UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 1, 2019
LEO HOLDINGS CORP.
(Exact Name of Registrant as Specified in Charter)
| Cayman Islands | 001-38393 | 98-1399727 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| 21 Grosvenor Place London |
SW1X 7HF | |||
| (Address of Principal Executive Offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: +44 20 7201 2200
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☒ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
| Units, each consisting of one Class A ordinary share, $0.0001 par value, and one-third of one redeemable warrant | LHC.U | New York Stock Exchange | ||
| Class A ordinary shares included as part of the units | LHC | New York Stock Exchange | ||
| Warrants included as part of the units, each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50 | LHC WS | New York Stock Exchange | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
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 pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry Into A Material Definitive Agreement |
On April 7, 2019, Leo Holdings Corp. (“Leo”) entered into Subscription Agreements with certain investors (collectively, the “Private Placement Investors”) pursuant to which, among other things, such investors agreed to subscribe for and purchase and Leo agreed to issue and sell to such investors, including funds managed by Lion Capital LLP, in connection with the consummation of the Business Combination (as defined below), 10,700,000 shares of Leo’s common stock, par value $0.0001 per share (the “Common Stock”), in each case, for an aggregate of up to $100.0 million (the “Private Placement”). As a result of Leo Investors Limited Partnership (the “Sponsor”) agreeing to surrender 1,750,000 shares to Leo upon closing, the net effect is that the Private Placement is not dilutive to a $10 per share valuation of Leo.
On June 27, 2019, Leo entered into additional Subscription Agreements, in substantially the same form as those entered into with the Private Placement Investors and filed as Exhibit 10.2 to Leo’s Current Report on Form 8-K, filed with the Securities and Exchange Commission (“SEC”) on April 8, 2019 (the “Initial 8-K”). The additional subscriptions are for 1,519,500 shares of Common Stock and increased the size of the Private Placement by $14.2 million to a total of $114.2 million. In connection therewith, Leo and the Sponsor amended the Sponsor Shares Surrender Agreement, dated April 7, 2019, previously filed as Exhibit 10.1 to the Initial 8-K, to provide that the Sponsor will surrender an additional 99,407 shares to Leo upon closing (1,849,407 in the aggregate), to maintain that the net effect of the Private Placement is not dilutive to a $10 per share valuation of Leo.
The closing of the Private Placement is contingent upon, among other things, the substantially concurrent consummation of the Business Combination.
In connection with the Private Placement, Leo will grant the Private Placement Investors certain customary registration rights. The Leo Shares to be offered and sold in connection with the Private Placements have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemption provided in Section 4(a)(2) of the Securities Act and/or Regulation D or Regulation S promulgated thereunder without any form of general solicitation or general advertising.
| Item 7.01 | Regulation FD Disclosure. |
Furnished as Exhibit 99.1 hereto and incorporated into this Item 7.01 by reference are materials that Leo has prepared for use in connection with various meetings and conferences related to the proposed business combination (the “Business Combination”) pursuant to which, among other things, Leo will acquire Queso Holdings Inc. (“Queso”) and the “Chuck E. Cheese” business in accordance with the terms of that certain Business Combination Agreement, dated as of April 7, 2019, by and among Leo, Queso and the other parties thereto.
The foregoing (including Exhibit 99.1) is being furnished pursuant to Item 7.01 and will not be deemed to be filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise be subject to the liabilities of that section, nor will it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 8.01 | Other Events. |
Leo has established June 21, 2019 as the record date for a shareholder meeting for the purpose of voting on the Business Combination and related matters, to be held at a date and time to be determined by Leo.
Additional Information
In connection with the Business Combination, Leo filed a Registration Statement on Form S-4 (File No. 333-231110), which includes a preliminary prospectus and preliminary proxy statement. Leo will mail a definitive proxy statement/prospectus and other relevant documents to its shareholders. Investors and security holders of Leo are advised to read, when available, the proxy statement/prospectus in connection with Leo’s solicitation of proxies for its special meeting of shareholders to be held to approve the Business Combination (and related matters) because the proxy statement/prospectus will contain important information about the Business Combination and the parties to the Business Combination. The definitive proxy statement/prospectus will be mailed to shareholders of Leo as of a record date to be established for voting on the Business Combination. Shareholders will also be able to obtain copies of the proxy statement/prospectus, without charge, once available, at the SEC’s website at www.sec.gov or by directing a request to: Leo Holdings Corp., 21 Grosvenor Place, London SW1X 7HF.
Participants in the Solicitation
Leo, Queso and their respective directors, executive officers, other members of management, and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies of Leo’s shareholders in connection with the Business Combination. Investors and security holders may obtain more detailed information regarding the names and interests in the Business Combination of Leo’s directors and officers in Leo’s filings with the SEC, including Leo’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2019, and such information and names of Queso’s directors and executive officers are also in the Registration Statement on Form S-4, as amended, filed with the SEC, which includes the preliminary proxy statement of Leo for the Business Combination.
Forward Looking Statements
Certain statements made herein are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “may”, “should”, “would”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “seem”, “seek”, “continue”, “future”, “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements regarding Leo’s industry, future events, the Business Combination, the estimated or anticipated future results and benefits of the combined company following the Business Combination, including the likelihood and ability of the parties to successfully consummate the Business Combination, future opportunities for the combined company, and other statements that are not historical facts. These statements are based on the current expectations of Leo’s management and are not predictions of actual performance. These statements are subject to a number of risks and uncertainties regarding Leo’s businesses and the Business Combination, and actual results may differ materially. These risks and uncertainties include, but are not limited to, changes in the business environment in which Leo operates, including inflation and interest rates, and general financial, economic, regulatory and political conditions affecting the industry in which Leo operates; changes in taxes, governmental laws, and regulations; competitive product and pricing activity; difficulties of managing growth profitably; the loss of one or more members of Leo’s management teams; the inability of the parties to successfully or timely consummate the Business Combination, including the risk that the
required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the Business Combination or that the approval of the shareholders of Leo is not obtained; failure to realize the anticipated benefits of the Business Combination, including as a result of a delay in consummating the Business Combination or a delay or difficulty in integrating the businesses of Leo and Queso; uncertainty as to the long-term value of Leo’s ordinary shares; those discussed in Leo’s Annual Report on Form 10-K for the year ended December 31, 2018 under the heading “Risk Factors”, as updated from time to time by Leo’s Quarterly Reports on Form 10-Q, Leo’s Annual Report on Form 10-K and other documents of Leo on file with the SEC or in the proxy statement filed with the SEC by Leo. There may be additional risks that Leo presently does not know or that Leo currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements provide Leo’s expectations, plans or forecasts of future events and views as of the date of this communication. Leo anticipates that subsequent events and developments will cause Leo’s assessments to change. However, while Leo may elect to update these forward-looking statements at some point in the future, Leo specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Leo’s assessments as of any date subsequent to the date of this communication.
