Investor Presentation NASDAQ: DCIN www.digiplexdest.com
Forward Looking Statements Certain statements and estimates in this presentation are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. They include, for example, statements about: expected benefits from the conversion to digital cinema; and the Company’s ability to successfully pursue its strategies. These forward-looking statements are not guarantees of future performance. They are based on management's expectations that involve a number of business risks and uncertainties, including the risks set forth under the heading “Risk Factors” in our prospectus dated April 18, 2012, any of which could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. Any estimates or other forward-looking statements provided in this presentation speak only as of the date they were made, and, except to the extent required by law, we undertake no obligation to update or review any estimate and/or forward-looking statement because of new information, future events or other factors. 2
Digiplex Overview Digiplex (NASDAQ: DCIN) is a fast-growing U.S. motion picture exhibitor dedicated to transforming movie theatres into digital entertainment centers Founded in 2010, DCIN operates 8 theatres and 73 screens in 3 states; HQ is Westfield, NJ Strategy is to acquire existing cash flow positive theatres in strategic markets, and increase profitability by converting to digital format and benefiting from operational synergies, incremental revenue opportunities and cost reductions DCIN closed its initial public offering (IPO) of 2.2 million shares of Class A common stock at $6.10 per share on April 20, 2012 Joint book running managers / co-lead underwriters of DCIN’s IPO exercised the overallotment option on May 4, purchasing an additional 323,900 shares of Class A common stock at the public offering price Aggregate net proceeds from the IPO and overallotment were approximately $13.2 million 3
Digiplex Investment Highlights Led By Industry Demonstrated Organic Growth / Veterans Track Record Acquisition Strategy Transform Movie Acquisition Theatres To Opportunities Entertainment Centers 4
Management Digiplex Management Team BUD MAYO , Chairman and CEO (Board Member): Industry veteran with over two decades of experience. Founder and former leader of Cinedigm Digital Cinema Corp. (NasdaqGM:CIDM) and Clearview Cinemas BRIAN PFLUG , CFO (Board Member): Former Controller at Clearview Cinemas and former SVP of Accounting and Finance at Cinedigm Digital Cinema Corp JEFF BUTKOVSKY , Chief Technology Officer: Former Senior Vice President and Chief Technology Officer from October 2000 to July 2010 for Cinedigm Digital Cinema Corp Digiplex Independent Board Members CHUCK GOLDWATER , Consultant – Cinedigm Digital Cinema Corp.: Has worked in senior management positions within the industry for over 20 years (Clearview Cinemas, Loews, Mann Theatres); former CEO of Digital Cinema Initiatives, the major studio consortium that set digital standards; currently a consultant for Cinedigm for their digital cinema deployment NEIL ANDERSON , Partner / Of Counsel – Sullivan & Cromwell: Experienced veteran in M&A transactions across the globe, formerly Sr. M&A Partner at Sullivan & Cromwell; frequent speaker and faculty member on professional seminars and programs dealing with M&A RICHARD CASEY , Software Entrepreneur / Founder – The Casey Group: Operating since 1989, IT consulting firm that helps clients leverage technology to gain strategic advantages; Board Member of Affinity Federal Credit Union MARTIN O’CONNOR, II , Managing Partner – O’Connor, Morss & O’Connor P.C.: Law Firm focused on advising clients of strategic planning, wealth management and family offices; specializes in entertainment law. Board Member of Cinedigm and Rentrak 5
Case Study: Clearview Cinemas Clearview Cinemas: Attractive exit return for IPO Investors when sold to Cablevision Share Price Aug-21-1997 ( market open ): $ 8.00 Sold for Share Price Dec-8-1998 ( on or about 12/8 ): $24.25 Hold Time ( # of days ): ~ 474 Return on Investment ( approximate ): 233% Clearview Cinemas Corporate Timeline 1995: Acquired 3 1996: Acquired 9 Aug. 1997: IPO – Sold Jan. – Sep. 1998: Acquired 11 theatres and 11 theatres and 39 1.15M shares for $9.2M theatres and the right to screens screens gross operate one theatre for a total of 54 screens 1994 1995 1996 1997 1998 Sep. 1994: Co-founded Dec. 1994: Received May 1996: Received 1997: Acquired 14 theatres with Dec. 1998: Sale to Cablevision by Bud Mayo with 4 equity