. When motion picture distributors license their products to the domestic exhibition industry, they refrain from licensing their motion pictures to these other delivery vehicles during the theatrical release window. The theatrical release window has shortened over the last decade. In addition, proposals have been made from time to time, particularly in the last several years, which would further shorten the window substantially and allow for premium video on demand and other alternatives that would be available during theatrical releases. These initiatives have not been instituted due, in part, to the adverse reaction of motion picture exhibitors. Digiplex cannot assure you that these initiatives will not be instituted in the future. Digiplex believes that a material contraction of the current theatrical release window could significantly dilute the consumer appeal of in-theater motion picture offerings, which could have a material adverse effect on Digiplex’s business and results of operations.

Digiplex’s revenues vary significantly depending upon the timing of the motion picture releases by distributors.

Digiplex’s business is seasonal, with a disproportionate amount of its revenues generated during the summer months and year-end holiday season. While motion picture distributors have begun to release major motion pictures more evenly throughout the year, the most marketable motion pictures are usually released during the summer months and the year-end holiday season, and Digiplex expects to generate more revenue and cash flows during those periods than in other periods during the year. As a result, the timing of motion picture releases affects Digiplex’s results of operations, which may vary significantly from quarter to quarter and year to year. If Digiplex does not adequately manage its theater costs of operations, it could significantly affect Digiplex’s cash flow and potential for future growth. Due to the dependency on the success of films released from one period to the next, results of operations for one period may not be indicative of the results for the following period or the same period in the following year.

There can be no assurance of a supply of motion pictures.

The distribution of motion pictures is in large part regulated by federal and state antitrust laws and has been the subject of numerous antitrust cases. Consent decrees resulting from those cases effectively require major motion picture distributors to offer and license films to motion picture exhibitors, including Digiplex, on a film-by-film and theater-by-theater basis. Consequently, Digiplex cannot be assured of a supply of motion pictures by entering into long-term arrangements with major distributors, but must compete for licenses on a film-by-film and theater-by-theater basis.

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Properties

The Rialto, Cranford and Bloomfield 8 theaters are occupied under lease agreements with existing terms of approximately nine years and six months for the Rialto and Cranford Theaters and 10 years for the Bloomfield 8. At Digiplex’s option, Digiplex can renew all of these leases at defined rates for various periods ranging from five to 20 years. These existing leases provide for contingent rentals based on the revenue results of the underlying theater and require the payment of taxes, insurance and other costs applicable to the property. Also, all leases contain escalating minimum rental provisions.

The five theaters constituting Cinema Centers are occupied under lease agreements with initial remaining terms of between approximately four to 15 years. At Digiplex’s option, Digiplex can renew all of the leases at defined rates for various periods ranging from nine to 20 years. Three of five leases for the Cinema Centers theaters provide for contingent rentals based on the revenue results of the underlying theater and all require the payment of taxes, insurance, and other costs applicable to the property. Also, all leases contain escalating minimum rental provisions.

The Lisbon theater is occupied under a 25-year lease until 2029, with fixed annual rents, escalating minimum rental provisions and contingent rentals based upon revenue. The lease also provides for the payment of taxes and other expenses applicable to the property and contains options for three additional rental periods of five years each.

The six theaters that were acquired in the Ultrastar Acquisitions are occupied under lease agreements with initial remaining terms of between approximately two to 14 years. At Digiplex’s option, Digiplex can renew each of the leases at defined rates for various periods ranging from five to 20 years. Each of the leases provides for contingent rentals based upon the revenue results of the underlying theater and all contain escalating minimum rental provisions and require the payment of taxes, insurance and other costs applicable to the property.

The Sparta theater is occupied under a 10-year lease with fixed annual rents, escalating minimum rental provisions and contingent rentals based upon revenue results.

The Solon theater is occupied under a 10-year lease, with fixed annual rents, escalating minimum rental provisions, and contingent rentals based on revenue. The lease also provides for the payment of taxes, insurance and other costs applicable to the property, and contains options for three additional periods of five years each.

The Torrington theater is occupied under a lease agreement with a 10-year initial term and four option terms of five years each at defined rental rates, with escalating rental provisions. The lease also provides for the payment of taxes, insurance and other costs applicable to the property.

The Mechanicsburg theater is occupied under a 20-year lease until 2029, with fixed annual rents and contingent rentals based upon revenue. The lease also provides for payment of taxes and other expenses applicable to the property and contains two options terms of five years each at defined rental rates.

The Churchville theater is occupied under a 10-year lease until 2021, with fixed annual rents with escalating minimum rental provisions. The lease also provides for payment of taxes and other expenses applicable to the property. There are no options to renew.

The New Smyrna Beach theater has been occupied since May 6, 2014 under a 10-year lease, with rent to commence in November, 2014. The theater is being renovated. The lease provides for four option terms of five years each.

Digiplex has leased facilities comprising its corporate office located at 250 East Broad Street, Westfield, New Jersey 07090, under a 10-year lease that commenced on December 31, 2010.

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Legal Proceedings

Digiplex is not currently a party to any material legal or administrative proceedings. Digiplex may, however, from time to time become a party to various legal or administrative proceedings arising in the ordinary course of its business.

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DIGIPLEX MANAGEMENT’S DISCUSSION AND ANALYSIS OF DIGIPLEX’S FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Digiplex’s fiscal year ends on June 30 each year.