Disclaimer
This communication is for informational purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote in any jurisdiction pursuant to the Business Combination or otherwise, nor shall there be any sale, issuance or transfer or securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit |
Description | |
| 99.1 | Investor Materials, dated July 2019 | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: July 1, 2019 |
LEO HOLDINGS CORP. | |||||
| By: |
/s/ Simon Brown | |||||
| Name: Simon Brown | ||||||
| Title: Secretary | ||||||
Exhibit 99.1 Supplemental Materials July 2019 Exhibit 99.1 Supplemental Materials July 2019
Disclaimer Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt These Supplemental Materials supplement, and should be reviewed together with, the CEC Entertainment Investor Presentation dated March 2019. References below to this presentation 682C91 R:104 G:44 B:145 refer to such Investor Presentation as supplemented hereby. Neither Leo Holdings Corp. (“Leo”) nor CEC Entertainment, Inc. (“CEC”, “Chuck E. Cheese’s” or the “Company”) nor any of their respective affiliates makes any representation or warranty, Heading either express or implied, as to the accuracy, completeness or reliability of the information contained in this presentation. This presentation has been prepared for informational purposes only Colour: R:104 G:44 B:145 and the exclusive use of the party to whom the presentation has been delivered (such party, together with its subsidiaries and affiliates, the “Recipients”). The Recipient should not construe the contents of this presentation as legal, tax, accounting or investment advice or a recommendation. The Recipient should consult its own counsel and tax and financial advisors as to legal Line: R:104 G:44 B:145 / Hex: 682C91 and related matters concerning the matters described herein, and, by accepting this presentation, the Recipient confirms that it is not relying upon the information contained herein to make any decision. This presentation does not purport to be all-inclusive or to contain all of the information that the Recipient may require. Theme Colour Accents The Recipient acknowledges that Leo and the Company consider this presentation and all information contained herein to include confidential, sensitive and proprietary information that is 682C91 R:104 G:44 B:145 A1 covered by the confidentiality undertaking of the Recipient. The Recipient acknowledges and agrees that it will use this presentation and all information contained herein in accordance with the confidentiality agreement. D20033 R:210 G:0 B:51 A2 Forward-Looking Statements. Certain statements in this presentation may be considered forward-looking statements. Forward-looking statements generally relate to future events or Leo’s or the Company’s future financial or operating performance. For example, projections of future Adjusted EBITDA, Gross Profit, Capital Expenditures and Free Cash Flow are forward-looking 249384 R:36 G:147 B:132 A3 statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential” or “continue”, or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could FA7600 R:250 G:118 B:0 A4 cause actual results to differ materially from those expressed or implied by such forward looking statements. 0561BA R:5 G:97 B:186 A5 These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Leo and its management, and CEC and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations, include, but are not limited to, various factors beyond management's control including competition and general economic conditions for the Company and its management, and other risks, uncertainties and factors set forth in the sections entitled “Risk Factors” 76BB1F R:118 G:187 B:31 A6 and “Cautionary Statement Regarding Forward-Looking Statements” in (i) Leo’s Prospectus dated February 12, 2018 with respect to its initial public offering, and (ii) the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. 9D0E2D R:157 G:14 B:45 H/A7 Nothing in this presentation should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Neither Leo 76BB1F R:118 G:187 B:31 F/A8 nor the Company undertakes any duty to update these forward-looking statements. Recommended client's colour Following the completion of the Business Combination, the combined company does not intend to publicly issue quarterly guidance. Client: Fill with colour Financial Presentation. All Company financial information included in this presentation is consolidated financial information of Queso Holdings Inc., the direct parent holding company of CEC and the entity that will be party to the transaction with Leo. Queso Holdings Inc. has no material assets other than its ownership of CEC and conducts no operations other than through Recommended CS colour CEC and its subsidiaries. CS: Fill with colour Non-GAAP Financial Information. In this presentation, Leo and the Company may refer to certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA margin, Venue-Level Adjusted EBITDA, Adjusted EBITDAR, Adjusted EBITDAR margin, Free Cash Flow and Free Cash Flow Conversion. To the extent Leo and the Company disclose non-GAAP Highlights in tables financial measures, please refer to footnotes where presented on each page of this presentation or to the appendix found at the end of this presentation for a reconciliation of these measures to what the Company believes are the most directly comparable measure evaluated in accordance with generally accepted accounting principles in the U.S. (“GAAP”). This H1: Fill with colour presentation also includes certain projections of non-GAAP financial measures. Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from these projected measures, together with some of the excluded information not being ascertainable or accessible, the Company is unable to quantify certain H2: Fill with colour amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable efforts. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included. CustomColour Checker v2.2 2 Disclaimer Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt These Supplemental Materials supplement, and should be reviewed together with, the CEC Entertainment Investor Presentation dated March 2019. References below to this presentation 682C91 R:104 G:44 B:145 refer to such Investor Presentation as supplemented hereby. Neither Leo Holdings Corp. (“Leo”) nor CEC Entertainment, Inc. (“CEC”, “Chuck E. Cheese’s” or the “Company”) nor any of their respective affiliates makes any representation or warranty, Heading either express or implied, as to the accuracy, completeness or reliability of the information contained in this presentation. This presentation has been prepared for informational purposes only Colour: R:104 G:44 B:145 and the exclusive use of the party to whom the presentation has been delivered (such party, together with its subsidiaries and affiliates, the “Recipients”). The Recipient should not construe the contents of this presentation as legal, tax, accounting or investment advice or a recommendation. The Recipient should consult its own counsel and tax and financial advisors as to legal Line: R:104 G:44 B:145 / Hex: 682C91 and related matters concerning the matters described herein, and, by accepting this presentation, the Recipient confirms that it is not relying upon the information contained herein to make any decision. This presentation does not purport to be all-inclusive or to contain all of the information that the Recipient may require. Theme Colour Accents The Recipient acknowledges that Leo and the Company consider this presentation and all information contained herein to include confidential, sensitive and proprietary information that is 682C91 R:104 G:44 B:145 A1 covered by the confidentiality undertaking of the Recipient. The Recipient acknowledges and agrees that it will use this presentation and all information contained herein in accordance with the confidentiality agreement. D20033 R:210 G:0 B:51 A2 Forward-Looking Statements. Certain statements in this presentation may be considered forward-looking statements. Forward-looking statements generally relate to future events or Leo’s or the Company’s future financial or operating performance. For example, projections of future Adjusted EBITDA, Gross Profit, Capital Expenditures and Free Cash Flow are forward-looking 249384 R:36 G:147 B:132 A3 statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential” or “continue”, or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could FA7600 R:250 G:118 B:0 A4 cause actual results to differ materially from those expressed or implied by such forward looking statements. 0561BA R:5 G:97 B:186 A5 These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Leo and its management, and CEC and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations, include, but are not limited to, various factors beyond management's control including competition and general economic conditions for the Company and its management, and other risks, uncertainties and factors set forth in the sections entitled “Risk Factors” 76BB1F R:118 G:187 B:31 A6 and “Cautionary Statement Regarding Forward-Looking Statements” in (i) Leo’s Prospectus dated February 12, 2018 with respect to its initial public offering, and (ii) the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. 9D0E2D R:157 G:14 B:45 H/A7 Nothing in this presentation should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Neither Leo 76BB1F R:118 G:187 B:31 F/A8 nor the Company undertakes any duty to update these forward-looking statements. Recommended client's colour Following the completion of the Business Combination, the combined company does not intend to publicly issue quarterly guidance. Client: Fill with colour Financial Presentation. All Company financial information included in this presentation is consolidated financial information of Queso Holdings Inc., the direct parent holding company of CEC and the entity that will be party to the transaction with Leo. Queso Holdings Inc. has no material assets other than its ownership of CEC and conducts no operations other than through Recommended CS colour CEC and its subsidiaries. CS: Fill with colour Non-GAAP Financial Information. In this presentation, Leo and the Company may refer to certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA margin, Venue-Level Adjusted EBITDA, Adjusted EBITDAR, Adjusted EBITDAR margin, Free Cash Flow and Free Cash Flow Conversion. To the extent Leo and the Company disclose non-GAAP Highlights in tables financial measures, please refer to footnotes where presented on each page of this presentation or to the appendix found at the end of this presentation for a reconciliation of these measures to what the Company believes are the most directly comparable measure evaluated in accordance with generally accepted accounting principles in the U.S. (“GAAP”). This H1: Fill with colour presentation also includes certain projections of non-GAAP financial measures. Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from these projected measures, together with some of the excluded information not being ascertainable or accessible, the Company is unable to quantify certain H2: Fill with colour amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable efforts. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included. CustomColour Checker v2.2 2
Transaction Update Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 • On April 8, 2019, Leo Holdings, Corporation (“Leo”), a publicly traded special purpose acquisition company, and CEC Entertainment, Inc. (“CEC”) announced a definitive business combination agreement Heading Total Revenue: $929mm between Leo and Queso Holdings, Inc. (“Queso”), the parent company of CEC, together with Apollo Colour: R:104 G:44 B:145 Global Management (“Apollo”), Queso’s controlling stockholder Line: R:104 G:44 B:145 / Hex: 682C91 • The transaction values CEC at an enterprise value of $1.4bn Theme Colour Accents 682C91 R:104 G:44 B:145 A1 • Transaction funded by cash in trust of $200mm, a PIPE of $114mm, and rollover equity by Apollo and SSS Growth: 4.2% existing shareholders of $360mm D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 • Proceeds from the transaction will be used to de-leverage and pay down CEC’s Senior Unsecured Notes as well as pay expenses associated with the transaction FA7600 R:250 G:118 B:0 A4 • The PIPE investment has increased to $114mm from $100mm 0561BA R:5 G:97 B:186 A5 Adj. EBITDA: $187mm • This reflects an incremental $14mm investment of primary capital on the same terms as other 76BB1F R:118 G:187 B:31 A6 PIPE investors, the substantial majority of which is being made by a highly respected investor 9D0E2D R:157 G:14 B:45 H/A7 with a strong track record in the consumer sector 76BB1F R:118 G:187 B:31 F/A8 • This will lower the proceeds necessary to meet the minimum cash requirement under the Company Operated Venue Remodels: 60 Recommended client's colour business combination agreement from 75% to 68% of cash in trust Client: Fill with colour (To be completed in Q3 and Q4) • Apollo and existing shareholders will not be selling any shares and will continue to retain Recommended CS colour majority ownership of CEC. Excess proceeds will be utilized for de-leveraging CS: Fill with colour • Leo expects to hold a shareholder vote by the end of July 2019 and to close