IPIC Theaters - Chapter 11 Case Summary

Business Description

Headquartered in Boca Raton, Florida, iPic Theaters, LLC ("iPic Theaters" or the "Debtor") is one of America's premier restaurant-and-movie theater brands and a pioneer of the dine-in movie theater concept. The Debtor filed for relief under Chapter 11, Subchapter V of the Bankruptcy Code.

• The Debtor's mission is to provide entertainment escapes, presenting high-quality, chef-driven culinary and mixology in architecturally unique destinations that include premium movie theaters and restaurants.

The Debtor currently operates 13 locations in Florida, California, Georgia, New York, New Jersey, Texas, Washington, and Maryland, all of which are leased. Its corporate offices are located at 433 Plaza Real, Suite 355, Boca Raton, FL 33432-3932, which the Debtor also leases.

As of the Petition Date, the Debtor employed approximately 1,300 full- and part-time employees.

The Debtor had approximate gross income of $112,500,000 in 2025 and through January 31, 2026 had approximate gross income of $12,900,000. For the year ended December 31, 2025, the Debtor had a net loss of approximately $19,433,669.

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Corporate History

The Debtor's predecessor filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the District of Delaware in 2019. At the time, the Debtor's predecessor indicated that increased competition and rising construction costs affected financial liquidity.

• Moreover, the Debtor's predecessor's initial public offering failed to generate the capital sought, while the company's public equity resulted in increased operating costs related to Securities and Exchange Commission reporting and compliance requirements.

An affiliate of the Retirement Systems of Alabama, at the time a minority equity holder and lender to the Debtor, purchased the assets of the Debtor out of that bankruptcy proceeding. The Retirement Systems of Alabama currently owns 100% of the equity interests of the Debtor.

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Operations Overview

As of the Petition Date, the Debtor employs approximately 1,300 employees (collectively, the "Employees"), of which approximately 400 are full-time employees and 900 are part-time employees. The Employees are integral to the Debtor's operations and perform a wide variety of functions critical to the Debtor's ordinary course operations.

Payroll and Compensation Structure

The Debtor has designed its compensation programs to attract, retain, and motivate its employees. The Debtor pays Employees' wages, salaries, and other compensation bi-weekly, one week in arrears.

Prior to the Petition Date, the Debtor paid the Employee Compensation for certain employees of IPIC Marketing, LLC ("IPIC Marketing"), which is a wholly owned subsidiary of the Debtor. IPIC Marketing currently has six employees.

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Prepetition Obligations

As of the Petition Date, the Debtor reports approximately $2.6 million in total prepetition obligations, primarily consisting of unpaid wages and benefits, trade debt, and taxes.

Secured Claims

• The Debtor is aware of one UCC-1 financing statement filed by Konica Minolta Premier Finance with respect to a leased piece of equipment. The Debtor is unaware of any other secured claims.

Wages and Benefits

• There is approximately $2.1 million in wages and benefits in arrears owed as of the Petition Date.
  • Prior to the Petition Date, the Debtor spent approximately $1,624,500 per pay period on Employee Compensation in the aggregate (inclusive of Withholding Obligations).
  • As of the Petition Date, the Debtor estimates that the amount of accrued but unpaid Employee Compensation is approximately $1,523,500 (inclusive of Withholding Obligations).
• As of the Petition Date, the Debtor estimates that the aggregate amount of accrued but unpaid Deductions and Payroll Taxes (together, the "Withholding Obligations") is approximately $309,600.
  • During each applicable pay period, the Debtor routinely deducts certain amounts from Employees' paychecks, including, without limitation, garnishments, levies, child support and related fees, and pre-tax deductions payable pursuant to certain Health and Welfare Programs (collectively, the "Deductions"). The Debtor estimates that as of the Petition Date, it holds (or has accrued an obligation to deduct from the upcoming Employee paychecks) approximately $6,000.
• As of the Petition Date, the Debtor estimates that approximately $89,000 in Paid Time Off (the "Paid Time Off Obligations") has accrued but has not been used by Employees.

