As filed with the U.S. Securities and Exchange Commission on December 17, 2021

Registration No. 333-261132

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 1 to

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

FOGO HOSPITALITY, INC.

(Exact name of registrant as specified in its charter)

Delaware

5812

82-4843070

(State or Other Jurisdiction of

Incorporation or Organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

14850 Quorum Drive, Suite 500

Dallas, TX 75254

Telephone: (972) 960-9533

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

Barry McGowan

Chief Executive Officer and Director

14850 Quorum Drive, Suite 500

Dallas, TX 75254

Telephone: (972) 960-9533

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

Copies to:

Robert W. Downes

Sullivan & Cromwell LLP

125 Broad Street

New York, New York 10004

(212) 558-4000

Blake Bernet

General Counsel

14850 Quorum Drive, Suite 500

Dallas, TX 75254

(972) 960-9533

Richard D. Truesdell, Jr.

Pedro J. Bermeo

Davis Polk & Wardwell LLP

450 Lexington Avenue

New York, New York 10017

(212) 450-4000

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☐
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐

CALCULATION OF REGISTRATION FEE



Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(1)	Amount of Registration Fee
Common Stock, par value $0.01 per share	$100,000,000	$9,270⁽²⁾

(1)	Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended. Includes the aggregate offering price of any additional shares of common stock that the underwriters have the option to purchase.

(2)	The registrant previously paid $9,270 of the registration fee in connection with a prior filing of this registration statement.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is neither an offer to sell these securities nor a solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION DATED DECEMBER 17, 2021

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Shares

Common Stock

This is an initial public offering of shares of common stock of Fogo Hospitality, Inc. We are offering shares of our common stock and the selling stockholders identified in this prospectus are offering shares of our common stock. We will not receive any proceeds from the sale of the shares by the selling stockholders.

Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share of our common stock will be between $ and $ . We have applied to list our common stock on the New York Stock Exchange (“NYSE”) under the symbol “FOGO”.

After the completion of this offering, we expect to be a “controlled company” within the meaning of the corporate governance standards of the NYSE. As of the date of this prospectus, the Rhône Funds (as defined herein) own approximately 99% of our common stock. Upon completion of this offering and assuming no exercise of the underwriters’ option to purchase additional shares, the Rhône Funds will continue to beneficially own approximately % of our outstanding common stock (or % if the underwriters’ option to purchase additional shares is exercised in full). As a result, the Rhône Funds will have the ability to determine all matters requiring approval by shareholders.

We are an “emerging growth company” under the federal securities laws and, as such, are eligible for reduced public company reporting and other requirements.

See “Risk Factors” beginning on page 34 to read about risks you should consider before buying shares of the common stock.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.


	Per Share	Total

Initial public offering price	$	$
Underwriting discounts and commissions (1)	$	$
Proceeds, before expenses, to Fogo Hospitality, Inc.	$	$
Proceeds, before expenses, to the selling stockholders	$	$

(1)	See “Underwriting (Conflicts of Interest).”

To the extent that the underwriters sell more than shares of common stock, the underwriters have the option to purchase up to an additional shares from the selling stockholders at the initial public offering price less underwriting discounts and commissions, for 30 days after the date of this prospectus. We will not receive any proceeds from the sale of our common stock by the selling stockholders pursuant to any exercise of the underwriters’ option to purchase additional shares.

The underwriters expect to deliver the shares of common stock against payment on or about , 2022.

Prospectus dated , 2022.

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FORO DE CHAO WELCOME TO WHAT’S NEXT

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Brand History OVER 40 YEARS OF RICH SOUTHERN BRAZILIAN HISTORY

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[1] LTM Q3 2021 [2] LTM Q3 2021 [3] AS OF DATE OF THIS PROSPECTUS (4) 7 COMPANY-OWNED IN BRAZIL, 7 FRANCHISE IN MEXICO AND THE MIDDLE EAST [5} ~300+ DOMESTIC AND ~250+ INTERNATIONAL UNITS $7.9M AUV $362M REVENUE 40%+ TARGET CASH-ON-CASH RETURNS 79% MILLENNIAL AND GEN X DEMOGRAPHICS 48 U.S. RESTAURANTS ACROSS 21 STATES, D.C. AND PUERTO RICO 15% TARGETED COMPANY OWNED UNIT GROWTH 6 YEARS OF CONSECUTIVE TRAFFIC GROWTH PRIOR TO THE COVID-19 PANDEMIC ~4,800 EMPLOYEES 14 INTERNATIONAL LOCATIONS 550+ UNIT WHITESPACE OPPORTUNITY [1] [2] [4] [5] [3]

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THE GAUCHO WAY: OUR VALUES TEAMWORK We are inclusive team players who continually work shoulder-to-shoulder to achieve together. INTEGRITY We do what we say we’re going to, and strive to do right by all-at and beyond our table. EXCELLENCE We are passionate about hospitality and take pride in everything we do. HUMILITY We are masters in our crafts, yet have genuine desire to serve and put others first. DEIXA COMIGO We’ve got you. We take chances, not orders, and use our tenacity, grit and resolve to make experiences unforgettable.

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OUR MISSION Ignite fire and joy to care for our teams, our guests and our communities.Feeding Our Futures At Fogo de Chao, we believe better futures start when we all bring our best to the table ever day. That’s why we fill our kitchens and communities with opportunity, inclusivity, quality and generosity-creating a brighter future for everyone. our vision bring the soul of southern brizilian hospitality to the heart of everycity. our commitments. Feeding Our Families people We feed families with fufilling job opportunities for our Tean Members, making space around the table so everyone feels welcome Fulfilling Careers inclusive Workpalce Rewards & Benefits Feeding Our Guests Food & Environment Our vision has always been to serve our guests the most wholesome, high-quality and safest food in an environemntally friendly way. It’s a tradition from the Brazilian gaucho way of nurturing and harvesting foods with respect [“respeito Pela Comida” in Portuguese]. Feeding our Communities Community We are committed to feeding our communities with respect, transparency and generosity of spirit. Fulfilling Careers Inclusive Workplace Rewards & Benefits Quality Proteins Raised with Integrity Wholesome & Nutritious Food Food Safety Environment Reducing Food Insecurity fulfilling Local Needs

TABLE OF CONTENTS


	Page
Market and Industry Data		ii
Basis of Presentation		ii
Trademarks and Copyrights		iii
Prospectus Summary		1
Risk Factors		34
Special Note Regarding Forward-Looking Statements		69
Use of Proceeds		71
Dividend Policy		72
Capitalization		73
Dilution		75
Management’s Discussion and Analysis of Financial Condition and Results of Operations		83
Business		116
Management		142
Executive Compensation		149
Certain Relationships and Related Party Transactions		158
Principal Stockholders		160
Description of Capital Stock		161
Shares Eligible For Future Sale		165
Material U.S. Federal Tax Considerations For Non-U.S. Holders		167
Underwriting (Conflicts of Interest)		170
Validity of Common Stock		176
Experts		176
Where You Can Find More Information		177
Index to Consolidated Financial Statements		F-1

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MARKET AND INDUSTRY DATA

This prospectus includes industry and market data that we obtained from periodic industry publications, third-party studies and surveys and internal company studies and surveys. These sources include government and industry sources. Industry publications and surveys generally state that the information contained therein has been obtained from sources believed to be reliable. Although we believe the industry and market data to be reliable as of the date of this prospectus, this information could prove to be inaccurate. Industry and market data could be wrong because of the method by which sources obtained their data and because information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties. In addition, we do not know all of the assumptions regarding general economic conditions or growth that were used in preparing the forecasts from the sources relied upon or cited herein, particularly given the novel coronavirus (“COVID-19”) pandemic and its impact on the industry in which we operate.

BASIS OF PRESENTATION

Unless the context otherwise requires, references in this prospectus to “Fogo Hospitality, Inc.,” “Fogo de Chão,” “we,” “us,” “our,” and “our company” are, collectively, to Fogo Hospitality, Inc., a Delaware corporation, the issuer of the common stock offered hereby, and its consolidated subsidiaries.

Fogo Hospitality, Inc. was incorporated under the name Prime Cut Parent Holdings Inc. on February 16, 2018 in connection with the acquisition of Fogo de Chão, Inc. on April 5, 2018 by funds managed or advised by affiliates of Rhône Group L.L.C. (together with its affiliates, “Rhône,” such managed or advised funds and their affiliates, the “Rhône Funds,” and such acquisition, the “Rhône Acquisition”). In connection with the Rhône Acquisition, Fogo de Chão, Inc. was the surviving entity of transactions consummated pursuant to the Agreement and Plan of Merger, dated as of February 20, 2018 (the “Merger Agreement”), by and among Fogo de Chão, Inc., Prime Cut Intermediate Holdings Inc., a wholly-owned subsidiary of Fogo Hospitality, Inc. (“Intermediate Holdings”), and Prime Cut Merger Sub Inc., a wholly-owned subsidiary of Intermediate Holdings (“Merger Subsidiary”), Merger Subsidiary merged with and into Fogo de Chão, Inc., with Fogo de Chão, Inc. surviving the merger as a wholly-owned subsidiary of Intermediate Holdings, which in turn was and remains a wholly-owned subsidiary of Fogo Hospitality, Inc. On September 13, 2021, we changed our corporate name from Prime Cut Parent Holdings Inc. to Fogo Hospitality, Inc. Please see “Summary—Our Corporate Information” for a simplified organizational chart.

Before completion of the Rhône Acquisition on April 5, 2018, Fogo de Chão, Inc. was a publicly listed company whose shares of common stock traded on the Nasdaq Global Select Market.

We operate on a 52- or 53-week fiscal year that ends on the Sunday that is closest to December 31 of each year. Each fiscal year generally is comprised of four 13-week fiscal quarters, although in the years with 53 weeks the fourth quarter represents a 14-week period. Fiscal 2019 and Fiscal 2020 ended on December 29, 2019 and January 3, 2021, respectively. Fiscal 2019 was comprised of 52 weeks and Fiscal 2020 was comprised of 53 weeks. Approximately every five or six years a 53-week fiscal year occurs. The current fiscal year, ending on January 2, 2022, is a 52-week fiscal year.

Same store sales growth reflects the change in year-over-year sales for comparable restaurants. We consider a restaurant to be comparable during the first full fiscal quarter following the eighteenth full month of operations. We adjust the sales included in the same store sales calculation for restaurant closures, primarily as a result of remodels and restaurant closures in connection with the COVID-19 pandemic, so that the periods will be comparable. The Company uses a 52/53 week fiscal year convention. For fiscal years following a 53 week year the Company calculates same store sales using the most comparable calendar week to the current reporting period. A restaurant is considered a closure and excluded from same store sales when it is closed for operations

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for four consecutive days. Once a restaurant is considered a closure it is excluded from same store sales retroactively to the beginning of the quarter in which the closure occurred. The restaurant will be considered comparable again during the first full fiscal quarter 12 months after the restaurant resumes operations. Changes in same store sales reflect changes in sales for the comparable group of restaurants over a specified period of time. Changes in same store sales reflect changes in guest count trends as well as changes in average check and highlight the performance of existing restaurants as the impact of new restaurant openings is excluded.

The key measures we use for determining how our business is performing are new restaurant openings, same store sales, average unit volumes (“AUVs”), average weekly sales, traffic, restaurant contribution, restaurant contribution margin, Adjusted EBITDA and Adjusted EBITDA margin. AUVs consist of the average sales of all restaurants that have been open for a trailing 52-week period or longer.

Restaurant contribution is equal to revenue less direct restaurant operating costs (which include food and beverage costs, compensation and benefit costs, and occupancy and certain other operating costs, including above restaurant operations general & administrative costs, but exclude depreciation and amortization expense and pre-opening expense). Restaurant contribution margin is equal to restaurant contribution as a percentage of revenue. Restaurant contribution and restaurant contribution margin and Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For more information about our key performance measures and non-GAAP financial measures presented herein, see “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Performance Indicators,” and for more information about non-GAAP financial measures presented herein, see “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures,” including for information regarding our non-GAAP financial measures and reconciliations to the most comparable GAAP measures.

Certain monetary amounts, percentages and other figures included in this prospectus have been subject to rounding adjustments. Percentage amounts included in this prospectus have not in all cases been calculated on the basis of such rounded figures but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this prospectus may vary from those obtained by performing the same calculations using the figures in our consolidated financial statements. Certain other amounts that appear in this prospectus may not sum due to rounding.

Unless we specifically state otherwise, all dollar amounts listed in this prospectus are in U.S. dollars.

TRADEMARKS AND COPYRIGHTS

We own or have rights to trademarks, service marks or trade names that we use in connection with the operation of our business, including our corporate names, logos and website names. This prospectus contains references to certain trademarks and brands. These include our original trademarks Fogo^®, Fogo de Chão^® and Bar Fogo^®. We believe that we have full ownership rights to these brands. Solely for the convenience of the reader, we refer to these brands in this prospectus without the TM or _® symbol, but we will assert, to the fullest extent under applicable law, our rights to our copyrights, trademarks, service marks, trade names and brands. Other trademarks, service marks or trade names referred to in this prospectus are the property of their respective owners.

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Prospectus Summary

This summary highlights some of the information contained elsewhere in this prospectus. This summary is not complete and does not contain all the information that you should consider before investing in our common stock. You should read the entire prospectus carefully, especially the risks of investing in our common stock discussed in the “Risk Factors” section of this prospectus and our consolidated financial statements and the related notes to those statements included elsewhere in this prospectus before making an investment decision to invest in our common stock.

Our Company

We are Fogo de Chão (fogo-dee-shoun), an internationally renowned, growing restaurant brand. For more than 40 years, we have been known for creating lively and memorable experiences for our guests and serving high-quality cuisine at an approachable price point, all inspired by Brazilian family-style dining. Our menu is fresh, unique and innovative, and is centered on premium cuts of grilled meats, each expertly butchered and simply seasoned, utilizing the centuries-old cooking technique of churrasco, and carved tableside by our gaucho chefs. Fogo’s guests are invited to partake in The Full Churrasco Experience, which allows them to enjoy as many of our high-quality meats and Market Table offerings as they desire at an accessible fixed price. Our unique model enables us to compete across multiple dining occasions and formats, which results in a vast addressable market. As of the date of this prospectus, our total footprint is 62 locations, of which 55 are company-owned and 48 of these are in the U.S. (across 21 states, the District of Columbia and Puerto Rico), with long-term domestic U.S. unit potential of at least 300 restaurants, representing a substantial 20-year growth opportunity.

The exceptional price-value of our offering appeals to a diverse population, and in particular resonates with Millennial and Generation X demographic groups, who collectively represent approximately 79% of our guests, based on a 2018 survey, providing an attractive guest composition to drive positive traffic growth for years to come. Our guests visit our restaurants across a wide range of dining occasions and dayparts, driving high restaurant traffic, averaging 129,000 guests per U.S. restaurant in Fiscal 2019, before the COVID-19 pandemic. Our high traffic is further supported by fast table turns because our guests do not need to wait for their entrées to be prepared to order, as our gaucho chefs circulate on a continuous service model, providing a personalized experience that is tailored to each guest’s specific preferences and desired pace of dining. Our gaucho chefs’ dual role as both a chef and server enables them to earn comparatively higher income through a tip pool, which, combined with a path to management, drives a long average gaucho tenure of over four years as of October 3, 2021, while also driving passion in our employee base, better guest experience, and stronger performance in our restaurants.

Through the consistent execution of our unique business model, we are able to produce attractive unit volumes and restaurant contribution margins. Our unique service model yields significant economic advantages to Fogo by meaningfully reducing our labor costs versus peers, which contributes to our strong margins. Our U.S. average unit volumes (“AUVs”) were $7.7 million, $4.4 million, $4.5 million and $7.9 million in Fiscal 2019, Fiscal 2020, the 52 weeks ended September 27, 2020 and the 52 weeks ended October 3, 2021, respectively, while our U.S. restaurant contribution margin was 28%, 10%, 6% and 30% in Fiscal 2019, Fiscal 2020, the 39 weeks ended September 27, 2020 and the 39 weeks ended October 3, 2021, respectively. Our AUVs in the 52 weeks ended October 3, 2021 and restaurant contribution margin in the 39 weeks ended October 3, 2021 were weakened by restaurant closures in the fourth quarter of Fiscal 2020 and the first quarter of Fiscal 2021 in connection with the COVID-19 pandemic. Additionally, our consolidated operating margin was 10%, (24%), (25%) and 11% in Fiscal 2019, Fiscal 2020, the 39 weeks ended September 27, 2020 and the 39 weeks ended October 3, 2021, respectively.

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The combination of attractive unit economics with our whitespace opportunity, which we estimate to be at least 300 restaurants over the next 20 years in the U.S., together lay the foundation for our growth algorithm. In 2022, we plan to open 8-10 company-owned and 1-2 international franchise restaurants, supported by a strong pipeline of new restaurant development. Beyond 2022, we plan to maintain company-owned unit growth of at least 15% annually while continuing to expand internationally with our franchise model.

Our consumer appeal is evidenced by our six-year track record of consecutive year-over-year traffic growth through Fiscal 2019. This trend has resumed in Fiscal 2021 following the impact of the COVID-19 pandemic in Fiscal 2020. In Fiscal 2019, we generated total revenue, net income and Adjusted EBITDA of $350 million, $10 million and $64 million, respectively. In Fiscal 2020, we generated total revenue, net loss and Adjusted EBITDA of $205 million, $(57) million and $(9) million, respectively, reflecting the impact of the COVID-19 pandemic. Additionally, our revenue, net income and Adjusted EBITDA for the 39 weeks ended October 3, 2021 was $296 million, $10 million and $54 million, compared to $138 million, $(38) million and $(13) million for the comparable period in Fiscal 2020, and $251 million, $4 million and $43 million for the comparable period in Fiscal 2019, respectively.

This positive trend in Fiscal 2021 has improved on a sequential quarterly basis. While the pandemic significantly depressed our financial results in Fiscal 2020 and into the first quarter of Fiscal 2021, our financial results improved markedly during the second and third quarters of Fiscal 2021. This recovery has been driven largely by a strong rebound in guest traffic as pandemic conditions have moderated. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Unaudited Quarterly Statements of Operations.”

The Key Value Drivers of Our Business Model

Our core tenets continue to serve as the key drivers of our business model:


		Our Core Tenets
Authentic, Experiential Dining		We offer culinary discoveries with our gaucho chefs curating our guests’ dining experience with something new and exciting on every visit.

Compelling Value and Appeal for All Occasions		Our high-quality cuisine, differentiated dining experience and approachable price points leads our restaurants to appeal to broad demographic and socioeconomic groups for a wide range of occasions.

Attractive Unit Economics		By optimizing labor, food costs and guest traffic, we generate attractive AUVs, U.S. restaurant contribution margin, operating margin and net income.

Proven Portability Across Geographies		We have delivered consistent AUV and margin performance across suburban, metro and urban markets.

Experienced Leadership		Our senior management team, led by our CEO Barry McGowan, is focused on providing exceptional hospitality while accelerating our growth.

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Our Transformation Under Private Ownership

Since going private in early 2018, we have continued to build on our exceptional customer proposition and unique business model by enhancing our unit economics, refining our real estate development criteria, building our new restaurant opening pipeline, enhancing our same store sales drivers, launching international franchising and strengthening our leadership capabilities:


		Initiatives
Expanded Management		Created new positions to focus on enhancing operations and driving growth initiatives, while promoting top-performing managers.

Data-Driven Market and Site Selection		Developed a rigorous approach to market and site selection by utilizing new data resources, better analytics and consistent objective criteria, leading to strong and predictable performance of our new units.

Prepared for Growth		Prepared for growth with the Company on track to open 6 restaurants in Fiscal 2021 and built a pipeline to facilitate 8-10 company-owned and 1-2 international franchise restaurants in 2022, with 15% annual company-owned restaurant growth and continued international franchise growth thereafter.

New, Efficient Unit Formats		Redesigned smaller footprint units that more efficiently use revenue-producing space and modified our construction specifications, thus lowering cost per square foot, resulting in higher cash-on-cash returns and margin of safety for our investments.

Expanded Whitespace		Based on internal analysis and a study prepared by eSite and focused on driving down unit costs and improving site selection via enhanced data analytics and an increased focus on demand potential, identified an expanded whitespace of over 300 domestic U.S. units, representing a substantial 20-year growth opportunity.

Expanded Menu and Broadened Dayparts		Offering a broader menu that features indulgent cuts and other premium items driving higher average check size and diversifying our dining occasions, as well as new experiences such as Bar Fogo and Next Level Lounge.

Enhanced Marketing		Developed a digital marketing program and loyalty program with personalized marketing that resonates with younger audiences and drives occasions and traffic.

Capital-Light International Growth		Established a capital-light franchise model across multiple countries and continents with a tangible pipeline.

Reduced Exposure to Brazil		Brazil exposure limited to 3% of our total revenues in the 52 weeks ended October 3, 2021.

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We believe that these enhancements, combined with Fogo’s enduring value drivers, together supported by an expanded development pipeline exhibiting these same characteristics, has robustly positioned our long-term sustainable growth algorithm domestically and abroad.

Our Financial Performance

These core tenets and initiatives had driven consistently strong financial results before the COVID-19 pandemic, and have driven exceptional results as we have rebounded from the pandemic this year. For more information about our non-GAAP Financial measures presented below, see “Management’s Discussion and Analysis of Financial Conditions and Results of Operation—Non-GAAP Financial Measures,” including for information regarding our non-GAAP financial measures and reconciliations to the most comparable GAAP measures.

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Brand Resilience During COVID-19 and Acceleration Thereafter

At the onset of the COVID-19 pandemic, we responded quickly to nationwide government mandated restaurant closures in March 2020 by first taking care of our team members and feeding those most in need in our communities. We launched our technology-based off-premise and expanded catering platforms to enable our stores to remain open and functional, albeit at lower revenue levels. Both platforms have become important and permanent offerings as new channels of revenue. While we had to furlough the vast majority of our non-salaried team members in connection with restaurant shut-downs during the COVID-19 pandemic, we consistently communicated with them and offered incentives to return as government-mandated restrictions were lifted. As a result, we were nearly fully staffed back to 2019 levels by October 2020, staying well-staffed relative to our capacity restrictions. At the same time, we kept many of our gaucho chefs and all of our managers and sales managers fully employed to ensure business continuity, successful off-premise capabilities, and to have the ability to ramp back aggressively once capacity restrictions were lifted. We began reopening restaurants in May 2020, introducing our 12 safety promises that exceeded the CDC requirements to provide a safe environment for our team members and guests.

As we re-opened, our coordinated efforts, focused on bringing nearly all of our team members back to work and fully re-staffing our restaurants, allowed us to deliver a “journey back to joy” experience for our guests. During this time, we created significant outdoor dining capacity where possible to help mitigate the indoor dining restrictions still in effect. We launched an all-day happy hour and enhanced our “Indulgent Platform” to “lead with joy while reassuring with safety.” At the same time, we secured over $50 million in available third-party debt funding to provide enhanced operating flexibility and growth capital, renegotiated most of our leases and improved structural rents by over $1.2 million annually. We believe that many of our responsive efforts to the COVID-19 pandemic have already materialized through improving financial results, as illustrated by our recent monthly same store sales and earnings evolution to date in Fiscal 2021 and record quarterly revenue, net income, restaurant contribution and Adjusted EBITDA generation in the 13 weeks ended July 4, 2021 and October 3, 2021.

Our New Restaurant Performance

Restaurants opened with our improved development strategy under private ownership have performed exceptionally well and provide us with strong conviction in the potential of our current new restaurant pipeline and our longer term growth ambitions.

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As of the date of this prospectus, our six new restaurants opened since 2019 are performing in excess of our expectations. For example, our three new U.S. restaurants opened since 2019 (located in Bethesda, Long Island and Irvine) that were open during the entire 39 weeks ended October 3, 2021 had average weekly sales of $169,000 in that period, compared to average weekly sales of restaurants opened previously of $169,000, $85,000, and $148,000 generated in the 39 weeks ended October 3, 2021, Fiscal 2020 and Fiscal 2019. The $169,000 average weekly sales for the three new U.S. restaurants referenced above exceeds the average weekly sales implied by our target year 3 U.S. AUV of $6.6 million by 33%. Additionally, these three new restaurants are approximately 14% smaller on average (9,100 square feet on average as opposed to 10,600 square feet on average), hence demonstrating the potential that our smaller sized units can generate comparable sales levels. Furthermore, three of our newer units opened during 2021 (White Plains, NY, Albuquerque, NM, and Burlington, MA) are performing above our expectations.

Based on strong average weekly sales of our new development model restaurants during the thirty-nine weeks of Fiscal 2021 and our reduced targeted average cash investment of $3.5 million per new restaurant, we have confidence that we will achieve our targeted 40% cash-on-cash returns with our new restaurant development strategy, which is generally in line with our 43% U.S. cash-on-cash returns and 43% Brazil cash-on-cash returns in Fiscal 2019, before the COVID-19 pandemic, and higher than our 11% U.S. cash-on-cash returns and (1%) Brazil cash-on-cash returns in Fiscal 2020, which reflect the impact of the COVID-19 pandemic.

Our Competitive Strengths

Authentic, Experiential Dining

Fogo provides guests with authentic experiences and the opportunity to discover something new at every turn. Our concept is centered on the wide range of freshly grilled, premium meats carved tableside, providing guests with the optionality to set the pace, portion, variety and temperature of their meal. These fire-roasted cuts are accompanied with continuous visits to the “Market Table” and hot, seasonal side dishes, all offered for a single price. Our main offerings feature a variety of simply seasoned meats including Brazilian style cuts of beef such as fraldinha (bottom sirloin) and picanha (top sirloin cap), our signature steak, as well as premium cuts such as filet mignon and ribeye, complemented by lamb, chicken and pork. On a typical day in our restaurants, guests can choose from as many as 14-16 different meat options. Our chefs serve each cut within moments of being removed from the grill, in a manner designed both to enhance the tenderness of each slice and meet our guests’ desired portion size and temperature. Our Market Table, which features a variety of seasonal salads, exotic fruits and vegetables, aged cheeses, smoked salmon and charcuterie, is immediately available once our guests are seated.

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In recent years, we have expanded our menu options in a number of ways designed to cater to a wider range of guests and occasions. For guests preferring lighter fare, or a vegetarian option, we offer à la carte seafood entrées and appetizers, a Market Table only option and a selection of sharable plates. And for those wishing to indulge, we now feature premium à la carte options to share with the table including dry-aged Tomahawk Ribeye and Wagyu steaks as well as appetizers such as seafood towers. These additions have also enabled us to drive positive “mix” in our same store sales growth as guests add incremental items to their checks. Our menu has been enhanced by a renewed focus on our wine list and a full bar (Bar Fogo), which offers a selection of seasonal cocktail innovations and Brazilian-inspired cocktails such as the caipirinha, or the caramelized pineapple old fashioned.

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Our gaucho chefs, skilled artisans who we train in the centuries-old culinary art of churrasco and the culture of Southern Brazil, are central to our ability to maintain consistency and authenticity throughout our restaurants. We utilize a continuous style of service, where our team members focus on anticipating guests’ needs by curating their dining experience with new discoveries on every visit. Our gaucho chefs engage with guests at their table, learning each guest’s specific preferences and tailoring their dining experience accordingly. In addition to providing an entertaining and interactive experience, our continuous service allows our guests to control the entrée variety, portions and pace of their meal, which maximizes the customization of their experience, value and the satisfaction they receive from dining at our restaurants. We believe our authentic, experiential dining built around our gaucho service model, distinct flavors and variety of cuisine are critical in driving guest visits to our restaurants.

Award-Winning Concept Appealing to a Broad and Attractive Customer Demographic with a Compelling Value Proposition for All Occasions

The combination of our high-quality cuisine, differentiated dining experience and approachable price points of our dayparts, including our prix fixe, all you can experience dining options, leads our restaurants to appeal to wide demographic and socioeconomic groups. Fogo provides guests with authentic experiences and the opportunity to discover something new at every turn, which are key drivers of dining frequency among our core demographic. The exceptional price-value of our offering appeals to a diverse population, and in particular resonates with the high-growth Millennial and Generation X demographic groups, who collectively represent 79% of our guests, based on a 2018 survey, providing a strong foundation to continue driving positive traffic growth for years to come.

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Source: 2018 customer survey with total respondents (N=2,028).

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In recent years, we innovated differentiated, new revenue platforms to drive frequency across guest need states, including weekday lunch, dinner, weekend Brazilian brunch and group dining, plus Bar Fogo, full-service catering and takeout and delivery options. Whether our guests opt for our Picanha Burger starting at $8 or our signature, The Full Churrasco Experience, where guests can sample a wide range of meat options and our Market Table starting at $54.95, our platforms provide our guests with an exceptional value compared to other restaurant concepts.

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Our platforms provide guests a preferred venue for various dining occasions, including intimate gatherings, family get-togethers, business functions, convention banquets and other celebrations. Our revenue platform expansion has effectively generated new trial and increased frequency as evidenced by our six-year track record of consecutive year-over-year traffic growth through Fiscal 2019. This trend has resumed in Fiscal 2021 following the impact of the COVID-19 pandemic in Fiscal 2020.

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Source: 2018 customer survey with total respondents (N=2,028).

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Our restaurants have received numerous awards and accolades from critics and reviewers domestically and internationally. For example, we have been nationally recognized by Nation’s Restaurant News, USA Today, Consumer Reports and Magazine, and Wine Spectator Magazine, and we have received local and social media awards from outlets including Zagat, Atlanta Magazine and Crain’s Chicago Business. Additionally, our restaurants are consistently ranked among the top dining options by reputable online reviewers such as Open Table, Trip Advisor and Yelp.

Unique Operating Model Drives Attractive Unit Economics

Our business model is unique in multiple aspects that relate to operating and restaurant contribution margin. First, since our freshly grilled meats are in constant circulation, our customers can begin eating as soon as they sit down, which enables fast turns of our tables by eliminating such tasks as long time spent over menus or waiting for distinct parts of meals to be served. Second, our gaucho chefs do more than simply take orders and serve the food – in addition, they butcher meat into the various cuts and then cook the meat, which reduces our labor cost compared to restaurants where the same functions are performed by distinct staff. Moreover, our simple fixed price menu results in less food waste, enables more efficient kitchen operations and provides us the flexibility to cope with food inflation by adjusting the protein mix.

Through the consistent execution of our unique business model, we are able to produce attractive unit volumes and restaurant contribution margins. Our U.S. AUVs were $7.7 million, $4.4 million, $4.5 million and $7.9 million in Fiscal 2019, Fiscal 2020, the 52 weeks ended September 27, 2020 and the 52 weeks ended October 3, 2021, respectively, while our U.S. restaurant contribution margin was 28%, 10%, 6% and 30% in Fiscal 2019, Fiscal 2020, the 39 weeks ended September 27, 2020 and the 39 weeks ended October 3, 2021, respectively. Our Brazil AUVs were $3.7 million, $1.6 million, $2.3 million and $1.9 million in Fiscal 2019, Fiscal 2020, the 52 weeks ended September 27, 2020 and the 52 weeks ended October 3, 2021, respectively, while our Brazil restaurant contribution margin was 24%, 1%, (3%) and 1% in Fiscal 2019, Fiscal 2020, the 39 weeks ended September 27, 2020 and the 39 weeks ended October 3, 2021, respectively. For the 39 weeks ended October 3, 2021, Brazil revenues represented 3% of Fogo’s consolidated revenue. Our AUVs in the 52 weeks ended October 3, 2021 and restaurant contribution margin in the 39 weeks ended October 3, 2021 were weakened by restaurant closures in the fourth quarter of Fiscal 2020 and the first quarter of Fiscal 2021 in connection with the COVID-19 pandemic. Additionally, our consolidated operating margin was 10%, (24%), (25%) and 11% in Fiscal 2019, Fiscal 2020, the 39 weeks ended September 27, 2020 and the 39 weeks ended October 3, 2021, respectively.