the business Highlights in tables combination shortly thereafter H1: Fill with colour Total Capital Expenditures: $95-105mm • Leo has established June 21, 2019 as the record date for a shareholder meeting H2: Fill with colour CustomColour Checker v2.2 3 Transaction Update Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 • On April 8, 2019, Leo Holdings, Corporation (“Leo”), a publicly traded special purpose acquisition company, and CEC Entertainment, Inc. (“CEC”) announced a definitive business combination agreement Heading Total Revenue: $929mm between Leo and Queso Holdings, Inc. (“Queso”), the parent company of CEC, together with Apollo Colour: R:104 G:44 B:145 Global Management (“Apollo”), Queso’s controlling stockholder Line: R:104 G:44 B:145 / Hex: 682C91 • The transaction values CEC at an enterprise value of $1.4bn Theme Colour Accents 682C91 R:104 G:44 B:145 A1 • Transaction funded by cash in trust of $200mm, a PIPE of $114mm, and rollover equity by Apollo and SSS Growth: 4.2% existing shareholders of $360mm D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 • Proceeds from the transaction will be used to de-leverage and pay down CEC’s Senior Unsecured Notes as well as pay expenses associated with the transaction FA7600 R:250 G:118 B:0 A4 • The PIPE investment has increased to $114mm from $100mm 0561BA R:5 G:97 B:186 A5 Adj. EBITDA: $187mm • This reflects an incremental $14mm investment of primary capital on the same terms as other 76BB1F R:118 G:187 B:31 A6 PIPE investors, the substantial majority of which is being made by a highly respected investor 9D0E2D R:157 G:14 B:45 H/A7 with a strong track record in the consumer sector 76BB1F R:118 G:187 B:31 F/A8 • This will lower the proceeds necessary to meet the minimum cash requirement under the Company Operated Venue Remodels: 60 Recommended client's colour business combination agreement from 75% to 68% of cash in trust Client: Fill with colour (To be completed in Q3 and Q4) • Apollo and existing shareholders will not be selling any shares and will continue to retain Recommended CS colour majority ownership of CEC. Excess proceeds will be utilized for de-leveraging CS: Fill with colour • Leo expects to hold a shareholder vote by the end of July 2019 and to close the business Highlights in tables combination shortly thereafter H1: Fill with colour Total Capital Expenditures: $95-105mm • Leo has established June 21, 2019 as the record date for a shareholder meeting H2: Fill with colour CustomColour Checker v2.2 3
CEC Reiterates FY2019 Guidance Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading Total Revenue: $929mm Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 682C91 R:104 G:44 B:145 A1 SSS Growth: +4.2% D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 FA7600 R:250 G:118 B:0 A4 0561BA R:5 G:97 B:186 A5 Adj. EBITDA: $187mm 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 76BB1F R:118 G:187 B:31 F/A8 Company Operated Venue Remodels: 60 Recommended client's colour Client: Fill with colour (To be completed in Q3 and Q4) Recommended CS colour CS: Fill with colour Highlights in tables H1: Fill with colour Total Capital Expenditures: $95-105mm H2: Fill with colour CustomColour Checker v2.2 4 CEC Reiterates FY2019 Guidance Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading Total Revenue: $929mm Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 682C91 R:104 G:44 B:145 A1 SSS Growth: +4.2% D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 FA7600 R:250 G:118 B:0 A4 0561BA R:5 G:97 B:186 A5 Adj. EBITDA: $187mm 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 76BB1F R:118 G:187 B:31 F/A8 Company Operated Venue Remodels: 60 Recommended client's colour Client: Fill with colour (To be completed in Q3 and Q4) Recommended CS colour CS: Fill with colour Highlights in tables H1: Fill with colour Total Capital Expenditures: $95-105mm H2: Fill with colour CustomColour Checker v2.2 4
CEC on Track to Achieve FYE 2019 SSS Guidance Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt CEC SSS Performance Including Q2 and FYE Guidance 682C91 R:104 G:44 B:145 Heading On track to achieve full year SSS growth of +4.2% Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents Period As Reported Adjusted Commentary 682C91 R:104 G:44 B:145 A1 D20033 R:210 G:0 B:51 A2 150bps shifted to Q2 Q1 2019 +7.7% ~+6.2% Adjusted SSS represents shift 249384 R:36 G:147 B:132 A3 in Easter / Spring Break timing between quarters to properly FA7600 R:250 G:118 B:0 A4 reflect YoY performance (1) Q2 2019E +0.4% ~+2.2% 175bps shifted from Q1 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 2019 (1) YTD +4.5% Represents SSS results through the end of Q2 2019 SSS 76BB1F R:118 G:187 B:31 F/A8 Growth Implied H2 2019E performance Recommended client's colour Initiatives In Test: reflected in current guidance All Time Stores Client: Fill with colour Implied 8.0 Tickets per tap +3.9% Includes ~70bps total YoY H2 2019E Recommended CS colour Simplified Menu contribution to SSS from CS: Fill with colour Bigger Combo Deals planned remodels Highlights in tables 2019E +4.2% CEC reiterates 2019E SSS growth guidance of +4.2% H1: Fill with colour H2: Fill with colour CustomColour Checker v2.2 5 Note: CEC financials available at SEC.gov. (1) Reported SSS figures may differ due to rounding. CEC on Track to Achieve FYE 2019 SSS Guidance Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt CEC SSS Performance Including Q2 and FYE Guidance 682C91 R:104 G:44 B:145 Heading On track to achieve full year SSS growth of +4.2% Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents Period As Reported Adjusted Commentary 682C91 R:104 G:44 B:145 A1 D20033 R:210 G:0 B:51 A2 150bps shifted to Q2 Q1 2019 +7.7% ~+6.2% Adjusted SSS represents shift 249384 R:36 G:147 B:132 A3 in Easter / Spring Break timing between quarters to properly FA7600 R:250 G:118 B:0 A4 reflect YoY performance (1) Q2 2019E +0.4% ~+2.2% 175bps shifted from Q1 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 2019 (1) YTD +4.5% Represents SSS results through the end of Q2 2019 SSS 76BB1F R:118 G:187 B:31 F/A8 Growth Implied H2 2019E performance Recommended client's colour Initiatives In Test: reflected in current guidance All Time Stores Client: Fill with colour Implied 8.0 Tickets per tap +3.9% Includes ~70bps total YoY H2 2019E Recommended CS colour Simplified Menu contribution to SSS from CS: Fill with colour Bigger Combo Deals planned remodels Highlights in tables 2019E +4.2% CEC reiterates 2019E SSS growth guidance of +4.2% H1: Fill with colour H2: Fill with colour CustomColour Checker v2.2 5 Note: CEC financials available at SEC.gov. (1) Reported SSS figures may differ due to rounding.