Employee Benefits

• Medical Plans: The total cost of the Medical Plans is approximately $65,000 per bi-weekly pay period, of which approximately $20,000 is covered by Employee premiums and approximately $45,000 is paid by the Debtor. As of the Petition Date, the Debtor is holding premium contributions from employees on account of the Medical Plans.
• Vision Plans: The total cost of the Vision Plans is approximately $1,000 per bi-weekly pay period, of which approximately $500 is covered by Employee premiums and approximately $500 is paid by the Debtor. As of the Petition Date, the Debtor is holding premium contributions from employees on account of the Vision Plans.
• Dental Plans: The total cost of the Dental Plans is approximately $3,500 per bi-weekly pay period, of which approximately $1,750 is covered by Employee premiums and approximately $1,750 is paid by the Debtor. As of the Petition Date, the Debtor is holding premium contributions from employees on account of the Dental Plans.
• Disability Benefits: Currently, eighty-nine Employees receive long-term disability benefits and one-hundred thirty-one Employees receive short-term disability benefits. The total cost of the short-term disability benefits to the Debtor is approximately $2,845 per month.
• Workers' Compensation Program: The Debtor pays an annual premium of $761,590 payable over a 12-month period. The premium is financed through AFCO. The next monthly payment is due February 28, 2026, in the amount of $63,465.84. As of the Petition Date, the Debtor does not believe that it has any amount of accrued and unpaid claims due on account of the Workers' Compensation Program.

Trade Debt

• The Debtor estimates that it owes approximately $409,000 to vendors and other parties in trade debt as of the Petition Date.

Taxes

• The Debtor estimates that it owes approximately $141,000 in taxes as of the Petition Date.
  • Sales Taxes: The Debtor estimates that, as of the Petition Date, it has accrued approximately $121,373.17 in total Sales Taxes owed to various Taxing Authorities.
  • New York Commercial Rent Taxes: The Debtor estimates that, as of the Petition Date, it has accrued approximately $20,171.43 in NY Rent Taxes that are owed to the City of New York, Department of Finance.

Insurance

• The Debtor's annual aggregate premium, TRIA, and surcharge payments (including taxes and fees) for the Insurance Policies is approximately $3,413,143.90, with approximately $2,928,298.00 financed or invoiced in installments, and approximately $327,049.72 paid per month.
  • The premiums for nine of the Insurance Policies are financed (collectively, the "Financed Policies") because it is not economically advantageous to pay the premiums on the Financed Policies, in full, on a lump-sum, quarterly, or monthly basis. The premiums are financed by AFCO Direct, a division of AFCO Credit/Acceptance Corporation ("AFCO"). As of the Petition Date, the Debtor is current with respect to its obligations under the terms of the Premium Finance Agreements.
  • The Debtor makes monthly installment premium payments to Willis Towers Watson Southeast Inc. d/b/a Willis Towers Watson Southeast Insurance Services, Inc. ("Willis"), its broker and agent, with respect to the four non-financed Insurance Policies on or around the first day of each month in the amount of $169,210.00. The next monthly installment payment is due on or around March 1, 2026. As of the Petition Date, the Debtor is current with respect to its obligations relating to the Non-Financed Policies.

Bank and Operational Fees

• The Debtor pays approximately $2,700 in Bank Fees on a monthly basis.
• The Debtor also utilizes a credit card receipt management and expense reporting platform through Concur (the "Concur Platform"). The cost of this platform is approximately $4,374 per quarter.
• The Debtor also incurs gift card program fees for a platform that the Debtor previously utilized as these gift cards are still being redeemed (the "Gift Card Platform"). The fee associated with this program was approximately $1,450 for February 2026.

Utility Deposits

• Currently, approximately five of the Utility Companies hold a security deposit or bond.

Customer Obligations

• As of January 31, 2026, there were 65,000,000 outstanding IPIC ACCESS points, however the terms and conditions of the program expressly state: Points have no cash value and are not redeemable for cash, gift certificates, gift cards, or any cash equivalent.

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Events Leading to Bankruptcy

Post-Acquisition Impact of COVID-19 Pandemic

Less than six months after the purchase of the Debtor's predecessor's assets out of bankruptcy, the COVID pandemic brought the movie theater industry to a screeching halt. While movie theaters subsequently reopened, the audience levels and box office receipts have never recovered to the levels that existed prior to the COVID pandemic.

• There are a variety of factors which have resulted in these depressed levels. The number of theatrical releases by movie studios has dropped significantly since prior to the COVID pandemic.
• Additionally, there is significantly increased competition for movie theaters from streaming services which enable consumers to watch a variety of entertainment options at home.

The Debtor, through this Subchapter V Case, intends to pursue an orderly liquidation of its assets for the benefit of its estate and stakeholders.