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Our restaurants that were open at least one full year as of December 29, 2019 generated an average U.S. cash-on-cash return of 43% in Fiscal 2019, and our restaurants that were open at least one full year as of January 3, 2021 generated an average U.S. cash-on-cash return of 11% in Fiscal 2020, which reflects the impact of the COVID-19 pandemic. In addition to AUVs and U.S. restaurant contribution margin, total U.S. labor costs, food & beverage costs and occupancy & other costs are presented in the following table as a percentage of total U.S. revenue for Fiscal 2019, Fiscal 2020 , the 39 weeks ended September 27, 2020, and the 39 weeks ended October 3, 2021, respectively:

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(All costs shown as a percent of total revenue)	39 Weeks Ended October 3, 2021⁽¹⁾	39 Weeks Ended September 27, 2020⁽¹⁾	FY 2020	FY 2019

U.S. Average Unit Volume	$7.9MM	$4.5MM	$4.4MM	$7.7MM

Total Labor Costs	25%	34%	32%	25%

Food & Beverage Costs	26%	29%	29%	27%

Occupancy & Other Operating Expenses	19%	31%	29%	20%

U.S. Restaurant Contribution Margin	30%	6%	10%	28%

U.S. Cash-on-Cash Return			11%	43%

(1)	The AUV measure is calculated for trailing 52 weeks.

Proven Portability and Consistent Performance Across Geographies in the U.S. and Abroad

Our concept works nationwide, across suburban, metro and urban markets. Such portability is proven by consistent AUV and margin performance across regions.

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Due to the broad appeal of our brand, the universal appeal of grilled meats, the diversity of our guest base, the variety of occasions served and the traffic generated by our restaurants, our concept is an attractive and desirable tenant for real estate owners. Landlords and developers, both in the United States and internationally, often seek out our restaurants to enhance their tenant mix and drive traffic in their developments. Our U.S. restaurants that opened prior to Fiscal 2019 attracted, on average, approximately 129,000 guests per restaurant in Fiscal 2019, which we believe, based on an internal survey of public fine-dining competitors, is approximately 60% more guests per restaurant than those competitors on average. In Fiscal 2020 and the 52 weeks ended October 3, 2021, our restaurants that opened prior to 2020 attracted, on average, 70,000 guests per restaurant and 122,000 guests per restaurant, respectively. Our consistent AUVs and restaurant contribution margin performance, brand recognition and relatively high guest traffic position us well to obtain prime site locations with favorable lease terms, which enhances our return on invested capital.

Experienced Leadership

Our tenured senior management team has extensive operating experience with an average of over 26 years of experience in the restaurant industry. We are led by our CEO, Barry McGowan. Mr. McGowan first began working with Fogo de Chão in 2013 as COO where he drove key platform creation such as unique dayparted menus for Weekday Lunch and Brunch, Bar Fogo, Appetizers, Market Table branding and Group Dining expansion, and increased our focus on hospitality, driving traffic and in-restaurant execution. Soon after we went private, Mr. McGowan was appointed as our CEO and has guided the growth of our company in comparable store traffic, revenue and Adjusted EBITDA, and our ongoing transformation, including via the expansion of

revenue and innovation platforms, the re-engineering and upgrade of our development process, and the growth of our global restaurant footprint including the acceleration and significant expansion of our new restaurant pipeline and the inception of our international franchising business model. Mr. McGowan leads a team of dedicated, experienced restaurant professionals who are equally passionate about Fogo, including Tony Laday, our CFO, Rick Lenderman, our COO, Selma Oliveira, our Chief Culture Officer, Janet Gieselman, our CMO, Andrew Feldmann, President of International Franchise Development and Blake Bernet, our General Counsel.

Our Growth Strategies

We plan to expand our restaurant footprint and platforms to drive revenue growth, improve operating contribution, restaurant contribution and Adjusted EBITDA margins, enhance our competitive positioning and continue to delight our diverse customer base by executing on the following strategies:

Grow Our Restaurant Base in the U.S. and Abroad

We are in the early stages of our growth with our 62 current restaurants, 48 of which are company-owned restaurants in the United States (across 21 states, the District of Columbia and Puerto Rico). We believe our concept has proven portability, with consistently strong AUVs across a diverse range of geographic regions and real estate settings. In 2022, we anticipate opening 8-10 new restaurants in the U.S., and 1-2 international franchises. Based on internal analysis and an in-depth study prepared by eSite, we believe there exists long-term potential for over 300 total sites in the United States, which represent a substantial 20-year growth opportunity. We also believe, based on an internal review of other American restaurant group store counts throughout the world as well as insights from our international franchise advisors, that there is potential for 250 franchise restaurants internationally over the next 20 years. Through the broad appeal of our differentiated concept, improved unit economic model and enhanced real estate strategy lowering overall investment costs, we believe we can meet the same return hurdles in smaller trade demand areas than in the past and do so more predictably, which has expanded our overall whitespace of new restaurants which meet our high return hurdle. While we are targeting a substantial whitespace opportunity in growing our restaurant base, we continue to evaluate the impact of the COVID-19 pandemic, which disrupted and may again disrupt our business and ability to expand our restaurant base.

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Our current restaurant investment model targets an average cash investment of $3.5 million per restaurant, net of tenant allowances and pre-opening costs, assuming an average restaurant size of approximately 8,500 square feet, an AUV of $6.6 million or $776 of sales per square foot and targeted cash-on-cash returns of approximately 40%, which we calculate by dividing our restaurant contribution in the third year of operation by our initial investment costs (net of tenant allowances and excluding pre-opening expenses). As of the date of this prospectus, six of our restaurants opened since 2019 (located in Albuquerque, NM, Bethesda, MD, Burlington, MA, Long Island, NY, Irvine, CA, and White Plains, NY) are performing in excess of our expectations. For example, our three new U.S. restaurants opened since 2019 that were open during the 39 weeks ended October 3, 2021 (Bethesda, MD, Long Island, NY, Irvine, CA) had average weekly sales of $169,000 in that period, compared to average weekly sales of restaurants opened previously of $169,000, $85,000 and $148,000 generated in the 39 weeks ended October 3, 2021, Fiscal 2020 and Fiscal 2019. The $169,000 average weekly sales for the three new U.S. restaurants referenced above exceeds the average weekly sales implied by our target year 3 U.S. AUV of $6.6 million by 33%. Additionally, these three new restaurants are approximately 14% smaller on average (9,100 square feet on average as opposed to 10,600 square feet on average), hence demonstrating the potential that our smaller sized units can generate comparable sales levels. Furthermore, three of our newer units opened during 2021 (White Plains, NY, Albuquerque, NM, and Burlington, MA) are performing above our expectations.

The strength of and thesis behind our improved development model is supported by the results of units opened thus far under it. These units are currently outperforming with respect to AUV and sales per square foot, despite these stores each being open for less than three years, representing the typical timeline for our stores to reach fully-stabilized levels of performance.

Our primary focus is a disciplined company-owned new restaurant growth strategy primarily in the United States in both new and existing markets where we believe we are capable of achieving sales volumes and restaurant contribution margins. We plan to open eight restaurants during Fiscal 2021, which includes six company-owned restaurants, and two franchise restaurants in Mexico. In 2022, we plan to open 8-10 company-owned and 1-2 international franchise restaurants, supported by a strong pipeline of new restaurant development. Beyond 2022, we plan to maintain a company-owned unit growth of at least 15% annually while continuing to expand internationally with our franchise model.

We plan to grow in international markets through our new franchise strategy, while simultaneously pursuing the opportunity to enter into airports and other non-traditional sites. We believe our high-quality food offering at an affordable price point served in an experimental setting will be received as well in international markets as it was when Fogo first expanded from Brazil to the U.S. in 1997, and as evidenced by the growth of our current franchising program in the Middle East and Mexico and the strong interest demonstrated by our franchise opportunity pipeline. We also believe both domestic U.S. and international airports represent a compelling, natural extension of our brand proposition opportunity given the immediacy of our dining model, rapid table turns, high quality of our food and reputation of our brand.

Continue to Grow Our Traffic and Comparable Restaurant Sales

Unlike many of our peers in the sit-down restaurant category, we consistently grew our traffic for six consecutive years prior to the COVID-19 pandemic. Our strategy is to build traffic with trial, new occasions through continuous culinary and bar innovation that build frequency, enhance our guest experience with add-on

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sales and then evaluate price increases (in line with inflation) by location to continue to maintain our strong value proposition versus our peers.

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Continue to Innovate Food and Beverage. We introduce innovative items that satisfy evolving consumer preferences and broaden our appeal, increasing the number of occasions for guests to visit our restaurants. To expand our value proposition, we introduced “added-value items” to The Full Churrasco Experience, such as our Bone-in Ribeye, Porterhouse or NY Strip and add-on “indulgent items,” such as Wagyu and Dry-aged Tomahawk Ribeye, center cut Cauliflower Steak (a vegan entrée), as well as affordably priced items like our $8 Picanha Burger. We have also introduced new beverages, such as our Passion Fruit Mimosas to appeal to our Bar Fogo brunch guests, among others. The expanded menu with the above items has increased our average check size. Finally, we plan to continue our menu innovation by introducing more seasonal and indulgent dishes.

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Expand Dayparts. We continue to drive comparable restaurant sales growth through expanding the dayparts offered at our restaurants. In 2015, we introduced dayparted menus with varying price points for additional occasions, such as weekday lunch, weekend brunch, dinner and special occasions to provide additional optionality to our guests and increase traffic in our restaurants. Additionally, our recently expanded Bar Fogo platform drives incremental daypart opportunities and features a more casual way to experience Fogo de Chão via small and sharable plates served at the bar, in addition to All Day Happy Hour and Cellar Selects in the dining room and bar.

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Further Grow Our Large Group Dining Sales. We believe our differentiated dining experience, broadly appealing menu, flexible restaurant layout, speed of service and compelling value proposition makes us a preferred destination for group dining occasions of all types. Our Group Sales managers covering all our restaurants have recently expanded their outbound targeting to include both in-dining occasions and off-site catering, which we believe will generate significant momentum in group sales growth.

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Accelerate Our Investment in Marketing. Beginning in 2018, we accelerated our investments in marketing, social engagement and advertising to drive guest trial and frequency by identifying media whitespace and seeking to expand our share of voice. We communicate new marketing initiatives through an ever-changing, layered media mix that reaches guests with emerging, predictive media (streaming video and audio, digital, social, podcasts), traditional media (TV, radio, print and out of home) and earned media (public relations and social buzz), with the intent to increase brand awareness. Our media mix, creative messaging and social engagement have resulted in strong ad completion and response rates, trackable year-over-year revenue growth and top quadrant community size, net sentiment and brand passion scores across social platforms. We will continue to harness word of mouth and e-mail marketing and grow our social media fan base through social engagement, unique promotions and rich content that reward loyalty and increase guest engagement with our brand. In addition, we intend to launch a curated loyalty program in 2022.

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Remodel Select Restaurants. We will continue to opportunistically remodel our restaurants to enhance the guest experience, highlight our brand attributes and encourage guest trial and frequency. We also believe there are opportunities to optimize revenue and restaurant capacity through patio enclosures, bar expansions, seating additions and innovation platforms to maximize sales per square foot.

Improve Margins by Leveraging Our Infrastructure and Investments in Human Capital

To better support our future growth and improve our operations and management team, we have invested in and fine-tuned our SG&A cost structure. We created new management positions in key functional areas to drive future growth initiatives including new restaurant site selection and analysis, new restaurant design, group dining, product innovation, procurement, international franchise development and in-restaurant employee training. We concurrently promoted several of our top performing managers to elevated positions in the organization. In addition, we have repurposed costs and implemented initiatives in our restaurants to improve quality, labor productivity and lower waste, which are designed to further enhance restaurant profitability and the

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guest experience. We have made substantial investments in our IT systems, which we expect to drive operational efficiency and greater margins through the use of labor productivity and training tools and improved guest frequency through the development of our loyalty and media platforms. We believe that improving our restaurant contribution and Adjusted EBITDA margins through both IT and restaurant infrastructure as well as human capital investments is a key driver of our future profitability growth, and these investments will drive operating leverage as our revenue grows.

Recent Developments

Preliminary Results for the Thirteen Weeks and Fiscal Year Ended January 2, 2022

We have not yet completed our closing procedures for the thirteen weeks ended January 2, 2022. Presented below are certain estimated preliminary unaudited financial results and key operating metrics for the thirteen weeks and fiscal year ended January 2, 2022. These ranges are based on the information available to us as of the date of this prospectus. We have provided estimated ranges, rather than specific amounts, because these results are preliminary and subject to change. These ranges reflect our management’s best estimate of the impact of events during the thirteen weeks ended January 2, 2022. As such, our actual results may vary from the estimated preliminary results set forth below and will not be finalized until after the completion of this offering.

In addition, the estimated preliminary results and key operating metrics set forth below are forward-looking statements and are not guarantees of future performance and may differ from actual results. See “Risk Factors” and “Special Note Regarding Forward-Looking Statements” for additional information regarding factors that could result in differences between the preliminary estimated ranges of certain of our financial results that are presented below and the actual financial results we will report. These estimates should not be viewed as a substitute for our full interim financial statements prepared in accordance with GAAP. Accordingly, you should not place undue reliance on these estimated preliminary results and key operating metrics. These estimated preliminary results and key operating metrics should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, “Risk Factors”, our audited consolidated financial statements and the related notes thereto, and our unaudited interim condensed consolidated financial statements and the related notes thereto included elsewhere in this prospectus.

Additionally, the estimates reported below include certain financial measures that are not required by, or presented in accordance with, GAAP. Management believes that investors’ understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. These non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation, or as an alternative to, or a substitute for, net income or other financial statement data presented in our consolidated financial statements as indicators of financial performance or liquidity. We may calculate or present these non-GAAP financial measures differently than other companies who report measures with the same or similar names, and as a result, the non-GAAP measures we report may not be comparable.

All of the data presented below has been prepared by and is the responsibility of management and have not been audited, reviewed, or compiled by our independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”). Accordingly, Deloitte does not express an opinion and assumes no responsibility for and disclaims any association with such preliminary estimated financial results.

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The following includes our unaudited preliminary estimated results and key operating metrics for the thirteen weeks ended January 2, 2022 (in thousands):


	Thirteen Weeks Ended
	January 2, 2022		January 3, 2021			December 29, 2019
	Low	High	Actuals			Actuals
New restaurant openings
Company-operated
Franchised
Total net new restaurant openings
U.S. Average unit volume (AUV) ($ in millions)⁽¹⁾			$	4.4		$	7.7
Same store sales⁽²⁾
Traffic growth
Revenue			$	66,838		$	98,602
Income (loss) from operations				(13,297	)		12,576
Operating margin				(19.9	%)		12.8	%
Total restaurant operating costs (excluding depreciation and amortization)				54,492			67,808
Restaurant contribution⁽³⁾			$	12,346		$	30,794
Restaurant contribution margin⁽³⁾				18.5	%		31.2	%

(1)	The AUV measure is calculated for the trailing 52 weeks.

(2)

For purposes of calculating same store sales, we consider a restaurant to be comparable during the first full fiscal quarter following 18 full months of operation. We adjust the sales included in the same store sales calculation for restaurant closures, primarily as a result of remodels and restaurant closures in connection with the COVID-19 pandemic, so that the periods will be comparable. A restaurant is considered a closure and excluded from comparable restaurant sales when it is closed for operations for four consecutive days. Same store sales growth reflects the change in year-over-year sales for the comparable restaurant base.

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Restaurant contribution, a non-GAAP financial measure, is equal to revenue generated by our restaurants sales less direct restaurant operating costs (which include food and beverage costs, compensation and benefit costs, and occupancy and certain other operating costs but exclude depreciation and amortization expense and pre-opening expense). This performance measure includes only the costs that restaurant-level managers can directly control and excludes other operating costs that are essential to conduct the Company’s business. Depreciation and amortization expense is excluded because it is not an operating cost that can be directly controlled by restaurant-level managers. Pre-opening expenses are excluded because we believe such costs do not reflect ordinary course operating expenses of our restaurants. Restaurant contribution margin is equal to restaurant contribution as a percentage of revenue from restaurant sales. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures—Restaurant Contribution and Restaurant Contribution Margin” for discussion of restaurant contribution and description of its limitations as an analytical tool.

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The following includes our unaudited preliminary estimated results and key operating metrics for the fiscal year ended January 2, 2022 (in thousands):


	Fiscal Year Ended
	January 2, 2022		January 3, 2021			December 29, 2019
	Low	High	Actuals			Actuals
New restaurant openings
Company-operated				—			3
Franchised				1			2
Total net new restaurant openings				1			5
U.S. Average unit volume (AUV) ($ in millions)			$	4.4		$	7.7
Same store sales				(40.9	%)		2.7	%
Traffic growth				(43.0	%)		0.6	%
Revenue			$	204,824		$	349,886
Income (loss) from operations				(48,368	)		34,064
Operating margin				(23.6	%)		9.7	%
Total restaurant operating costs (excluding depreciation and amortization)				184,716			251,656
Restaurant contribution			$	20,108		$	98,230
Restaurant contribution margin				9.8	%		28.1	%

Restaurant Contribution Reconciliation

The following table reconciles income (loss) from operations, the most comparable GAAP measure, to preliminary restaurant contribution for the thirteen weeks ended January 2, 2022 (in thousands):


	Thirteen Weeks Ended
	January 2, 2022		January 3, 2021			December 29, 2019
	Low	High	Actuals			Actuals
Income (loss) from operations			$	(13,297	)	$	12,576
Marketing and advertising				3,301			2,639
General and administrative				6,136			7,139
Pre-opening costs				163			1,397
Impairment charge				10,163			448
Depreciation and amortization				6,589			6,378
Gain on sale of Mexican JV				(1,023	)		—
Other operating (income) expense, net				314			217

Total restaurant contribution			$	12,346		$	30,794

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The following table reconciles income (loss) from operations, the most comparable GAAP measure, to preliminary restaurant contribution for the fiscal year ended January 2, 2022 (in thousands):


	Fiscal Year Ended
	January 2, 2022		January 3, 2021			December 29, 2019
	Low	High	Actuals			Actuals
Income (loss) from operations			$	(48,368	)	$	34,064
Marketing and advertising				7,180			10,065
General and administrative				23,078			25,675
Pre-opening costs				1,146			3,478
Impairment charge				10,566			448
Depreciation and amortization				25,127			24,620
Gain on sale of Mexican JV				(1,023	)		—
Other operating (income) expense, net				2,402			(120	)

Total restaurant contribution			$	20,108		$	98,230

Our Sponsor

Rhône, established in 1996, is a global private equity firm with a focus on investing in high-quality, industry-leading businesses with significant opportunities for value creation through transformative improvement and international expansion. Rhône operates across its London, New York and Madrid offices. Rhône has invested in a diversified portfolio of companies including investments in the business services, branded consumer, and industrial sectors.

As of the date of this prospectus, the Rhône Funds own approximately 99% of our common stock. Upon completion of this offering and assuming no exercise of the underwriters’ option to purchase additional shares, the Rhône Funds will continue to beneficially own approximately % of our outstanding common stock (or % if the underwriters’ option to purchase additional shares is exercised in full). As a result, the Rhône Funds will have the ability to determine all matters requiring approval by shareholders. Additionally, we expect to be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”), on which we have applied for our shares to be listed. See “Risk Factors—Risks Related to this Offering, Ownership of Our Common Stock and Our Governance Structure—We will be a “controlled company” within the meaning of NYSE rules and, as a result, will be exempt from certain corporate governance requirements.

Rhône engages in a range of investing activities, including investments in restaurants and other consumer-related companies in particular that could directly or indirectly compete with us. In the ordinary course of its business activities, Rhône may engage in activities where its interests conflict with our interests or those of our stockholders. See “Risk Factors—The Rhône Funds have a substantial ownership interest in our common stock. Conflicts of interest may arise because some of our directors are principals of Rhône.”

Our Corporate Information

Fogo Hospitality, Inc. was incorporated as a Delaware corporation as Prime Cut Parent Holdings Inc. on February 16, 2018. On September 13, 2021 we changed our corporate name from Prime Cut Parent Holdings Inc. to Fogo Hospitality, Inc. Our principal executive offices are located at 14850 Quorum Drive, Suite 500, Dallas, TX 75254. Our telephone number is (972) 960-9533. The address of our website is www.fogo.com. The information contained on, or accessible through, our website is not incorporated in, and shall not be part of, this prospectus.

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Our corporate structure, reflecting the completion of this offering, is set out in the following simplified organizational chart, which shows the economic and voting power of the Rhône Funds, public shareholders, our directors and management after this offering. Upon completion of this offering, the Rhône Funds will continue to hold capital stock representing a majority of our outstanding voting power and we will be a “controlled company” within the meaning of NYSE corporate governance standards. The Rhône Funds will have the ability to determine all matters requiring approval by stockholders.

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Use of Proceeds and Concurrent Refinancing Transaction

As of October 3, 2021, we had $344.2 million aggregate principal amount of outstanding debt, consisting of approximately $311.7 million of original term loans (the “Original Term Loans”) and $32.5 million of incremental term loans (the “Incremental Term Loan” and, together with the Original Term Loan, the “Term Loans”) under our senior secured credit agreement between Fogo de Chão, Inc. and certain of our other subsidiaries and a syndicate of lenders and Credit Suisse Loan Funding LLC and Wells Fargo Securities, LLC (as subsequently amended from time to time, the “2018 Credit Agreement”) in connection with the Rhône Acquisition (the “2018 Credit Facility”). In addition, we have access to (i) $35 million of revolving credit facility available with Credit Suisse Loan Funding LLC and Wells Fargo Securities, LLC until April 2023 and (ii) $11.2 million of the Woodforest Bank Loan available for draw down until December 2025.

Concurrently with, and conditioned upon, the consummation of our initial public offering, we intend to repay in full and terminate our existing 2018 Credit Facility and enter into a new $210 million credit facility consisting of $150 million of senior secured term loans and a $60 million revolving credit facility (the “New Credit Facility”). The amount, maturity, interest rates and other terms of the New Credit Facility are subject to continuing negotiations with prospective lenders. We expect the new term loans will have a maturity of seven years and that the revolving credit facility will have a maturity of five years from the effective date of the New Credit Facility. We expect that the New Credit Facility will contain customary covenants applicable to us and certain of our subsidiaries, including a springing financial maintenance covenant requiring us to maintain a maximum First Lien Net Leverage Ratio (as will be defined in the New Credit Facility) if usage of the revolving credit facility exceeds a certain level as of the end of any four fiscal quarter period. Borrowings under the New Credit Facility may vary significantly from time to time depending on our cash needs at any given time, and upon consummation of our initial public offering we expect that approximately $150 million of term loans will be

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drawn under our New Credit Facility. The Company may also borrow revolving loans under the New Credit Facility at the consummation of our initial public offering, subject to liquidity requirements. See “Use of Proceeds” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Facility.”

Implications of Being an Emerging Growth Company

As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:

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being permitted to present only two years of audited financial statements and only two years of related Management’s Discussion and Analysis of Financial Condition and Results of Operations in this prospectus;

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not being required to comply with the auditor attestation requirements on the effectiveness of our internal controls over financial reporting;

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not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis);

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reduced disclosure obligations regarding executive compensation arrangements; and

•

exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We may use these provisions for so long as we remain an emerging growth company until the last day of the fiscal year following the fifth anniversary of the date of the completion of this offering, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.

Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards. We have elected to use this extended transition period under the JOBS Act until such time the Company is no longer considered to be an emerging growth company.

We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.

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The Offering

Issuer

Fogo Hospitality, Inc.

Common stock offered by Fogo Hospitality, Inc.

shares.

Common stock offered by the selling stockholders

shares.

Option to purchase additional shares

We have granted the underwriters an option for a period of 30 days to purchase up to additional shares of common stock from the selling stockholders.

Common stock outstanding immediately after this offering

shares (or shares if the underwriters exercise their option to purchase additional shares in full).

Principal stockholders

Upon completion of this offering, the Rhône Funds will continue to beneficially own a controlling interest in us. As a result, we intend to avail ourselves of the controlled company exemption under NYSE corporate governance standards. See “Management—Board Composition.”

Voting rights

Holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders.

Dividend policy

We currently intend to retain all of our earnings for the foreseeable future to fund the operation and growth of our business and to repay indebtedness, and therefore, we do not anticipate paying any cash dividends in the foreseeable future. Any future determination to declare and pay cash dividends will be at the discretion of our board of directors and will depend on, among other things, our financial condition, results of operations, cash requirements, liquidity, contractual restrictions, general business conditions and such other factors as our board of directors deems relevant. In addition, our 2018 Credit Facility restricts, and our New Credit Facility will restrict, our ability to pay dividends. For additional information, see “Dividend Policy.”

Use of proceeds

We estimate that the net proceeds to us from this offering will be approximately $ million, assuming an initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

We intend to use the net proceeds of this offering, together with borrowings under our New Credit Facility, to fully repay the outstanding indebtedness under our 2018 Credit Facility and to pay fees and expenses related to our initial public offering, the entry into

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the New Credit Facility and the repayment in full and termination of our 2018 Credit Facility. See “Use of Proceeds.”

We will not receive any of the proceeds from the sale of shares of common stock by the selling stockholders in this offering. The selling stockholders will receive all of the net proceeds and bear the underwriting discount, if any, attributable to their sale of our common stock. We will pay certain expenses associated with this offering. See “Use of Proceeds” and “Principal and Selling Stockholders.”

Conflicts of Interest

A portion of the proceeds from this offering, together with borrowings under our New Credit Facility, will be used to repay the outstanding indebtedness under our 2018 Credit Facility. Because affiliates of Credit Suisse Securities (USA) LLC are lenders under our 2018 Credit Facility and each will receive 5% or more of the net proceeds of this offering, Credit Suisse Securities (USA) LLC is deemed to have a “conflict of interest” under Rule 5121 of the Financial Industry Regulatory Authority, Inc., or FINRA. As a result, this offering will be conducted in accordance with FINRA Rule 5121. Pursuant to that rule, the appointment of a “qualified independent underwriter” is not required in connection with this offering as the members primarily responsible for managing the public offering do not have a conflict of interest, are not affiliates of any member that has a conflict of interest and meet the requirements of paragraph (f)(12)(E) of FINRA Rule 5121. See “Use of Proceeds” and “Underwriting (Conflicts of Interest).”

Risk factors

Investment in our common stock involves substantial risks. Please read this prospectus carefully, including the section entitled “Risk Factors” and the consolidated financial statements and the related notes to those statements included elsewhere in this prospectus before deciding to invest in our common stock.

Expected NYSE symbol

FOGO

The number of shares of our common stock to be issued and outstanding after the completion of this offering is based on shares of our common stock issued and outstanding as of , 2021. Unless otherwise indicated, information in this prospectus:

•

assumes an initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus;

•

reflect the consummation of the stock split to be effected upon the closing of the offering pursuant to which each share held will be reclassified into shares;

•

assumes no exercise by the underwriters of their option to purchase up to an additional shares of our common stock; and

•

does not reflect an additional shares of our common stock reserved for future grant under our 2022 Plan (as defined herein) which we expect to adopt in connection with this offering.

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Summary Risk Factors

Investing in our common stock involves substantial risk. The risks described in the section titled “Risk Factors” immediately following this summary may cause us to be unable to successfully execute all or part of our strategy or realize the full benefits of our competitive strengths.

The Company’s business is subject to uncertainties and risks including:

•

The ongoing COVID-19 pandemic and restrictions adopted by governments and measures taken by individual consumers in response to the pandemic have adversely affected, and will continue to adversely affect, our operations and financial results for the foreseeable future.

•

As a consumer-based business, certain changes in macroeconomic and societal conditions including an economic slowdown, changing consumer preferences, food safety and foodborne illness concerns as well as outbreaks of flu, viruses or other diseases transmitted by human contact could adversely affect our business, financial position and results of operations.

•

Our long-term growth depends on our ability to successfully identify appropriate sites and open new restaurants in existing and new markets and to operate these restaurants profitably.

•

We rely significantly on certain suppliers. Their failure to provide deliveries or services at the quantity, quality or cost level acceptable to us could harm our business, financial position and results of operations.

•

Our business depends on guest goodwill. If we fail to conduct successful marketing programs and effectively manage our public image, our business will suffer.

•

We are subject to all of the risks associated with leasing space subject to long-term non-cancelable leases.

•

We face a variety of economic, regulatory and other risks associated with doing business in foreign markets that could have a negative impact on our financial performance.

•

Our business is subject to extensive federal, state, local and foreign beer, liquor and food service regulations including requirements to obtain certain licenses and permits. Our failure to comply with applicable laws could harm our reputation and business and changes in current laws could significantly increase our operational costs.

•

Failure to obtain, maintain, protect and enforce our intellectual property rights could adversely affect the value of our business, including our brand.

•

We rely heavily on information technology, and any material failure, weakness, interruption or breach of security could prevent us from effectively operating our business.

•

A breach of security of confidential or consumer personal information related to our electronic processing of credit and debit card transactions, Cybersecurity breaches of confidential or personal information of our guests and team members, threats to our technological systems and increasing privacy compliance requirements could substantially affect our business, reputation and financial results.

•

The amount of money that we have borrowed and may in the future borrow could adversely affect our financial condition and operating activities.

•

Our 2018 Credit Facility imposes, and our New Credit Facility will impose, operating and financial restrictions that may impair our ability to respond to changing business and industry conditions.

•

We cannot assure you that we will be able to refinance the indebtedness we will incur under the New Credit Facility.

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The Company is subject to general risk factors including:

•

We face significant competition from other restaurant companies, which could adversely affect our business and financial performance and make it difficult to expand in new and existing markets.

•

Our future success depends upon the continued appeal of our restaurant concept and we are vulnerable to changes in consumer preferences.

•

Loss of key management personnel could hurt our business and inhibit our ability to operate and grow successfully.

Your ownership of common stock is subject to risks including:

•

As a “controlled company,” we may rely on exemptions from certain corporate governance requirements required under NYSE corporate governance rules.

•

We are controlled by the Rhône Funds whose interests may conflict with ours or yours.

•

Future sales of our common stock could cause the market price of such shares to fall.

•

The market price and trading volume of our common stock may be volatile, which could result in rapid and substantial losses for our stockholders.

•

We do not intend to pay dividends for the foreseeable future, which could reduce your chance of receiving any return on an investment in our common stock.

•

We are an “emerging growth company,” and we take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of Sarbanes-Oxley, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

•

As a public company, we are required to establish and maintain effective internal controls pursuant to the Sarbanes-Oxley Act. Failure to do so could adversely affect our business and stock price.

Summary Consolidated Financial and Other Information

The following tables present summary consolidated financial information of the Company as of October 3, 2021, for the 39 weeks ended October 3, 2021 and September 27, 2020, and for the fiscal years ended January 3, 2021 and December 29, 2019.

The summary historical consolidated statements of operations and cash flow data for the fiscal years ended January 3, 2021 and December 29, 2019 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary historical consolidated statements of operations and cash flow data for the 39 weeks ended October 3, 2021 and September 27, 2020, and the summary of historical consolidated balance sheet as of October 3, 2021, have been derived from our unaudited interim condensed consolidated financial statements included elsewhere in this prospectus. Historical amounts do not give effect to the consummation of the stock split to be effected upon the closing of this offering. Historical results for any prior period are not necessarily indicative of results that may be expected in any future period, and results for any interim period are not necessarily indicative of results that may be expected for the entire year. The data set forth in the following tables should be read together with the sections of this prospectus entitled “Use of Proceeds,” “Capitalization,” “Unaudited Pro Forma Consolidated Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” and in our consolidated financial statements and related notes to those statements included elsewhere in this prospectus.