Consistent CEC SSS Outperformance vs Dave & Buster’s Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt CEC SSS Outperformance 682C91 R:104 G:44 B:145 Heading § The below graph shows the outperformance of CEC vs. Dave & Buster’s same store sales on a quarterly basis Colour: R:104 G:44 B:145 § For comparability purposes, CEC’s sales results have been aligned to Dave & Buster’s fiscal calendar Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents Difference in CEC vs Dave & Buster’s Year-on-Year SSS Performance 682C91 R:104 G:44 B:145 A1 (1) CEC SSS Conformed to FYE January for Comparability to D&B D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 + 4.3% + 4.2% + 4.2% FA7600 R:250 G:118 B:0 A4 + 3.0% 0561BA R:5 G:97 B:186 A5 + 1.5% 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 Q1 Q2 Q3 Q4 Q1 76BB1F R:118 G:187 B:31 F/A8 2018 2019 Quarterly SSS Performance Recommended client's colour (1) CEC SSS Conformed to FYE January for Comparability to D&B Client: Fill with colour Recommended CS colour (0.6%) (0.9%) +2.9% +5.9% +3.9% CS: Fill with colour (4.9%) (2.4%) (1.3%) +2.9% (0.3%) Highlights in tables H1: Fill with colour Consistent CEC SSS Outperformance versus Dave & Buster’s H2: Fill with colour CustomColour Checker v2.2 6 Note: CEC and Dave & Buster’s financials available at SEC.gov. (1) CEC year-on-year SSS data conformed to match D&B's reporting period, e.g. February 4 to May 5 2019, for Q1 2019. Consistent CEC SSS Outperformance vs Dave & Buster’s Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt CEC SSS Outperformance 682C91 R:104 G:44 B:145 Heading § The below graph shows the outperformance of CEC vs. Dave & Buster’s same store sales on a quarterly basis Colour: R:104 G:44 B:145 § For comparability purposes, CEC’s sales results have been aligned to Dave & Buster’s fiscal calendar Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents Difference in CEC vs Dave & Buster’s Year-on-Year SSS Performance 682C91 R:104 G:44 B:145 A1 (1) CEC SSS Conformed to FYE January for Comparability to D&B D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 + 4.3% + 4.2% + 4.2% FA7600 R:250 G:118 B:0 A4 + 3.0% 0561BA R:5 G:97 B:186 A5 + 1.5% 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 Q1 Q2 Q3 Q4 Q1 76BB1F R:118 G:187 B:31 F/A8 2018 2019 Quarterly SSS Performance Recommended client's colour (1) CEC SSS Conformed to FYE January for Comparability to D&B Client: Fill with colour Recommended CS colour (0.6%) (0.9%) +2.9% +5.9% +3.9% CS: Fill with colour (4.9%) (2.4%) (1.3%) +2.9% (0.3%) Highlights in tables H1: Fill with colour Consistent CEC SSS Outperformance versus Dave & Buster’s H2: Fill with colour CustomColour Checker v2.2 6 Note: CEC and Dave & Buster’s financials available at SEC.gov. (1) CEC year-on-year SSS data conformed to match D&B's reporting period, e.g. February 4 to May 5 2019, for Q1 2019.
§ Play Pass, All You § Management Can Play and More guiding to flat to Tickets initiatives negative 2019 SSS CEC has a Growth Algorithm Driven by SSS and Proven Initiatives Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 (1) (2) Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading § 1% traffic / remodels § Management highlighted 2019E: +4.2% 2019E: (0.6%) Colour: R:104 G:44 B:145 § 12%+ sales lift, ~480 remaining remodels § 1.5% basket / share of wallet competitive pressures as a SSS 2020E: +4.0% 2020E: +0.8% Remodel § 1.5% price driver of negative SSS § No new site selection, labor or leases Line: R:104 G:44 B:145 / Hex: 682C91 § [ ] § 20%+ cash-on-cash returns Program Theme Colour Accents § ~$45 – 55m incremental Adj. EBITDA 682C91 R:104 G:44 B:145 A1 § Focused on high ROIC remodels Company-Operated 2019E: 4 2019E: 16 § Focused on developing in near-term D20033 R:210 G:0 B:51 A2 New Units new units 2020E: 2 2020E: 16 § 29 new franchised units § 230-250 domestic unit opportunity internationally 249384 R:36 G:147 B:132 A3 § Play Pass, All You Can Play and More Tickets initiatives SSS Growth FA7600 R:250 G:118 B:0 A4 § Improved guest experience 2019E: 60 § 12%+ sales lift per venue 2019E: None Remodels § Market share gains from strong execution § No announced remodels 0561BA R:5 G:97 B:186 A5 § 32 completed by Q1 2019, 450+ 2020E: 90 2020E: None remaining including 60 in H2 2019 76BB1F R:118 G:187 B:31 A6 § Operational deleveraging at 9D0E2D R:157 G:14 B:45 H/A7 existing units § International expansion Sales CAGR New Unit and 76BB1F R:118 G:187 B:31 F/A8 § 200+ domestic unit opportunity (FY2018-20) ~4.3% ~8.9% § 50-60% flow through from Other § Licensing & other brand extensions remodeled venues Opportunities Recommended client's colour (4) § Platform for future M&A – ~$45-55mm incremental EBITDA § Increased franchise royalties Client: Fill with colour EBITDA Margin Recommended CS colour (Δ FY2018-20) § Strong “risk-adjusted” near term returns § Guidance to flat / negative SSS targets ~150bps ~(160bps) CS: Fill with colour § SSS growth drives strong flow-through § Management highlighted competitive Highlights in tables § 15 – 16 new units in FY2019 (12% of pressures as a driver of negative SSS § Benefitting from operational investments store base) H1: Fill with colour New Unit EBITDA CAGR § Focused on new game and VR experiences § Unit growth drives sales growth § Proven remodel concept Growth ~8.2% ~4.8% H2: Fill with colour (FY2018-20) to drive traffic § Estimated 230 – 250 unit potential CustomColour Checker v2.2 7 Note: Company management, Company filings, Wall Street research and Dave & Buster’s filings. CEC and Dave & Buster’s financials available at SEC.gov. (1) Fiscal year ending in December of calendar year. CEC FY2020E reflects 52-week basis. (2) Fiscal year ending in January of following calendar year. Calculated using 2018A revenue of $1,265mm, 2018A EBITDA of $279mm, 2020E revenue of $1,502mm and 2020E EBITDA of $307mm, based on Wall Street consensus. § 22 large and 8 § Limited new owned Flat to small format units; § Guidance of (1.5%) to +0.5% for FY2019 units; ~29 new Negative SSS +18% from 2018 franchised units § Historic underperformance unit base Performance Muted § Growth driven by new units EBITDA § Expected margin contraction in future years Performance § Play Pass, All You § Management Can Play and More guiding to flat to Tickets initiatives negative 2019 SSS CEC has a Growth Algorithm Driven by SSS and Proven Initiatives Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 (1) (2) Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading § 1% traffic / remodels § Management highlighted 2019E: +4.2% 2019E: (0.6%) Colour: R:104 G:44 B:145 § 12%+ sales lift, ~480 remaining remodels § 1.5% basket / share of wallet competitive pressures as a SSS 2020E: +4.0% 2020E: +0.8% Remodel § 1.5% price driver of negative SSS § No new site selection, labor or leases Line: R:104 G:44 B:145 / Hex: 682C91 § [ ] § 20%+ cash-on-cash returns Program Theme Colour Accents § ~$45 – 55m incremental Adj. EBITDA 682C91 R:104 G:44 B:145 A1 § Focused on high ROIC remodels Company-Operated 2019E: 4 2019E: 16 § Focused on developing in near-term D20033 R:210 G:0 B:51 A2 New Units new units 