Midway 'hemorrhaging cash,' Boon getting $1M bonus?

By Tor Thorsen, GameSpotPosted Mar 3, 2009 3:00 pm PT

Bankruptcy-court objection predicts publisher will burn through 75 percent of cash reserves by early May; Variety reports company struggling to retain Mortal Kombat cocreator.

Yesterday, Midway Games confirmed to GameSpot that it was considering selling its Mortal Kombat IP. The move is one of several the bankrupt publisher is seeking approval from its creditors for so it can pay around $8 million in "key employee incentive payments" (KEIP). According to a rep for the Chicago-based publisher, there are three KEIPs to retain workers, with two other bonus plans dedicated to keeping design staff in general and the Mortal Kombat team in particular on the recently slashed payroll.

Variety contends the lion's share of the Mortal Kombat team KEIP is for Ed Boon, who cocreated the series back in 1992. The Hollywood trade points to the plan's mention of a "key designer" who is "responsible for historically [Midway's] most successful video game series"--a designer who could, in all likelihood, not be anyone other than Boon.

Will Boon ever get his payday for helping craft what might be Midway's last hit, the nearly 2-million-unit-shipping Mortal Kombat vs. DC Universe? Maybe not, if Mark Thomas has anything to say about it. He's the mystery investor who paid $100,000 last December for a controlling stake in Midway--the same stake media mogul Sumner Redstone paid an estimated $30 million for during the preceding years.

Thomas is also the same mystery investor who has submitted an objection in the Delaware bankruptcy court where Midway filed for Chapter 11 bankruptcy protection last month. Specifically, Thomas' company, Acquisition Holdings Subsidiary I LLC (AHS), accused Midway of recklessly going through its rapidly dwindling financial reserves.

"The [Midway] Debtors are hemorrhaging cash at an alarming rate," read the objection. "Indeed, the Debtors' Budget indicates that between February 9, 2009 and May 4, 2009, the Debtors will burn through approximately $12,392,598 in cash representing an approximately 75 percent depletion of its cash reserves." The objection asked the court to allow it to impose limitations on the way the cash reserves are spent.

49 Comments

  • ismailelsharkaw

    Posted Apr 28, 2009 6:37 am PT

    GOOD GAME

  • mesc420

    Posted Apr 1, 2009 3:31 pm PT

    Boo Hoo! MK hasn't been good since MK2

  • living_wmd_888

    Posted Mar 5, 2009 2:48 pm PT

    If Midway does sell MK, Ed Boon needs to buy it,, setup his own studio, and get some backing from a publisher like Capcom, Square Enix, or Konami. Just please don't sell it to Actiblizzard... ugh....

    Midway was a hell of a developer once upon a time, and MK is still a worthy franchise.

  • plm3d_basic

    Posted Mar 5, 2009 9:19 am PT

    They should change their name to AIG.

  • jazilla

    Posted Mar 5, 2009 9:04 am PT

    if the company you work for is going under, you get no bonus. that company is trying to salvage what's left of its meager holdings. i think ed boon is already financially stable. can't say i feel bad for him if he doesn't get 1 million dollars lol.

  • KuraiMauri

    Posted Mar 5, 2009 7:44 am PT

    midway started to die since the release of mortal kombat 4... the series was not meant to be 3d

  • djHaQ

    Posted Mar 4, 2009 7:43 pm PT

    Wow. All hope is lost for MK. You will be missed.

  • SolidSnake52

    Posted Mar 4, 2009 6:12 pm PT

    HAHA ya Garrainaigarra if street fighter vsd mk that would be sweet like they could battle dhalsims fatalitie burns them to death hahaha

  • Garrainaigarra

    Posted Mar 4, 2009 6:04 pm PT

    Capcom better pick up the MK Licence so we can finally have Mortalkombat VS Street Fighter

  • Glade_Gnarr

    Posted Mar 4, 2009 5:32 pm PT

    So Midway is selling their best franchise, maybe Squere should by the company altogether since they want more western developers, then again, Midway's been dead since MK went to the 3D.

  • SolidSnake52

    Posted Mar 4, 2009 3:08 pm PT

    hmmm well i guess midway could be a good like company but i think they should well not stop the mortal kombat games but put a little more effort the game like we dont want original fatalities or somthing or creating your own fatalitie we wanna see like picture this...."FINISH HIM" sub-zero freezes so and so's head does some combos then punches his head the it pops or somthing or maybe even more violent i just want to see a lil more outta mortal kombat and i wanna see the next mortal kombat game on WII!!!

  • Henninger

    Posted Mar 4, 2009 1:12 pm PT

    I hate reading these articles about Midway. Such a sad time 4 the company that birthed Mortal Kombat.

  • arcelonious

    Posted Mar 4, 2009 1:07 pm PT

    Sounds like Mark Thomas is mad for investing in a company that was already spiraling towards bankruptcy. It's apparent that Sumner Redstone sold his $30 million worth of shares for a measly $100,000 because he was trying to cut his losses and run. I'm sorry Mark Thomas, you made a bad investment.

  • DEATH775

    Posted Mar 4, 2009 10:51 am PT

    Hmm

  • thingta42

    Posted Mar 4, 2009 9:33 am PT

    NAMCO!!! NAMCO!!!! NAMCO!!!! NAMCO!!!!

  • Hvac0120

    Posted Mar 4, 2009 9:16 am PT

    So this guy and the guy that sold him the shares for $100,000 are trying to accomplish...what? First the sale goes down, then the publisher crashes with the burn near eminent. Now this guy is objecting to the bankruptcy claim? I really don't understand what they are trying to do here. _

  • StSk8ter29

    Posted Mar 4, 2009 7:37 am PT

    CAPCOM!!!! CAPCOM!!!! CAPCOM!!!! CAPCOM!!!!

  • Hedfix

    Posted Mar 4, 2009 6:56 am PT

    I reckon Rare could make a good go of Mortal Kombat, they've the twisted sense of humour and the beat 'em up experience.

  • Hedfix

    Posted Mar 4, 2009 6:55 am PT

    Looks like people're heading for the door and grabbing as much on the way as they can.

  • Sniper

    Posted Mar 4, 2009 6:42 am PT

    The non-word "key" isn't used enough in this report.

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