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	Fiscal Period Ended October 3, 2021			Fiscal Period Ended September 27, 2020			Fiscal Year Ended January 3, 2021			Fiscal Year Ended December 29, 2019
(in thousands)	(39 weeks)			(39 weeks)
Consolidated Statements of Operations:
Revenue
U.S. restaurants⁽¹⁾	$	286,841		$	130,668		$	194,357		$	320,238
Brazil restaurants		8,758			7,318			10,467			29,648

Total revenue		295,599			137,986			204,824			349,886

Restaurant operating costs (excluding depreciation and amortization)
Food and beverage		79,420			40,368			59,933			97,099
Compensation and benefits		74,443			46,047			64,234			83,546
Occupancy and other		56,704			43,809			60,549			71,011

Total restaurant operating costs (excluding depreciation and amortization)		210,567			130,224			184,716			251,656

Marketing and advertising		11,892			3,879			7,180			10,065
General and administrative		18,959			16,942			23,078			25,675
Pre-opening costs		2,831			983			1,146			3,478
Impairment charge		—			403			10,566			448
Depreciation and amortization		18,434			18,538			25,127			24,620
Gain on sale of Mexico JV		—			—			(1,023	)		—
Other operating (income) expense, net		(139	)		2,088			2,402			(120	)

Total operating costs		262,544			173,057			253,192			315,822

Income (loss) from operations		33,055			(35,071	)		(48,368	)		34,064
Other income (expense):
Interest expense, net of capitalized interest		(21,075	)		(18,729	)		(26,312	)		(23,768	)
Interest income		61			41			61			95
Other income (expense)		(180	)		(38	)		(88	)		(126	)

Total other income (expense)		(21,194	)		(18,726	)		(26,339	)		(23,799	)

Income (loss) before income taxes		11,861			(53,797	)		(74,707	)		10,265
Income tax expense (benefit)		2,299			(14,364	)		(16,970	)		1,626

Net income (loss)		9,562			(39,433	)		(57,737	)		8,639
Less: Net income (loss) attributable to noncontrolling interest		—			(1,474	)		(693	)		(987	)

Net income (loss) attributable to Fogo Hospitality, Inc.	$	9,562		$	(37,959	)	$	(57,044	)	$	9,626

1.	The U.S. revenue segment includes other revenues, which is comprised of gift card breakage revenue of $28 and $20 and franchised operations revenue of approximately $403 and $52 for the thirty-nine week periods ended October 3, 2021 and September 27, 2020, respectively.

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(in thousands)	As of October 3, 2021
Consolidated Balance Sheet (unaudited):	Actual			Pro Forma⁽¹⁾
Cash and cash equivalents	$	23,077
Total assets		772,190
Working capital		(19,887	)
Total liabilities		576,482
Total liabilities and shareholders’ equity		772,190

(1)	Pro forma amounts give effect to the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares.


(in thousands)	39 Weeks Ended						Fiscal Year Ended
Consolidated Statement of Cash Flows:	October 3, 2021			September 27, 2020			January 3, 2021			December 29, 2019
Net cash provided by (used in)
Operating activities	$	32,095		$	(15,260	)	$	(28,033	)	$	43,600
Investing activities		(16,670	)		(6,121	)		(6,788	)		(30,682	)
Financing activities		(11,200	)		64,590			40,246			(12,523	)
Effect of foreign exchange		(112	)		(543	)		(456	)		(12	)

Net increase in cash	$	4,113		$	42,666		$	4,969		$	383

The following tables set forth a variety of performance and non-GAAP financial measures that we use to assess the performance of our business. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Performance Indicators,” and for more information about non-GAAP financial measures presented herein, see “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures,” including for information regarding our non-GAAP financial measures and reconciliations to the most comparable GAAP measures.


	39 Weeks Ended					Fiscal Year Ended
	October 3, 2021		September 27, 2020			January 3, 2021			December 29, 2019
New Restaurant Openings
Company-operated		2		—			—			3
Franchised		—		1			1			2
Total net new restaurant openings		2		1			1			5
U.S. Average unit volume (AUV) ($ in millions)⁽¹⁾	$	7.9	$	4.5		$	4.4		$	7.7
Same store sales⁽²⁾		117.7%		(45.1%	)		(40.9%	)		2.6%
Traffic growth		101.6%		(46.5%	)		(43.0%	)		0.3%
Income (loss) from operations	$	33,055	$	(35,071	)	$	(48,368	)	$	34,064
Operating margin		11.2%		(25.4%	)		(23.6%	)		9.7%
Restaurant contribution ($ in thousands)⁽³⁾	$	85,032	$	7,762		$	20,108		$	98,230
Restaurant contribution margin⁽³⁾		28.8%		5.6%			9.8%			28.1%
Net income (loss) attributable to Fogo Hospitality, Inc.	$	9,562	$	(37,959	)	$	(57,044	)	$	9,626
Net income (loss) attributable to Fogo Hospitality, Inc. margin		3.2%		(27.5%	)		(27.9%	)		2.8%
Adjusted EBITDA ($ in thousands)⁽⁴⁾	$	54,474	$	(12,763	)	$	(9,153	)	$	64,197
Adjusted EBITDA margin⁽⁴⁾		18.4%		(9.2%	)		(4.5%	)		18.3%

(1)	The AUV measure is calculated for trailing 52 weeks.

(2)

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with the COVID-19 pandemic, so that the periods will be comparable. A restaurant is considered a closure and excluded from comparable restaurant sales when it is closed for operations for four consecutive days. Same store sales growth reflects the change in year-over-year sales for the comparable restaurant base.

(3)

(4)

Adjusted EBITDA is defined as net income before interest, taxes and depreciation and amortization plus the sum of certain operating and non-operating expenses, equity-based compensation costs, management and consulting fees, impairment and restructuring costs, and other non-cash and similar adjustments. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue. By monitoring and controlling our Adjusted EBITDA and Adjusted EBITDA margin, we can gauge the overall profitability of our company. Adjusted EBITDA and Adjusted EBITDA margin are supplemental measures of our performance that are neither required by, nor presented in accordance with, GAAP. Adjusted EBITDA and Adjusted EBITDA margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to net income (loss), operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity. In addition, in evaluating Adjusted EBITDA and Adjusted EBITDA margin, you should be aware that in the future we will incur expenses or charges such as those added back to calculate Adjusted EBITDA. Our presentation of Adjusted EBITDA and Adjusted EBITDA margin should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures—Adjusted EBITDA and Adjusted EBITDA Margin” for a discussion of the Adjusted EBITDA and a description of its limitations as an analytical tool.

The following table sets forth the reconciliation of income (loss) from operations to restaurant contribution for the unaudited periods ended October 3, 2021, September 27, 2020 and September 29, 2019 and the fiscal years ended January 3, 2021, December 29, 2019, December 30, 2018 and December 31, 2017 (in thousands):


	Fiscal Period (39 Weeks) Ended									Fiscal Year Ended
	October 3, 2021			September 27, 2020			September 29, 2019			January 3, 2021			December 29, 2019			December 30, 2018		December 31, 2017
Income (loss) from operations		33,055			(35,071	)		21,488			(48,368	)		34,064			1,479		29,484

Marketing and advertising		11,892			3,879			7,426			7,180			10,065			8,894		8,069
General and administrative		18,959			16,942			18,536			23,078			25,675			48,959		23,321
Pre-opening costs		2,831			983			2,081			1,146			3,478			2,414		3,773
Impairment charge		—			403			—			10,566			448			—		4,188
Depreciation and amortization		18,434			18,538			18,242			25,127			24,620			22,861		19,037
Gain on sale of Mexican JV		—			—			—			(1,023	)		—			—
Other operating (income) expense, net		(139	)		2,088			(337	)		2,402			(120	)		6,602		330

Total restaurant contribution		85,032			7,762			67,436			20,108			98,230			91,209		88,202

Operating Margin		11.2%			(25.4%	)		8.6%			(23.6%	)		9.7%			0.4%		9.4%
Restaurant Contribution Margin		28.8%			5.6%			26.8%			9.8%			28.1%			27.5%		28.1%

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The following table summarizes restaurant contribution by segment and restaurant contribution margin by segment for the unaudited Fiscal Periods Ended October 3, 2021 (39 weeks) and September 27, 2020 (39 weeks), respectively (in thousands):


	Fiscal Period Ended October 3, 2021					Fiscal Period Ended September 27, 2020
	(39 weeks)					(39 weeks)						Increase/(Decrease)
	Dollars		% ^(a)			Dollars			% ^(a)			Dollars		% ^(b)			% ^(c)
Revenue
U.S. restaurants	$	286,841		97.0	%	$	130,668			94.7	%	$	156,173		119.5	%		2.3	%
Brazil restaurants		8,758		3.0	%		7,318			5.3	%		1,440		19.7	%		(2.3	%)

Total revenue		295,599		100.0	%		137,986			100.0	%		157,613		114.2	%		0.0	%

Restaurant operating costs (excluding depreciation and amortization)
U.S.		201,878		70.4	%		122,686			93.9	%		79,192		64.5	%		(23.5	%)
Brazil		8,689		99.2	%		7,538			103.0	%		1,151		15.3	%		(3.8	%)

Total restaurant operating costs		210,567		71.2	%		130,224			94.4	%		80,343		61.7	%		(23.2	%)

U.S.^(d)		84,963		29.6	%		7,982			6.1	%		76,981		964.4	%		23.5	%
Brazil		69		0.8	%		(220	)		(3.0	%)		289		(131.4	%)		3.8	%

Total restaurant contribution	$	85,032		28.8	%	$	7,762			5.6	%	$	77,270		995.5	%		23.2	%

(a)	Calculated as a percentage of total revenue or segment revenue where applicable.

(b)	Calculated percentage increase / (decrease) in dollars.

(c)	Calculated increase / (decrease) in percentage of total revenue or segment revenue where applicable.

(d)

U.S. restaurant contribution includes other revenue, which is comprised of gift card breakage revenue of less than $0.1 million for each of the 39 weeks ended October 3, 2021 and September 27, 2020, respectively, and franchised operations revenue of $0.4 million and $0.1 million for the 39 weeks ended October 3, 2021 and September 27, 2020.

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The following table sets forth the reconciliation of net income attributable to Fogo Hospitality, Inc. to Adjusted EBITDA for the unaudited 39 weeks ended October 3, 2021, September 27, 2020 and September 29, 2019 and the fiscal years ended January 3, 2021, December 29, 2019, December 30, 2018 and December 31, 2017, respectively (in thousands):


	Fiscal Period (39 Weeks) Ended									Fiscal Year Ended
(dollars in thousands)	October 3, 2021			September 27, 2020			September 29, 2019			January 3, 2021			December 29, 2019			December 30, 2018			December 31, 2017
Net income attributable to Fogo Hospitality, Inc.	$	9,562		$	(37,959	)	$	3,531		$	(57,044	)	$	9,626			(14,891	)		28,789
Depreciation and amortization		18,434			18,538			18,242			25,127			24,620			22,861			19,037
Interest expense, net		21,075			18,729			18,078			26,312			23,768			19,662			4,984
Interest income		(61	)		(41	)		(83	)		(61	)		(95	)		(692	)		(2,386	)
Income tax expense (benefit)		2,299			(14,364	)		965			(16,970	)		1,626			(3,090	)		(1,470	)
Noncontrolling interest (a)		—			(504	)		(419	)		(659	)		(356	)		(259	)		(447	)

EBITDA		51,309			(15,601	)		40,314			(23,295	)		59,189			23,591			48,507
Non-cash adjustments (b)		786			1,128			1,126			1,557			1,584			1,817			923
Management and consulting fees		750			750			750			1,000			1,000			739			—
Impairment charge		—			403			—			10,566			448			2,480			4,188
Non-recurring expenses (c)		1,629			648			1,347			1,127			2,156			30,681			502
Share-based compensation		—			—			—			—			—			1,570			565
Secondary offering costs		—			—			—			—			—			—			715
Corporate office relocation		—			—			—			—			—			12			525
Noncontrolling interest (d)		—			(91	)		(77	)		(108	)		(180	)		(84	)		—

Adjusted EBITDA		54,474			(12,763	)		43,460			(9,153	)		64,197			60,806			55,925

(a)	Consists of the amounts of depreciation and amortization expense, interest expense and income tax expense (benefit) attributable to the noncontrolling interest.

(b)	Consists of the non-cash portion of straight-line rent expense and loss on disposal of fixed assets.

(c)

For the 39 weeks ended October 3, 2021, this amount consists of $1.0 million in legal/professional fees related to specific litigation, settlement and transaction costs, and $0.3 million in a one-time retention bonus. For the 39 weeks ended September 27, 2020, this amount consists primarily of $0.4 million in severance pay and consulting expense. For the 39 weeks ended September 29, 2019, this amount consists primarily of $0.5 million in legal & consulting fees and $1.3 million in severance pay and consulting expenses. For fiscal year ended January 3, 2021, this amount primarily consists of $0.3 million in severance pay and $0.6 million in specific litigation and settlement costs and consulting fees. For the fiscal year ended December 29, 2019, amount includes $0.6 million in incremental tax consulting fees due to the Rhône Acquisition, $0.4 million of professional fees, $0.3 million executive employment search fees, and $0.3 million in accounting department restructuring costs.

(d)	Consists of the amount of non-cash adjustments, impairment charges, and non-recurring expenses attributable to the noncontrolling interest.

The following tables present our unaudited quarterly results of operations for the fiscal quarters ended October 3, 2021, July 4, 2021, April 4, 2021, and for each of the four fiscal quarters ended January 3, 2021 and December 29, 2019. You should read the following tables in conjunction with our audited and unaudited consolidated financial statements and related notes appearing elsewhere in this prospectus. We have prepared the unaudited financial information on a basis consistent with our audited consolidated financial statements and have included all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary to fairly present our operating results for the quarters presented. Our historical unaudited quarterly results of operations are not necessarily indicative of results for any future quarter or for a full year.

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Our quarterly results of operations have historically varied due to a variety of factors, including the COVID-19 pandemic, timing of new restaurant openings and related expenses, profitability of new restaurants, weather, increases or decreases in comparable restaurant sales, foreign exchange fluctuations, general economic conditions, consumer confidence in the economy, changes in consumer preferences, competitive factors, changes in food costs, changes in labor costs and rising gas prices. In the past, we have experienced significant variability in restaurant pre-opening costs from quarter to quarter primarily due to the timing of restaurant openings. Accordingly, the number and timing of new restaurant openings in any quarter has had, and is expected to continue to have, a significant impact on quarterly restaurant pre-opening costs, labor and direct operating and occupancy costs. As such, we believe that comparisons of our quarterly results of operations should not be unduly relied upon as an indication of our future performance.

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	Fiscal 2021 Quarter Ended									Fiscal 2020 Quarter Ended												Fiscal 2019 Quarter Ended
(in thousands)	October 3			July 4			April 4			January 3			September 27			June 28			March 29			December 29			September 29			June 30			March 31
Revenue	$	106,395		$	110,898		$	78,306		$	66,838		$	49,504		$	12,361		$	76,121		$	98,602		$	79,235		$	84,594		$	87,455
Restaurant operating costs (excluding depreciation and amortization):
Food and beverage		28,712			28,926			21,782			19,565			14,326			4,747			21,295			26,348			22,283			24,042			24,426
Compensation and benefits		27,443			26,180			20,820			18,187			15,552			9,064			21,431			22,275			20,732			19,957			20,582
Occupancy and other		20,202			19,662			16,840			16,740			13,759			12,155			17,895			19,185			17,411			17,317			17,098

Total restaurant operating costs (excluding depreciation and amortization)		76,357			74,768			59,442			54,492			43,637			25,966			60,621			67,808			60,426			61,316			62,106
Marketing and advertising		4,580			4,759			2,553			3,301			1,045			398			2,436			2,639			1,922			2,921			2,583
General and administrative		7,317			6,494			5,148			6,136			4,988			5,278			6,676			7,139			5,847			6,083			6,606
Pre-opening costs		1,398			630			803			163			231			252			500			1,397			1,215			637			229
Impairment charge		—			—			—			10,163			403			—			—			448			—			—			—
Depreciation and amortization		6,169			6,125			6,140			6,589			6,079			6,116			6,343			6,378			6,216			5,999			6,027
Gain on sale of Mexican JV		—			—			—			(1,023	)		—			—			—			—			—			—			—
Other operating (income) expenses, net		(29	)		(396	)		286			314			1,280			359			449			217			(113	)		(163	)		(61	)

Total operating costs		95,792			92,380			74,372			80,135			57,663			38,369			77,025			86,026			75,513			76,793			77,490
Other income (expense) Income (loss) from operations		10,603			18,518			3,934			(13,297	)		(8,159	)		(26,008	)		(904	)		12,576			3,722			7,801			9,965
Interest expense, net		(6,938	)		(7,146	)		(6,991	)		(7,583	)		(6,690	)		(6,301	)		(5,738	)		(5,690	)		(5,872	)		(6,064	)		(6,142	)
Interest income		30			22			9			20			15			14			12			12			18			24			41
Other income (expense), net		(154	)		(35	)		9			(50	)		103			(9	)		(132	)		(55	)		(29	)		(21	)		(21	)

Total other income (expense), net		(7,062	)		(7,159	)		(6,973	)		(7,613	)		(6,572	)		(6,296	)		(5,858	)		(5,733	)		(5,883	)		(6,061	)		(6,122	)
Income (loss) before income taxes		3,541			11,359			(3,039	)		(20,910	)		(14,731	)		(32,304	)		(6,762	)		6,843			(2,161	)		1,740			3,843
Income tax expense (benefit)		645			1,566			88			(2,606	)		(4,134	)		(8,346	)		(1,884	)		661			278			219			468

Net income (loss)	$	2,896		$	9,793		$	(3,127	)	$	(18,304	)	$	(10,597	)	$	(23,958	)	$	(4,878	)	$	6,182		$	(2,439	)	$	1,521		$	3,375
Less: Net income (loss) attributable to noncontrolling interest		—			—			—			781			(757	)		(228	)		(489	)		87			(333	)		(394	)		(347	)

Net income (loss) attributable to Fogo Hospitality, Inc.	$	2,896		$	9,793		$	(3,127	)	$	(19,085	)	$	(9,840	)	$	(23,730	)	$	(4,389	)	$	6,095		$	(2,106	)	$	1,915		$	3,722

RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors and the other information included in this prospectus before deciding to purchase shares of our common stock. Any of these risks may have a material adverse effect on our business, results of operations, financial condition and prospects. Consequently, the trading price of our common stock could decline, and you could lose all or part of your investment. The risks described below are those known to us and that we currently believe may materially affect us. Additional risks not presently known to us or that we currently consider immaterial may also negatively affect us.

Risks Related to the COVID-19 Pandemic

The COVID-19 pandemic adversely affected our business, results of operations, liquidity and financial condition. Future re-intensification of the COVID-19 pandemic, outbreaks of contagious diseases or other adverse public health developments in the United States or worldwide could have similar impacts on our business.

The initial outbreak of the COVID-19 pandemic adversely affected our business, results of operations, liquidity and financial condition as a result of dining room closures, capacity restriction on businesses, as well as other restrictions either mandated or encouraged by federal, state and local governments. The COVID-19 pandemic, which also significantly impacted the economy in general, specifically affected our business in many respects, including

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shut-down of our restaurants in compliance with government mandates or encouragement resulting in an unprecedented reduction in revenues of 41% in Fiscal 2020 as compared to Fiscal 2019;

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furlough of the vast majority of our non-salaried team members during such restaurant shut-downs;

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physical renovations and other changes to our restaurants to comply with government mandates;

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pause in our expansion program and growth strategy, including an interruption in construction of new restaurants in the U.S., delay in negotiation and execution of new franchising agreements in international markets, and a pause in our expansion into the domestic and international airport market;

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our inability to access certain funding sources and increased cost of funding sources we were able to access;

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ongoing operating restrictions in many markets after our restaurants re-opened for various periods of time, and higher costs associated with hygiene measures;

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a degree of ongoing consumer reticence to dine out following re-opening;

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ongoing lower levels of group business dining, decreased by 76% as compared to 2019, group dining and tourism, which generally have not fully recovered to pre-pandemic levels;

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the economic impact of COVID-19 and related disruptions on the communities we serve;

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our overall level of indebtedness and our ability to obtain additional waivers or amendments, and therefore continue to satisfy covenant requirements (even as they may be amended), under our 2018 Credit Facility, and, following the expected repayment in full and termination of the 2018 Credit Facility, covenants imposed under the New Credit Facility;

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risk of future impairments of our long-lived assets or impairment of our trademarks, goodwill and other intangibles; and

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management’s ability to estimate future performance of our business.

The extent to which the current COVID-19 pandemic re-intensifies (including emergence of new variants) or future outbreaks of disease or similar public health threats materially and adversely impact our business,

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results of operations, liquidity and financial condition is highly uncertain and will depend on future developments. Such developments may include the geographic spread of the COVID-19 virus (including emergence of new COVID-19 variants), the severity of the disease, the pace and scope of vaccine administration and the mitigating and remedial actions that may be taken by various governmental authorities and other third parties, and guests themselves, in response to the outbreak. In addition, how quickly, and to what extent, normal economic and operating conditions can be maintained or resumed cannot be predicted, and the resumption of normal business operations may be delayed or constrained by lingering effects of any pandemic on us or our suppliers, third-party service providers, and/or guests. In response to the outbreak, in March 2020, we closed all dining rooms and temporarily shifted to a “to-go” only operating model. Currently, national, state and local jurisdictions have removed their capacity restrictions on businesses and therefore the Company’s restaurants are serving guests in its dining rooms without social distancing requirements. All 47 company-owned U.S. restaurants are open, as well as our seven restaurants in Brazil as of the date of this prospectus. However, it is possible additional outbreaks could require the Company to reduce capacity, implement social distancing or further suspend its in-restaurant dining operations, and there is no guarantee that state and local jurisdictions that ease restrictions will not later reverse or roll-back the restrictions, as many have done in the past.

Additionally, the Company’s restaurant operations have been and could continue to be disrupted by team member staffing issues because of illness, exclusion, fear of contracting COVID-19 or caring for family members due to COVID-19, or for other reasons. Furthermore, the Company remains in regular contact with its major suppliers and while to date it has not experienced significant disruptions in its supply chain due to COVID-19, it could see significant future disruptions should the impacts of COVID-19 extend for a considerable amount of time.

Risks Related to Our Business and Industry

Challenging economic, political and social conditions may have a negative effect on our business and financial results.

Dining at restaurants is a discretionary activity for consumers, and, therefore, we are subject to the effects of any economic conditions on our guests. Our restaurants cater to both business and social guests. Accordingly, our business is susceptible to economic factors that may result in reduced discretionary spending by our guests. We also believe that consumers generally tend to make fewer discretionary expenditures, including for high-end restaurant meals, during periods of actual or perceived negative economic conditions. For example, international, domestic and regional economic conditions, consumer income levels, financial market volatility, social unrest, governmental, political and budget matters and a slow or stagnant pace of economic recovery and growth generally may have a negative effect on consumer confidence and discretionary spending, which the restaurant industry depends upon. Specifically, in response to the initial stages of the COVID-19 pandemic and resulting economic uncertainty, together with other governmental actions in response to the pandemic, consumers significantly reduced discretionary spending and were unable to dine out for a number of months in certain markets in which we operate. In addition, protests, demonstrations, riots, civil disturbance, disobedience, insurrection, or social and other political unrest, such as those seen in 2020 and early 2021, have and may continue to result in restrictions, curfews, or other actions and give rise to significant changes in regional and global economic conditions. If such events or disruptions persist for a prolonged period of time, our overall business and results of operations may be adversely affected.

In addition, it is difficult to predict what impact, if any, changes in federal policy, including tax policies, as a result of recent U.S. federal elections will have on our industry, the economy as a whole, consumer confidence and discretionary spending. As a result, the nature, timing and impact on our business of potential changes to the current legal and regulatory frameworks are uncertain. It is also difficult to predict what the long-term economic impacts of the ongoing COVID-19 pandemic will be.

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Our historical revenue and AUV may not be indicative of our future financial performance.

Our revenue and AUV have historically been, and will continue to be, affected by, among others, the following factors:

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our ability to execute effectively our business strategy;

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the square footage and number of seats in new restaurants, which may vary from existing restaurants;

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initial sales performance by new restaurants;

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competition;

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consumer and demographic trends, and levels of beef and, more generally, protein consumption; and

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general economic conditions and conditions specific to the restaurant industry.

Existing restaurants may fail to maintain revenue and AUV levels consistent with our historical experience. New restaurants may not reach the historical revenue and AUV levels of our existing restaurants or according to our plans, if at all. New restaurants may negatively affect sales at our existing restaurants. Any decrease in our revenue or AUVs would negatively affect our financial performance, which could cause the price of our common stock to fluctuate substantially.

Our future growth depends on our ability to open new restaurants in existing and new markets and to operate these restaurants profitably.

Our future financial performance will depend on our ability to execute our business strategy—in particular, to open new restaurants on a profitable basis. We currently operate 47 restaurants in the U.S. and seven restaurants in Brazil. We have franchised five restaurants in Mexico and two restaurants in the Middle East. While we plan to open eight restaurants during Fiscal 2021, which includes six company-owned restaurants, and two franchise restaurants in Mexico, and 8-10 company-owned and 1-2 international franchise restaurants in 2022, there is no guarantee that we will be able to increase the number of our restaurants in North America or in international markets. Our ability to successfully open new restaurants is, in turn, dependent upon a number of factors, many of which are beyond our control, including:

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finding and securing quality locations on acceptable financial terms;

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complying with applicable zoning, land use, environmental, health and safety and other governmental rules and regulations (including interpretations of such rules and regulations);

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obtaining, for an acceptable cost, required permits and approvals;

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having adequate cash flow and financing for construction, opening and operating costs;

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controlling construction and equipment costs for new restaurants;

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weather, climate change, natural disasters and disasters beyond our control resulting in delays;

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hiring, training and retaining management and other team members necessary to meet staffing needs; and

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successfully promoting new restaurants and competing in the markets in which these are located.

We continuously review potential sites for future restaurants. Typically, we experience a “start-up” period before a new restaurant achieves our targeted level of operating and financial performance which may include an initial start-up period of sales volatility. The start-up period varies for each new restaurant and may last as long as three years to achieve targeted results. Delays encountered in negotiating, or our inability to finalize to our satisfaction, the terms of a restaurant lease, or disruptions such as the COVID-19 pandemic, may delay our actual rate of new restaurant growth and cause a significant variance from our targeted capacity growth rate. In addition, we often face temporarily higher operating costs caused by start-up costs including higher food, labor and other direct operating expenses and other temporary inefficiencies associated with opening new restaurants.

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We may also face challenges such as lack of brand recognition, market familiarity and acceptance when we enter new markets. The opening of new restaurants in or near markets in which we already have restaurants could adversely affect the sales of those existing restaurants.

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

We intend to develop new restaurants in our existing markets, and selectively enter into new markets. There can be no assurance that any new restaurant that we open will have similar operating results to those of existing restaurants. There is no guarantee that a sufficient number of suitable restaurant sites will be available in desirable areas or on terms that are acceptable to us, and we may not be able to open our planned new restaurants on a timely basis, if at all. Further, if opened, these restaurants may not be operated profitably. As part of our growth strategy, we may enter into geographic markets in which we have little or no prior operating experience. Consumer recognition of our brand has been important in the success of restaurants in our existing markets and recognition may be lacking in new geographic markets. In addition, restaurants we open in new markets may take longer to reach expected sales and profit levels on a consistent basis and may have higher construction, occupancy or operating expenses than restaurants we open in existing markets, thereby affecting our overall profitability. Any failure on our part to recognize or respond to these challenges may adversely affect the success of any new restaurants.

If we are unable to successfully open new restaurants, our financial results or revenue growth could be adversely affected, and our business negatively affected, as we expect a portion of our growth to come from new restaurants.

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

Our growth plan includes opening a number of new restaurants. Our existing restaurant management systems, administrative staff, financial and management controls and information systems may be inadequate to support our planned expansion. Those demands on our infrastructure and resources may also adversely affect our ability to manage our existing restaurants. Managing our growth effectively will require us to continue to enhance these systems, procedures and controls and to hire, train and retain managers, gaucho chefs and other team members. We may not respond quickly enough to the changing demands that our expansion will impose on our management, restaurant teams and existing infrastructure which could harm our business, financial condition and results of operations.

We believe our gaucho culture is an important contributor to our success. As we grow, however, we may have difficulty maintaining our culture or adapting it sufficiently to meet the needs of our operations. Our business, financial condition and results of operations could be materially adversely affected if we do not maintain our infrastructure and culture as we grow.

Increases in the prices of, or reductions in the availability of, top-quality meat could reduce our operating margins and revenue.

We purchase substantial quantities of meat, which is subject to significant price fluctuations due to conditions affecting livestock markets, weather, feed prices, industry demand and other factors. Our meat costs in the United States and the international markets in which we operate accounted for approximately 54.7% and 53.7% of our total food and beverage costs during Fiscal 2020 and Fiscal 2019, respectively. If the price for beef or other meats increases in the future and we choose not to pass, or cannot pass, these increases on to our guests, our operating margins could decrease significantly. In addition, if key beef or other meat items become unavailable for us to purchase, our revenue could decrease.

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We may experience higher operating costs, including increases in supplier prices and team member salaries and benefits, which could adversely affect our financial performance.

Our ability to maintain consistent quality throughout our restaurants depends, in part, upon our ability to acquire fresh food products, including substantial quantities of beef, and related items from reliable sources in accordance with our specifications and in sufficient quantities. We have pricing agreements in place with a few suppliers for our beef purchases and for the purchase of certain other commodities in the U.S. and short-term contracts with a limited number of suppliers for the distribution of our other food purchases and other supplies for our restaurants. Our two largest suppliers of beef in the U.S. accounted for 92% and 99% of our beef purchases in Fiscal 2020 and Fiscal 2019, respectively. Our dependence on a limited number of suppliers subjects us to risks of shortages, delivery interruptions and price fluctuations. If our suppliers do not perform adequately or otherwise fail to distribute supplies to our restaurants, we may be unable to replace them in a short period of time on acceptable terms. Any inability to so replace suppliers could increase our costs or cause shortages at our restaurants of food and other items that may cause us to remove popular items from a restaurant’s menu or temporarily close a restaurant, which could result in a loss of guests and, consequently, revenue during the time of the shortage and thereafter, if our guests change their dining habits as a result.

If we pay higher prices for food items or other supplies or increase compensation or benefits to our team members, we will sustain an increase in our operating costs. Many factors affect the prices paid for food and other items, including conditions affecting livestock markets, climate change, weather, changes in demand, adverse effects due to the COVID-19 pandemic and inflation. Factors that may affect compensation and benefits paid to our team members include changes in minimum wage and team member benefits laws (as discussed below). Other factors that could cause our operating costs to increase include fuel prices, occupancy and related costs, maintenance expenditures and increases in other day-to-day expenses. If we are unable or unwilling to increase our menu prices or take other actions to offset increased operating costs, we could experience a decline in our financial performance.

We rely heavily on certain vendors, suppliers and distributors, which could adversely affect our business.

Our ability to maintain consistent price and quality throughout our restaurants depends in part upon our ability to acquire specified food products and supplies in sufficient quantities from third-party vendors, suppliers and distributors at a reasonable cost. We rely on US Foods, Inc. (“US Foods”) as one of our primary distributors in the United States. In Fiscal 2020 and Fiscal 2019, we spent approximately 67% and 79%, respectively, of our food and beverage costs in the U.S. on products and supplies procured from or through US Foods. Our agreement with US Foods may be terminated by either us or US Foods upon 60 days’ written notice. We do not control the businesses of our vendors, suppliers and distributors, and our efforts to specify and monitor the standards under which they perform may not be successful. If such entities fail to comply with applicable laws and regulations or engage in conduct which is illegal or unethical, such conduct could damage our reputation and reduce demand for our restaurants, which could adversely affect our business, financial condition and result of operations. Furthermore, certain food items are perishable, and we have limited control over whether these items will be delivered to us in appropriate condition for use in our restaurants. If any of our vendors, suppliers or distributors are unable to fulfill their obligations to our standards, or if we are unable to find replacement providers in the event of a supply or service disruption, we could encounter supply shortages and incur higher costs to secure adequate supplies, which could materially adversely affect our business, financial condition and results of operations.

Additionally, our suppliers may initiate or otherwise be subject to food recalls that may impact the availability of certain products, result in adverse publicity or require us to take actions that could be costly for us or otherwise impact our business.

Our marketing programs may not be successful.

We believe our brand is critical to our business. We incur costs and expend other resources in our marketing efforts to raise brand awareness and attract and retain guests. These initiatives may not be successful, resulting in

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expenses incurred without the benefit of higher revenue. Additionally, some of our competitors have greater financial resources, which enable them to spend significantly more than we are able to on marketing and advertising. Should our competitors increase spending on marketing and advertising or our marketing funds decrease for any reason, or should our advertising and promotions be less effective than our competitors, there could be a material adverse effect on our results of operations and financial condition.

Any negative publicity surrounding our restaurants, our sector of the restaurant industry or the consumption of beef and meats generally could adversely affect the number of restaurant guests, which could reduce revenue in our restaurants.

We believe that any adverse publicity concerning the quality of our food and our restaurants generally could damage our brand and adversely affect the future success of our business. Company-specific adverse publicity, including inaccurate publicity, could take different forms, such as negative reviews by restaurant or word-of-mouth criticisms emanating from our guest base. The experience of other restaurants and restaurant chains with incidents relating to food-borne illnesses or product recalls that affect their business could adversely affect our sector of the restaurant industry.

Our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media could have a material adverse impact on our business.

There has been a marked increase in the use of social media platforms and similar devices, including weblogs (blogs), social media websites, and other forms of Internet-based communications which allow individuals access to a broad audience of consumers and other interested persons. Many social media platforms immediately publish the content their subscribers and participants can post, often without filters or checks on accuracy of the content posted. There is significant opportunity for dissemination of information, including inaccurate information. Information concerning our company or our sector of the restaurant industry may be posted on such platforms at any time. Information posted may be adverse to our interests or may be inaccurate, either of which may harm our business and financial performance. The harm may be immediate without affording us an opportunity for redress or correction.

Many of our competitors are expanding their use of social media and new social media platforms are rapidly being developed, potentially making more traditional social media platforms obsolete. As a result, we need to continuously innovate and develop our social media strategies in order to maintain broad appeal with guests and brand relevance. A significant part of our marketing efforts relies on social media platforms and search engine marketing to attract and retain guests. We also continue to invest in other digital marketing initiatives that allow us to reach our guests across multiple digital channels and build their awareness of, engagement with, and loyalty to our brands. These initiatives may not be successful, resulting in expenses incurred without the benefit of higher revenues, increased team member engagement or brand recognition. In addition, a variety of risks are associated with the use of social media, including the improper disclosure of proprietary information, negative comments about us, exposure of personally identifiable information, fraud, or out-of-date information. The inappropriate use of social media vehicles by our guests or team members could increase our costs, lead to litigation or result in negative publicity that could damage our reputation and could have a material adverse impact on our business.

Negative publicity relating to the consumption of food products, including in connection with food-borne illness, could result in reduced consumer demand for our menu offerings, which could reduce sales.

Instances of food-borne illness, including Bovine Spongiform Encephalopathy, which is also known as BSE, and aphthous fever, as well as hepatitis A, listeria, salmonella, norovirus and e-coli, whether or not found in the U.S. or the international markets in which we operate or traced directly to one of our suppliers or our restaurants, could reduce demand for our menu offerings. We cannot guarantee that our internal controls and training will be fully effective in preventing all food safety issues at our restaurants, including instances of food-borne illnesses. Any negative publicity relating to these and other health-related matters may affect consumers’

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perceptions of our restaurants and the food that we offer, reduce guest visits to our restaurants and negatively impact demand for our menu offerings. Adverse publicity relating to any of these matters, beef in general or other similar concerns could adversely affect our business and results of operations. Further, food-borne illnesses and injuries caused by food tampering have had in the past, and could have in the future, an adverse effect on the price and availability of certain of our produce and meat offerings.

Any failure to obtain, maintain, protect and enforce our intellectual property rights could adversely affect the value of our business, including our brand.

We believe that our intellectual property rights, and in particular our trademarks, are valuable assets that are critical to our success. We have registered our principal trademarks including the Fogo, Fogo de Chão, Bar Fogo and Fogo Market marks, the campfire design and other marks used by our restaurants as trade names, trademarks and service marks used by our restaurants in the U.S. and a number of foreign jurisdictions. The success of our business depends on our continued ability to use our intellectual property in order to increase our brand awareness, and the unauthorized use or other misappropriation of our intellectual property in any jurisdiction could materially and adversely diminish the value of our brand and restaurant concept and may cause a decline in our revenue.

Despite our efforts to obtain, maintain, protect and enforce our trademarks, service marks and other intellectual property rights, there can be no assurance that these protections will be available in all cases and jurisdictions, or that our efforts to protect these rights will be sufficient or effective, and our trademarks, service marks or other intellectual property rights could be challenged, invalidated, declared generic, circumvented, infringed upon, narrowed or otherwise violated. Additionally, any protective actions taken by us with respect to these rights may fail to prevent unauthorized usage, misappropriation, dilution or imitation by others, which could materially and adversely harm our intellectual property rights, reputation, brand or competitive position. For example, competitors may adopt service names confusingly similar to ours, or purchase confusingly similar terms as keywords in Internet search engine advertising programs, thereby impeding our ability to build brand identity and possibly leading to consumer confusion. We are aware of names similar to those of our restaurants used by third parties in certain limited geographical areas in the U.S., Brazil, Venezuela, Costa Rica, the EU and the UK.

The value of our intellectual property could also diminish if others assert rights in or ownership of our trademarks, service marks and other intellectual property rights, or trademarks or service marks that are similar to ours. We may be unable to successfully resolve these types of conflicts in a manner favorable to us. In some cases, there may be trademark or service mark owners who have prior rights to our trademarks and service marks or to similar trademarks and service marks, either globally, nationally, or locally. During trademark and service mark registration proceedings, we may receive rejections of our applications by the United States Patent and Trademark Office or in other foreign jurisdictions. Additionally, opposition or cancellation proceedings may be filed against our trademark or service mark applications and registrations, and our trademarks, service marks and any applications thereof may not survive such proceedings. In the event that our trademarks, service marks and any applications thereof are successfully challenged, we could be forced to rebrand our products, which could result in loss of brand recognition and could require us to devote resources towards advertising and marketing new brands. Over the long term, if we are unable to establish name recognition based on our trademarks and service marks, then we may not be able to compete efficiently. Any claims or guest confusion related to our trademarks and service marks could damage our reputation and brand and materially and adversely harm our business, liquidity, financial condition and results of operations.

Any failure to obtain, maintain, protect and enforce our intellectual property rights in future jurisdictions could adversely affect the value of our business, including our brand.

We may be required to protect our trademarks, service marks and other intellectual property rights in an increasing number of jurisdictions, a process that is expensive and may not be successful, or which we may not

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have the resources to pursue in each jurisdiction. The trademarks we currently use have not been registered in all of the countries outside of the U.S. in which we do business or may do business in the future. We may never register such trademarks in all of these countries and, even if we do, the laws of some foreign countries may not protect intellectual property rights to the same extent as the laws of the U.S. Accordingly, we may choose not to seek protection in certain countries, and we will not have the benefit of protection in such countries. Moreover, any changes in, or unexpected interpretations of, intellectual property laws in any jurisdiction may compromise our ability to obtain, maintain, protect and enforce our intellectual property rights. The protective actions that we take, however, may not be sufficient, in some jurisdictions, to secure our trademark and service mark rights for some of the goods and services that we offer or to prevent imitation by others, which could adversely affect the value of our trademarks and service marks or cause us to incur litigation costs, or pay damages or licensing fees to third parties, including prior users or registrants of intellectual property similar to our intellectual property or allegedly infringed by our intellectual property or the conduct of our business. Moreover, policing our intellectual property rights is difficult, costly and may not always be effective. Any failure to obtain, maintain, protect and enforce our intellectual property rights could result in material and adverse harm to our business.

Any failure to obtain rights to the intellectual property developed by our associates, franchisees, contractors and third parties could have a material adverse effect on our business.

We also rely on agreements under which we contract to own, or license rights to use, intellectual property developed by associates, franchisees, contractors and other third parties. In addition, while we generally enter into confidentiality agreements with our associates, franchisees and third parties with whom we share our trade secrets, know-how, manufacturing expertise, business strategy and other proprietary information, such confidentiality agreements could be breached or otherwise may not provide meaningful protection. Such associates, franchisees and third parties may share our trade secrets, know-how, manufacturing expertise, business strategy and other proprietary information with their employees, contractors, agents or other third parties who may not be bound by any confidentiality agreement or, to the extent they are bound by a confidentiality agreement, such confidentiality agreements could be breached or otherwise may not provide meaningful protection. Adequate remedies may not be available in the event of an unauthorized use or disclosure of our trade secrets, know-how, manufacturing expertise, business strategy and other proprietary information. Similarly, while we seek to enter into agreements with all of our associates and franchisees who develop intellectual property during their employment for, or relationship with, us or on our behalf to assign the rights in such intellectual property to us, we may fail to enter into such agreements with all relevant associates and franchisees and such agreements may be breached or may not be self-executing. We may be subject to claims that such associates misappropriated relevant rights from their previous employers. Any failure to obtain rights in the intellectual property rights developed by our associates, franchisees, contractors and third parties could lead to material and adverse harm to our business.

We may become involved in lawsuits to protect or enforce our intellectual property rights or to defend against claims that we infringe, misappropriate or otherwise violate the intellectual property of third parties, which could be expensive, time consuming and unsuccessful.

Third parties may independently develop technologies, products and services that are substantially similar or superior to ours. From time to time, legal action may be necessary for us to enforce or protect our intellectual property rights, including our trademarks, service marks and trade secrets (including by instituting cancellation or opposition proceedings, or other challenges), to determine the validity and scope of the intellectual property rights of others or to defend against claims of alleged infringement, misappropriation, other violation or invalidity. Such actions or efforts may not be successful. Even if we are successful in asserting our intellectual property rights or defending against third-party claims, such litigation to enforce or defend our intellectual property rights may cause us to incur significant legal expenses, diversion of resources and could materially and adversely affect our business, reputation, results of operations and financial condition. To the extent that we seek to enforce our rights, we could be subject to claims that an intellectual property right is invalid, otherwise not enforceable, or is licensed to or not infringed or otherwise violated by the party against whom we are pursuing a

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claim. In addition, our assertion of intellectual property rights may result in the other party seeking to assert alleged intellectual property rights or other claims against us, which could materially and adversely harm our business. If we are not successful in defending such claims in litigation, we may not be able to use, sell or license a particular offering due to an injunction, or we may have to pay damages that could, in turn, materially and adversely affect our results of operations. In addition, governments may adopt regulations, or courts may render decisions, requiring compulsory licensing of intellectual property to others, or governments may require that products meet specified standards that serve to favor local companies. Furthermore, we may have granted our licensees or franchisees exclusive rights to enforce our intellectual property in certain circumstances, thereby limiting our own ability to enforce our intellectual property. Our inability to enforce our intellectual property rights under these circumstances may materially and adversely affect our competitive position and our business.

We may also face claims of infringement, misappropriation or violation of third-party intellectual property rights that could interfere with the use of our trademarks and the proprietary know-how, concepts, recipes, or trade secrets used in our business. Our commercial success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property or proprietary rights of third parties. Intellectual property disputes can be costly to defend and may cause our business, operating results and financial condition to suffer. Whether merited or not, in the markets in which we operate, we have faced, and may in the future face, allegations that we or parties indemnified by us (including our franchisees and licensees), or our or their respective products, services or intellectual property, have infringed, misappropriated or otherwise violated the trademarks, patents, copyrights, trade secrets or other intellectual property rights of third parties. Some third parties may be able to sustain the costs of complex litigation more effectively than us because they have substantially greater resources. If we are unable to successfully settle future claims on terms acceptable to us, we may be required to engage in or to continue claims, regardless of whether such claims have merit, which can be time-consuming, divert management’s attention and financial resources and be costly to evaluate and defend. Defending against such claims may be costly, results of any such litigation are difficult to predict and we may be prohibited from using the applicable intellectual property rights in the future or forced to pay damages, royalties, or other fees to do so. Any claims we make for indemnification against our partners, licensees, franchisees or others who have agreed to indemnify us may be limited by contractual liability limitations or waivers, thereby reducing or eliminating any related recovery. Additionally, we may be required to stop commercializing products, obtain licenses or modify and redesign our products or trademarks while we develop non-infringing substitutes, which may not be possible or may require substantial monetary expenditures and time. Otherwise, we may incur substantial damages or settlement costs, or face a temporary or permanent injunction prohibiting us from marketing or providing the affected products. Any of these events could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our reliance on third parties, including our franchisees and other licensees, may negatively impact or limit our ability to protect or exploit our intellectual property.

We rely on third parties, including franchisees and licensees, to whom we license our intellectual property. Although we monitor and restrict third-party activities through our license agreements, third parties, including our franchisees and other licensees, may use, refer to, or make statements about our brands that do not make proper use of our trademarks, service marks or required designations, improperly alter trademarks, service marks or branding, or are critical of our brands or place our brands in a context that may tarnish our reputation. This may result in dilution or tarnishment of our intellectual property. Franchisee, licensee and other third-party noncompliance with the terms and conditions of our franchise or license agreements may reduce the overall goodwill of our brands, whether through the failure to meet health and safety standards (including with respect to additional sanitation protocols and guidelines in connection with the COVID-19 pandemic), engage in quality control or maintain product consistency, or through the participation in improper or objectionable business practices. Certain of our license agreements may provide for exclusive rights under our intellectual property which may limit our ability to exploit such intellectual property within certain fields or territories. Additionally, our ability to generate revenue from exclusive licenses under our intellectual property will depend on our licensees’ abilities and efforts to successfully commercialize the products or services within the fields and

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territories in which we grant such licenses. Moreover, unauthorized third parties may conduct business using our intellectual property to take advantage of the goodwill of our brands, resulting in consumer confusion or dilution. Any reduction of our goodwill, consumer confusion, or dilution is likely to impact sales, and could materially and adversely impact our business and operating results.

The impact of negative economic factors, including the availability of credit, on our landlords and other retail center tenants could negatively affect our financial results.

Negative effects on our existing and potential landlords due to any inaccessibility of credit and other unfavorable economic factors may, in turn, adversely affect our business and results of operations. If our landlords are unable to obtain financing or remain in good standing under their existing financing arrangements, they may be unable to provide construction contributions or satisfy other lease covenants to us. If any landlord files for bankruptcy protection, the landlord may be able to reject our lease in the bankruptcy proceedings. While we would have the option to retain our rights under the lease, we could not compel the landlord to perform any of its obligations and would be left with damages as our sole recourse. In addition, if our landlords are unable to obtain sufficient credit to continue to properly manage their retail sites, we may experience a drop in the level of quality of such retail centers. Our development of new restaurants may also be adversely affected by the negative financial situations of developers and potential landlords.

We occupy most of our restaurants under long-term non-cancelable leases, which we may be unable to renew at the end of the lease terms or which may limit our flexibility to move to new locations.

All but two of our restaurants in the U.S. are located in leased premises and all of our restaurants in Brazil are located in leased premises. Many of our current leases in the U.S. are non-cancelable and usually have terms ranging from 10 to 20 years, with renewal options for terms ranging from five to 10 years. We anticipate that leases that we enter into in the future in the U.S. will also be long-term and non-cancelable and have similar renewal options. If we were to close or fail to open a restaurant at a leased location, we would generally remain committed to perform our obligations under the applicable lease, which could include, among other things, payment of the base rent and a percentage of common area operating expenses for the balance of the lease term. Our obligation to continue making rental payments and fulfilling other lease obligations under leases for closed or unopened restaurants could have a material adverse effect on our business and results of operations. Lease rates in Brazil are periodically readjusted and the rent amounts are not predetermined as they generally are in the U.S. If the landlord and we cannot agree on an adjusted rate, the dispute is submitted to a judicial resolution process. As a result, our lease rates in Brazil are subject to more volatility than those in the U.S. and we may not always be able to predict these rates due to the unpredictable nature of the judicial resolution process, which could be unfavorable to us.

At the end of the lease term and any renewal period for a restaurant, we may be unable to renew the lease without substantial additional cost, if at all. If we are unable to renew our restaurant leases, we may be forced to close or relocate a restaurant, which could subject us to significant construction and other costs. For example, closing a restaurant, even for a brief period to permit relocation, would reduce the revenue contribution of that restaurant to our total revenue. Additionally, the revenue and profit, if any, generated at a relocated restaurant may not equal the revenue and profit generated at the previous restaurant location.

Long-term leases can, however, limit our flexibility to move a restaurant to a new location. For example, current locations may no longer be attractive in the event that demographic patterns shift or neighborhood conditions decline. In addition, long-term leases may affect our ability to take advantage of more favorable rent levels due to changes in local real estate market conditions. These and other location-related issues may affect the financial performance of individual restaurants.

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Our rent expense could increase our vulnerability to adverse economic and industry conditions and could limit our operating and financial flexibility.

Our rent expense accounted for approximately 11.8% and 7.9% of our revenue in Fiscal 2020 and Fiscal 2019, respectively. We expect that new restaurants will typically be leased by us under operating leases. Substantial operating lease obligations could have significant negative consequences, including:

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increasing our vulnerability to adverse economic and industry conditions;

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requiring a substantial portion of our available cash to be applied to pay our rental obligations, thus reducing cash available for other purposes;

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limiting our ability to obtain any necessary financing; and

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limiting our flexibility in planning for, or reacting to, changes in our business or our industry.

Upon the temporary closure of restaurant dining rooms in March 2020 due to the COVID-19 pandemic, we negotiated amendments to our leases that involved varying concessions, including the abatement of rent payments, deferral of all or a portion of rent payments to later periods, and deferrals of rent payments combined with an early exercise of an existing renewal option or extension of the lease term. Accordingly, our rent expense in Fiscal 2020 and so far in 2021 is less than what we expect our run-rate rent expense to be in future years as we pursue our expansion plan and deferrals and abatements are released.

We depend on cash flow from operations to pay our lease obligations and to fulfill our other cash requirements. If our restaurants do not generate sufficient cash flow and sufficient funds are not otherwise available to us from borrowings under bank loans or from other sources, we may not be able to meet our lease obligations, grow our business, respond to competitive challenges or fund our other liquidity and capital needs, which would have a material adverse effect on us.

Opening new restaurants in existing markets may negatively affect sales at our existing restaurants.

The consumer target area of our restaurants varies by location, depending on a number of factors, including population density, other local retail and business attractions, area demographics and geography. As a result, the opening of a new restaurant in or near markets in which we already have restaurants could adversely affect sales at these existing restaurants. Existing restaurants could also make it more difficult to build our consumer base for a new restaurant in the same market. Our core business strategy does not entail opening new restaurants that we believe will materially affect sales at our existing restaurants, but we may selectively open new restaurants in and around areas of existing restaurants that are operating at or near capacity to effectively serve our guests. Sales cannibalization among our restaurants may become significant in the future as we continue to expand our operations and could affect our sales growth, which could, in turn, materially adversely affect our business, financial condition and results of operations.

Our success depends on securing desirable restaurant locations.

The success of any restaurant depends in substantial part on its location. There can be no assurance that the current locations of our restaurant will continue to be attractive as demographic patterns change. Neighborhood or economic conditions where stores are located could decline in the future, thus resulting in potentially reduced sales in those locations. Competition for restaurant locations can also be intense and there may be delay or cancellation of new store developments by our franchise partners, which may be exacerbated by factors related to the commercial real estate or credit markets. If we cannot obtain desirable locations for our restaurant at reasonable prices due to, among other things, higher than anticipated acquisition, construction and/or development costs of new locations, difficulty negotiating leases with acceptable terms, onerous land use or zoning restrictions, or challenges in securing required governmental permits, then our ability to open new restaurants and our ability to meet our growth expectations may be adversely affected.

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Labor shortages or increases in labor costs could slow our growth and adversely affect our ability to operate our restaurants.

Our success depends, in part, upon our ability to attract, motivate and retain qualified team members, including restaurant managers and gaucho chefs necessary to meet the needs of our existing restaurants and to support our expansion program. Qualified personnel to fill these positions may be in short supply in some areas. If we are unable to continue to recruit and retain sufficiently qualified personnel, our business and our growth could be adversely affected. Any future inability to recruit and retain qualified personnel may delay openings of new restaurants and could adversely impact existing restaurants. Any such delays, any material increases in team member turnover rates in existing restaurants or any team member dissatisfaction could have a material adverse effect on our business and results of operations. In addition, competition for qualified team members could require us to pay higher wages, which could result in higher labor costs, which could, in turn, have a material adverse effect on our financial performance.

We face a variety of economic, regulatory and other risks associated with doing business in foreign markets that could have a negative impact on our financial performance.

We currently do business through franchised restaurants in Mexico and the Middle East and intend to expand through franchises into other international markets in the future and also operate through company-owned restaurants in Brazil. We license certain of our trademarks to our Mexico and Middle East franchise partners for use in connection with their operation of franchised restaurants under the Fogo brand.

Markets in which we do business, either through franchises or operation of company-owned restaurants, may suffer from depressed economic activity, recessionary economic cycles, higher fuel or energy costs, low consumer confidence, high levels of unemployment, reduced home values, increases in home foreclosures, investment losses, personal bankruptcies, reduced access to credit or other economic factors that may affect consumer discretionary spending. If negative economic conditions persist for a long period of time or become more pervasive, consumers might make long-lasting changes to their discretionary spending behavior, including dining out less frequently on a permanent basis and generating lower average check sizes at our restaurants. If restaurant revenue decreases, our profitability could decline as we spread fixed costs across a lower level of revenue. Reductions in staff levels, asset impairment charges and potential restaurant closures could result from prolonged negative restaurant sales. There can be no assurance that the macroeconomic environment or the regional economics in which we do business will improve significantly or that government stimulus efforts will improve consumer confidence, liquidity, credit markets, home values or unemployment, among other things.

International operations, including our operations in Brazil and our franchise strategy in Mexico, the Middle East and elsewhere, subject us to a number of risks, including:

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inflation and currency devaluations;

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fluctuations in currency exchange rates;

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foreign and legal regulatory requirements;

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difficulties in managing and staffing international operations;

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potentially adverse tax consequences, including complexities of international tax systems and restrictions on the repatriation of earnings;

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expropriation or governmental regulation restricting foreign ownership or requiring divestiture;

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increases in the cost of labor (as a result of unionization or otherwise);

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the burdens of complying with different legal standards; and

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political, social and economic conditions.

Additionally, we are subject to the U.S. Foreign Corrupt Practices Act of 1977 (“FCPA”), the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) regulations, other U.S. laws and regulations governing

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our international operations and similar laws in other countries. Any violation of the FCPA, OFAC regulations or other applicable anti-corruption laws, by us, our affiliated entities or their respective officers, directors, team members and agents could result in substantial fines, sanctions, civil and/or criminal penalties and curtailment of operations in certain jurisdictions and could adversely affect our financial condition, results of operations, cash flows or our availability of funds under our revolving line of credit. Further, detecting, investigating, and resolving actual or alleged violations is expensive and can consume significant time and attention of our management.

If we are unable to account for these risks while operating abroad, our reputation and brand value could be harmed. The occurrence of any of these risks could negatively affect our current international operations and any future expansion into new geographic markets, which would have a material adverse effect on our business and results of operations.

Our franchisees could take actions that harm our reputation and reduce our royalty and restaurant revenues.

We do not exercise control over the day-to-day operations of our franchisee-owned restaurants. While we strive to ensure that franchisee-owned restaurants maintain the same high operating standards that we demand of Company-owned restaurants, one or more of these restaurants may fail to maintain these standards or provide a guest experience consistent with our brand standards. Any operational or financial shortcomings of the franchisee-owned restaurants are likely to be attributed to our broader operations and could adversely affect our reputation and damage our brand as well as have a direct negative impact on the royalty income we receive from those restaurants. Franchisee noncompliance with the operational standards and the terms and conditions of our franchise agreements or with applicable laws and regulations may reduce the overall goodwill of our brand, whether through the failure to meet health and safety standards, engage in quality control or maintain product consistency, adequate succession planning or through the participation in improper or objectionable business practices. Any harm to our brand or goodwill, guest confusion or brand dilution could materially and adversely impact our business and results of operations.

Our strategy to open franchisee-owned restaurants subjects us to extensive government regulation, compliance with which might increase our investment costs and restrict our growth.

We are subject to the rules and various international laws regulating the offer and sale of franchises that can restrict our ability to sell franchises in such jurisdictions. Non-compliance with those laws could result in governmental enforcement actions seeking a civil or criminal penalty, rescission of a franchise, and loss of our ability to offer and sell franchises in a jurisdiction, or a private lawsuit seeking rescission, damages and legal fees, which could have a material adverse effect on our business.

We are a multinational organization faced with increasingly complex tax issues in the international jurisdictions in which we operate or have franchises, including in Brazil, Mexico and the Middle East, and we could be obligated to pay additional taxes in those jurisdictions.

As a multinational organization that operates or has franchises in several jurisdictions, including the U.S., Brazil, Mexico, Saudi Arabia and the United Arab Emirates, we may be subject to taxation in jurisdictions with increasingly complex tax laws, the application of which can be uncertain. The tax positions that we have taken or may take in the future may be subject to challenge on audit, and the authorities in these jurisdictions, including Brazil, Mexico, Saudi Arabia and the United Arab Emirates could successfully assert that we are obligated to pay additional taxes, interest and penalties. In addition, the amount of taxes we pay could increase substantially as a result of changes in the applicable tax principles, including increased tax rates, new tax laws or revised interpretations of existing tax laws and precedents, which could negatively affect our liquidity and operating results. The authorities could also claim that various withholding requirements apply to us or our subsidiaries or

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assert that benefits of tax treaties are not available to us or our subsidiaries, any of which could have a negative impact on us and the results of our operations.

Our reporting currency is the U.S. dollar but a portion of our revenue and costs and expenses are in other currencies so that exchange rate movements may affect our results of operation.

We generate revenue, and incur costs and expenses, in our foreign operations denominated in local currencies. Our reported consolidated results of operations have periodically been affected by the strength of the U.S. dollar relative to other currencies and appreciation of the U.S. dollar in the future periods could affect adversely our consolidated results of operations in those periods. Disruptions in financial markets may also result in significant changes in foreign exchange rates in relatively short periods of time which further increases the risk of an adverse currency effect. For example, the results of our Brazilian operations, which accounted for approximately 5% and 8.4% of our revenues in Fiscal 2020 and Fiscal 2019, respectively, are translated from Brazilian Reals into U.S. dollars upon consolidation when we prepare our consolidated financial statements. The Brazilian currency has historically been subject to significant exchange rate fluctuations in relation to the U.S. dollar and other currencies attributable to economic conditions in Brazil, Brazilian governmental policies and actions, developments in global foreign exchange markets and other factors. The Brazilian government has in the past implemented various economic plans and used various exchange rate policies to address exchange rate fluctuation and there can be no assurances the government will not take action in the future.

Risks Related to Regulations and Legal Proceedings

Our company could face lawsuits relating to workplace and employment laws and fair credit reporting requirements, which, if determined adversely, could result in negative publicity or in payment of substantial damages by us.

Various federal and state labor laws govern our relationships with our team members and affect operating costs. These laws include team member classifications as exempt or non-exempt, minimum wage requirements, unemployment tax rates, workers’ compensation rates, tip reporting and classification, citizenship requirements and other wage and benefit requirements for team members classified as non-exempt. Our business may be adversely affected by legal or governmental proceedings brought by or on behalf of our team members or guests. Although we require all workers to provide us with government-specified documentation evidencing their employment eligibility, some of our team members may, without our knowledge, be unauthorized workers. We currently participate in the “E-Verify” program, an Internet-based, free program run by the United States government to verify employment eligibility, in states in which participation is required. However, use of the “E-Verify” program does not guarantee that we will properly identify all applicants who are ineligible for employment. Unauthorized workers are subject to deportation and may subject us to fines or penalties, and if any of our workers are found to be unauthorized we could experience adverse publicity that negatively impacts our brand and may make it more difficult to hire and keep qualified team members. Termination of a significant number of team members who were unauthorized team members may disrupt our operations, cause temporary increases in our labor costs as we train new team members and result in additional adverse publicity. We could also become subject to fines, penalties and other costs related to claims that we did not fully comply with all record-keeping obligations of federal and state immigration compliance laws. These factors could have a material adverse effect on our business, financial condition and results of operations.

In recent years, a number of restaurant companies, including our company, have been subject to lawsuits and other claims, including class action lawsuits, alleging violations of federal and state law governing workplace and employment matters such as various forms of discrimination, tip pooling, wrongful termination, harassment and similar matters and violations of fair credit reporting requirements. A number of these lawsuits and claims against other companies have resulted in various penalties, including the payment of substantial damages by the defendants. In addition, lawsuits by team members or on behalf of our team members are common in Brazil after termination of employment and we have been subject to a number of such lawsuits.

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Insurance may not be available at all or in sufficient amounts to cover all liabilities with respect to these matters. Accordingly, we may incur substantial damages and expenses resulting from claims and lawsuits, which would increase our operating costs, decrease funds available for the development of our business and result in charges to our income statements resulting in decreased profitability or net losses. Team member claims against us also create not only legal and financial liability but negative publicity that could adversely affect us and divert our financial and management resources that would otherwise be used to benefit the future performance of our operations.

We are from time to time the target of class action lawsuits and other claims proceedings concerning food quality, health, team member conduct and other issues could require us to incur additional liabilities or cause guests to avoid our restaurants.

Restaurant companies have from time to time faced lawsuits alleging that a guest suffered illness or injury during or after a visit to a restaurant, including actions seeking damages resulting from food-borne illness and relating to notices with respect to chemicals contained in food products required under state law. Similarly, food tampering, team member hygiene and cleanliness failures or improper team member conduct at our restaurants could lead to product liability or other claims. To date, we have not been a defendant in any lawsuit asserting such a claim. However, we cannot assure you that such a lawsuit will not be filed against us and we cannot guarantee to guests that our internal controls and training will be fully effective in preventing claims. We are also subject to various claims arising in the ordinary course of our business, including personal injury claims, contract claims and other matters. In addition, we could become subject to class action lawsuits related to these and other matters in the future. Regardless of whether any claims against us are valid or whether we are ultimately held liable, claims may be expensive to defend and may divert management attention and other resources from our operations and hurt our financial performance. A judgment significantly in excess of our insurance coverage for any claims would materially adversely affect our results of operations and financial condition. In addition, adverse publicity resulting from any such claims may negatively impact revenue at one or more of our restaurants.

Our business is subject to extensive federal, state, local and foreign beer, liquor and food service regulations and we may incur additional costs or liabilities as a result of government regulation of our restaurants.

Our business is subject to extensive federal, state, local and foreign government regulation, including, among others, regulations related to the preparation and sale of food, the sale of alcoholic beverages, zoning and building codes, land use and team member, health, sanitation and safety matters. For example, in response to guidelines and restrictions put in place by federal, state, local and foreign governments related to the COVID-19 pandemic, in 2020 many of our restaurants were unable to operate or have limited operations, which had a significant adverse effect on our business before re-opening commenced.

Typically, our licenses to sell alcoholic beverages must be renewed annually and may be suspended or revoked at any time for cause. Alcoholic beverage control regulations govern various aspects of daily operations of our restaurants, including the minimum age of guests and team members, hours of operation, advertising, wholesale purchasing and inventory control, handling and storage. Any failure by any of our restaurants to obtain and maintain, on a timely basis, liquor or other licenses, permits or approvals required to serve alcoholic beverages or food, as well as any associated negative publicity, could delay or prevent the opening of, or adversely impact the viability of, and could have an adverse effect on, that restaurant and its operating and financial performance. We apply for our liquor licenses with the advice of outside legal counsel and licensing consultants. Because of the many and various state and federal licensing and permitting requirements, there is a significant risk that one or more regulatory agencies could determine that we have not complied with applicable licensing or permitting regulations or have not maintained the approvals necessary for us to conduct business within its jurisdiction. Any changes in the application or interpretation of existing laws may adversely impact our restaurants in that state, and could also cause us to lose, either temporarily or permanently, the licenses, permits and regulations necessary to conduct our restaurant operations, and subject us to fines and penalties.

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Our restaurants in the U.S. are subject to state “dram shop” laws, which generally allow a person to sue us if that person was injured by an intoxicated person who was wrongfully served alcoholic beverages at one of our restaurants. Recent litigation against restaurant chains has resulted in significant judgments, including punitive damages, under dram shop laws. A judgment against us under a dram shop law could exceed our liability insurance coverage policy limits and could result in substantial liability for us and have a material adverse effect on our results of operations. Our inability to continue to obtain such insurance coverage at reasonable cost also could have a material adverse effect on us. Regardless of whether any claims against us are valid or whether we are liable, we may be adversely affected by publicity resulting from such laws.

We are also required to comply with the standards mandated by the Americans with Disabilities Act (the “ADA”), which generally prohibits discrimination in accommodation or employment based on disability. We may in the future have to modify restaurants or our operations to make reasonable accommodations for disabled persons. While these expenses could be material, our current expectation is that any such actions will not require us to expend substantial funds.

The costs of operating our restaurants may increase in the event of changes in laws governing minimum hourly wages, working conditions, predictive scheduling, overtime and tip credits, health care, workers’ compensation insurance rates, unemployment tax rates, sales taxes or other laws and regulations, such as those governing access for the disabled (including the ADA). If any of these costs were to increase and we were unable or unwilling to pass on such costs to our guests by increasing menu prices or by other means, our business and results of operations could be negatively affected.

Failure to comply with federal, state, local or foreign regulations could cause our licenses to be revoked and force us to cease the sale of alcoholic beverages at certain restaurants. Any difficulties, delays or failures in obtaining such licenses, permits or approvals could delay or prevent the opening of a restaurant in a particular area or increase the costs associated therewith. In addition, in certain states, including states where we have existing restaurants or where we plan to open a restaurant, the number of liquor licenses available is limited, and licenses are traded on the open market. Liquor, beer and wine sales comprise a significant portion of our revenue. If we are unable to maintain our existing licenses, our guest patronage, revenue and results of operations would be adversely affected. Or, if we choose to open a restaurant in those states where the number of licenses available is limited, the cost of a new license could be significant.

Increases in minimum wages or unionization activities could substantially increase our labor costs.

Under the minimum wage laws in most jurisdictions in the U.S., we are permitted to pay certain hourly team members a wage that is less than the base minimum wage for general team members because these team members receive tips as a substantial part of their income. As of January 3, 2021, approximately 46.2% of our hourly team members in the U.S. earn this lower minimum wage in their respective locations as tips constitute a substantial part of their income. If federal, state, local or foreign governments change their laws to require that all team members be paid the general team member minimum base wage regardless of supplemental tip income, our labor costs would increase substantially. Our labor costs would also increase if the minimum base wage increases. In addition, several states and localities in which we operate and the federal government have from time to time enacted minimum wage increases, changes to eligibility for overtime pay, paid sick leave and mandatory vacation accruals, and similar requirements and these changes could increase our labor costs. We may be unable or unwilling to increase our prices in order to pass increased labor costs on to our guests, in which case our operating margins would be adversely affected. Also, although none of our team members in the U.S. are currently covered under collective bargaining agreements, many of our team members in Brazil participate in industry-wide trade union programs. Additionally, our team members in the U.S. may elect or attempt to be represented by labor unions in the future. If a significant number of our team members were to become unionized and collective bargaining agreement terms were significantly different from our current compensation arrangements, it could adversely affect our business, financial condition and results of operations.

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Legislation and regulations requiring the display and provision of nutritional information for our menu offerings, and new information or attitudes regarding diet and health or adverse opinions about the health effects of consuming our menu offerings, could affect consumer preferences and negatively impact our results of operations.

Government regulation and consumer eating habits may impact our business as a result of changes in attitudes regarding diet and health or new information regarding the health effects of consuming our menu offerings. These changes have resulted in, and may continue to result in, the enactment of laws and regulations that impact the ingredients and nutritional content of our menu offerings, or laws and regulations requiring us to disclose the nutritional content of our food offerings.

The Patient Protection and Affordable Care Act as amended by the Health Care and Education Affordability Reconciliation Act of 2010 (the “PPACA”) establishes a uniform, federal requirement for certain restaurants to post certain nutritional information on their menus. Specifically, the PPACA amended the Federal Food, Drug and Cosmetic Act to require chain restaurants with 20 or more locations operating under the same name and offering substantially the same menus to publish the total number of calories of standard menu items on menus and menu boards, along with a statement that puts this calorie information in the context of a total daily calorie intake. The PPACA also requires covered restaurants to provide to consumers, upon request, a written summary of detailed nutritional information for each standard menu item, and to provide a statement on menus and menu boards about the availability of this information. The PPACA further permits the United States Food and Drug Administration to require covered restaurants to make additional nutrient disclosures, such as disclosure of trans-fat content. An unfavorable report on, or reaction to, our menu ingredients, the size of our portions or the nutritional content of our menu items could negatively influence the demand for our offerings.

Furthermore, a number of states, counties and cities have enacted menu labeling laws requiring multi-unit restaurant operators to disclose certain nutritional information to guests or have enacted legislation restricting the use of certain types of ingredients in restaurants. Compliance with current and future laws and regulations regarding the ingredients and nutritional content of our menu items may be costly and time-consuming. Additionally, some government authorities are increasing regulations regarding trans-fats and sodium, which may require us to limit or eliminate trans-fats and sodium in our offerings, switch to higher cost ingredients or may hinder our ability to operate in certain markets. Some jurisdictions have banned certain cooking ingredients, such as trans-fats, or have discussed banning certain products, such as large sodas. Removal of these products and ingredients from our menus could affect product tastes, guest satisfaction levels, and sales volumes, whereas if we fail to comply with these laws or regulations, our business could experience a material adverse effect.

We cannot make any assurances regarding our ability to effectively respond to changes in consumer health perceptions or our ability to successfully implement the nutrient content disclosure requirements and to adapt our menu offerings to trends in eating habits. The imposition of additional menu-labeling laws could have an adverse effect on our results of operations and financial position, as well as on the restaurant industry in general.

Compliance with environmental, health and safety laws and regulations may negatively affect our business.

We are subject to national, provincial, state and local environmental, health and safety laws and regulations in the U.S. and other countries in which we operate, including those concerning waste disposal, climate change, pollution, the presence, use, management, discharge, storage, handling, release, treatment and disposal of, and exposure to and remediation of, hazardous substances and wastes. These laws and regulations can be costly to comply with, and provide for significant civil and criminal fines and penalties or other sanctions for noncompliance, and joint and several liabilities for remediation, sometimes without regard to whether the owner or operator of the property knew of, or was responsible for, such contamination. Third parties may also make claims against owners or operators of properties for personal injuries and property damage associated with releases of, or actual or alleged exposure to, such hazardous substances or wastes at, on or from our restaurants.

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Environmental conditions relating to releases of hazardous substances or wastes at prior, existing or future restaurant sites, or our violations of environmental, health and safety laws and regulations could materially adversely affect our business, financial condition and results of operations. Further, environmental, health and safety laws and regulations, and the administration, interpretation and enforcement thereof, are subject to change and may become more stringent in the future, each of which could materially adversely affect our business, financial condition and results of operations.

In addition, there has been increased public focus by governmental and nongovernmental entities and guests on environmental and sustainability matters such as climate change, reduction of greenhouse gas emissions, animal health and welfare, packaging, waste, and water consumption. As a result, we may face increased pressure to provide expanded disclosure, make or expand commitments, establish targets or goals, or take other actions in connection with environmental and sustainability matters. Legislative, regulatory or other efforts to address environmental and sustainability matters could negatively impact our cost structure, operational efficiencies and talent availability or result in future increases in the cost of raw materials, taxes, transportation and utilities, which could decrease our operating profits and necessitate future investments in facilities and equipment. In addition, our business, financial condition and results of operations could be adversely affected to the extent that such environmental or sustainability concerns reduce demand for our restaurants.

New or revised tax regulations could have an adverse effect in our financial results.

We are subject to income and other taxes in the United States and numerous state and foreign jurisdictions. Our effective income tax rate and other taxes in the future could be adversely affected by a number of factors, including changes in the mix of earnings in countries with different statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in tax laws or other legislative changes and the outcome of income tax audits. Although we believe our tax estimates are reasonable, the final determination of tax audits could be materially different from our historical income tax provisions and accruals. The results of a tax audit could have a material effect on our results of operations or cash flows in the period or periods for which that determination is made. In addition, our effective income tax rate and our results may be impacted by our ability to realize deferred tax benefits, including our FICA tip credit carryforwards, and by any increases or decreases of our valuation allowances applied to our existing deferred tax assets. Additional tax regulations could be issued, and no assurance can be made that future guidance will not adversely affect our business or financial condition.

Risks Related to Information Technology and Cybersecurity

We rely on information technology in our operations and are making improvements to important business systems. Any material failure, inadequacy or interruption of that technology could adversely affect our ability to effectively operate our business and result in financial or other loss.

We rely on computer systems and information technology to conduct our business and our ability to effectively manage our business depends significantly on the reliability and capacity of these systems. In addition, we must effectively respond to changing guest expectations and new technological developments. Disruptions or failures of these systems could cause an interruption in our business, which could have a material adverse effect on our results of operations and financial condition.

We intend to perform upgrades to our information technology systems. Such upgrades may include software and hardware upgrades, for example, our web ordering platform, internal communications software, drive-thru ordering tables and point of sale systems, as well as a migration of certain systems to the public cloud. Implementing these systems is a lengthy and expensive process that may result in a diversion of resources from other initiatives and activities. Continued execution of the project plans, or a divergence from them, may result in cost overruns, project delays or business interruptions. Business interruptions also could result from the failure of other important information technology platforms we use to operate our business, including platforms hosted or otherwise provided by third parties on our behalf, or from a failure to maintain or follow adequate disaster

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recovery, backup, upgrade, or migration plans. Any disruptions, delays or deficiencies in the design and/or implementation of any of these systems, or our inability to accurately predict the costs of such initiatives or our failure to generate revenue and corresponding profits from such activities and investments, could impact our ability to perform necessary business operations, which could materially and adversely affect our reputation, competitive position, business, results of operations and financial condition.

A breach of security of confidential or consumer personal information related to our electronic processing of credit and debit card transactions could substantially affect our reputation and financial results.

A significant majority of our sales are by credit or debit cards. Restaurants and retailers have experienced security breaches in which credit and debit card information has been stolen. We use third-party providers to track, process and authorize our sales by credit or gift card. Improper access to our or these third-party providers’ systems or databases could result in the unauthorized use, theft, disclosure, publication, deletion or modification of confidential consumer personal information and/or card data, including theft of funds on the card or counterfeit reproduction of the cards. If the security of such third-party providers is compromised, then we may be subject to unplanned losses, expenses, fines or penalties. We may in the future become subject to claims for purportedly fraudulent transactions arising out of the actual or alleged theft of credit or debit card information, and we may also be subject to lawsuits or other proceedings related to these types of incidents. In addition, all fifty U.S. states, Puerto Rico, Washington, D.C., and international jurisdictions in which we operate, have enacted legislation or implemented regulations requiring notification of security breaches involving personal information, including credit and debit card information. Claims or proceedings related to theft of credit or debit card information may be brought by payment card providers, banks and credit unions that issue the cards, cardholders (either individually or as part of a class action lawsuit) and government regulators (both foreign and domestic). Further, the standards for systems currently used for transmission and approval of electronic payment transactions, and the technology utilized in electronic payments, all of which can put electronic payment card data at risk, are determined and set by the payment card industry. For example, we are subject to industry requirements such as the Payment Card Industry Data Security Standard, or PCI DSS, as well as certain other industry standards. Any failure to comply with these rules and/or requirements could materially and adversely harm our brand, reputation, business and results of operations and may subject us to fines by the payment card brands that are passed down to us by our merchant bank. If the third-party independent service providers we rely on for payment processing, including credit and debit cards, become unwilling or unable to provide these services to us or if the cost of using these providers increases, our business could materially and adversely be harmed. Any such claim or proceeding could cause us to incur significant unplanned expenses, which could have an adverse impact on our financial condition and results of operations. Further, adverse publicity resulting from these allegations may have a material adverse effect on us and our restaurants.

We rely heavily on information technology, and any material failure, weakness, interruption or breach of security could prevent us from effectively operating our business.

We rely heavily on information systems, including point-of-sale processing in our restaurants, management of our supply chain, payment of obligations, collection of cash, credit and debit card transactions, payment of payroll and other obligations and other processes and procedures. Our ability to efficiently and effectively manage our business depends significantly on the reliability and capacity of these systems. Our operations depend upon our ability to protect our computer equipment and systems against damage from physical theft, power loss, cybersecurity attacks (including ransomware), improper or unauthorized usage by team members, telecommunications failures or other catastrophic events, such as fires, earthquakes, tornadoes and hurricanes, climate change, widespread power outages caused by severe storms, as well as from internal and external security breaches, viruses, worms and other disruptive problems. Any damage, failure, or breach of our information systems that causes an interruption in our operations could have a material adverse effect on our business and subject us to litigation or actions by regulatory authorities. To mitigate potential risk to the Company posed by natural disasters or other catastrophic events, we have taken a number of steps such as removing information systems from our environment and migrating file storage and sharing, including

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operational reporting, to cloud services. Nonetheless, there is no guarantee that these efforts will prove successful in the event of future natural disasters that might prevent us from effectively operating our business.

Some of our essential business processes that are dependent on technology are outsourced to third parties. Such processes include, but are not limited to, gift card tracking and authorization, web site hosting and maintenance, data warehousing and business intelligence services, point-of-sale system maintenance, certain tax filings, telecommunications services, web-based labor scheduling and other key processes. We make a diligent effort to ensure that all providers of outsourced services are observing proper internal control practices, such as redundant processing facilities; however, there are no guarantees that failures will not occur. The failure of our systems or those of third-party service providers to operate effectively, maintenance problems, upgrading or transitioning to new platforms, expanding information systems as we grow or experiencing a breach in security of these systems could result in delays in guest service and reduce efficiency in our operations. Remediation of such problems could result in significant, unplanned capital investments and result in a material and adverse harm to our business.

Cybersecurity breaches of confidential or personal information of our guests and team members, threats to our technological systems and increasing privacy compliance requirements may adversely affect our business.

A cybersecurity breach, including a ransomware attack, that compromises the personal information of our guests or team members, either through an attack on our technological systems or those of third-party service providers that we rely on, could result in widespread negative publicity, damage to the reputation of our brands, a loss of consumers, an interruption of our business and legal liabilities.

From time to time we have been, and likely will continue to be, the target of attempted cybersecurity and other security threats, including those common to most industries and those targeting us, due to the confidential and consumer personal information we obtain through our electronic processing of credit and debit card transactions. The techniques and sophistication used to conduct cyber-attacks and breaches of information technology systems, as well as the sources and targets of these attacks, may take many forms (including phishing, social engineering, denial or degradation of service attacks, malware or ransomware), change frequently and are often not recognized until such attacks are launched or an unauthorized third party has already accessed our information systems for a period of time. A cybersecurity breach or even a perceived security breach or failure to appropriately respond to such a breach could result in litigation or investigations and enforcement from governmental authorities. Security breaches (including ransomware attacks) could also materially and adversely affect our reputation with consumers and third parties with whom we do business. It is possible that advances in computer capabilities, new discoveries, undetected fraud, inadvertent violations of our policies or procedures or other developments could result in a compromise of information or a breach of the technology and security processes that are used to protect consumer transaction data. We may be required to expend significant capital and other resources to protect against and remedy any potential or existing security breaches and their consequences.

We are subject to a variety of continuously evolving laws and regulations regarding privacy, data security and the protection of personal information at the federal, state, local and foreign levels. For example, Brazil’s General Law for the Protection of Personal Data (“LGPD”) requires companies to meet certain requirements regarding the handling of personal data, including its use, collection, classification, processing, storage, protection, deletion, sharing and transfer of such data. Failure to meet the LGPD requirements could result in penalties of up to 2% of sales revenue or $50 million Brazilian Real, which, based on exchange rates of the date of this filing, is approximately $12 million U.S. dollars. Additionally, the California Consumer Privacy Act of 2018 (“CCPA”), which became effective January 1, 2020, provides a new private right of action to California residents related to data breaches and imposes new disclosure and other requirements on companies with respect to their data collection, use and sharing practices as they relate to California residents. In November 2020, California passed the California Privacy Rights Act of 2020 (also known as Proposition 24), which amended and

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expanded the CCPA, removed the cure period before which businesses can be penalized and created the California Privacy Protection Agency to enforce the state’s consumer data privacy laws. Following the enactment of the CCPA, in 2021, Virginia enacted the Virginia Consumer Data Protection Act of 2021 (“VCDPA”), and Colorado enacted the Colorado Privacy Act (“CPA”). We operate locations in California, Colorado and Virginia and collect the personal information of sufficient numbers of residents of those states such that the CCPA, VCDPA and CPA would be applicable to our operations. In addition, several other states are considering enacting similar comprehensive privacy legislation, state laws are changing rapidly and there is discussion in Congress of a new comprehensive federal data privacy law to which we would become subject if it is enacted, which may add additional complexity, variation in requirements, restrictions and potential legal risks, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs or changes in business practices and policies. We could be materially and adversely affected if legislation or regulations are expanded to require changes in business practices or privacy policies (particularly to the extent such changes would affect the manner in which we store, share, use, disclose, process and protect such data), or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our business, financial condition, results of operations, and prospects. In addition, even if legislation or regulation does not expand in a manner that affects our business directly, changing consumer attitudes or the perception of the use of personal information could also materially and adversely affect our business, financial condition, results of operations and prospects.

Because the interpretation and application of laws, regulations, standards and other obligations relating to data privacy and security are still uncertain and continuously evolving, it is possible that these laws, regulations, standards and other obligations may be interpreted and applied in a manner that is inconsistent with our data processing practices and policies. If our practices are not consistent, or are viewed as not consistent, with changes in laws, regulations and standards or new interpretations or applications of existing laws, regulations and standards, we may also become subject to fines, audits, inquiries, whistleblower complaints, adverse media coverage, investigations, lawsuits, severe criminal or civil sanction or other penalties. Although we endeavor to comply with our public statements and documentation, we may at times fail to do so or be alleged to have failed to do so. The publication of our privacy policies and other statements that provide promises and assurances about data privacy and security can subject us to potential government or legal action if they are found to be deceptive, unfair or misrepresentative of our actual practices. If we fail, or are perceived to have failed, to properly respond to security breaches of our or third party’s information technology systems or fail to properly respond to consumer requests under the LGPD, CCPA, VCDPA or CPA, we could experience reputational damage, adverse publicity, loss of consumer confidence, reduced sales and profits, complications in executing our growth initiatives and regulatory and legal risk, including criminal penalties or civil liabilities. A claim or investigation resulting from a cyber or other security threat to our systems and data may have a material adverse effect on our business and the potential of incurring significant remediation costs. As cybersecurity and privacy laws and regulations evolve, we may also incur significant costs for additional technology, third-party services and personnel to maintain and improve our cybersecurity systems and privacy-related procedures. Any concerns about our data privacy and security practices, even if unfounded, could damage the reputation of our businesses and discourage potential users from using our products and services. Any of the foregoing could have an adverse effect on our business, financial condition, results of operations and prospects.

We may have contractual and other legal obligations to notify relevant stakeholders of any security breaches. Most jurisdictions have enacted laws requiring companies to notify individuals, regulatory authorities, and others of security breaches involving certain types of data. Such mandatory disclosures are costly, could lead to negative publicity, may cause our guests to lose confidence in the effectiveness of our security measures and require us to expend significant capital and other resources to respond to and/or alleviate problems caused by the actual or perceived security breach. A security breach could lead to claims by our guests, or other relevant stakeholders that we have failed to comply with such data security obligations and, as a result, we could be subject to legal action or loss of business from affected guests.

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While we currently maintain cybersecurity insurance, such insurance may not be sufficient in type or amount to cover us against claims related to breaches, failures or other data security-related incidents, and we cannot be certain that cyber insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material and adverse effect on our business, financial condition and results of operations. Any of the foregoing could have an adverse effect on our business, financial condition, results of operations and prospects.

Risks Related to Our Indebtedness

The amount of money that we have borrowed and may in the future borrow could adversely affect our financial condition and operating activities.

As of October 3, 2021, we had $344.2 million aggregate principal amount of outstanding debt. As of October 3, 2021, on a pro forma basis after giving effect to the consummation of our initial public offering, the consummation of the repayment in full and termination of our 2018 Credit Facility and entry into, and effectiveness of, our New Credit Facility and our use of proceeds therefrom as set forth under “Use of Proceeds” we would have had $ million of outstanding debt and $ million available to be borrowed under our New Credit Facility. Our 2018 Credit Facility and any other debt incurred in the future, including our New Credit Facility, may have important consequences to holders of our common stock, including the following:

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our ability to obtain additional financing for working capital, capital expenditures, acquisitions or other purposes may be impaired;

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we may use a substantial portion of our cash flow from operations to service our indebtedness, rather than for operations or other purposes;

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our level of indebtedness could place us at a competitive disadvantage compared to our competitors with proportionately less debt; and

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our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate may be limited.

We intend to apply the net proceeds of this offering, together with borrowings under the New Credit Facility, to fully prepay amounts outstanding under our 2018 Credit Facility, to terminate the 2018 Credit Facility, and to pay fees and expenses associated with this offering, the borrowings under the New Credit Facility and the repayment and termination of our 2018 Credit Facility.

Our ability to make payments on our indebtedness and access the capital markets depends on our future performance, which will be affected by business, financial, economic and other factors, many of which we cannot control. If we do not have sufficient funds, we may not be able to refinance all or part of our then existing debt or may be required to sell assets or borrow at higher interest rates than our New Credit Facility. We may not be able to accomplish any of these alternatives on terms acceptable to us, if at all. In addition, the terms of existing or future debt agreements may restrict us from adopting any of these alternatives.

Our New Credit Facility will impose, operating and financial restrictions that may impair our ability to respond to changing business and industry conditions.

Our New Credit Facility will contain, restrictions and covenants that generally limit our ability to, among other things:

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incur additional indebtedness;

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make investments and acquisitions;

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incur liens or use assets as collateral in other transactions;

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sell assets or merge with or into other companies;

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pay dividends to, or purchase stock from, our stockholders;

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enter into transactions with affiliates; and

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create or permit restrictions on our subsidiaries’ ability to make payments to us.

We expect that the New Credit Facility will include a springing financial maintenance covenant pursuant to which we will be required to maintain a First Lien Net Leverage Ratio not to exceed a certain level to be agreed if as of the last day of any fiscal quarter the principal amount of revolving loans outstanding under the New Credit Facility exceeds a certain percentage of the total revolving commitments thereunder (the “Springing Financial Maintenance Covenant”). If we breach the Springing Financial Maintenance Covenant, the lenders under our revolving facility would have the right to declare borrowings to be immediately due and payable and terminate the revolving commitments. If the revolving lenders take such measures, our term lenders would also have the right to accelerate the term loans and exercise remedies under our New Credit Facility, as applicable.

Breach of any of the foregoing provisions or failure to comply with the Springing Financial Covenant could result in a default under our New Credit Facility, in which case our lenders would have the right to declare borrowings to be immediately due and payable. Our lenders may also accelerate payment of borrowings upon the occurrence of certain change of control events relating to us. If we are unable to repay borrowings when due, whether at maturity or following a default or change of control event, our lenders would have the right to take or sell assets pledged as collateral to secure the indebtedness. We expect the New Credit Facility will be secured by substantially all of our assets (including equity of our principal subsidiaries). Any such actions taken by our lenders or other creditors would have a material adverse effect on our business and financial condition.

In the event the applicable lenders or agents accelerate the repayment of our borrowings, we and our subsidiaries may not have sufficient assets to repay that indebtedness. If we were unable to repay or otherwise refinance these borrowings and loans when due, the applicable lenders or agents could proceed against the collateral granted to them to secure that indebtedness, which could cause us into bankruptcy or liquidation. Any acceleration of amounts due under the agreements governing our New Credit Facility or future debt agreement or the exercise by the applicable lenders or agents of their rights under the security documents would likely have a material adverse effect on our business and operations. In addition, holders of our common stock may not receive any recovery in any such bankruptcy or liquidation proceedings.

General Risk Factors

We face significant competition from other restaurant companies, which could adversely affect our business and financial performance and make it difficult to expand in new and existing markets.

We must compete successfully with other restaurant companies in existing or new markets in order to maintain and enhance our overall financial performance. The restaurant industry in the U.S. and international markets in which we operate is highly competitive in terms of price, quality of service, restaurant location, atmosphere, and type and quality of food. We compete with restaurant chains and independently owned restaurants (including, among others, churrascaria operators) for guests, restaurant locations and experienced management and staff. Some of our competitors have greater financial and other resources, have been in business for a longer period of time, have greater name recognition and are more established in the markets where we currently operate and where we plan to open new restaurants. Any inability to compete successfully with other restaurant companies may harm our ability to maintain or increase our revenue, force us to close one or more of our restaurants or limit our ability to expand our restaurant base. Restaurant closings would reduce our revenue and could subject us to significant costs, including severance payments to team members, write-downs of leasehold improvements, equipment, furniture and fixtures, and legal expenses. In addition, we could remain liable for remaining future lease obligations for any terminated restaurant locations.

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Churrascaria operators and other competitors in the steakhouse sector of our industry have continued to open restaurants in recent years. If we overestimate demand for our restaurants or underestimate the popularity of competing restaurants, we may be unable to realize anticipated revenue from existing or new restaurants. Similarly, if any of our competitors opens additional restaurants in existing or targeted markets, we may realize lower than expected revenue from our restaurants. Any decrease in the number of restaurant guests for any of our existing or new restaurants due to competition could reduce our revenue and adversely affect our business and financial performance, which could cause the market price of our common stock to decline.

Our future success depends upon the continued appeal of our restaurant concept and we are vulnerable to changes to consumer preferences.

Our success depends, in considerable part, on the popularity of our menu offerings and the overall dining experience provided to guests by our restaurants. Any shift in consumer preferences away from our restaurant concept could negatively affect our financial performance. The restaurant industry is characterized by the continual introduction of new concepts and is subject to rapidly changing consumer preferences, tastes and dining habits. Our sales could be impacted by shifts in consumer preferences arising from dietary concerns relating to calories, sodium or carbohydrates. Shifts in consumer preferences away from the kinds of food we offer, particularly beef and other meats, whether because of environmental or sustainability concerns, dietary or other health concerns or otherwise, would make our restaurants less appealing to consumers. There can be no assurance that consumers will continue to regard churrasco-inspired food favorably or that we will be able to develop new products that appeal to consumer preferences. Guest preferences may also be affected by a decline in the price of groceries which may increase the attractiveness of dining at home versus dining out. Our business, financial condition and results of operations depend in part on our ability to anticipate, identify and respond to changing consumer preferences. Any failure by us to anticipate and respond to changing guest preferences could make our restaurants less appealing and adversely affect our business.

Changes to estimates related to our property, fixtures and equipment, goodwill or operating results that are lower than our current estimates at certain restaurant locations may cause us to incur impairment charges, which may adversely affect our results of operations.

In accordance with accounting guidance as it relates to the impairment of long-lived assets, we make certain estimates and projections with regard to individual restaurant operations, as well as our overall performance, in connection with our impairment analyses for long-lived assets. When impairment triggers are deemed to exist for any location, the estimated undiscounted future cash flows are compared to its carrying value. If the carrying value exceeds the undiscounted cash flows, an impairment charge equal to the difference between the carrying value and the fair value is recorded. In the absence of extraordinary events, individual restaurants are excluded in our impairment analysis until they have been open for 36 months. An initial three-year operating plan is developed for each new restaurant and we remain committed to that plan barring unforeseen circumstances. For example, in Fiscal 2019, we recorded an impairment of the fixed assets of our Barra, Brazil restaurant, in the amount of $0.4 million due to a continuous decline in its financial performance and weak forecasts for future performance for that location.

Additionally, we test our reporting units for impairment of goodwill annually. We compare the fair value of the reporting unit, estimated using a combination of methodologies, to its carrying amount and, if the carrying amount of a reporting unit’s goodwill exceeds its fair value, we would measure the impairment loss. For example, in Fiscal 2020, we recorded an impairment charge of $10.2 million for our Brazil operations as the carrying value of the reporting unit exceeded its fair value. The projections of future cash flows, and application of other methodologies, used in these analyses require the use of judgment and a number of estimates and projections of future operating results. If actual results differ from our estimates, additional charges for asset impairments may be required in the future. If future impairment charges are significant, our reported operating results would be adversely affected.

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Loss of key management personnel could hurt our business and inhibit our ability to operate and grow successfully.

Our success will continue to depend, to a significant extent, on our leadership team and other key management personnel. If we are unable to attract and retain sufficiently experienced and capable management personnel, our business and financial results may suffer. If members of our leadership team or other key management personnel leave, we may have difficulty replacing them, and our business may suffer. There can be no assurance that we will be able to successfully attract and retain our leadership team and other key management personnel that we need. We also do not maintain any key man life insurance policies for any of our team members.

Our current insurance policies may not provide adequate levels of coverage against all claims, and we may incur losses that are not covered by our insurance.

We maintain insurance coverage for a significant portion of our risks and associated liabilities with respect to general liability, property and casualty liability, liquor liability, employer’s liability and other insurable risks. However, there are types of losses we may incur that cannot be insured against or that we believe are not commercially reasonable to insure. For example, insurance covering liability for violations of wage and hour laws has not generally been available. We also self-insure for workers’ compensation and health benefits under plans with high deductibles. Losses for such uninsured claims, if they occur, could have a material adverse effect on our business and results of operations.

Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.

As of January 3, 2021, we had gross federal and state net operating loss carryforwards of $64,867 and $40,989, respectively, and federal general business credits of $22,374. Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, if a corporation undergoes an “ownership change,” its ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes to offset its post-change income may be limited. In general, an “ownership change” generally occurs if there is a cumulative change in our ownership by “5-percent shareholders” that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under state tax laws. We experienced an ownership change in the past and may experience ownership changes in the future as a result of future transactions in our stock, some of which may be outside our control. As a result, if we earn net taxable income, our ability to use our pre-change net operating loss carryforwards, or other pre-change tax attributes, to offset U.S. federal and state taxable income may be subject to significant limitations. A portion of the state net operating losses and general business credit carryforwards are subject to limitations under Sections 382 and 383, but due to the accumulation of annual allowances, as of January 3, 2021, the attributes are no longer subject to limitation. The federal net operating loss carryforwards and certain conforming state jurisdictions have unlimited net operating loss carryforward periods. For state jurisdictions that do not conform to the unlimited net operating loss carryforward period, the net operating loss carryforwards begin to expire in 2027, with carryforward periods ranging from 5 to 20 years. The general business credit carryforwards will begin to expire in 2032 - 2040.

Risks Related to this Offering, Ownership of Our Common Stock and Our Governance Structure

The Rhône Funds have a substantial ownership interest in our common stock. Conflicts of interest may arise because some of our directors are principals of Rhône.

After giving effect to this offering, we expect that the Rhône Funds will beneficially own approximately % of our outstanding common stock. As a consequence, Rhône is able to control matters requiring stockholder approval, including the election of directors, a merger, consolidation or sale of all or substantially all of our assets, and any other significant transaction. The interests of Rhône may not always coincide with our interests or the interests of our other stockholders.

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Rhône could invest in entities that directly or indirectly compete with us. As a result of these relationships, when conflicts arise between the interests of Rhône and the interests of our stockholders, these directors may not be disinterested. The representatives of Rhône on our Board of Directors, by the terms of our amended and restated certificate of incorporation, are not required to offer us any transaction opportunity of which they become aware and could take any such opportunity for themselves or offer it to other companies in which they have an investment, unless such opportunity is expressly offered to them solely in their capacity as our directors.

Rhône may have conflicts of interest with other stockholders in the future.

Rhône may exert significant influence over, and could control, matters requiring stockholder approval, including the election of directors and approval of major corporate transactions. In addition, this concentration of ownership may delay or prevent a change of control of our company and make some transactions more difficult or impossible without the support of Rhône.

The interests of Rhône may not always be consistent with the interests of our company or of other stockholders. Accordingly, Rhône could cause us to enter into transactions or agreements of which holders of our common stock would not approve or make decisions with which such holders would disagree.

Rhône is in the business of making investments in companies and could from time to time acquire and hold interests in businesses that compete with us. Rhône may also pursue acquisition opportunities that may be complementary to our business, and as a result, desirable acquisitions may not be available to us.

An active market for our common stock may not develop, which could make it difficult for you to sell your shares at or above the initial public offering price.

Prior to this offering, there is no public market for shares of our capital stock. We have applied to list our common stock on NYSE under the symbol FOGO. However, we cannot assure you that an active public trading market for our common stock will develop on that exchange or elsewhere or, if developed, that any market will be active or sustained. Accordingly, we cannot assure you as to the liquidity of any such market, your ability to sell your shares of common stock or the prices that you may obtain upon sale of your shares. As a result, you could lose all or part of your investment in our common shares.

We are a “controlled company” within the meaning of NYSE rules and, as a result, are exempt from certain corporate governance requirements.

Upon completion of this offering, the Rhône Funds will continue to hold capital stock representing a majority of our outstanding voting power. So long as the Rhône Funds maintain holdings of more than 50% of the voting power of our capital stock, we will be a “controlled company” within the meaning of NYSE corporate governance standards. Under these standards, a company need not comply with certain corporate governance requirements, including:

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the requirement that a majority of our board of directors consist of “independent directors” as defined under NYSE rules;

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the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

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the requirement that we have a nominating and corporate governance committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities, or otherwise have director nominees selected by vote of a majority of the independent directors; and

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the requirement for an annual performance evaluation of the nominating and corporate governance and compensation committees.

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If we are eligible to do so following this offering, we intend to utilize these exemptions. As a result, we would not have a majority of independent directors on our board of directors and our compensation committee and nominating and corporate governance committee would not consist entirely of independent directors and will not be subject to annual performance evaluations. If we are no longer eligible to rely on the controlled company exception, we will comply with all applicable NYSE corporate governance requirements, but we will be able to rely on phase-in periods for certain of these requirements in accordance with NYSE rules. Accordingly, our stockholders may not have the same protections afforded to stockholders of companies that are subject to all NYSE corporate governance requirements.

The market price of our common stock may decline, and you could lose all or a significant part of your investment.

The initial public offering price for our common stock was determined by negotiations between us and the underwriters and does not purport to be indicative of market prices after this offering. The market price of, and trading volume for, our common stock may be influenced by many factors, some of which are beyond our control, including, among others, the following:

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variations in our quarterly or annual operating results;

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changes in our earnings estimates (if provided) or differences between our actual financial and operating results and those expected by investors and analysts;

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initiatives undertaken by our competitors, including, for example, the opening of restaurants in our existing markets;

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actual or anticipated fluctuations in our or our competitors’ results of operations, and our and our competitors’ growth rates;

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the failure of securities analysts to cover our common stock, or changes in estimates by analysts who cover us and competitors in our industry;

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recruitment or departure of key personnel;

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adoption or modification of laws, regulations, policies, procedures or programs applicable to our business or announcements relating to these matters;

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any increased indebtedness we may incur in the future;

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actions by stockholders;

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announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic relationships;

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capital commitments;

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the expiration of lock-up agreements entered into by our existing stockholders in connection with our initial public offering;

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economic conditions;

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geopolitical incidents; and

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investor perceptions of us, our competitors and our industry.

As a result of these and other factors, our stockholders may experience a decrease, which could be substantial, in the value of their shares of our common stock, including decreases unrelated to our financial performance or prospects.

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The market price and trading volume of our common stock may be volatile, which could result in rapid and substantial losses for our stockholders.

The market price of our common stock may be highly volatile and could be subject to wide fluctuations. In addition, the trading volume in our common stock may fluctuate and cause significant price variations to occur. If the market price of our common stock declines significantly, stockholders may be unable to resell shares of our common stock at or above their purchase price, if at all. The market price of our common stock may fluctuate or decline significantly in the future.

Certain broad market and industry factors may materially decrease the market price of our common stock, regardless of our actual operating performance. The stock market in general has from time to time experienced extreme price and volume fluctuations, including recently. In addition, in the past, following periods of volatility in the overall market and decreases in the market price of a company’s securities, securities class action litigation has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources.

Future sales of our common stock could cause the market price of such shares to fall.

If our existing stockholders sell substantial amounts of our common stock, the market price of our common stock could decrease significantly. The perception in the public market that major stockholders might sell substantial amounts of our common stock could also depress the market price of our common stock. A decline in the market price of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities.

Immediately after completion of this offering, we will have shares of common stock outstanding, including shares that will be beneficially owned by the Rhône Funds. In general, the common stock sold in this offering will be freely transferable without restriction or additional registration under the Securities Act of 1933, as amended, or the Securities Act. In addition, under lock-up agreements entered into by us, our officers, directors and holders of all or substantially all our outstanding common stock in connection with this offering, the remaining shares of our common stock outstanding immediately after this offering will become eligible for sale in the public markets from time to time, subject to Securities Act restrictions, following expiration of an 180-day lock-up period.

Morgan Stanley & Co. LLC, BofA Securities, Inc. and Jefferies LLC may, in their sole discretion and at any time or from time to time, without notice, release all or any portion of the shares of common stock subject to the lock-up agreements for sale in the public and private markets prior to expiration of the 180-day lock-up period. The market price for our common stock may drop significantly when the restrictions on resale by our existing stockholders lapse or if those restrictions on resale are waived. A decline in the market price of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities.

Purchasers of common stock in this offering will experience immediate and substantial dilution.

If you purchase shares of our common stock in this offering, the value of those shares based on our book value will immediately be less than the price you paid. This reduction in the value of your shares is known as dilution. Dilution occurs mainly because our earlier investors paid substantially less than the initial public offering price when they acquired their shares of our capital stock. If you purchase shares in this offering, you will incur immediate dilution of $ in the net tangible book value per share. In addition, if we raise funds through equity offerings in the future, the newly issued shares will further dilute your percentage ownership interest in our company.

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The market price of our common stock could decline if securities or industry analysts do not publish research or reports about our company or if they downgrade us or other restaurant companies in our industry.

The market price of our common stock will depend, in part, on the research and reports that securities or industry analysts publish about us or our business. We do not influence or control the reporting of these analysts. In addition, if no analysts provide coverage of our company or if one or more of the analysts who do cover us downgrade shares of our company or other companies in our industry, the market price of our common stock could be negatively impacted. If one or more of these analysts cease coverage of our company, we could lose visibility in the market, which could, in turn, cause the market price of our common stock to decline.

Future offerings of equity by us may adversely affect the market price of our common stock.

In the future, we may attempt to obtain financing or to further increase our capital resources by issuing additional shares of our common stock or by offering debt or other equity securities, including senior or subordinated notes, debt securities convertible into equity or shares of preferred stock. Opening new restaurants in existing and new markets could require substantial additional capital in excess of cash from operations. We would expect to finance the capital required for new restaurants through a combination of additional issuances of equity, corporate indebtedness and cash from operations.

Issuing additional shares of our common stock or other equity securities or securities convertible into equity may dilute the economic and voting rights of our existing stockholders or reduce the market price of our common stock or both. Upon liquidation, holders of such debt securities and preferred shares, if issued, and lenders with respect to other borrowings would receive a distribution of our available assets prior to the holders of our common stock. Debt securities convertible into equity could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities issuable upon conversion. Preferred shares, if issued, could have a preference with respect to liquidating distributions or a preference with respect to dividend payments that could limit our ability to pay dividends to the holders of our common stock. Our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may adversely affect the amount, timing or nature of our future offerings. Thus, holders of our common stock bear the risk that our future offerings may reduce the market price of our common stock and dilute their stockholdings in us.

Our amended and restated bylaws will provide, to the fullest extent permitted by law, that unless we consent to the selection of an alternative forum, a state or federal court located within the state of Delaware will, with certain limited exceptions, be the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.

Our amended and restated bylaws will require, to the fullest extent permitted by law, that a state or federal court located within the state of Delaware will, with certain limited exceptions, be the sole and exclusive forum for the following types of actions or proceedings under Delaware statutory or common law: (1) any derivative action or proceeding brought on the Company’s behalf; (2) any action asserting a claim of breach of a fiduciary duty or other wrongdoing by any of the Company’s directors, officers, employees, or agents to us or the Company’s stockholders; (3) any action asserting a claim against the Company arising pursuant to any provision of the Delaware General Corporate Law (“DGCL”) or our amended and restated certificate of incorporation or amended and restated bylaws; (4) any action to interpret, apply, enforce, or determine the validity of the Company’s amended and restated certificate of incorporation or amended and restated bylaws; or (5) any action asserting a claim governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in our amended and restated bylaws. This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers or employees, which may discourage lawsuits with respect to such claims, although our stockholders will not be

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deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder and may therefore bring a claim in another appropriate forum. We cannot be certain that a court will decide that this provision is either applicable or enforceable, and if a court were to find the choice of forum provision contained in our amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.

Our amended and restated bylaws will provide that the exclusive forum provision will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions. Accordingly, both federal and state courts have jurisdiction to entertain such claims. To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, the amended and restated bylaws will provide that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act and the rules and regulations thereunder. We note, however, that there is uncertainty as to whether a court would enforce this provision and that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder.

We do not intend to pay cash dividends for the foreseeable future.

We intend to retain all of our earnings for the foreseeable future to fund the operation and growth of our business and to repay indebtedness, and therefore, we do not anticipate paying any cash dividends to holders of our capital stock for the foreseeable future. Any future determination regarding the payment of any dividends will be made at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, liquidity, contractual restrictions, general business conditions and other factors that our board of directors may deem relevant. Consequently, investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment. Investors seeking cash dividends should not invest in our common stock.

Our future capital requirements are uncertain, and we may have difficulty raising money in the future on acceptable terms, if at all.

Our capital requirements depend on many factors, including the amounts required to open new restaurants and to service our indebtedness. To the extent that our capital resources are insufficient to meet these requirements, we may need to raise additional funds through financings or curtail our growth, reduce our costs and expenses, or sell certain of our assets. Any additional equity offerings or debt financings may be on terms that are not favorable to us. Equity offerings could result in dilution to our stockholders, and equity or debt securities issued in the future may have rights, preferences and privileges that are senior to those of our common stock. If our need for capital arises because of significant losses, the occurrence of these losses may make it more difficult for us to raise the necessary capital.

Provisions of our charter documents, Delaware law and other documents could discourage, delay or prevent a merger or acquisition at a premium price.

Our amended and restated certificate of incorporation and bylaws include provisions that:

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permit us to issue preferred stock in one or more series and, with respect to each series, fix the number of shares constituting the series and the designation of the series, the voting powers, if any, of the shares of the series and the preferences and other special rights, if any, and any qualifications, limitations or restrictions, of the shares of the series;

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•

restrict the ability of stockholders to act by written consent or to call special meetings;

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require the affirmative vote of 66^2/3% of the outstanding shares entitled to vote to approve certain transactions or to amend certain provisions of our certificate of incorporation or bylaws;

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limit the ability of stockholders to amend our certificate of incorporation and bylaws;

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require advance notice for nominations for election to the board of directors and for stockholder proposals;

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establish a classified board of directors with staggered three-year terms;

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provide that our amended and restated bylaws can be amended by the board of directors; provide that the authorized number of directors may be changed only by resolution of the board of directors;

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provide that all vacancies in our board of directors may, except as otherwise required, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; and

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contain advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us.

These provisions may discourage, delay or prevent a merger or acquisition of our company, including a transaction in which the acquiror may offer a premium price for our common stock.

Our equity incentive plans also permit vesting of stock options and restricted stock, and payments to be made to the team members thereunder, in connection with a change of control of our company, which could discourage, delay or prevent a merger or acquisition at a premium price. In addition, our 2018 Credit Facility includes and other debt incurred by us in the future, including the New Credit Facility, may include, provisions entitling the lenders to demand immediate repayment of borrowings upon the occurrence of certain change of control events relating to our company, which also could discourage, delay or prevent a business combination transaction.

The future issuance of additional common stock in connection with our incentive plans, acquisitions or otherwise will dilute all other stockholdings.

After this offering, assuming the underwriters exercise their option to purchase additional shares in full, we will have an aggregate of shares of common stock authorized but unissued and not reserved for issuance under our incentive plans (including shares of our common stock issuable upon the exercise of stock options we expect to grant to team members upon the closing of this offering at an exercise price per share equal to the initial public offering price). We may issue all of these shares of common stock without any action or approval by our stockholders, subject to certain exceptions. Any common stock issued in connection with our incentive plans, the exercise of outstanding stock options or otherwise would dilute the percentage ownership held by the investors who purchase common stock in this offering.

The underwriters of this offering may waive or release parties to the lock-up agreements entered into in connection with this offering, which could adversely affect the price of our common stock.

We, the Rhône Funds and other holders of our common stock that do not receive such shares in this offering will, subject to certain exceptions, be subject to certain resale restrictions with respect to our common stock or any securities convertible into or exercisable or exchangeable for our common stock for a period of 180 days from the date of this prospectus. See “Certain Relationships and Related Party Transactions” and “Underwriting (Conflicts of Interest)”. The representatives for the underwriters, at any time and without notice, may upon request release all or any portion of the shares of common stock subject to the foregoing lock-up agreements. If

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the restrictions under the lock-up agreements are waived, then such shares will be available for sale into the public markets, which could cause the market price of our common stock to decline and impair our ability to raise capital.

Our costs could increase significantly as a result of operating as a public company, and our management will be required to devote substantial time to complying with public company regulations.

As a public company and particularly after we cease to be an “emerging growth company” (to the extent that we take advantage of certain exceptions from reporting requirements that are available under the JOBS Act as an emerging growth company), we could incur significant legal, accounting and other expenses not presently incurred. In addition, Sarbanes-Oxley, as well as rules promulgated by the SEC and the NYSE, require us to adopt corporate governance practices applicable to U.S. public companies. These rules and regulations may increase our legal and financial compliance costs.

Sarbanes-Oxley, as well as rules and regulations subsequently implemented by the SEC and the NYSE, have imposed increased disclosure and enhanced corporate governance practices for public companies. We are committed to maintaining high standards of corporate governance and public disclosure, and our efforts to comply with evolving laws, regulations and standards are likely to result in increased expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. We may not be successful in implementing these requirements and implementing them could adversely affect our business, results of operations and financial condition. In addition, if we fail to implement the requirements with respect to our internal accounting and audit functions, our ability to report our financial results on a timely and accurate basis could be impaired.

Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

Our amended and restated certificate of incorporation to be adopted in connection with this offering will provide that we will indemnify our directors and officers to the fullest extent permitted by Delaware law. Our amended and restated certificate of incorporation will also permit us to purchase insurance on behalf of any officer, director, team member or other agent for any liability arising out of that person’s actions as our officer, director, team member or agent, regardless of whether Delaware law would permit indemnification. We intend to enter into indemnification agreements with each of our current and future directors and officers. These agreements will require us to indemnify these individuals to the fullest extent permitted under Delaware law against liability that may arise by reason of their service to us and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified.

In addition, our amended and restated certificate of incorporation to be adopted in connection with this offering will limit the liability of our directors for monetary damages for breach of their fiduciary duty as directors, except for liability that cannot be eliminated under the DGCL. Delaware law provides that directors of a company will not be personally liable for monetary damages for breach of their fiduciary duty as directors, except for liabilities:

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for any breach of their duty of loyalty to us or our shareholders;

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for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

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for unlawful payment of dividend or unlawful stock repurchase or redemption, as provided under Section 174 of the DGCL; or

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for any transaction from which the director derived an improper personal benefit.

The above limitations on liability and our indemnification obligations limit the personal liability of our directors and officers for monetary damages for breach of their fiduciary duty as directors by shifting the burden

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of such losses and expenses to us. Certain liabilities or expenses covered by our indemnification obligations may not be covered by our directors’ and officers’ liability insurance or the coverage limitation amounts may be exceeded. As a result, any claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

We are an “emerging growth company” and comply with reduced reporting requirements applicable to emerging growth companies.

We are an emerging growth company, as defined in the JOBS Act, and we take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of Sarbanes-Oxley, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. In addition, even if we begin to comply with the greater obligations of public companies that are not emerging growth companies, we may avail ourselves of the reduced requirements applicable to emerging growth companies from time to time in the future. We cannot predict whether our common stock is less attractive if we choose to rely on these exemptions. If our common stock is less attractive as a result of our reliance on the available exemptions, there may be a less active trading market for our common stock and our stock price may be more volatile.

Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. We have elected to use this extended transition period under the JOBS Act until such time the Company is no longer considered to be an emerging growth company.

We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.

The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business, particularly after we are no longer an “emerging growth company.”

Following the completion of this offering, we are required to comply with various regulatory and reporting requirements, including those required by the SEC. Complying with these reporting and other regulatory requirements will be time-consuming and will result in increased costs to us and could have a negative effect on our results of operations, financial condition or business.

As a public company, we will be subject to the reporting requirements of the Exchange Act and the requirements of the Sarbanes-Oxley Act. These requirements may place a strain on our systems and resources. The Exchange Act requires that we file annual, quarterly and current reports with respect to our business and financial condition. The Sarbanes-Oxley Act requires that we implement and maintain effective disclosure controls and procedures and internal controls over financial reporting. To implement, maintain and improve the effectiveness of our disclosure controls and procedures, we will need to commit significant resources, hire additional staff and provide additional management oversight. We will be implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. Sustaining our growth also will require us to commit additional management, operational and financial resources to identify new professionals to join our firm and to maintain appropriate operational and financial systems to

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adequately support expansion. These activities may divert management’s attention from other business concerns, which could have a material adverse effect on our results of operations, financial condition or business.

As an emerging growth company as defined in the JOBS Act, we intend to take advantage of certain temporary exemptions from various reporting requirements including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We may also delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies, as permitted by the JOBS Act.

Our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal control over financial reporting until the later of our second annual report or the first annual report required to be filed with the SEC following the date we are no longer an emerging growth company as defined in the JOBS Act.

When these exemptions cease to apply, we expect to incur additional expenses and devote increased management effort toward ensuring compliance with them. We cannot predict or estimate the amount of additional costs we may incur as a result of becoming a public company or the timing of such costs.

Certain members of our management team have limited recent experience managing a public company, and our current resources may not be sufficient to fulfill our public company obligations.

As a public company, we are subject to various regulatory requirements, including those of the SEC. These requirements relate to, among other matters, record keeping, financial reporting and corporate governance. Certain members of our management team have limited recent experience in managing a public company, and our internal infrastructure may not be adequate to support our increased regulatory obligations. Further, we may be unable to hire, train or retain necessary staff and may initially be reliant on engaging outside consultants or professionals to overcome our lack of experience. After this offering, we will be required to maintain adequate internal infrastructure, engage outside consultants and otherwise fulfill our public company obligations.

As a public company, we are obligated to develop and maintain proper and effective internal control over financial reporting, and any failure to maintain the adequacy of internal control may adversely affect investor confidence in our company and, as a result, the value of our common shares.

The Sarbanes-Oxley Act of 2002, or Sarbanes-Oxley, requires, among other things, that we assess the effectiveness of our internal control over financial reporting annually and disclosure controls and procedures quarterly. At a future date to be determined based on the facts and circumstances of the Company in accordance with the applicable rules and regulations, we will be required to perform system and process evaluation and testing of our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of Sarbanes-Oxley. Section 404 of Sarbanes-Oxley also generally requires an attestation from our independent registered public accounting firm on the effectiveness of our internal control over financial reporting. However, for as long as we remain an “emerging growth company” as defined in the JOBS Act, we intend to utilize the provision exempting us from the requirement that our independent registered public accounting firm provide an attestation on the effectiveness of our internal control over financial reporting.

During the evaluation and testing process, if we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal control over financial reporting is effective. We cannot assure you that there will not be material weaknesses or other deficiencies in our internal control over financial reporting in the future. Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations. If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered

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public accounting firm determines we have a material weakness or other deficiency in our internal control over financial reporting once that firm begins its Section 404 audits of internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of our common shares could decline, and we could be subject to sanctions or investigations by the SEC, the NYSE or other regulatory authorities. Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements contained in this prospectus constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts, such as statements regarding our future financial condition or results of operations, our prospects and strategies for future growth, the development and introduction of new products, and the implementation of our marketing and branding strategies. In many cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “seeks,” “intends,” “targets” or the negative of these terms or other comparable terminology.

The forward-looking statements contained in this prospectus reflect our current views about future events and are subject to risks, uncertainties, assumptions and changes in circumstances that may cause events or our actual activities or results to differ significantly from those expressed in any forward-looking statement. Although we believe that our assumptions are reasonable, we cannot guarantee future events, results, actions, levels of activity, performance or achievements. Readers are cautioned not to place undue reliance on these forward-looking statements. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements, including, but not limited to, those factors described in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These factors include without limitation:

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the severity, extent and duration of the COVID-19 pandemic, its impacts on our business and results of operations, financial condition and liquidity, including any adverse impact on our stock price and on the other factors listed below, and the responses of federal, state, local and foreign governments to the pandemic;

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changes in general economic or market conditions in the United States and in international markets in which we operate, including Brazil, Mexico and the Middle East;

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increased competition in our industry;

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our ability to manage operations at our current size or manage growth effectively;

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our ability to locate suitable locations to open new restaurants and to attract guests to our restaurants;

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the fact that we will rely on our operating subsidiaries to provide us with distributions to fund our operating activities, which could be limited by law, regulation or otherwise;

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our ability to continually innovate and provide our consumers with innovative dining experiences;

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the ability of our suppliers to deliver meat and other proteins and food items in a timely or cost-effective manner;

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our lack of long-term supplier contracts, our concentration of suppliers and distributors and potential increases in the price of meat and other proteins and food items;

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our ability to successfully expand in the United States and in international markets;

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risk associated with our international operations, presently in Brazil, Mexico and the Middle East, and any other future international operations;

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our ability to raise money and maintain sufficient levels of cash flow;

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conflicts of interest with Rhône;

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the fact that upon listing of our common stock, we will be considered a “controlled company” and exempt from certain corporate governance rules primarily relating to board independence, and we intend to use some or all of these exemptions;

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our ability to effectively market and maintain a positive brand image;

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•

changes in, noncompliance with or liabilities under laws and regulations, including climate change and environmental and sustainability matters;

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our ability to attract and maintain the services of our senior management and key team members;

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the availability and effective operation of management information systems and other technology;

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our ability to obtain, maintain, protect and enforce our intellectual property rights;

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our ability to protect our information technology systems from interruption or security breach, including cybersecurity threats, and to protect consumer data and personal team member information;

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changes in consumer preferences or changes in demand for upscale dining experiences;

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our ability to accurately anticipate and respond to seasonal or quarterly fluctuations in our operating results;

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our ability to maintain effective internal controls or the identification of additional material weaknesses;

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our expectations regarding the time during which we will be an emerging growth company under the JOBS Act;

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changes in accounting standards; and

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other risks described in the “Risk Factors” section of this prospectus.

Although we believe that the assumptions inherent in the forward-looking statements contained in this prospectus are reasonable, undue reliance should not be placed on these statements, which only apply as of the date hereof. Except as required by applicable securities law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.

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USE OF PROCEEDS

We estimate that the net proceeds to us from this offering will be approximately $ million, or $ million if the underwriters exercise their option to purchase additional shares in full from the selling stockholders at the initial public offering price less underwriting discounts and commissions, based upon an assumed initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

We intend to use the net proceeds of this offering, together with borrowings under our New Credit Facility, to fully repay indebtedness of $ outstanding under and to terminate our 2018 Credit Facility and to pay fees and expenses associated with this offering, such repayment of the 2018 Credit Facility and borrowing under our New Credit Facility. The outstanding balance on our 2018 Credit Facility is comprised of our Original Term Loan and Incremental Term Loan, which mature on April 5, 2025 and August 11, 2023, respectively. The borrowings repaid under our 2018 Credit Facility accrue variable interest based on our total net leverage ratio with applicable margins to the Eurodollar Rate or the Base Rate. As of October 3, 2021, our Original Term Loan bore interest at a rate of 4.25% plus LIBOR and our Incremental Term Loan bore interest at a rate of 12.50% plus LIBOR.

Following this offering and borrowing under our New Credit Facility, we expect to have approximately $ million of senior secured term loans outstanding and access to an additional $ million committed revolving credit facility under our New Credit Facility. The amount, maturity, interest rates and other terms of the New Credit Facility are subject to continuing negotiations with prospective lenders. See Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Facility”

A $1.00 increase or decrease in the assumed initial public offering price of $ per share would increase or decrease, respectively, the net proceeds to us from this offering by approximately $ million, assuming the number of shares offered by us, as set forth on the cover of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Affiliates of Credit Suisse Loan Funding LLC, that are affiliates of our underwriters in this offering, are lenders under our 2018 Credit Facility and will be repaid with a portion of the proceeds of this offering, together with borrowings from the New Credit Facility. Because affiliates of Credit Suisse Securities (USA) LLC are lenders under our 2018 Credit Facility and each will receive 5% or more of the net proceeds of this offering, Credit Suisse Securities (USA) LLC is deemed to have a “conflict of interest” under Rule 5121 of the Financial Industry Regulatory Authority, Inc., or FINRA. As a result, this offering will be conducted in accordance with FINRA Rule 5121. Pursuant to that rule, the appointment of a “qualified independent underwriter” is not required in connection with this offering as the members primarily responsible for managing the public offering do not have a conflict of interest, are not affiliates of any member that has a conflict of interest and meet the requirements of paragraph (f)(12)(E) of FINRA Rule 5121. See “Underwriting (Conflicts of Interest).”

We will not receive any of the proceeds from the sale of shares of common stock by the selling stockholders in this offering, including any shares sold by the selling stockholders pursuant to the underwriters’ over-allotment option. We have agreed to pay the expenses of the selling stockholders related to this offering other than the underwriting discounts and commissions.

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DIVIDEND POLICY

We do not expect to pay dividends on our common stock for the foreseeable future. Instead, we anticipate that all of our earnings in the foreseeable future, if any, will be used for the operation and growth of our business or to repay indebtedness.

Any future determination to declare and pay cash dividends will be at the discretion of our board of directors and will depend on, among other things, our financial condition, results of operations, cash requirements, liquidity, contractual restrictions, restrictions imposed by our current and future financing arrangements and such other factors as our board of directors deems relevant. The terms of our 2018 Credit Facility also restrict, and terms of our New Credit Facility will restrict, the ability of our subsidiary, Fogo de Chão, Inc., to make distributions to us, which in turn restricts our ability to pay dividends on our common stock. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—2018 Credit Facility” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—New Credit Facility.”

Accordingly, you may need to sell your shares of our common stock to realize a return on your investment, and you may not be able to sell your shares at or above the price you paid for them. See “Risk Factors—Risks Related to this Offering, Ownership of Our Common Stock and Our Governance Structure—We do not intend to pay cash dividends for the foreseeable future.”

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CAPITALIZATION

The following table describes our cash and cash equivalents and capitalization as of October 3, 2021. Our capitalization is presented:

•

on an actual basis; and

•

on a pro forma basis, reflecting (i) the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares, (ii) the sale by us of shares of our common stock in this offering at the assumed initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, and after deducting estimated offering expenses and estimated underwriting discounts and commissions payable by us, (iii) the consummation of the prepayment and termination of our 2018 Credit Facility and entry into, and effectiveness of, our New Credit Facility and (iv) the application of the net proceeds from this offering, as well as borrowings under the New Credit Facility, as set forth under “Use of Proceeds.”

You should read the information below with the sections entitled “Use of Proceeds,” “Unaudited Pro Forma Consolidated Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Capital Stock” and our consolidated financial statements and the related notes included elsewhere in this prospectus.


	As of October 3, 2021
	Actual			Pro Forma ⁽¹⁾⁽³⁾
	(dollars in thousands)
Cash and cash equivalents	$	23,077		$

Debt:
Revolving line of credit under 2018 Credit Facility	$	—		$	—
Term Loans under 2018 Credit Facility		344,246
Revolving Line of Credit Under New Credit Facility
Term Loans Under New Credit Facility
Woodforest Bank Loan
Total debt, including current portion ⁽²⁾		344,246

Equity:⁽⁴⁾
Shareholders’ equity
Preferred stock, $0.01 par value; no shares authorized, actual; shares authorized, none issued and outstanding pro forma		—			—
Common stock, $0.01 value; shares authorized, issued and outstanding, actual; authorized, issued and outstanding, pro forma
Additional paid-in capital		260,657
Accumulated deficit		(56,844	)
Accumulated other comprehensive loss		(19,226	)

Total shareholders’ equity		184,587
Total equity		184,587

Total capitalization	$	528,833		$

(1)

A $1.00 increase or decrease in the assumed public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, would increase or decrease, respectively, each of additional paid-in capital, total shareholders’ equity and total capitalization by $ million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

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(2)	As of October 3, 2021, the total amount available to be borrowed under our Revolver was approximately $35.4 million, and we had access to $11.2 million under the Woodforest Bank Loan.

(3)	Pro forma amounts give effect to the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares.

(4)	Actual amounts do not give effect to the consummation of the stock split to be effected upon the closing of this offering.

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DILUTION

If you invest in our common stock in this offering, your interest will be diluted to the extent of the difference between the initial public offering price per share of our common stock and the pro forma net tangible book value per share of our common stock after this offering.

Our historical net tangible book value as of October 3, 2021 was approximately $ million, or approximately $ per share (without giving any effect to the consummation of the stock split to be effected upon the closing of this offering). Historical net tangible book value per share is determined by dividing the amount of our net tangible book value, or total tangible assets less total liabilities, as of October 3, 2021 by the number of shares of our common stock outstanding as of October 3, 2021.

Dilution to new investors represents the difference between the amount per share paid by investors in this offering and the pro forma net tangible book value per share of our common stock immediately after the completion of this offering. After giving effect to (i) the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares, (ii) the sale by us of shares of our common stock in this offering at the assumed initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, and after deducting estimated offering expenses and estimated underwriting discounts and commissions payable by us, (iii) the consummation of the refinancing of our 2018 Credit Facility and entry into, and effectiveness of, our New Credit Facility and (iv) the application of the net proceeds from this offering, as well as borrowings under the New Credit Facility, as set forth under “Use of Proceeds,” our pro forma net tangible book value as of October 3, 2021 would have been $ million, or $ per share. This represents an immediate increase in pro forma net tangible book value of $ per share to existing stockholders and an immediate dilution in pro forma net tangible book value of $ per share to new investors. The following table illustrates this per share dilution:


Assumed initial public offering price per share		$
Historical net tangible book value per share as of October 3, 2021	$
Increase in historical net tangible book value per share attributable to new investors

Pro forma net tangible book value per share after this offering⁽¹⁾

Dilution in pro forma net tangible book value per share to new investors		$

(1)	Pro forma amounts give effect to the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares.

Sales by the selling stockholders in this offering will reduce the number of shares held by existing stockholders to , or approximately % of the total shares of common stock outstanding after this offering, which will increase the number of shares held by new investors to , or approximately % of the total shares of common stock outstanding after this offering.

A $1.00 increase (decrease) in the assumed public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, would increase (decrease) our pro forma net tangible book value after this offering by $ million, our pro forma net tangible book value per share after this offering by $ per share of common stock, and the dilution in pro forma net tangible book value to new investors in this offering by $ per share of common stock, assuming the number of shares on the cover of this prospectus remains the same.

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If the underwriters’ option to purchase additional shares is fully exercised, the pro forma net tangible book value per share after this offering as of October 3, 2021, would be approximately $ per share and the dilution to new investors per share after this offering would be $ per share.

The following table sets forth, on a pro forma basis as of October 3, 2021, the total number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid to us by existing stockholders and by new investors who purchase shares of common stock in this offering, before deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, assuming an initial public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus and before deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us:

Shares Purchased

Total Consideration

Average
Price Per
Share

(dollars in thousands)⁽¹⁾

Number

Percent

Amount

Percent

Existing stockholders

New investors

Total

(1)	Pro forma amounts give effect to the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares.

A $1.00 increase (decrease) in the assumed public offering price of $ per share of common stock, the midpoint of the price range on the cover of this prospectus, would increase (decrease) total consideration paid by new investors by approximately $ million, and increase (decrease) the percent of total consideration paid by all new investors by % (assuming the number of shares on the cover of this prospectus remains the same).

Upon completion of this offering, our existing stockholders will own %, and new investors will own % of the total number of shares of common stock outstanding after this offering. If the underwriters exercise their option to purchase additional shares in full, our existing stockholders would own %, and new investors would own %, of the total number of shares of common stock outstanding after this offering.

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UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

The following unaudited pro forma consolidated statement of operations for the year ended January 3, 2021 and the unaudited pro forma consolidated statement of operations for the 39 weeks ended October 3, 2021 give pro forma effect to the initial public offering as if the offering was completed on January 4, 2021. The unaudited pro forma consolidated balance sheet as of October 3, 2021 gives pro forma effect to the initial public offering as if the offering was completed on October 3, 2021.

The unaudited pro forma consolidated financial information presents our consolidated financial position and results of operations to reflect the following transactions, which we refer to as the “Transaction Accounting Adjustments,” including (i) the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares, (ii) the sale and issuance of common stock pursuant to the offering, (iii) new borrowings of $210 million under the New Credit Facility, and (iv) the use of proceeds from this offering and borrowings under the New Credit Facility to repay $ million of outstanding obligations under the 2018 Credit Facility.

For purposes of the unaudited pro forma consolidated financial information presented in this prospectus, we have assumed that shares of common stock will be issued by us at a price per share equal to $ , which is the midpoint of the estimated price range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. The amounts below are presented under the assumption that the underwriters do not exercise their option to purchase additional shares of common stock from the selling stockholders at the initial public offering price less underwriting discounts and commissions. Fogo Hospitality, Inc.’s historical consolidated financial information has been derived from its consolidated financial statements and accompanying notes included elsewhere in this prospectus.

The following unaudited pro forma consolidated financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses”. Release No. 33-10786 replaces the previously existing pro forma adjustment criteria with simplified requirements to depict the accounting for the initial public offering for the Transaction Accounting Adjustments.

As a public company, we are implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. We expect to incur additional annual expenses related to these steps and, among other things, additional directors’ and officers’ liability insurance, director fees, reporting requirements of the SEC, transfer agent fees, hiring additional accounting, legal, and administrative personnel, increased auditing and legal expenses, and other related costs. Due to the scope and complexity of these activities, the amount of these costs could increase or decrease materially and would be based on subjective estimates and assumptions that could not be factually supported. We have not included any pro forma adjustments related to these costs.

The unaudited pro forma consolidated financial information is provided for informational purposes only and is not necessarily indicative of the operating results that would have occurred if the initial public offering had been completed as of the dates set forth above, nor is it indicative of our future results. The unaudited pro forma consolidated financial information also does not give effect to the potential impact of any anticipated synergies, operating efficiencies, or cost savings that may result from the offering.

The unaudited pro forma financial information should be read in conjunction with the “Use of Proceeds,” “Capitalization,” “Summary Consolidated Financial and Other Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the historical consolidated financial statements and related notes included elsewhere in this prospectus.

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FOGO HOSPITALITY, INC.

UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

(in thousands, except share and per share amounts)

As of October 3, 2021


	Historical Fogo Hospitality, Inc.⁽¹⁾			Transaction Accounting Adjustments		Pro Forma Fogo Hospitality, Inc.
Assets
Current assets:
Cash and cash equivalents	$	23,077		$	(a)	$
Accounts receivable, net of allowances of $0		10,477
Other receivables		6,123
Inventories		4,503
Prepaid expenses		1,580
Other current assets		2,742			(d)

Total current assets		48,502
Property and equipment, net		162,342
Operating lease right-of-use assets		160,276
Goodwill		240,524
Intangible assets, net		156,159
Liquor licenses		1,621
Other assets		2,766

Total assets	$	772,190		$		$

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable and accrued expenses	$	39,439		$		$
Deferred revenue		12,759
Current portion of long-term debt		—			(c)
Current portion of operating lease liabilities		16,191

Total current liabilities		68,389
Long-term debt, less current portion		337,064			(b)
Operating lease liabilities, less current portion		163,039
Other noncurrent liabilities		3,164
Deferred taxes		4,826

Total liabilities	$	576,482		$		$

Commitments and contingencies
Shareholders’ equity:
Common stock		—
Additional paid-in capital		260,657			(e)
Accumulated deficit		(47,282	)
Accumulated other comprehensive loss		(17,667	)

Total shareholders’ equity		195,708

Total liabilities and shareholders’ equity	$	772,190		$		$

(1)	Historical amounts do not give effect to the consummation of the stock split to be effected upon the closing of this offering.

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FOGO HOSPITALITY, INC.

UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands, except share and per share amounts)

For the 39 weeks ended October 3, 2021


	Historical Fogo Hospitality, Inc. ⁽¹⁾			Transaction Accounting Adjustments		Pro Forma FOGO Hospitality, Inc.
Revenue	$	295,599		$		$
Restaurant operating costs (excluding depreciation and amortization):
Food and beverage		79,420
Compensation and benefits		74,443
Occupancy and other		56,704

Total restaurant operating costs (excluding depreciation and amortization)		210,567
Marketing and advertising		11,892
General and administrative		18,959			(h)(i)
Restaurant opening		2,831
Depreciation and amortization		18,434
Other operating (income) expense, net		(139	)

Total operating costs		262,544

Income (loss) from operations		33,055
Other income (expense):
Interest expense, net		(21,075	)		(f)(g)
Interest income		61
Other expense		(180	)

Total other expense		(21,194	)

Income (loss) before income taxes		11,861
Income tax expense (benefit)		2,299			(f)(g)(h)(i)

Net income (loss)	$	9,562		$		$
Less: Net (loss) attributable to noncontrolling interest		—

Net income (loss) attributable to Fogo Hospitality, Inc	$	9,562		$		$

Net income (loss)	$	9,562		$		$
Net income (loss) per common share attributable to Fogo do Chão, Inc.
Basic and diluted	$	9,562
Weighted-average common shares outstanding
Basic and diluted		1,000
Pro forma earnings per share
Pro forma basic and diluted					$
Pro forma weighted-average number of shares
Pro forma basic and diluted

(1)	Historical amounts do not give effect to the consummation of the stock split to be effected upon the closing of this offering.

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FOGO HOSPITALITY, INC.

UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands, except share and per share amounts)

For the 52 weeks ended January 3, 2021


	Historical Fogo Hospitality, Inc.⁽¹⁾			Transaction Accounting Adjustments		Pro Forma Fogo Hospitality, Inc.
Revenue	$	204,824		$		$
Restaurant operating costs (excluding depreciation and amortization):
Food and beverage		59,933
Compensation and benefits		64,234
Occupancy and other		60,549
Total restaurant operating costs (excluding depreciation and amortization)		184,716
Marketing and advertising		7,180
General and administrative		23,078			(h)(i)
Pre-opening costs		1,146
Impairment charge		10,566
Depreciation and amortization		25,127
Gain on sale of Mexican JV		(1,023	)
Other operating expenses, net		2,402
Total operating costs		253,192
(Loss) income from operations		(48,368	)
Other income (expense):
Interest expense, net of capitalized interest		(26,312	)		(f)(g)
Interest income		61
Other expense		(88	)
Total other expense		(26,339	)
(Loss) income before income taxes		(74,707	)
Income tax (benefit) expense		(16,970	)		(f)(g)(h)(i)
Net (loss) income		(57,737	)
Less: Net (loss) attributable to noncontrolling interest		(693	)
Net (loss) income attributable to Fogo Hospitality, Inc.	$	(57,044	)
Net (loss) income	$	(57,737	)
Net income per common share attributable to Fogo Hospitality, Inc.
Basic and diluted	$	(57,044	)
Weighted-average common shares outstanding
Basic and diluted		1,000
Pro forma earnings per share
Pro forma basic and diluted						$
Pro forma weighted-average number of shares
Pro forma basic and diluted

(1)	Historical amounts do not give effect to the consummation of the stock split to be effected upon the closing of this offering.

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NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

1. Adjustments to Unaudited Pro Forma Consolidated Financial Information

Adjustments to the unaudited pro forma consolidated balance sheet as of October 3, 2021 are as follows:

Represents the gross proceeds from this offering, net of discounts and commissions, and net of payments of long-term debt and estimated offering costs, as follows:


Gross proceeds		$
Less: discounts and commissions

Net proceeds
Payment of long-term debt
Payment of offering costs
Net proceeds remaining		$

Represents a net decrease to long-term debt, due to the repayment in full and termination of our existing indebtedness under the 2018 Credit Facility using the net proceeds from the equity offering, offset by new borrowings of $ million under our New Credit Facility, net of debt issuance costs of $ million. See note (a) and “Prospectus Summary—Use of Proceeds and Concurrent Refinancing Transaction.”

Represents the current portion of long-term debt due under our New Credit Facility. We anticipate that the terms of the New Credit Facility will require the Company to repay 1% of the initial principal amount of the term loans annually. See note (b).

Reflects the reclassification of deferred offering costs from current assets to equity.

Reflects the pro forma impacts of the Transaction Accounting Adjustments as follows:


Net proceeds from issuance of common stock in excess of par value (see note (a))		$
Capitalized offering costs (see note (d))
Stock-based compensation expense related to vesting of performance-based profits interest units (see note (h)
Stock-based compensation expense related to vesting of restricted shares (see note (i))

Total		$

Adjustments related to the unaudited pro forma consolidated statements of operations for the 39 weeks ended October 3, 2021 and for the fiscal year-ended January 3, 2021, as follows:

Reflects a net change in interest expense due to changes in the debt balance as described in note (b), as follows (in thousands):

Principal

Interest Rate

39 Weeks
Ended October 3, 2021

52 Weeks
Ended January 3, 2020

Term Loan (New Credit Facility)

Less: Historical interest expense

Incremental interest expense

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Reflects the reversal of amortization expense of debt issuance costs previously recognized under the 2018 Credit Facility, offset by the recognition of amortization of debt issuance costs under the New Credit Facility. See note (a).

Reflects the vesting of profits interest units in Prime Cut Holdings, LP, the Issuer’s direct parent, outstanding as of this offering. Refer to “Executive Compensation—Post IPO Compensation.”

Represents the incremental compensation expense associated with the issuance of restricted stock units (“RSU”) of our common stock exchanged for the vested profits interest units. A portion of these RSUs vested ratably over period of time and the expense is recognized straight-line over the vesting period. The remainder of these RSUs vest based on performance conditions. The pro forma consolidated statements of operations include compensation expense for the awards that are probable of vesting. Refer to “Executive Compensation—Post IPO Compensation.”

Represents the consummation of a stock split effected upon the closing of this offering pursuant to which each share held by the holder of common stock will be reclassified into shares.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the “Summary Consolidated Financial and Other Information” section of this prospectus and our consolidated financial statements and related notes appearing elsewhere in this prospectus. In addition to historical information, this discussion and analysis contains forward-looking statements based on current expectations that involve risks, uncertainties and assumptions, such as our plans, objectives, expectations and intentions described in the “Cautionary Note Regarding Forward-Looking Statements” section and included elsewhere in this prospectus. Our actual results and the timing of events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the “Risk Factors” section and included elsewhere in this prospectus.

In this section and other parts of this prospectus, we refer to certain measures used for financial and operational decision making and as a means to evaluate period-to-period comparisons. We also may refer to a number of financial measures that are not defined under generally accepted accounting principles in the United States of America (“GAAP”) but have corresponding GAAP-based measures. Where non-GAAP measures appear, we provide tables reconciling these non-GAAP measures to their corresponding GAAP-based measures and make reference to a discussion of their use. We believe these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

We operate on a 52- or 53-week fiscal year that ends on the Sunday that is closest to December 31 of that year. Each fiscal year generally comprises four 13-week fiscal quarters, although in the years with 53 weeks the fourth quarter represents a 14-week period. References to Fiscal 2020 relate to our 53-week fiscal year ended January 3, 2021. References to Fiscal 2019 relate to our 52-week fiscal year ended December 29, 2019. There are 52 weeks in the current fiscal year ending January 1, 2022.

Overview

We are Fogo de Chão (fogo-dee-shoun), an internationally-renowned, growing restaurant brand. For more than 40 years, we have been known for creating lively and memorable experiences for our guests and serving high-quality cuisine at an approachable price point, all inspired by Brazilian family-style dining. Our menu is fresh, unique and innovative, and is centered on premium cuts of grilled meats, each expertly butchered and simply seasoned, utilizing the centuries-old cooking technique of churrasco, and carved tableside by our gaucho chefs. Fogo’s guests are invited to partake in The Full Churrasco Experience, which allows them to enjoy as many of our high-quality meats and Market Table offerings as they desire at an accessible fixed price.

Growth Strategies and Outlook

Our growth is based on the following strategies:

•

Grow our restaurant base in the U.S. and abroad;

•

Continue to grow our traffic and comparable restaurant sales; and

•

Improve margins by leveraging our infrastructure and investments in human capital.

We are in the early stages of our growth with our 62 current restaurants, of which 48 are in the United States (across 21 states, the District of Columbia and Puerto Rico). We believe our concept has proven portability, with consistently strong AUVs across a diverse range of geographic regions and real estate settings.

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While new restaurants are expected to be a key driver of our growth, and we aim to accelerate our expansion plans, we believe positive same store sales growth and margin expansion through leveraging our infrastructure will also contribute to future growth.

Highlights and Trends

Restaurant Development

Restaurant openings reflect the number of new restaurants opened during a particular reporting period. As of October 3, 2021, we opened two new locations for fiscal year 2021, one in Albuquerque on August 17 and the second in White Plains on April 6, 2021. Since October 3, 2021, the Company opened four additional company-owned restaurants in Burlington, Massachusetts, Morumbi (Sao Paulo), Brazil. Oak Brook, Illinois, and Huntington, New York, and one franchise restaurant in Acoxpa, Mexico. In 2022, we plan to open 8-10 company-owned and 1-2 international franchise restaurants, supported by a strong pipeline of new restaurant development. Beyond 2022, we plan to maintain a company-owned unit growth of at least 15% annually while continuing to expand internationally with our franchise model. We believe our strategy to pursue growth internationally, primarily through franchise agreements, allows us to expand our brand with limited capital investment.

On December 14, 2020, the Company sold its partnership interest in its restaurants in Mexico and signed a new franchise development agreement for nine locations in Mexico. Four of the nine locations are currently operating under the new franchise agreements.

On March 19, 2021, the Company sold its partnership interest in its restaurants in the Middle East and signed a new franchise development agreement for eight locations in the Middle East. Two of the eight locations are currently operating under the new franchise agreements.


	39 Weeks ended October 3, 2021
	39 Weeks ended October 3, 2021						Fiscal 2020									Fiscal 2019
	Company		Franchise		Total		Company			Franchise			Total			Company		Franchise		Total
Restaurant Activity:
Beginning of period		49		6		55		51			6			57			48		4		52
Openings		2		—		2		—			1			1			3		2		5
Closings		—		—		—		(2	)		(1	)		(3	)		—		—		—

Restaurants at end of period		51		6		57		49			6			55			51		6		57

(a)	The Company converted its international joint ventures in the Middle East and Mexico to franchises on March 19, 2021 and December 14, 2020, respectively, prior to which time such restaurants operated as joint ventures.

(b)	Subsequent to October 3, 2021, the Company opened four additional company-owned restaurants in Burlington, Massachusetts, Morumbi (Sao Paulo), Brazil. Oak Brook, Illinois, and Huntington, New York, and one additional franchise restaurant in Acoxpa, Mexico.

(c)	The leases for two restaurants in Rio Barra and Santo Amaro Brazil expired in 2020 and were not renewed. Such restaurants were fully impaired as of December 30, 2018 and the third quarter of Fiscal 2020, respectively. The Santa Fe, New Mexico restaurant closed in Fiscal 2020 and will not re-open.

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Key Events

COVID-19 Impact

In March 2020, the spread of a novel strain of coronavirus (“COVID-19”) caused a global pandemic. The spread of COVID-19 resulted in a significant reduction in sales at our restaurants due to changes in consumer behavior as well as social distancing practices, dining room closures and other restrictions that have been mandated or encouraged by federal, state, and local governments. The Company temporarily ceased to operate the dine-in portion of its business in the U.S. and Brazil in mid-March. We gradually began to re-open restaurants beginning in May 2020 with limited capacity.

Fiscal 2020 results as compared to Fiscal 2019 were severely and negatively impacted by the COVID-19 pandemic, including as follows:

•

Reduction in same store sales growth from 2.6% in Fiscal 2019 to (40.9)% in Fiscal 2020.

•

Total revenue declined 41% from $349.9 million in Fiscal 2019 to $204.8 million in Fiscal 2020.

•

Loss from operations was $48.4 million in Fiscal 2020, as compared to net income of $34.1 million in Fiscal 2019. Restaurant contribution and restaurant contribution margin were $20.1 million and 9.8%, respectively, in Fiscal 2020, as compared to $98.2 million and 28.1%, respectively, in Fiscal 2019.

•

Net loss attributable to Fogo Hospitality, Inc. was $57.0 million in Fiscal 2020, as compared to net income of $9.6 million in Fiscal 2019. Adjusted EBITDA and Adjusted EBITDA Margin were ($9.2) million and (4.5%) respectively, in Fiscal 2020, as compared to $64.2 million and 18.3% respectively, in Fiscal 2019.

As of the date of this prospectus, all 47 company-owned U.S. restaurants, as well as our seven restaurants in Brazil, are open. Our financial performance in the 39 weeks ended October 3, 2021 was significantly ahead of what we experienced in the comparable period of 2019 prior to the onset of the pandemic. The U.S. is expected to recover in the second half of 2021 as vaccination rates continue to increase, subject to the impact of ongoing waves of virus transmission. Brazil’s economic recovery is expected to be slower in 2021 as vaccination rates lag the U.S.

Commodity Pricing

Commodity pricing inflation can significantly affect the profitability of our restaurant operations. While the Company has experienced inflation in the cost of proteins, we have focused on culinary and cost management initiatives to minimize the financial impact. Our simple fixed price menu provides us to some extent the flexibility to cope with food inflation by adjusting the protein mix.

Labor Cost Inflation

Labor cost inflation can significantly affect the profitability of our restaurant operations. Many of our restaurant team members are paid hourly rates subject to federal, state or local minimum wage requirements. Numerous state and local governments have their own minimum wage and other regulatory requirements for employees that are generally greater than the federal minimum wage and are subject to annual increases based on changes in local consumer price indices. Although the Company has experienced general labor cost inflation, we have focused on productivity and cost management initiatives to minimize the financial impact, and we believe that the fact that our labor cost model is meaningfully advantaged relative to our peers bolsters our competitive position in an inflationary labor cost environment.

Performance Indicators

We consider a variety of performance and financial measures in assessing the performance of our business. The key measures we use for determining how our business is performing are new restaurant openings, same

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store sales, average unit volumes, traffic, cash-on-cash returns, restaurant contribution and restaurant contribution margin and Adjusted EBITDA and Adjusted EBITDA margin. Restaurant contribution and restaurant contribution margin and Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. See page 93 for a discussion of non-GAAP financial measures.


	39 Weeks Ended					Fiscal Year Ended
	October 3, 2021		September 27, 2020			January 3, 2021			December 29, 2019
New Restaurant Openings
Company-operated		2		—			—			3
Franchised		—		1			1			2
Total net new restaurant openings in the period		2		1			1			5
U.S. Average unit volume (AUV) ($ in millions)⁽¹⁾	$	7.9	$	4.5		$	4.4		$	7.7
Same store sales		117.7%		(45.1%	)		(40.9%	)		2.6%
Traffic growth		101.6%		(46.5%	)		(43.0%	)		0.3%
Income (loss) from operations	$	33,055	$	(35,071	)	$	(48,368	)	$	34,064
Operating margin		11.2%		(25.4%	)		(23.6%	)		9.7%
Restaurant contribution ($ in thousands)	$	85,032	$	7,762		$	20,108		$	98,230
Restaurant contribution margin		28.8%		5.6%			9.8%			28.1%
Net income (loss) attributable to Fogo Hospitality, Inc.	$	9,562	$	(37,959	)	$	(57,044	)	$	9,626
Net income (loss) attributable to Fogo Hospitality, Inc. margin		3.2%		(27.5%	)		(27.9%	)		2.8%
Adjusted EBITDA ($ in thousands)	$	54,474	$	(12,763	)	$	(9,153	)	$	64,197
Adjusted EBITDA margin		18.4%		(9.2%	)		(4.5%	)		18.3%

(1)	The AUV measure is calculated for trailing 52 weeks.

(2)

(3)

(4)

Adjusted EBITDA is defined as net income before interest, taxes and depreciation and amortization plus the sum of certain operating and non-operating expenses acquisition costs, equity-based compensation costs, management and consulting fees, impairment and restructuring costs, and other non-cash and similar adjustments. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue. By monitoring and controlling our Adjusted EBITDA and Adjusted EBITDA margin, we can gauge the overall profitability of our company. Adjusted EBITDA and Adjusted EBITDA margin are supplemental measures of our performance that are neither required by, nor presented in accordance with, GAAP. Adjusted EBITDA and Adjusted EBITDA margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to net income (loss), operating income or any other

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performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity. In addition, in evaluating Adjusted EBITDA and Adjusted EBITDA margin, you should be aware that in the future we will incur expenses or charges such as those added back to calculate Adjusted EBITDA. Our presentation of Adjusted EBITDA and Adjusted EBITDA margin should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures—Adjusted EBITDA and Adjusted EBITDA Margin” for a discussion of the Adjusted EBITDA and a description of its limitations as an analytical tool.

New Restaurant Openings

Our ability to successfully open new restaurants and expand our restaurant base is critical to adding revenue capacity to meet our goals for growth. Before a new restaurant opens, we incur pre-opening costs, as described below. New restaurants often open with an initial start-up period of sales variability, which stabilizes within three years. New restaurants typically experience normal inefficiencies in the form of higher food, labor and other direct operating expenses and, as a result, restaurant contribution margins are generally lower during the start-up period of operation and, in our experience stabilize in the initial 12 months after opening. Ultimately, the typical timeline for our restaurants to reach fully-stabilized levels of performance as revenues increase is approximately three years from opening. To achieve our goal to successfully open new restaurants, we consider a number of factors including macro and micro economic conditions, availability of appropriate locations, competition in local markets, and the availability of teams to manage new locations. Our ability to successfully open new restaurants is dependent upon a number of factors, many of which are beyond our control, including:

•

finding and securing quality locations on acceptable financial terms;

•

complying with applicable zoning, land use, environmental, health and safety and other governmental rules and regulations (including interpretations of such rules and regulations);

•

obtaining, for an acceptable cost, required permits and approvals;

•

having adequate cash flow and financing for construction, opening and operating costs;

•

controlling construction and equipment costs for new restaurants;

•

weather, climate change, natural disasters and disasters beyond our control resulting in delays;

•

hiring, training and retaining management and other team members necessary to meet staffing needs; and

•

successfully promoting new restaurants and competing in the markets in which these are located.

Same Store Sales

We consider a restaurant to be comparable during the first full fiscal quarter following 18 full months of operation. We adjust the sales included in the same store sales calculation for restaurant closures, primarily as a result of remodels and restaurant closures in connection with the COVID-19 pandemic, so that the periods will be comparable. The Company uses a 52/53 week fiscal year convention. For fiscal years following a 53 week year the Company calculates same store sales using the most comparable calendar week to the current reporting period. A restaurant is considered a closure and excluded from same store sales when it is closed for operations for four consecutive days. Once a restaurant is considered a closure it is excluded from same store sales retroactively to the beginning of the quarter in which the closure occurred. The restaurant will be considered comparable again during the first full fiscal quarter 12 months after the restaurant resumes operations. Changes in same store sales reflect changes in sales for the comparable group of restaurants over a specified period of time. Changes in comparable sales reflect changes in guest count trends as well as changes in average check per person, as described below. This measure highlights performance of existing restaurants, as the impact of new

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restaurant openings is excluded. The Company uses a 52/53-week fiscal year convention. For fiscal years following a 53-week year the Company calculates same store sales using the most comparable calendar weeks to the current reporting period.


	39 Weeks Ended October 3, 2021			Fiscal 2020			Fiscal 2019
Beginning Comparable Store Base		40			48			44
Temporarily Closed		(4	)		(7	)		—
Permanently Closed		—			(3	)		—
New		3			2			3
Reopened		2			—			1
Consolidated Same Store Sales Base		41			40			48
Beginning Non-Comparable Base		9			7			6
Added Stores
Temporarily Closed		4			7			—
New Openings		2			—			5
Moved to Comparable Base		(5	)		(2	)		(4	)
Consolidated Non-Comparable Restaurants		10			12			7
Franchised Stores		6			3			2
Total Stores at End of Period		57	⁽¹⁾		55			57

(1)	Since October 3, 2021, we have opened three U.S. company-owned restaurants in Burlington, Massachusetts, Oak Brook, Illinois and Huntington, New York, one Brazil company-owned restaurant in Morumbi (Sao Paulo), Brazil and one franchised restaurant in Acoxpa, Mexico.

Average Unit Volumes

We measure average unit volumes, or AUVs, of company-owned restaurants on an annual (52-week) basis. In fiscal years with 53 weeks, we exclude the 53rd week from the AUV calculation for consistency purposes. AUVs consist of the average sales of all restaurants that have been open for a trailing 52-week period or longer. We adjust the sales included in AUV calculations for restaurant closures.

Average Weekly Sales Volumes

We measure average weekly sales of company-owned restaurants based on average unit volumes for the particular restaurants, divided by the number of weeks in the period measured. This measurement allows us to assess changes in consumer spending patterns at our restaurants and the overall performance of our restaurant base.

Traffic Growth

Traffic growth is measured by the number of entrées ordered at our restaurants over a given time period. Examples of our entrées include our The Full Churrasco Experience, à la carte seafood items, and Gaucho Lunch, and select Bar Fogo items.

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Cash-on-Cash Returns

Cash-on-cash return for an individual restaurant is calculated by dividing restaurant contribution by our net initial investment and subsequent remodel costs. The following table shows a derivation of cash-on-cash returns from operating income for Fiscal 2020 and Fiscal 2019.


	Fiscal Year Ended January 3, 2021			Fiscal Year Ended December 29, 2019
(Loss) income from operations	$	(48,368	)	$	34,064
Plus:
Marketing and advertising		7,180			10,065
General and administrative		23,078			25,675
Pre-opening costs		1,146			3,478
Impairment charge		10,566			448
Depreciation and amortization		25,127			24,620
Gain on sale of Mexican JV		(1,023	)		—
Other expense (income)		2,402			(120	)
Restaurant contribution	$	20,108		$	98,230
Adjustment for JV & franchise fees		294			(651	)
Adjustment for new/closed locations		2,955			(1,389	)
Other one-time non-recurring adjustments		(1,837	)		—
Adjusted restaurant contribution	$	21,520		$	96,190


	Fiscal Year Ended									Fiscal Year Ended
	January 3, 2021									December 29, 2019
	US			BR			Total			US			BR			Total
Restaurant contribution		19,993			115			20,108			90,982			7,248			98,230
Adjustment for JV & fran fees ⁽¹⁾		294			—			294			(651	)		—			(651	)
Adjustment for new/closed locations ^(2,3)		2,557			398			2,955			(1,379	)		(10	)		(1,389	)
Other one-time non-recurring adjustments ⁽⁴⁾		(1,220	)		(617	)		(1,837	)		—			—			—
Adjusted restaurant contribution		21,624			(104	)		21,520			88,952			7,238			96,190
Adjusted restaurant contribution (local currency)		21,624			(518	)					88,952			28,813
Number of restaurants		41			6						40			8
Adjusted average restaurant contribution (local currency)		527			(86	)					2,224			3,602
Average net investment local currency (local currency) ^(5,6)		4,730			8,928						5,225			8,343
Cash on cash returns		11.2	%		(1.0	%)					42.6	%		43.2	%

(1) Franchise fees and JV contribution

(2) Excludes three new restaurants opened in 2019 in the US

(3) Excludes two restaurants in the US closed for more than 30 days and 2 Brazil locations that did not re-open in the second half of 2020

(4) Excludes one-time CARES Act related payroll tax credit in the US and non-recurring adjustment in Brazil

(5) Net Investment is equal to initial investment plus remodel costs less tenant allowances.

(6) Brazil Restaurant Contribution converted to Reais using a foreign exchange rate of 3.98 per USD and 4.96 per USD in 2019 and 2020 respectively

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We use cash-on-cash returns to evaluate new restaurant performance and return on capital we reinvest in our business. For the calculation of average cash-on-cash return in a fiscal year, a restaurant’s cash-on-cash return is included if the restaurant has a full 12 months of operations during the fiscal year. A restaurant is excluded from the calculation of cash-on-cash return when it is closed for operations for 30 consecutive days during the fiscal year in which the cash on cash returns are calculated.


	Fiscal 2020		Fiscal 2019
October 3, 2021
Restaurants included in calculation of cash-on-cash return
U.S.		41		40
Brazil		6		8
Restaurants excluded in calculation of cash-on-cash return
U.S.		2		—
Brazil		2		—

Factors Affecting the Comparability of our Operating Results

52- vs. 53-Week Fiscal Year

Fiscal 2019 contained 52 weeks whereas Fiscal 2020 contained 53 weeks, and Fiscal 2021, which ends on January 1, 2022, will contain 52 weeks. We estimate the 53rd week in Fiscal 2020 contributed approximately $5.5 million of incremental revenue, as compared to Fiscal 2019. While certain expenses that were directly related to the incremental revenue increased, other expenses, such as fixed costs, were incurred on a calendar basis.

2018 Credit Facility

In April 2018, in connection with the Rhône Acquisition, our subsidiaries entered into the 2018 Credit Agreement that provides for (i) senior secured term loans in an aggregate principal amount of $325.0 million (“Original Term Loan”) and (ii) senior secured revolving credit commitments in an aggregate principal amount of $40.0 million (“Revolver”). The 2018 Credit Facility is secured by substantially all of our assets (including equity of our principal subsidiaries).

In March 2020, the Company borrowed $35.1 million under the Revolver to ensure that adequate cash was available to offset the impact of the COVID-19 pandemic on its business and cash flow; this was repaid in October 2020. In the third quarter of 2020, the Company borrowed an additional $32.5 million as an Incremental Term Loan under its 2018 Credit Facility. The Incremental Term Loan matures in three years from the closing date of August 11, 2020.

As of October 3, 2021, the Company had seven letters of credit outstanding for a total of $4.6 million.

New Credit Facility

Concurrently with, and conditioned upon, the consummation of our initial public offering, we intend to repay in full and terminate our existing 2018 Credit Facility and enter into a new $210 million credit facility consisting of $150 million of senior secured term loans and a $60 million revolving credit facility (the “New Credit Facility”). The amount, maturity, interest rates and other terms of the New Credit Facility are subject to continuing negotiations with prospective lenders. We expect the new term loans will have a maturity of seven years and that the revolving credit facility will have a maturity of five years from the effective date of the New Credit Facility. We expect that the New Credit Facility will contain customary covenants applicable to us and certain of our subsidiaries, including a springing financial maintenance covenant requiring us to maintain a maximum First Lien Net Leverage Ratio (as will be defined in the New Credit Facility) if usage of the revolving credit facility exceeds a certain level as of the end of any four fiscal quarter period. We also expect the New Credit Facility will be secured by substantially all of our assets (including equity of our principal subsidiaries). Borrowings under the New Credit Facility may vary significantly from time to time depending on our cash needs at any given time, and upon consummation of our initial public offering we expect that approximately $150

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million of term loans. The Company may also borrow revolving loans under the New Credit Facility at the consummation of our initial public offering, subject to liquidity requirements. See “Use of Proceeds,” “Unaudited Pro Forma Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Facility.”