2020E: 2 2020E: 16 § 29 new franchised units § 230-250 domestic unit opportunity internationally 249384 R:36 G:147 B:132 A3 § Play Pass, All You Can Play and More Tickets initiatives SSS Growth FA7600 R:250 G:118 B:0 A4 § Improved guest experience 2019E: 60 § 12%+ sales lift per venue 2019E: None Remodels § Market share gains from strong execution § No announced remodels 0561BA R:5 G:97 B:186 A5 § 32 completed by Q1 2019, 450+ 2020E: 90 2020E: None remaining including 60 in H2 2019 76BB1F R:118 G:187 B:31 A6 § Operational deleveraging at 9D0E2D R:157 G:14 B:45 H/A7 existing units § International expansion Sales CAGR New Unit and 76BB1F R:118 G:187 B:31 F/A8 § 200+ domestic unit opportunity (FY2018-20) ~4.3% ~8.9% § 50-60% flow through from Other § Licensing & other brand extensions remodeled venues Opportunities Recommended client's colour (4) § Platform for future M&A – ~$45-55mm incremental EBITDA § Increased franchise royalties Client: Fill with colour EBITDA Margin Recommended CS colour (Δ FY2018-20) § Strong “risk-adjusted” near term returns § Guidance to flat / negative SSS targets ~150bps ~(160bps) CS: Fill with colour § SSS growth drives strong flow-through § Management highlighted competitive Highlights in tables § 15 – 16 new units in FY2019 (12% of pressures as a driver of negative SSS § Benefitting from operational investments store base) H1: Fill with colour New Unit EBITDA CAGR § Focused on new game and VR experiences § Unit growth drives sales growth § Proven remodel concept Growth ~8.2% ~4.8% H2: Fill with colour (FY2018-20) to drive traffic § Estimated 230 – 250 unit potential CustomColour Checker v2.2 7 Note: Company management, Company filings, Wall Street research and Dave & Buster’s filings. CEC and Dave & Buster’s financials available at SEC.gov. (1) Fiscal year ending in December of calendar year. CEC FY2020E reflects 52-week basis. (2) Fiscal year ending in January of following calendar year. Calculated using 2018A revenue of $1,265mm, 2018A EBITDA of $279mm, 2020E revenue of $1,502mm and 2020E EBITDA of $307mm, based on Wall Street consensus. § 22 large and 8 § Limited new owned Flat to small format units; § Guidance of (1.5%) to +0.5% for FY2019 units; ~29 new Negative SSS +18% from 2018 franchised units § Historic underperformance unit base Performance Muted § Growth driven by new units EBITDA § Expected margin contraction in future years Performance
Slide title - Font size: 20 pt CEC Economics and Attractive Growth Opportunity FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 748 127 682C91 R:104 G:44 B:145 Global Venues Units Heading Colour: R:104 G:44 B:145 14% 26% 0% 0% (1) (1) International Franchised International Franchised Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 12,700 sq.ft. 41,000 sq.ft. 682C91 R:104 G:44 B:145 A1 Average Store Size Average Store Size D20033 R:210 G:0 B:51 A2 ~150bps 249384 R:36 G:147 B:132 A3 ~(160bps) EBITDA margin expansion, EBITDA margin contraction, FA7600 R:250 G:118 B:0 A4 FY2018-20 (4) FY2018-20 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 230-250 ~200 (3) Domestic Unit Opportunity Domestic Unit Opportunity 9D0E2D R:157 G:14 B:45 H/A7 ~$45-55mm 76BB1F R:118 G:187 B:31 F/A8 $2.5mm $8.3-$8.8mm Long-Term Incremental EBITDA (5) (2) Cost to Build New Venue Net Development Cost for from Remodels ; Recommended client's colour (6) Large Stores $525k to $575k Cost per Remodel Client: Fill with colour Recommended CS colour n Smaller, less expensive venues n Higher buildout costs CS: Fill with colour n Scalable in smaller markets n Focused on new unit expansion in large urban n Multiple levers for growth Highlights in tables markets − Proven remodel program H1: Fill with colour − Large addressable market for new units that can be n Growth driven by square footage expansion targeted once high-ROI remodel spend is complete H2: Fill with colour CustomColour Checker v2.2 Note: CEC financials reflect Q1 2019A data. Dave & Buster’s financials reflect Q1 (3) Buxton’s estimate of ~150 Chuck E. Cheese venues plus select other opportunities validated by Buxton and Management. 2019A data. CEC and Dave & Buster’s financials available at SEC.gov. (4) Wall Street research consensus; calculated using 2020E revenue of $1,502mm and 2020E EBITDA of $307mm. 8 (1) Units outside of U.S. and Canada. (5) Cost to build adjusted for tenant incentives and capital overhead. Represents cost to build large format CEC venue. (2) Assumes 480 venues, $1.6mm AUV, 12% AUV uplift and 50-60% flow (6) Large Stores defined as 30,000-45,000 sq. ft. Net development costs include equipment, building, leaseholds and site costs, net of tenant through. improvement allowances and other landlord payments, excluding pre-opening costs and capitalized interest. Slide title - Font size: 20 pt CEC Economics and Attractive Growth Opportunity FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 748 127 682C91 R:104 G:44 B:145 Global Venues Units Heading Colour: R:104 G:44 B:145 14% 26% 0% 0% (1) (1) International Franchised International Franchised Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 12,700 sq.ft. 41,000 sq.ft. 682C91 R:104 G:44 B:145 A1 Average Store Size Average Store Size D20033 R:210 G:0 B:51 A2 ~150bps 249384 R:36 G:147 B:132 A3 ~(160bps) EBITDA margin expansion, EBITDA margin contraction, FA7600 R:250 G:118 B:0 A4 FY2018-20 (4) FY2018-20 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 230-250 ~200 (3) Domestic Unit Opportunity Domestic Unit Opportunity 9D0E2D R:157 G:14 B:45 H/A7 ~$45-55mm 76BB1F R:118 G:187 B:31 F/A8 $2.5mm $8.3-$8.8mm Long-Term Incremental EBITDA (5) (2) Cost to Build New Venue Net Development Cost for from Remodels ; Recommended client's colour (6) Large Stores $525k to $575k Cost per Remodel Client: Fill with colour Recommended CS colour n Smaller, less expensive venues n Higher buildout costs CS: Fill with colour n Scalable in smaller markets n Focused on new unit expansion in large urban n Multiple levers for growth Highlights in tables markets − Proven remodel program H1: Fill with colour − Large addressable market for new units that can be n Growth driven by square footage expansion targeted once high-ROI remodel spend is complete H2: Fill with colour CustomColour Checker v2.2 Note: CEC financials reflect Q1 2019A data. Dave & Buster’s financials reflect Q1 (3) Buxton’s estimate of ~150 Chuck E. Cheese venues plus select other opportunities validated by Buxton and Management. 2019A data. CEC and Dave & Buster’s financials available at SEC.gov. (4) Wall Street research consensus; calculated using 2020E revenue of $1,502mm and 2020E EBITDA of $307mm. 8 (1) Units outside of U.S. and Canada. (5) Cost to build adjusted for tenant incentives and capital overhead. Represents cost to build large format CEC venue. (2) Assumes 480 venues, $1.6mm AUV, 12% AUV uplift and 50-60% flow (6) Large Stores defined as 30,000-45,000 sq. ft. Net development costs include equipment, building, leaseholds and site costs, net of tenant through. improvement allowances and other landlord payments, excluding pre-opening costs and capitalized interest.
Slide title - Font size: 20 pt CEC Has a More Defensive Platform FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Iconic Brand Heading (1) Unaided Brand Awareness vs. Brand Alternatives Colour: R:104 G:44 B:145 n Loyal young age n Older demographic with 61% group with limited greater range of Line: R:104 G:44 B:145 / Hex: 682C91 More choices for out of entertainment options Theme Colour Accents Attractive home entertainment Demographics 682C91 R:104 G:44 B:145 A1 n Not dependent on 21% new content D20033 R:210 G:0 B:51 A2 8% 7% 249384 R:36 G:147 B:132 A3 3% 2% FA7600 R:250 G:118 B:0 A4 n Affordable and n Higher price point convenient business business model 0561BA R:5 G:97 B:186 A5 model appeals to Compelling broad consumer base More Affordable Value 76BB1F R:118 G:187 B:31 A6 Proposition (2) Example Spend 9D0E2D R:157 G:14 B:45 H/A7 n Example Spend per n Example Spend per (2) (2) Visit: $39 Visit: $106 76BB1F R:118 G:187 B:31 F/A8 $112 $106 Recommended client's colour 2008-2010 2008-2010 Client: Fill with colour +0.2% (12.5%) SSS Stacked SSS Stacked $45 Recommended CS colour $39 n No corporate events n Corporate events >10% CS: Fill with colour Less n Consistent recurring of sales Cyclicality Highlights in tables revenue: H1: Fill with colour − 26% franchised n 0% franchise revenue − Birthdays ~15% of H2: Fill with colour (3) sales Family Dining Movie Theatres CustomColour Checker v2.2 9 Note: CEC financials reflect Q1 2019A data. Dave & Buster’s financials reflect Q1 2019A data. CEC and Dave & Buster’s financials available at SEC.gov. (2) Illustrative pricing for parties of 2 adults and 2 children for an everyday visit. Chuck E. Cheese based on New York pricing versus (1) When mothers (on an unaided basis) were asked ‘‘When thinking about places to take your children for family-fun and entertainment, and also having a $35 price point in most U.S. venues. meal and/or snacks, what is the first place that comes to mind? What other places come to mind?” (3) Based on 2 kids meals (pizza), 2 adult burgers & fries, and 4 beverages at Chili’s. Slide title - Font size: 20 pt CEC Has a More Defensive Platform FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Iconic Brand Heading (1) Unaided Brand Awareness vs. Brand Alternatives Colour: R:104 G:44 B:145 n Loyal young age n Older demographic with 61% group with limited greater range of Line: R:104 G:44 B:145 / Hex: 682C91 More choices for out of entertainment options Theme Colour Accents Attractive home entertainment Demographics 682C91 R:104 G:44 B:145 A1 n Not dependent on 21% new content D20033 R:210 G:0 B:51 A2 8% 7% 249384 R:36 G:147 B:132 A3 3% 2% FA7600 R:250 G:118 B:0 A4 n Affordable and n Higher price point convenient business business model 0561BA R:5 G:97 B:186 A5 model appeals to Compelling broad consumer base More Affordable Value 76BB1F R:118 G:187 B:31 A6 Proposition (2) Example Spend 9D0E2D R:157 G:14 B:45 H/A7 n Example Spend per n Example Spend per (2) (2) Visit: $39 Visit: $106 76BB1F R:118 G:187 B:31 F/A8 $112 $106 Recommended client's colour 2008-2010 2008-2010 Client: Fill with colour +0.2% (12.5%) SSS Stacked SSS Stacked $45 Recommended CS colour $39 n No corporate events n Corporate events >10% CS: Fill with colour Less n Consistent recurring of sales Cyclicality Highlights in tables revenue: H1: Fill with colour − 26% franchised n 0% franchise revenue − Birthdays ~15% of H2: Fill with colour (3) sales Family Dining Movie Theatres CustomColour Checker v2.2 9 Note: CEC financials reflect Q1 2019A data. Dave & Buster’s financials reflect Q1 2019A data. CEC and Dave & Buster’s financials available at SEC.gov. (2) Illustrative pricing for parties of 2 adults and 2 children for an everyday visit. Chuck E. Cheese based on New York pricing versus (1) When mothers (on an unaided basis) were asked ‘‘When thinking about places to take your children for family-fun and entertainment, and also having a $35 price point in most U.S. venues. meal and/or snacks, what is the first place that comes to mind? What other places come to mind?” (3) Based on 2 kids meals (pizza), 2 adult burgers & fries, and 4 beverages at Chili’s.