Overview

(dollars in thousands, except share data)

At March 31, 2014, Digiplex operated 20 theaters located in New Jersey, Connecticut, Pennsylvania, Maryland, California, Arizona and Ohio, consisting of 192 screens. Digiplex’s theaters had 2,892,512 and 1,844,944 attendees for the nine months ended March 31, 2014 and 2013, respectively (for the portions of the periods Digiplex operated them). At June 30, 2013, Digiplex operated 18 theaters located in New Jersey, Connecticut, Pennsylvania, California, Arizona and Ohio, consisting of 178 screens. At June 30, 2012, Digiplex operated eight theaters located in New Jersey, Connecticut and Pennsylvania, consisting of 73 screens. Digiplex’s 18 theaters had over 2,850,000 attendees for fiscal year 2013 (for the time Digiplex operated the theaters, including only parts of the year at ten locations), and over 570,000 for fiscal year 2012 (for the period of time Digiplex operated them including only parts of the year at five locations).

Digiplex’s theaters operated as of March 31, 2014 are:

On December 10, 2012, Digiplex entered into a joint venture with Start Media, LLC, which we refer to as the “JV”, to acquire, refit and operate movie theaters. On December 21, 2012, wholly owned subsidiaries of JV completed the Ultrastar Acquisitions of seven theaters with an aggregate of 74 digital screens from the Ultrastar Sellers. These seven theaters have annual attendance of over 2.0 million patrons.

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As of March 31, 2014, JV operated 9 theaters with 92 screens, including the Ultrastar Acquisitions, theaters in Sparta, NJ and Solon, OH that were leased in January and February 2013, respectively and a theater in Torrington, CT acquired in July 2013. All of the JV locations are operated by Digiplex pursuant to the Management Agreements whereby Digiplex has full day to day responsibility for all aspects of theater operations, and Digiplex receives a fee equal to 5% of the gross revenues of these theaters.

On February 14, 2014, the JV sold the Mission Valley theater back to Ultrastar Theaters for 361,599 shares of Digiplex Class A common stock and $38 in cash. The sale was made after discussions with Ultrastar Theaters regarding the theater performance and the ability of the landlord to terminate the lease with little notice.

On December 19, 2013, Digiplex acquired an eight screen movie theater in Mechanicsburg, Pennsylvania. The theater was equipped with digital projection systems before Digiplex began operating the theater.

On March 21, 2014, Digiplex acquired a seven screen movie theater in Bel Air, Maryland. The theater was equipped with digital projection systems before Digiplex began operating the theater.

At March 31, 2014, Digiplex and Start Media owned 34% and 66% of the equity of JV, respectively.

Digiplex manages its business under one reportable segment: theater exhibition operations.

Components of Operating Results

Revenues

Digiplex generates revenues primarily from admissions and concession sales, with additional revenues from screen advertising sales and other revenue streams, such as theater rentals and private parties. Digiplex’s advertising agreement with NCM has assisted Digiplex in expanding its offerings to domestic advertisers and will be broadening ancillary revenue sources, such as digital video monitor advertising and third party branding. Digiplex’s alternative content agreements with NCM and others has assisted Digiplex in expanding its alternative content offerings, such as live and pre-recorded concert events, opera, ballet, sports programs, and other cultural events. In addition to NCM, Digiplex selects, markets and exhibits alternative content from a variety of other sources, including Emerging Pictures, Cinedigm Corp., Screenvision, DigiNext, and others as they offer Digiplex their programs. Digiplex’s 20 theaters are located in “free zones,” or areas that permit Digiplex to acquire movies from any distributor. As such, Digiplex displays all of the leading movies and can tailor its offerings to each of its markets.

Digiplex’s revenues are affected by changes in attendance and concession revenues per patron. Attendance is primarily affected by the quality and quantity of films released by motion picture studios. Digiplex’s revenues are seasonal, coinciding with the timing of releases of motion pictures by the major distributors. Generally, motion picture studios release the most marketable motion pictures during the summer and holiday seasons. The unexpected emergence or continuance of a “hit” film during other periods can alter the traditional pattern. The timing of movie releases can have a significant effect on its results of operations, and the results of one fiscal quarter are not necessarily indicative of the results for the next or any other fiscal quarter. The seasonality of motion picture exhibition, however, has become less pronounced as motion picture studios are releasing motion pictures somewhat more evenly throughout the year. Digiplex’s operations may be impacted by the effects of rising costs of its concession items, wages, energy and other operating costs. Digiplex would generally expect to offset those increased costs with higher costs for admission and concessions.

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Expenses

Film rent expenses are variable in nature and fluctuate with Digiplex’s admissions revenues. Film rent expense as a percentage of revenues is generally higher for periods in which more blockbuster films are released. Film rent expense can also vary based on the length of a film’s run and are generally negotiated on a film-by-film and theater-by-theater basis. Film rent expense is higher for mainstream movies produced by the Hollywood studios, and lower for art and independent product. Film rent expense is reduced by virtual print fees, which we refer to as “VPFs” that Digiplex records from motion picture distributors under an exhibitor-buyer agreement that entitles Digiplex to payments for the display of digital movies.

Cost of concessions is variable in nature and fluctuates with Digiplex’s concession revenues. Digiplex purchases concession supplies to replace units sold. Digiplex negotiates prices for concession supplies directly with concession vendors and manufacturers to obtain volume rates. Because Digiplex purchases certain concession items, such as fountain drinks and popcorn, in bulk and not pre-packaged for individual servings, Digiplex is able to improve its margins by negotiating volume discounts.

Salaries and wages include a fixed cost component (i.e., the minimum staffing costs to operate a theater facility during non-peak periods) and a variable component in relation to revenues as theater staffing is adjusted to respond to changes in attendance.

Facility lease expense is primarily a fixed cost at the theater level as most of Digiplex’s facility operating leases require a fixed monthly minimum rent payment. Digiplex’s leases are also subject to percentage rent in addition to their fixed monthly rent if a target annual revenue level is achieved.

Utilities and other expenses include certain costs that have both fixed and variable components such as utilities, property taxes, janitorial costs, repairs and maintenance, and security services.

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