from CMNY equity investment of 79 screens, added 6 screens to (NYSE: CVC) for $160M and theatres and 8 screens Capital and added 3 $4.5M from MidMark acquired theatres and acquired 35 screens including screens Capital constructed a 5 screen theatre New York City’s Ziegfeld Theatre PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS: The above information is presented solely for informational purposes, and no representation, warranty or guarantee is being made relative to the future performance of the Company or the trading price of its Class A common stock whatsoever. An investment in our Class A common stock involves significant risks. You should consider carefully all of the information in our preliminary prospectus dated April 9, 2012, including the risks and uncertainties described therein and the financial statements and related notes included therein, before making an investment in our Class A common stock. There is a substantial risk of loss. 6
Industry Overview 7
Box Office Results 3rd Consecutive Year Of $10B+ U.S. Box Office U.S. Annual Box Office Performance (billions $US) Box office growth over the long term $12 2011 (1970-2011) despite new media 5% Box Office CAGR* (1970-2011) $10.2 $11 outlets and alternative distribution $10 methods $9 $8 Q1 ’ 12 domestic box office revenues $7 $6 grew +23.7% Y/Y and attendance $5 grew +22.7% Y/Y 1 $4 $3 $2 $1 $0 Commercial Penetration of New Media Forms “Competing” With Box Office: 1 Source: BoxOfficeMojo Cable VCR Internet DVD Sources: Box Office Mojo, Box Office Magazine 8
Industry Growth Through All Economic Cycles Industry has Performed Well Long-term U.S. Box Office Performance Stable industry with long-term 12 $9.00 growth trends and consistent pricing power 10 $7.00 Box Office Revenues (billions $US) Average Ticket Price ($US) As a fairly inexpensive entertainment Attendance (billions) 8 option, the movie industry is resilient $5.00 to economic pressures 6 $3.00 Industry growth in five of the last 4 seven recessions $1.00 2 0 -$1.00 Box Office Revenues Tickets Sold Recession Period Avg. Ticket Price Sources: Box Office Mojo, Box Office Magazine 9
Out of Home Entertainment Options 2011 Average Ticket Price for a Family of Four ($US) NFL $309.44 NHL $228.40 Movie ticket costs for a family of four in North America are Theme $199.00 significantly lower when Parks compared to theme parks and NBA $193.92 major U.S. sports MLB $107.64 Cinemas $31.72 $- $50 $100 $150 $200 $250 $300 $350 Source: MPAA, NATO, Sports Leagues, International Theme Park Services 1 NBA and NHL data is for the last complete season. 10
Digital Cinema as the New Industry Paradigm Motion Picture Exhibitor Benefits Pricing: Premium 3D Expanded content offerings Improved seat utilization New revenue streams Operating efficiencies Incremental concession sales Digital cinema benefits both the Flexibility and faster delivery Sharper image, improved patron experience exhibitors and industry partners. DCIN is successfully Motion Picture Studio Benefits implementing innovative Distribution cost savings programming strategies to Visually higher-quality films further maximize the value of Pricing benefits from 3D format this new industry paradigm Improved security against piracy Ability to tap archives for re-releases Director / Producer Benefits Sharper image and advanced effects Enhanced creative platform Reduced post-production time Immersive viewer experience 11
Strong Growth of Digital Screens and 3D Worldwide Digital Screens (thousands) 1 Over half of the worldwide cinema screens have 70 already converted to digital format 60 50 Approximately 30% of worldwide cinema 40 screens are 3-D capable 30 20 Digital drives incremental admissions, 10 concessions and advertising revenues by - 2007 2008 2009 2010 2011 enabling theatres to show alternative content (i.e. Opera, Sports, Concerts, etc.) at off-peak U.S. Screens by Type (thousands) 1 times in addition to Hollywood films; DCIN utilizes preshow advertising supplied by Digital 3-D Digital non-3D Analog 45.0 40.0 National CineMedia (NasdaqGS: NCMI) 35.0 30.0 Alternative content represented 7% of DCIN’s 25.0 20.0 admissions revenues in 1 H’F 12; 10% December 15.0 quarter 10.0 5.0 Source: MPAA 2011 0.0 1 Total screens figures are forecasts as of February 2012. IHS Screen Digest revised the estimates for China and India significantly downward from 2010 levels, affecting the Asia Pacific and 2006 2007 2008 2009 2010 2011 global totals. 12
Business Overview 13
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