The Wall Street Journal reports this morning that "Chuck E. Cheese, the restaurant chain and popular children’s party venue, is in talks with its lenders to raise money to avoid filing for bankruptcy, according to people familiar with the matter … the Irving, Texas-based food-and-games chain has also approached lenders in recent weeks to gauge their interest in providing a $200 million loan to finance a stay in bankruptcy."
The Journal writes that "soon after the pandemic shut most restaurants, Chuck E. Cheese’ parent, CEC Entertainment Inc., in April announced that the company was exploring options including refinancings, restructuring out-of-court or bankruptcy."
And then, there is this nugget from the Journal story:
"On Friday CEC said it would pay nearly $3 million in retention bonuses to three top executives, including $1.3 million earmarked for Chief Executive David McKillips.
Such prebankruptcy bonuses for top executives have become more common at struggling companies during the coronavirus pandemic because retention bonuses for insiders and other top managers are illegal under bankruptcy law."
- KC's View:
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Did a quick check online, and it looks like Chuck E. Cheese had about 15,000 employees in North America before the pandemic hit … and it seems like a pretty good bet that none of those folks got retention bonuses. (The Journal notes that the company, as soon as it started closing its restaurants because of the pandemic, it stopped making rent payments - saving $7 million a month - and furloughed most of its employees.)
But the CEO gets a cool million - for, best I can tell, doing his freakin' job.
Now, except for those poor employees, I'm not inclined to spend much energy defending Chuck E. Cheese. When I saw this story, I asked my wife and kids if we'd ever done a kid's birthday party there. My wife and two older kids remember my going to several parties held for other kids, but we never did one there for our kids. My youngest, our daughter, cannot remember my ever going to one - she says it is because I am a pizza snob and wouldn't even think of going to such a place to eat.
I am more than totally okay with this characterization. I feel about Chuck E. Cheese the way James T. Kirk used to feel about Klingons:
