Consolidating Guarantor Financial Information

12 Months Ended

Dec. 28, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Consolidating Guarantor Financial Information

Consolidating Guarantor Financial Information:

The senior notes issued by CEC Entertainment, Inc. (the “Issuer”) in conjunction with the Merger are our unsecured obligations and are fully and unconditionally, jointly and severally guaranteed by all of our 100% wholly-owned U.S. subsidiaries (the “Guarantors”). Our wholly-owned foreign subsidiaries and our less-than-wholly-owned U.S. subsidiaries are not a party to the guarantees (the “Non-Guarantors”). The following schedules present the condensed consolidating financial statements of the Issuer, Guarantors and Non-Guarantors, as well as consolidated results, for the periods presented:

CEC Entertainment, Inc.
Condensed Consolidating Balance Sheet
As of January 3, 2016
(in thousands)
	Successor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Current assets:
Cash and cash equivalents	$	42,235		$	1,797		$	6,622		$	—		$	50,654
Accounts receivable	21,595			3,944			9,468			(9,071		)	25,936
Inventories	19,959			3,021			295			—			23,275
Other current assets	13,562			3,561			1,100			—			18,223
Total current assets	97,351			12,323			17,485			(9,071		)	118,088
Property and equipment, net	585,915			34,539			8,593			—			629,047
Goodwill	432,462			51,414			—			—			483,876
Intangible assets, net	21,855			466,240			—			—			488,095
Intercompany	129,151			30,716			—			(159,867		)	—
Investment in subsidiaries	422,407			—			—			(422,407		)	—
Other noncurrent assets	4,318			8,940			671			—			13,929
Total assets	$	1,693,459		$	604,172		$	26,749		$	(591,345	)	$	1,733,035
Current liabilities:
Bank indebtedness and other long-term debt, current portion	$	7,600		$	50		$	—		$	—		$	7,650
Capital lease obligations, current portion	418			—			3			—			421
Accounts payable and accrued expenses	71,320			27,774			3,270			—			102,364
Other current liabilities	3,350			328			—			—			3,678
Total current liabilities	82,688			28,152			3,273			—			114,113
Capital lease obligations, less current portion	14,980			—			64			—			15,044
Bank indebtedness and other long-term debt, less current portion	971,320			13			—			—			971,333
Deferred tax liability	184,083			17,867			(216		)	—			201,734
Intercompany	20,580			121,850			26,508			(168,938		)	—
Other noncurrent liabilities	211,262			10,784			219			—			222,265
Total liabilities	1,484,913			178,666			29,848			(168,938		)	1,524,489
Stockholders' equity:
Common stock	—			—			—			—			—
Capital in excess of par value	356,460			466,114			3,241			(469,355		)	356,460
Retained earnings (deficit)	(144,598		)	(40,608		)	(3,024		)	43,632			(144,598		)
Accumulated other comprehensive income (loss)	(3,316		)	—			(3,316		)	3,316			(3,316		)
Total stockholders' equity	208,546			425,506			(3,099		)	(422,407		)	208,546
Total liabilities and stockholders' equity	$	1,693,459		$	604,172		$	26,749		$	(591,345	)	$	1,733,035

CEC Entertainment, Inc.
Condensed Consolidating Balance Sheet
As of December 28, 2014
(in thousands)
	Successor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Current assets:
Cash and cash equivalents	$	97,020		$	6,427		$	7,547		$	—		$	110,994
Accounts receivable	13,209			5,487			3,797			(3,658		)	18,835
Inventories	15,008			3,596			375			—			18,979
Other current assets	15,642			3,212			2,040			—			20,894
Total current assets	140,879			18,722			13,759			(3,658		)	169,702
Property and equipment, net	638,239			33,064			10,669			—			681,972
Goodwill	432,462			50,982			—			—			483,444
Intangible assets, net	24,649			466,751			—			—			491,400
Intercompany	129,429			25,090			32,655			(187,174		)	—
Investment in subsidiaries	428,836			—			—			(428,836		)	—
Other noncurrent assets	3,683			5,875			37			—			9,595
Total assets	$	1,798,177		$	600,484		$	57,120		$	(619,668	)	$	1,836,113
Current liabilities:
Bank indebtedness and other long-term debt, current portion	$	9,500		$	45		$	—		$	—		$	9,545
Capital lease obligations, current portion	405			—			3			—			408
Accounts payable and accrued expenses	82,995			21,989			(248		)	(484		)	104,252
Other current liabilities	2,990			—			—			—			2,990
Total current liabilities	95,890			22,034			(245		)	(484		)	117,195
Capital lease obligations, less current portion	15,395			—			81			—			15,476
Bank indebtedness and other long-term debt, less current portion	974,287			67			—			—			974,354
Deferred tax liability	203,814			14,378			780			—			218,972
Intercompany	6,309			126,497			57,542			(190,348		)	—
Other noncurrent liabilities	209,896			7,472			162			—			217,530
Total liabilities	1,505,591			170,448			58,320			(190,832		)	1,543,527
Stockholders' equity:
Common stock	—			—			—			—			—
Capital in excess of par value	355,587			465,451			3,089			(468,540		)	355,587
Retained earnings (deficit)	(62,088		)	(35,415		)	(3,376		)	38,791			(62,088		)
Accumulated other comprehensive income (loss)	(913		)	—			(913		)	913			(913		)
Total stockholders' equity	292,586			430,036			(1,200		)	(428,836		)	292,586
Total liabilities and stockholders' equity	$	1,798,177		$	600,484		$	57,120		$	(619,668	)	$	1,836,113

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
Fiscal Year 2015
(in thousands)
	Successor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	353,200		$	48,747		$	6,148		$	—		$	408,095
Entertainment and merchandise sales	469,741			16,864			10,410			—			497,015
Total company store sales	822,941			65,611			16,558			—			905,110
Franchise fees and royalties	2,280			15,199			—			—			17,479
International Association assessments and other fees	995			24,591			43,829			(69,415		)	—
Total revenues	826,216			105,401			60,387			(69,415		)	922,589
Operating Costs and Expenses:
Company store operating costs:
Cost of food and beverage	89,772			12,527			2,135			—			104,434
Cost of entertainment and merchandise	29,147			1,729			643			—			31,519
Total cost of food, beverage, entertainment and merchandise	118,919			14,256			2,778			—			135,953
Labor expenses	230,113			14,968			5,503			—			250,584
Depreciation and amortization	109,307			3,856			2,073			—			115,236
Rent expense	88,773			5,363			2,533			—			96,669
Other store operating expenses	155,366			9,017			4,308			(25,613		)	143,078
Total company store operating costs	702,478			47,460			17,195			(25,613		)	741,520
Advertising expense	46,136			4,014			40,798			(43,802		)	47,146
General and administrative expenses	20,939			44,446			618			—			66,003
Transaction, severance and Merger related litigation costs	6			11,908			—			—			11,914
Asset Impairment	766			20			89			—			875
Total operating costs and expenses	770,325			107,848			58,700			(69,415		)	867,458
Operating income (loss)	55,891			(2,447		)	1,687			—			55,131
Equity in earnings (loss) in affiliates	(4,654		)	—			—			4,654			—
Interest expense	65,775			4,288			519			—			70,582
Income (loss) before income taxes	(14,538		)	(6,735		)	1,168			4,654			(15,451		)
Income tax expense (benefit)	(2,028		)	(1,575		)	662			—			(2,941		)
Net income (loss)	$	(12,510	)	$	(5,160	)	$	506		$	4,654		$	(12,510	)
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(2,403		)	—			(2,403		)	2,403			(2,403		)
Comprehensive income (loss)	$	(14,913	)	$	(5,160	)	$	(1,897	)	$	7,057		$	(14,913	)

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the 317 Day Period Ended December 28, 2014
(in thousands)
	Successor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	293,407		$	8,259		$	6,030		$	—		$	307,696
Entertainment and merchandise sales	391,818			2,490			10,094			—			404,402
Total Company store sales	685,225			10,749			16,124			—			712,098
Franchise fees and royalties	1,813			4,670			—			—			6,483
International Association assessments and other fees	1,006			1,233			37,388			(39,627		)	—
Total revenues	688,044			16,652			53,512			(39,627		)	718,581
Operating Costs and Expenses:
Company store operating costs:
Cost of food and beverage	75,772			2,324			1,900			—			79,996
Cost of entertainment and merchandise	23,832			244			660			(128		)	24,608
Total cost of food, beverage, entertainment and merchandise	99,604			2,568			2,560			(128		)	104,604
Labor expenses	192,651			2,922			5,282			—			200,855
Depreciation and amortization	111,816			1,197			2,938			—			115,951
Rent expense	73,337			938			2,423			—			76,698
Other store operating expenses	112,669			2,445			3,410			1,372			119,896
Total Company store operating costs	590,077			10,070			16,613			1,244			618,004
Advertising expense	38,511			638			31,712			(37,159		)	33,702
General and administrative expenses	18,414			32,389			1,091			(3,712		)	48,182
Transaction, severance and Merger related litigation costs	40,998			9,547			—			—			50,545
Asset Impairment	40			3			364			—			407
Total operating costs and expenses	688,040			52,647			49,780			(39,627		)	750,840
Operating income (loss)	4			(35,995		)	3,732			—			(32,259		)
Equity in earnings (loss) in affiliates	(36,988		)	—			—			36,988			—
Interest expense	59,644			770			538			—			60,952
Income (loss) before income taxes	(96,628		)	(36,765		)	3,194			36,988			(93,211		)
Income tax expense (benefit)	(34,540		)	2,441			976			—			(31,123		)
Net income (loss)	$	(62,088	)	$	(39,206	)	$	2,218		$	36,988		$	(62,088	)
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(913		)	—			(913		)	913			(913		)
Comprehensive income (loss)	$	(63,001	)	$	(39,206	)	$	1,305		$	37,901		$	(63,001	)

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the 47 Day Period Ended February 14, 2014
(in thousands)
	Predecessor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	49,803		$	32		$	1,062		$	—		$	50,897
Entertainment and merchandise sales	61,082			—			1,577			—			62,659
Total company store sales	110,885			32			2,639			—			113,556
Franchise fees and royalties	353			334			—			—			687
International Association assessments and other fees	—			4,558			6,095			(10,653		)	—
Total revenues	111,238			4,924			8,734			(10,653		)	114,243
Operating Costs and Expenses:
Company store operating costs:
Cost of food and beverage	11,924			25			336			—			12,285
Cost of entertainment and merchandise	3,618			—			131			(20		)	3,729
Total cost of food, beverage, entertainment and merchandise	15,542			25			467			(20		)	16,014
Labor expenses	31,107			—			891			—			31,998
Depreciation and amortization	9,430			—			303			—			9,733
Rent expense	11,962			—			403			—			12,365
Other store operating expenses	20,193			(44		)	(82		)	(4,307		)	15,760
Total company store operating costs	88,234			(19		)	1,982			(4,327		)	85,870
Advertising expense	6,144			17			5,853			(6,111		)	5,903
General and administrative expenses	4,124			3,863			191			(215		)	7,963
Transaction, severance and Merger related costs	1,800			9,834			—			—			11,634
Total operating costs and expenses	100,302			13,695			8,026			(10,653		)	111,370
Operating income (loss)	10,936			(8,771		)	708			—			2,873
Equity in earnings (loss) in affiliates	(4,523		)	—			—			4,523			—
Interest expense (income)	1,822			(771		)	100			—			1,151
Income (loss) before income taxes	4,591			(8,000		)	608			4,523			1,722
Income tax expense (benefit)	3,887			(3,040		)	171			—			1,018
Net income (loss)	$	704		$	(4,960	)	$	437		$	4,523		$	704
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(541		)	—			(541		)	541			(541		)
Comprehensive income (loss)	$	163		$	(4,960	)	$	(104	)	$	5,064		$	163

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
Fiscal Year 2013
(in thousands)
	Predecessor
	Issuer			Guarantor			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	358,931		$	683		$	9,016		$	(46	)	$	368,584
Entertainment and merchandise sales	434,429			—			13,726			—			448,155
Total company store sales	793,360			683			22,742			(46		)	816,739
Franchise fees and royalties	2,363			2,619			—			—			4,982
International Association assessments and other fees	—			63,400			43,463			(106,863		)	—
Total revenues	795,723			66,702			66,205			(106,909		)	821,721
Operating Costs and Expenses:
Company store operating costs:
Cost of food and beverage	87,543			33			2,787			—			90,363
Cost of entertainment and merchandise	28,952			(32		)	915			(60		)	29,775
Total cost of food, beverage, entertainment and merchandise	116,495			1			3,702			(60		)	120,138
Labor expenses	222,085			—			7,087			—			229,172
Depreciation and amortization	76,026			—			2,141			—			78,167
Rent expense	75,681			—			2,782			—			78,463
Other store operating expenses	189,087			(460		)	4,782			(62,374		)	131,035
Total company store operating costs	679,374			(459		)	20,494			(62,434		)	636,975
Advertising expense	44,244			—			40,411			(43,438		)	41,217
General and administrative expenses	17,817			38,617			1,294			(1,037		)	56,691
Transaction, severance and related litigation costs	316			—			—			—			316
Asset impairment	2,241			—			810			—			3,051
Total operating costs and expenses	743,992			38,158			63,009			(106,909		)	738,250
Operating income (loss)	51,731			28,544			3,196			—			83,471
Equity in earnings (loss) in affiliates	23,240			—			—			(23,240		)	—
Interest expense (income)	12,620			(6,002		)	835			—			7,453
Income (loss) before income taxes	62,351			34,546			2,361			(23,240		)	76,018
Income tax expense (benefit)	14,527			12,877			790			—			28,194
Net income (loss)	$	47,824		$	21,669		$	1,571		$	(23,240	)	$	47,824
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	$	(1,116	)	$	—		$	(1,116	)	$	1,116		$	(1,116	)
Comprehensive income (loss)	$	46,708		$	21,669		$	455		$	(22,124	)	$	46,708

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
Fiscal Year 2015
(in thousands)
	Successor
	Issuer				Guarantors			Non-Guarantors			Eliminations			Consolidated
Cash flows provided by (used in) operating activities:	$	95,659			$	(492	)	$	5,446		$	—		$	100,613
Cash flows from investing activities:
Acquisition of Peter Piper Pizza	(663		)		—			—			—			(663		)
Intercompany note	2,393				2,925			—			(5,318		)	—
Purchases of property and equipment	(65,070		)		(6,028		)	(1,936		)	—			(73,034		)
Development of internal use software	(2,018		)		(2,784		)	—			—			(4,802		)
Proceeds from sale of property and equipment	308				—			—			—			308
Cash flows provided by (used in) investing activities	(65,050		)		(5,887		)	(1,936		)	(5,318		)	(78,191		)
Cash flows from financing activities:
Repayments on senior term loan	(9,500		)		—			—			—			(9,500		)
Repayments on note payable	—				(49		)	—			—			(49		)
Intercompany note	(3,847		)		1,798			(3,269		)	5,318			—
Proceeds from financing sale-leaseback transaction	—				—			—			—			—
Payment of debt financing costs	—				—			—			—			—
Payments on capital lease obligations	(402		)		—			(3		)	—			(405		)
Payments on sale leaseback transactions	(1,663		)	—	—			—			—			(1,663		)
Dividends paid	(70,000		)		—			—			—			(70,000		)
Excess tax benefit realized from stock-based compensation	18				—			—			—			18
Equity contribution	—				—			—			—			—
Cash flows provided by (used in) financing activities	(85,394		)		1,749			(3,272		)	5,318			(81,599		)
Effect of foreign exchange rate changes on cash	—				—			(1,163		)	—			(1,163		)
Change in cash and cash equivalents	(54,785		)		(4,630		)	(925		)	—			(60,340		)
Cash and cash equivalents at beginning of period	97,020				6,427			7,547			—			110,994
Cash and cash equivalents at end of period	$	42,235			$	1,797		$	6,622		$	—		$	50,654

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
For the 317 Day Period Ended December 28, 2014
(in thousands)
	Successor
	Issuer				Guarantors				Non-Guarantors				Eliminations				Consolidated
Cash flows provided by (used in) operating activities:	$	70,034			$	(24,166	)		$	2,223			$	—			$	48,091
Cash flows from investing activities:
Acquisition of Predecessor	(946,898		)		—				—				—				(946,898		)
Acquisition of Franchise	—				(1,529		)		—				—				(1,529		)
Acquisition of Peter Piper Pizza	(118,409		)		5,267				—				—				(113,142		)
Intercompany note	—				375,539				—				(375,539		)		—
Purchases of property and equipment	(55,299		)		(4,136		)		(1,593		)		—				(61,028		)
Development of internal use software	—				(2,130		)		—				—				(2,130		)
Proceeds from sale of property and equipment	23				419				—				—				442
Cash flows provided by (used in) investing activities	(1,120,583		)	—	373,430			—	(1,593		)	—	(375,539		)	—	(1,124,285		)
Cash flows from financing activities:
Proceeds from secured credit facilities, net of original issue discount	756,200				—				—				—				756,200
Proceeds from senior notes	255,000				—				—				—				255,000
Repayment of Predecessor Facility	—				(348,000		)		—				—				(348,000		)
Repayments on senior term loan	(3,800		)		(7		)		—				—				(3,807		)
Intercompany note	(375,539		)		5,050				(5,050		)		375,539				—
Proceeds from financing sale-leaseback transaction	183,685				—				—				—				183,685
Payment of debt financing costs	(27,575		)		—				—				—				(27,575		)
Payments on capital lease obligations	(297		)		—				—				—				(297		)
Payments on sale leaseback transactions	(742		)		—				—				—				(742		)
Dividends paid	(890		)		—				—				—				(890		)
Excess tax benefit realized from stock-based compensation	4,874				—				—				—				4,874
Equity contribution	350,000				—				—				—				350,000
Cash flows provided by (used in) financing activities	1,140,916				(342,957		)		(5,050		)		375,539				1,168,448
Effect of foreign exchange rate changes on cash	—				—				(444		)		—				(444		)
Change in cash and cash equivalents	90,367				6,307				(4,864		)		—				91,810
Cash and cash equivalents at beginning of period	6,653				120				12,411				—				19,184
Cash and cash equivalents at end of period	$	97,020			$	6,427			$	7,547			$	—			$	110,994

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
For the 47 Day Period Ended February 14, 2014
(in thousands)
	Predecessor
	Issuer				Guarantors				Non-Guarantors				Eliminations				Consolidated
Cash flows provided by (used in) operating activities:	$	(12,224	)		$	29,906			$	4,632			$	—			$	22,314
Cash flows from investing activities:
Intercompany note	—				(17,601		)		—				17,601				—
Purchases of property and equipment	(8,538		)		(1,082		)		(90		)		—				(9,710		)
Proceeds from sale of property and equipment	(2		)		53				—				—				51
Cash flows provided by (used in) investing activities	(8,540		)	—	(18,630		)	—	(90		)	—	17,601			—	(9,659		)
Cash flows from financing activities:
Net proceeds from (repayments on) revolving credit facility	—				(13,500		)		—				—				(13,500		)
Intercompany note	17,571				430				(400		)		(17,601		)		—
Payments on capital lease obligations	(153		)		—				(11		)		—				(164		)
Dividends paid	(38		)		—				—				—				(38		)
Restricted stock returned for payment of taxes	(142		)		—				—				—				(142		)
Cash flows provided by (used in) financing activities	17,238			—	(13,070		)	—	(411		)	—	(17,601		)	—	(13,844		)
Effect of foreign exchange rate changes on cash	—				—				(313		)		—				(313		)
Change in cash and cash equivalents	(3,526		)	—	(1,794		)	—	3,818			—	—			—	(1,502		)
Cash and cash equivalents at beginning of period	10,177				1,914				8,595				—				20,686
Cash and cash equivalents at end of period	$	6,651			$	120			$	12,413			$	—			$	19,184

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
Fiscal Year 2013
(in thousands)
	Predecessor
	Issuer			Guarantors			Non-Guarantors			Eliminations			Consolidated
Cash flows provided by (used in) operating activities:	$	179,913		$	(43,734	)	$	2,485		$	—		$	138,664
Cash flows from investing activities:
Intercompany Note	—			87,775			—			(87,775		)	—
Purchases of property and equipment	(71,947		)	(1,265		)	(873		)	—			(74,085		)
Proceeds from sale of property and equipment	1,890			640			—			—			2,530
Other investing activities	613			—			—			—			613
Cash flows provided by (used in) investing activities	(69,444		)	87,150			(873		)	(87,775		)	(70,942		)
Cash flows from financing activities:
Net proceeds from (repayments on) revolving credit facility	—			(28,000		)	—			—			(28,000		)
Intercompany Note	(73,650		)	(13,750		)	(375		)	87,775			—
Payments on capital lease obligations	(885		)	—			(68		)	—			(953		)
Dividends paid	(17,097		)	—			—			—			(17,097		)
Excess tax benefit realized from stock-based compensation	343			—			—			—			343
Restricted stock returned for payment of taxes	(2,212		)	—			—			—			(2,212		)
Purchases of treasury stock	(18,112		)	—			—			—			(18,112		)
Cash flows provided by (used in) financing activities	(111,613		)	(41,750		)	(443		)	87,775			(66,031		)
Effect of foreign exchange rate changes on cash	—			—			(641		)	—			(641		)
Change in cash and cash equivalents	(1,144		)	1,666			528			—			1,050
Cash and cash equivalents at beginning of period	11,321			248			8,067			—			19,636
Cash and cash equivalents at end of period	$	10,177		$	1,914		$	8,595		$	—		$	20,686