Highly Attractive Valuation for CEC Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt Restaurants & Entertainment Pizza-Focused QSR 682C91 R:104 G:44 B:145 Median: 10.4x 21.5x MTN-US Vail Resorts 14.7x Heading FV / 12.8x 12.1x 11.9x 11.1x 10.4x DRI-US Darden 9.5x 9.2x 8.9x 7.8x 7.5x CY2019 6.7x Colour: R:104 G:44 B:145 SIX-US Six Flags Adj. TXRH-US Texas Roadhouse Line: R:104 G:44 B:145 / Hex: 682C91 EBITDA CBRL-US Cracker Barrel (1) Median of MERL-GB Merlin Entertainment Pizza-Focused Theme Colour Accents (2) SEAS-US Seaworld QSR Peers FUN-US Cedar Fair 682C91 R:104 G:44 B:145 A1 CAKE-US Cheesecake Factory Median: 1.7x BJRI-US BJ's D20033 R:210 G:0 B:51 A2 8.4x Growth- PLAY-US Dave & Busters 6.1x Adjusted 2.5x 1.9x 1.9x 1.4x 1.5x 1.7x 1.4x 249384 R:36 G:147 B:132 A3 0.9x 0.5x NM NM EBITDA (3) Multiple (1) Median of FA7600 R:250 G:118 B:0 A4 Pizza-Focused (2) QSR Peers 0561BA R:5 G:97 B:186 A5 Median: 5.1% 76BB1F R:118 G:187 B:31 A6 9.9% Sales 8.7% 8.9% 6.1% CAGR 5.5% 5.1% 4.3% 4.2% 4.4% 3.6% 9D0E2D R:157 G:14 B:45 H/A7 3.5% 1.9% 1.5% CY2018- 76BB1F R:118 G:187 B:31 F/A8 (4) (1) CY2020 Median of Pizza-Focused (2) QSR Peers Recommended client's colour Median: 4.7% Client: Fill with colour 17.8% Adj. 11.3% 10.6% Recommended CS colour 8.7% EBITDA 8.2% 5.5% 5.4% 4.7% 4.7% 1.8% CAGR 0.9% CS: Fill with colour CY2018- (1.8%) (2.2%) Highlights in tables (4) CY2020 (1) Median of Pizza-Focused H1: Fill with colour (2) QSR Peers CY2019 Adj. H2: Fill with colour EBITDA 20.1% 31.2% 14.1% 37.5% 11.3% 12.7% 28.9% 31.2% 34.9% 9.1% 11.1% 21.0% 18.8% Margin CustomColour Checker v2.2 10 Source: Company Filings, FactSet. Market data as of June 28, 2019. Utilizes medians of broker estimates. (2) Includes Domino’s, Yum! Brands and Papa John’s. (1) Merlin Entertainment data as of June 27, 2019, prior to announcement of acquisition by Kirkbi Invest and (3) (FV / 2019 Adj. EBITDA) / ’18 – ’20 Adj. EBITDA CAGR. Blackstone. (4) CEC CY2020 shown on 52-week basis. Highly Attractive Valuation for CEC Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt Restaurants & Entertainment Pizza-Focused QSR 682C91 R:104 G:44 B:145 Median: 10.4x 21.5x MTN-US Vail Resorts 14.7x Heading FV / 12.8x 12.1x 11.9x 11.1x 10.4x DRI-US Darden 9.5x 9.2x 8.9x 7.8x 7.5x CY2019 6.7x Colour: R:104 G:44 B:145 SIX-US Six Flags Adj. TXRH-US Texas Roadhouse Line: R:104 G:44 B:145 / Hex: 682C91 EBITDA CBRL-US Cracker Barrel (1) Median of MERL-GB Merlin Entertainment Pizza-Focused Theme Colour Accents (2) SEAS-US Seaworld QSR Peers FUN-US Cedar Fair 682C91 R:104 G:44 B:145 A1 CAKE-US Cheesecake Factory Median: 1.7x BJRI-US BJ's D20033 R:210 G:0 B:51 A2 8.4x Growth- PLAY-US Dave & Busters 6.1x Adjusted 2.5x 1.9x 1.9x 1.4x 1.5x 1.7x 1.4x 249384 R:36 G:147 B:132 A3 0.9x 0.5x NM NM EBITDA (3) Multiple (1) Median of FA7600 R:250 G:118 B:0 A4 Pizza-Focused (2) QSR Peers 0561BA R:5 G:97 B:186 A5 Median: 5.1% 76BB1F R:118 G:187 B:31 A6 9.9% Sales 8.7% 8.9% 6.1% CAGR 5.5% 5.1% 4.3% 4.2% 4.4% 3.6% 9D0E2D R:157 G:14 B:45 H/A7 3.5% 1.9% 1.5% CY2018- 76BB1F R:118 G:187 B:31 F/A8 (4) (1) CY2020 Median of Pizza-Focused (2) QSR Peers Recommended client's colour Median: 4.7% Client: Fill with colour 17.8% Adj. 11.3% 10.6% Recommended CS colour 8.7% EBITDA 8.2% 5.5% 5.4% 4.7% 4.7% 1.8% CAGR 0.9% CS: Fill with colour CY2018- (1.8%) (2.2%) Highlights in tables (4) CY2020 (1) Median of Pizza-Focused H1: Fill with colour (2) QSR Peers CY2019 Adj. H2: Fill with colour EBITDA 20.1% 31.2% 14.1% 37.5% 11.3% 12.7% 28.9% 31.2% 34.9% 9.1% 11.1% 21.0% 18.8% Margin CustomColour Checker v2.2 10 Source: Company Filings, FactSet. Market data as of June 28, 2019. Utilizes medians of broker estimates. (2) Includes Domino’s, Yum! Brands and Papa John’s. (1) Merlin Entertainment data as of June 27, 2019, prior to announcement of acquisition by Kirkbi Invest and (3) (FV / 2019 Adj. EBITDA) / ’18 – ’20 Adj. EBITDA CAGR. Blackstone. (4) CEC CY2020 shown on 52-week basis.
Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 682C91 R:104 G:44 B:145 A1 D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 FA7600 R:250 G:118 B:0 A4 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 76BB1F R:118 G:187 B:31 F/A8 Recommended client's colour Client: Fill with colour Recommended CS colour CS: Fill with colour Highlights in tables H1: Fill with colour 11 H2: Fill with colour CustomColour Checker v2.2 Slide title - Font size: 20 pt FFFFFF R:255 G:255 B:255 Subtitle - Font size: 11 pt 682C91 R:104 G:44 B:145 Heading Colour: R:104 G:44 B:145 Line: R:104 G:44 B:145 / Hex: 682C91 Theme Colour Accents 682C91 R:104 G:44 B:145 A1 D20033 R:210 G:0 B:51 A2 249384 R:36 G:147 B:132 A3 FA7600 R:250 G:118 B:0 A4 0561BA R:5 G:97 B:186 A5 76BB1F R:118 G:187 B:31 A6 9D0E2D R:157 G:14 B:45 H/A7 76BB1F R:118 G:187 B:31 F/A8 Recommended client's colour Client: Fill with colour Recommended CS colour CS: Fill with colour Highlights in tables H1: Fill with colour 11 H2: Fill with colour CustomColour Checker v2.2