Woodforest Bank Loan

On November 16, 2020, we entered into and drew down a mortgage loan for $11.2 million with Woodforest National Bank (the “Woodforest Bank Loan”) and provided a lien on two owned real estate assets as security. This loan matures on December 15, 2025. We repaid the loan on July 2, 2021. The loan is revolving and the full $11.2 million of the loan is available for draw down until December 2025.

Significant Components of Our Results of Operations

Revenue

Revenue primarily consists of food and beverage sales, and complimentary meals. Revenue is recognized when food and beverage products are sold at our restaurants net of any discounts. Revenue in a given period is directly influenced by the number of operating weeks in such period, the number of restaurants we operate and same store sales growth. Revenue is generated from two operating segments: U.S. (inclusive of Puerto Rico and our franchise and license revenue) and Brazil, which is how we organize our restaurants for making operating decisions and assessing performance. Proceeds from the sale of gift cards that do not have expiration dates are recorded as deferred revenue at the time of the sale and recognized as revenue when the gift card is redeemed by the holder. The portion of gift cards sold which are never redeemed is commonly referred to as gift card breakage. Estimated gift card breakage is recorded as revenue and recognized in proportion to the Company’s historical redemption pattern, unless there is a legal obligation to remit the unredeemed gift cards to government authorities.

Food and Beverage Costs

Food and beverage costs include the direct costs associated with food, beverage and distribution of our menu items. We monitor and measure food and beverage costs by tracking the cost as a percentage of revenue. Food and beverage costs as a percentage of revenue are generally influenced by the cost of food and beverage items, distribution costs, import taxes and sales mix. These components are variable in nature, increase with revenue, are subject to increases or decreases based on fluctuations in commodity costs, including beef, lamb, pork, chicken and seafood prices, and depend in part on the specific mix of proteins we offer guests and controls we have in place to manage costs at our restaurants.

Compensation and Benefit Costs

Compensation and benefit costs comprise restaurant and regional management salaries and bonuses, hourly staff payroll and other payroll-related expenses, including bonus expenses, any long-term incentive plan, vacation pay, payroll taxes, fringe benefits and health insurance expenses and are monitored and measured by tracking hourly and total labor as a percentage of revenue and on a per-100-guests basis.

Occupancy and Other Operating Expenses

Occupancy and other operating expenses comprise all occupancy costs, consisting of both fixed and variable portions of rent, common area maintenance charges, utility costs, credit card fees, real estate property and other related taxes and other related restaurant supply and occupancy costs, but exclude depreciation and amortization expense, and are monitored and measured by tracking occupancy and other operating expenses as a percentage of revenue.

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Marketing and Advertising Costs

Marketing and advertising costs include all media, production and related costs for both local restaurant advertising and national marketing. We monitor and measure the efficiency of our marketing and advertising expenditures by tracking these costs as a percentage of total revenue.

General and Administrative Costs

General and administrative costs are comprised of costs related to certain corporate and administrative functions that support development and restaurant operations. These expenses are generally fixed and reflect management, supervisory and team member salaries, benefits and bonuses, share-based compensation, travel expense, information systems, training, corporate rent, technology, market research, and professional and consulting fees, including fees related to the implementation of, and compliance with, Section 404 of the Sarbanes-Oxley Act. We monitor and measure general and administrative costs by tracking general and administrative costs as a percentage of revenue and as a ratio to total restaurant count.

Pre-opening Costs

Pre-opening costs are costs incurred prior to, and directly associated with, opening a restaurant, and primarily consist of restaurant manager salaries, relocation costs, recruiting expenses, team member payroll and related training costs for new team members, including rehearsal of service activities, as well as straight-line lease costs incurred prior to opening, in each case specific to a new restaurant. In addition, pre-opening costs include media and public relations costs incurred prior to opening. We typically start incurring pre-opening costs four to six months prior to opening and these costs tend to increase four weeks prior to opening as we begin training activities.

Depreciation and Amortization Expense

Depreciation and amortization expense includes depreciation of fixed assets and certain definite life intangible assets such as software. We depreciate capitalized leasehold improvements over the shorter of the total expected lease term or their estimated useful life.

Income Tax Expense

Income tax expense is computed at the U.S. statutory federal income tax rate with certain modifications based on requirements in the jurisdictions where we operate. Our provision includes federal, state and local, and foreign current and deferred income tax expense.

Segment Reporting

We operate our restaurants using a single restaurant concept and brand. Each restaurant under our single global brand operates with similar types of products and menus, providing a continuous service style, similar contracts, guests and team members, irrespective of location. We have identified two operating segments: U.S. (inclusive of Puerto Rico and our franchise and license revenue) and Brazil, which is how we organize our restaurants for making operating decisions and assessing performance.

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Results of Operations

Fiscal Period Ended October 3, 2021 (39 weeks) Compared to Fiscal Period Ended September 27, 2020 (39 weeks)

The following table summarizes key components of our unaudited consolidated results of operations for the periods indicated, both in dollars and as a percentage of revenue (in thousands):


	Fiscal Period Ended October 3, 2021						Fiscal Period Ended September 27, 2020						Increase/(Decrease)
	(39 weeks)						(39 weeks)						Increase/(Decrease)
	Dollars			% ^(a)			Dollars			% ^(a)			Dollars			% ^(b⁾			% ^(c⁾
Revenue
U.S. restaurants^(d)	$	286,841			97.0	%	$	130,668			94.7	%	$	156,173			119.5	%		2.3	%
Brazil restaurants		8,758			3.0	%		7,318			5.3	%		1,440			19.7	%		(2.3	%)

Total revenue		295,599			100.0	%		137,986			100.0	%		157,613			114.2	%		0.0	%

Restaurant operating costs (excluding depreciation and amortization)
Food and beverage		79,420			26.9	%		40,368			29.3	%		39,052			96.7	%		(2.4	%)
Compensation and benefits		74,443			25.2	%		46,047			33.4	%		28,396			61.7	%		(8.2	%)
Occupancy and other		56,704			19.2	%		43,809			31.7	%		12,895			29.4	%		(12.5	%)

Total restaurant operating costs (excluding depreciation and amortization)		210,567			71.2	%		130,224			94.4	%		80,343			61.7	%		(23.2	%)

Marketing and advertising		11,892			4.0	%		3,879			2.8	%		8,013			206.6	%		1.2	%
General and administrative		18,959			6.4	%		16,942			12.3	%		2,017			11.9	%		(5.9	%)
Pre-opening costs		2,831			1.0	%		983			0.7	%		1,848			188.0	%		0.3	%
Impairment charge		—			0.0	%		403			0.3	%		(403	)		(100.0	%)		(0.3	%)
Depreciation and amortization		18,434			6.2	%		18,538			13.4	%		(104	)		(0.6	%)		(7.2	%)
Other operating (income) expense, net		(139	)		0.0	%		2,088			1.5	%		(2,227	)		(106.7	%)		(1.5	%)

Total operating costs		262,544			88.8	%		173,057			125.4	%		89,487			51.7	%		(36.6	%)

Income (loss) from operations		33,055			11.2	%		(35,071	)		(25.4	%)		68,126			(194.3	%)		36.6	%
Other income (expense):
Interest expense, net of capitalized interest		(21,075	)		(7.1	%)		(18,729	)		(13.6	%)		(2,346	)		12.5	%		6.5	%
Interest income		61			0.0	%		41			0.0	%		20			48.8	%		(0.0	%)
Other income (expense)		(180	)		(0.1	%)		(38	)		0.0	%		(142	)		373.7	%		(0.1	%)

Total other income (expense)		(21,194	)		(7.2	%)		(18,726	)		(13.6	%)		(2,468	)		13.2	%		6.4	%

Income (loss) before income taxes		11,861			4.0	%		(53,797	)		(39.0	%)		65,658			(122.0	%)		43.0	%
Income tax expense (benefit)		2,299			0.8	%		(14,364	)		(10.4	%)		16,663			(116.0	%)		11.2	%

Net income (loss)		9,562			3.2	%		(39,433	)		(28.6	%)		48,995			(124.2	%)		31.8	%
Less: Net income (loss) attributable to noncontrolling interest		—			0.0	%		(1,474	)		(1.1	%)		1,474			(100.0	%)		1.1	%

Net income (loss) attributable to Fogo Hospitality, Inc.	$	9,562			3.2	%	$	(37,959	)		(27.5	%)	$	47,521			(125.2	%)		30.7	%

(a)	Calculated as a percentage of total revenue.

(b)	Calculated percentage increase / (decrease) in dollars.

(c)	Calculated increase / (decrease) in percentage of total U.S. restaurant revenue.

(d)	U.S. restaurant contribution includes other revenue, which is comprised of gift card breakage revenue of less than $0.1 million for each of the 39 weeks ended October 3, 2021 and September 27, 2020, respectively, and

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franchised operations revenue of $0.4 million and $0.1 million for the 39 weeks ended October 3, 2021 and September 27, 2020.

Revenue

Total revenue increased $157.6 million in the 39 weeks ended October 3, 2021, compared to the same period in 2020. 45 of our 46 company-owned U.S. restaurants and six of our seven restaurants in Brazil that were open since the first day of the 39 weeks ended October 3, 2021 were open during the entire 39 weeks ended October 3, 2021. The increase in revenue was comprised of a $116.2 million increase in comparable restaurant sales and a $44.1 million increase in non-comparable restaurant sales. In addition, total revenue included an increase in franchise royalties of $0.4 million, offset by a $1.5 million decrease due to the deconsolidation of our former Mexico joint venture (which was converted to a franchise arrangement), an unfavorable foreign exchange impact of $0.8 million, and a decrease of $0.7 million due to the closures of our Santo Amaro and Rio Barra restaurants in Brazil. Same store sales increased 117.7%.

U.S. revenue increased $156.2 million due to an increase in same store sales of $113.2 million and an increase in non-comparable restaurant sales of $44.1 million, partially offset by a $1.5 million decrease due to the deconsolidation of our former Mexico joint venture. U.S. same store sales increased 121.4%

Brazil restaurant revenue increased $1.4 million due to an increase of $2.9 million in same store sales, partially offset by an unfavorable foreign currency exchange impact of $0.8 million, and a decrease of $0.7 million due to the closures of Santo Amaro and Rio Barra. Brazil same store sales increased 54.0%.

Food and Beverage Costs

Food and beverage costs increased by $39.1 million due to a $29.0 million increase in comparable restaurants and a $11.4 million increase in non-comparable restaurants, partially offset by decreases of $0.6 million due to our former Mexico joint venture deconsolidation, $0.4 million due to the Brazil closures, and a favorable foreign currency exchange impact of $0.3 million. As a percentage of total revenue, total food and beverage costs decreased from 29.3% to 26.9% primarily due to higher revenue levels and lower waste.

Compensation and Benefit Costs

Compensation and benefit costs increased $28.4 million due to an increase in comparable restaurants and non-comparable restaurants labor expense of $18.9 million and $10.4 million, respectively, partially offset by a $0.4 million decrease due to the deconsolidation of our former Mexico joint venture, a $0.3 million decrease due to the Brazil closures, and a favorable currency exchange impact of $0.2 million. As a percentage of total revenue, total compensation and benefits costs decreased from 33.4% to 25.2% primarily due to higher revenue levels and improved labor productivity.

Occupancy and Other Operating Expenses

Occupancy and other operating expenses increased $12.9 million due to a $9.9 million increase in comparable restaurants and a $4.5 million increase in non-comparable restaurants, partially offset by lower rent of $0.7 million due to the deconsolidation of our former Mexico joint venture, $0.5 million due to the Brazil closures, and a favorable currency exchange impact of $0.3 million. As a percentage of total revenue, total occupancy and other operating expenses decreased from 31.7% to 19.2% due to higher revenue levels and lower rents.

Marketing and Advertising Costs

Marketing and advertising costs increased $8.0 million due to an increase in comparable restaurants and non-comparable restaurants advertising expenses of $6.1 million and $1.9 million, respectively. As a percentage

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of total revenue, total marketing and advertising costs increased from 2.8% to 4.0% primarily driven by increased digital and radio spend to drive awareness.

General and Administrative Costs

General and administrative costs increased $2.0 million primarily due to increases in bonus of $2.3 million, legal and professional fees of $1.5 million and other net expenses of $0.1 million. These increases were partially offset by decreases in corporate salaries of $1.1 million, travel and meals of $0.6 million and donations of $0.2 million. Total general and administrative costs as a percentage of total revenue decreased from 12.3% to 6.4% due to higher revenue levels.

Pre-opening Costs

Pre-opening costs increased $1.8 million due to timing as we ramp up new restaurant development in 2021. The increase was primarily driven by the Company opening two new company-owned restaurants in White Plains in April 2021, and Albuquerque in August 2021. The Company did not open any new restaurants in Fiscal 2020, largely as a result of the COVID-19 pandemic.

Other operating (income) expense, net

Other operating income decreased $2.6 million primarily due to a decrease in costs related to the COVID-19 pandemic of $1.5 million, including payments to furloughed employees of $0.6 million, $0.2 million of legal costs, and purchases of personal protective equipment and cleaning supplies of $0.1 million, as well as $0.4 million of costs related to abandoned development sites and other expenses of $0.5 million.

Interest Expense

Interest expense, net of capitalized interest increased $2.3 million due to a higher outstanding debt balance. The borrowing rate increased from 6.6% to 7.1% as compared to the comparable 2020 period.

Income Tax Expense (Benefit)

The Company recorded income tax expense of $2.3 million and an income tax benefit of $14.4 million for the 39 weeks ended October 3, 2021 and September 27, 2020, respectively, an increase of $16.7 million year-over-year. The effective tax rate for the 39 weeks ended October 3, 2021, is 19.4% compared to 26.7% for the 39 weeks ended September 27, 2020. In accordance with ASC 740, jurisdictions forecasting losses that are not benefited due to valuation allowances are not included in the forecasted effective tax rate.

For the 39 weeks ended October 3, 2021, the Company recognized an immaterial, net discrete expense consisting of the release of the Puerto Rico valuation allowance, federal return to provision adjustments for the year ended January 3, 2021, and various state and foreign local tax payments. Excluding these discrete items, the Company had an effective tax rate of 19.1% for the 39 weeks ended October 3, 2021. The effective tax rate differed from the statutory tax rate due to projected Federal Insurance Contributions Act (“FICA”) tip credit generation, state and local taxes, and foreign rate differentials. For the 39 weeks ended September 27, 2020, the Company recognized a net discrete benefit of $0.4 million consisting of the December 30, 2018 amended return filing, federal return to provision adjustments for the year ended December 29, 2019, and various state and foreign local tax payments. Excluding these discrete items, the Company had an effective tax rate of 26.0% for the 39 weeks ended September 27, 2020. The effective tax differed from the statutory tax rate due to projected FICA tip credit generation, state and local taxes, and foreign rate differentials.

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Fiscal 2020 (53 Weeks) Compared to Fiscal 2019 (52 Weeks)

The following table summarizes key components of our consolidated results of operations for the periods indicated, both in dollars and as a percentage of revenue (in thousands):


	Fiscal Year Ended January 3, 2021						Fiscal Year Ended December 29, 2019						Increase/(Decrease)
	(53 weeks)						(52 weeks)						Increase/(Decrease)
	Dollars			% ^(a)			Dollars			% ^(a)			Dollars			% ^(b)			% ^(c)
Revenue
U.S. restaurants^(d)	$	194,357			94.9	%	$	320,238			91.5	%	$	(125,881	)		(39.3	%)		3.4	%
Brazil Restaurants		10,467			5.1	%		29,648			8.5	%		(19,181	)		(64.7	%)		(3.4	%)

Total revenue		204,824			100.0	%		349,886			100.0	%		(145,062	)		(41.5	%)		0.0	%

Restaurant operating costs (excluding depreciation and amortization)
Food and beverage		59,933			29.3	%		97,099			27.8	%		(37,166	)		(38.3	%)		1.5	%
Compensation and benefits		64,234			31.4	%		83,546			23.9	%		(19,312	)		(23.1	%)		7.5	%
Occupancy and other		60,549			29.6	%		71,011			20.3	%		(10,462	)		(14.7	%)		9.3	%

Total restaurant operating costs (excluding depreciation and amortization)		184,716			90.2	%		251,656			71.9	%		(66,940	)		(26.6	%)		18.3	%

Marketing and advertising		7,180			3.5	%		10,065			2.9	%		(2,885	)		(28.7	%)		0.6	%
General and administrative		23,078			11.3	%		25,675			7.3	%		(2,597	)		(10.1	%)		4.0	%
Pre-opening costs		1,146			0.6	%		3,478			1.0	%		(2,332	)		(67.1	%)		(0.4	%)
Impairment charge		10,566			5.2	%		448			0.1	%		10,118			2,258.5	%		5.1	%
Depreciation and amortization		25,127			12.3	%		24,620			7.0	%		507			2.1	%		5.3	%
Gain on sale of Mexico JV		(1,023	)		(0.5	%)		—			0.0	%		(1,023	)		0.0	%		(0.5	%)
Other operating (income) expense, net		2,402			1.2	%		(120	)		0.0	%		2,522			(2,101.7	%)		1.2	%

Total operating costs		253,192			123.6	%		315,822			90.3	%		(62,630	)		(19.8	%)		33.3	%

Income (loss) from operations		(48,368	)		(23.6	%)		34,064			9.7	%		(82,432	)		(242.0	%)		(33.3	%)
Other income (expense):
Interest expense, net		(26,312	)		(12.8	%)		(23,768	)		(6.8	%)		(2,544	)		10.7	%		(6.0	%)
Interest income		61			0.0	%		95			0.0	%		(34	)		(35.8	%)		0.0	%
Other income (expense)		(88	)		0.0	%		(126	)		0.0	%		38			(30.2	%)		0.0	%

Total other income (expense)		(26,339	)		(12.9	%)		(23,799	)		(6.8	%)		(2,540	)		10.7	%		(6.1	%)

Income (loss) before income taxes		(74,707	)		(36.5	%)		10,265			2.9	%		(84,972	)		(827.8	%)		(39.4	%)
Income tax expense (benefit)		(16,970	)		(8.3	%)		1,626			0.5	%		(18,596	)		(1,143.7	%)		(8.8	%)

Net income (loss)		(57,737	)		(28.2	%)		8,639			2.5	%		(66,376	)		(768.3	%)		(30.7	%)
Less: Net income (loss) attributable to noncontrolling interest		(693	)		(0.3	%)		(987	)		(0.3	%)		294			(29.8	%)		(0.0	%)

Net income (loss) attributable to Fogo Hospitality, Inc.	$	(57,044	)		(27.9	%)	$	9,626			2.8	%	$	(66,670	)		(692.6	%)		(30.7	%)

(a)	Calculated as a percentage of total revenue.

(b)	Calculated percentage increase / (decrease) in dollars.

(c)	Calculated increase / (decrease) in percentage of total revenue.

(d)	U.S. restaurant revenue includes other revenue, which is comprised of gift card breakage revenue of $0.1 million for both Fiscal 2020 and Fiscal 2019, respectively, and franchised operations revenue of $0.1 million and $0.2 million for Fiscal 2020 and Fiscal 2019, respectively.

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Revenue

Total revenue decreased $145.1 million for the twelve months ended January 3, 2021, compared to the same period in 2019 due to short- and longer-term dining room closures, seating capacity limitations, and guests dining out less as a result of the impact of the COVID-19 pandemic. The decrease in revenue was comprised of a $113.0 million decrease in comparable restaurant sales, a $23.1 million decrease in non-comparable restaurant sales, an unfavorable foreign currency exchange impact of $5.7 million, a decrease of $3.1 million in the Mexico joint venture, and a $0.2 million decrease in royalties. Same store sales decreased 41.9%, given an unfavorable comparison of a COVID-19 affected period in Fiscal 2020 versus an unaffected Fiscal 2019.

U.S. revenue decreased $125.9 million due to a decrease in comparable restaurant sales of $102.1 million, a decrease in non-comparable restaurant sales of $20.5 million, and a decrease in the Mexico joint venture restaurant revenue of $3.1 million. Same store sales decreased 40.9%.

Brazil restaurant revenue decreased $19.2 million due to a decrease of $10.9 million in comparable restaurant sales, a $2.6 million decrease in non-comparable restaurant sales, and an unfavorable foreign currency exchange impact of $5.7 million. Brazil same store sales decreased 54.5%.

Food and Beverage Costs

Food and beverage costs decreased by $37.2 million due to a $28.5 million decrease in comparable restaurants, a $5.5 million decrease in non-comparable restaurants, a favorable foreign currency exchange impact of $2.1 million, and a $1.1 million decrease in the Mexico JV. As a percentage of total revenue, total food and beverage costs increased from 27.8% to 29.3% primarily due to lower guest counts resulting in higher waste.

Compensation and Benefit Costs

Compensation and benefit costs decreased $19.3 million due to a decrease in comparable restaurant and non-comparable restaurant labor expense of $15.9 million and $2.1 million, respectively, a $0.5 million decrease in the Mexico joint venture restaurants, and a $0.8 million favorable foreign currency exchange impact. As a percentage of total revenue, total compensation and benefit costs increased from 23.9% to 31.4% primarily due to decreased sales resulting in lower productivity.

Occupancy and Other Operating Expenses

Occupancy and other operating expenses decreased $10.5 million due to a $7.6 million decrease in comparable restaurant and a $0.5 million decrease in non-comparable restaurant operating expenses, a $0.7 million decrease in the Mexico joint venture, and a favorable Brazil currency exchange impact of $1.7 million. Total occupancy and other operating expenses as a percentage of total revenue increased from 20.3% to 29.6% due to reduced leverage on lower revenue.

Marketing and Advertising Costs

Marketing and advertising costs decreased $2.9 million due to a decrease in comparable and non-comparable restaurants of $2.3 million and $0.2 million, respectively, a decrease of $0.1 million in the Mexico joint venture, and a favorable foreign currency exchange impact of $0.3 million. As a percentage of total revenue, total marketing and advertising costs increased from 2.9% to 3.5%, primarily driven by increased digital and radio spend to drive awareness.

General and Administrative Costs

General and administrative costs decreased $2.6 million primarily due to a decrease in corporate bonus of $1.3 million, IT-related expense of $1.1 million, travel and meals of $1.1 million, corporate salaries of

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$0.8 million due to headcount reduction and recruiting costs of $0.1 million. These decreases were partially offset by a $1.6 million increase in legal and professional fees and a $0.2 million increase in donations. Total general and administrative costs as a percentage of total revenue increased from 7.3% to 11.3% due to reduced leverage on lower revenue.

Pre-opening Costs

Pre-opening costs decreased $2.3 million due to the temporary hold on new restaurant development.

Impairment Charges

The Company performed a quantitative impairment test of goodwill and concluded that an impairment was not required for the U.S. reporting unit but was required for the Brazil reporting unit. We recorded a goodwill impairment charge of $10.2 million related to the Brazil reporting unit.

Gain on sale of Mexican Joint Venture

Effective December 14, 2020, the Company sold its 51% partnership interest to Grupo Restaurantero Dinar, S.A. de C.V. (Dinar). The Company recognized a gain of $1.0 million on the sale of the Mexican joint venture.

Other operating (income) expense, net

Other operating income increased $2.5 million primarily due to an increase in costs related to the COVID-19 pandemic, including labor, legal, and purchases of personal protective equipment and cleaning supplies.

Interest Expense

Interest expense, net of capitalized interest, increased $2.5 million due to a higher outstanding debt balance. The borrowing rate increased from 6.9% to 7.0% as compared to the prior year.

Income Tax Expense (Benefit)

The Company recognized income tax benefit of $17.0 million (consolidated effective tax rate of 22.7%) for Fiscal 2020 compared to a tax expense of $1.6 million (consolidated effective tax rate of 15.8%) for Fiscal 2019. The decrease in income tax expense is primarily due to decreased sales resulting in a loss before income taxes of $74.7 million in Fiscal 2020 compared to income before income taxes of $10.3 million in Fiscal 2019.

Non-GAAP Financial Measures

To supplement its unaudited condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, the Company uses the following non-GAAP financial measures: restaurant contribution and restaurant contribution margin and Adjusted EBITDA and Adjusted EBITDA margin (collectively, the “non-GAAP financial measures”). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that they provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. The non-GAAP financial measures used by the Company may be different from the methods used by other companies.

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Restaurant Contribution and Restaurant Contribution Margin

Restaurant contribution, a non-GAAP financial measure, is equal to revenue generated by our restaurants sales less direct restaurant operating costs (which include food and beverage costs, compensation and benefit costs, and occupancy and certain other operating costs but exclude depreciation and amortization expense and pre-opening expense). This performance measure includes only the costs that restaurant-level managers can directly control and excludes other operating costs that are essential to conduct the Company’s business. Depreciation and amortization expense is excluded because it is not an operating cost that can be directly controlled by restaurant-level managers. Pre-opening expenses are excluded because we believe such costs do not reflect ordinary course operating expenses of our restaurants. Restaurant contribution margin is equal to restaurant contribution as a percentage of revenue from restaurant sales. Restaurant contribution and restaurant contribution margin are supplemental measures of operating performance of our restaurants and our calculations thereof may not be comparable to those reported by other companies.

We use restaurant contribution and restaurant contribution margin as key metrics to evaluate the profitability of incremental sales at our restaurants, to evaluate our restaurant performance across periods and to evaluate our restaurant financial performance compared with our competitors. We believe restaurant contribution margin is useful to investors in that it highlights trends in our core business that may not otherwise be apparent to investors when relying solely on GAAP financial measures. Because other companies may calculate restaurant-level margin differently than we do, restaurant contribution margin as presented herein may not be comparable to similarly titled measures reported by other companies.

Restaurant contribution and restaurant contribution margin are neither required by, nor presented in accordance with, GAAP. Restaurant contribution and restaurant contribution margin have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP.

Restaurant Contribution and Restaurant Contribution Margin

The following table sets forth the reconciliation of income (loss) from operations to restaurant contribution for the unaudited periods ended October 3, 2021 and September 27, 2020 (in thousands):


	39 Weeks Ended
	October 3, 2021			September 27, 2020
Income (loss) from operations	$	33,055		$	(35,071	)

Marketing and advertising		11,892			3,879
General and administrative		18,959			16,942
Pre-opening costs		2,831			983
Impairment charge		—			403
Depreciation and amortization		18,434			18,538
Other operating (income) expense, net		(139	)		2,088

Total restaurant contribution	$	85,032		$	7,762

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	Fiscal Period Ended October 3, 2021					Fiscal Period Ended September 27, 2020						Increase/(Decrease)
	(39 weeks)					(39 weeks)						Increase/(Decrease)
	Dollars		% ^(a)			Dollars			% ^(a)			Dollars		% ^(b)			% ^(c)
Revenue
U.S. restaurants	$	286,841		97.0	%	$	130,668			94.7	%	$	156,173		119.5	%		2.3	%
Brazil restaurants		8,758		3.0	%		7,318			5.3	%		1,440		19.7	%		2.3	%

Total revenue		295,599		100.0	%		137,986			100.0	%		157,613		114.2	%		0.0	%

Restaurant operating costs (excluding depreciation and amortization)
U.S.		201,878		70.4	%		122,686			93.9	%		79,192		64.5	%		(23.5	%)
Brazil		8,689		99.2	%		7,538			103.0	%		1,151		15.3	%		(3.8	%)

Total restaurant operating cost		210,567		71.2	%		130,224			94.4	%		80,343		61.7	%		(23.2	%)

U.S.^(d)		84,963		29.6	%		7,982			6.1	%		76,981		964.4	%		23.5	%
Brazil		69		0.8	%		(220	)		(3.0	%)		289		(131.4	%)		3.8	%

Total restaurant contribution	$	85,032		28.8	%	$	7,762			5.6	%	$	77,270		995.5	%		23.2	%

(a)	Calculated as a percentage of total revenue or segment revenue where applicable.

(b)	Calculated percentage increase / (decrease) in dollars.

(c)	Calculated increase / (decrease) in percentage of total revenue or segment revenue where applicable.

(d)

Total restaurant contribution increased $77.3 million, or 995.5%, for the 39 weeks ended October 3, 2021, primarily due to a $56.0 million and $18.5 million increase attributable to comparable restaurants and non-comparable restaurants, respectively. As a percentage of revenue, total restaurant contribution increased from 5.6% to 28.8% due to higher sales and traffic as dine-in restrictions due to COVID-19 were lifted in our restaurants.

As a percentage of U.S. restaurant revenue, U.S. restaurant contribution margin increased from 6.1% to 29.6%, due to a 2.3% reduction in food and beverage costs primarily due to higher sales and lower waste, a 8.7% reduction in compensation and benefit costs due to increased labor productivity, and a 12.4% decrease in occupancy and other operating expenses driven by increased leverage on higher revenue and lower rents.

As a percentage of Brazil restaurant revenue, Brazil restaurant contribution margin increased from a negative 3.0% to 0.8% due to an 4.7% increase in food and beverage costs as a result of higher waste, a 3.1% reduction in compensation and benefit costs due to reduction in labor force, and a 5.4% decrease in occupancy and other operating expenses due to lower leverage on reduced revenue.

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The following table sets forth the reconciliation of income (loss) from operations to restaurant contribution for the fiscal years ended January 3, 2021 and December 29, 2019 (in thousands):


	Fiscal Year Ended
	January 3, 2021			December 29, 2019
(Loss) income from operations	($	48,368	)	$	34,064

Marketing and advertising		7,180			10,065
General and administrative		23,078			25,675
Pre-opening costs		1,146			3,478
Impairment charge		10,566			448
Depreciation and amortization		25,127			24,620
Gain on sale of Mexican JV		(1,023	)		—
Other operating expense (income), net		2,402			(120	)

Total restaurant contribution	$	20,108		$	98,230

The following table summarizes restaurant contribution by segment and restaurant contribution margin by segment for Fiscal 2020 compared to Fiscal 2019, respectively (in thousands):


	Fiscal Year Ended January 3, 2021					Fiscal Year Ended December 29, 2019					Increase / (Decrease)
	(53 weeks)					(52 weeks)					Increase / (Decrease)
	Dollars		% ^(a)			Dollars		% ^(a)			Dollars			% ^(b)			% ^(c)
Revenue
U.S. restaurants	$	194,357		94.9	%	$	320,238		91.5	%	$	(125,881	)		(39.3	%)		3.4	%
Brazil Restaurants		10,467		5.1	%		29,648		8.5	%		(19,181	)		(64.7	%)		(3.4	%)

Total revenue		204,824		100.0	%		349,886		100.0	%		(145,062	)		(41.5	%)		0.0	%

Restaurant operating costs (excluding depreciation and amortization)
U.S.		174,365		89.7	%		229,256		71.6	%		(54,891	)		(23.9	%)		18.1	%
Brazil		10,351		98.9	%		22,400		75.6	%		(12,049	)		(53.8	%)		23.3	%

Total restaurant operating costs (excluding depreciation and amortization)		184,716		90.2	%		251,656		71.9	%		(66,940	)		(26.6	%)		18.3	%

U.S.^(d)		19,992		10.3	%		90,982		28.4	%		(70,990	)		(78.0	%)		(18.1	%)
Brazil		116		1.1	%		7,248		24.4	%		(7,132	)		(98.4	%)		(23.3	%)

Total restaurant contribution	$	20,108		9.8	%	$	98,230		28.1	%	$	(78,122	)		(79.5	%)		(18.3	%)

Fogo Hospitality, Inc. S-1/A