Midway golden parachutes bronzed
Bankruptcy court approves incentive plan that sees key employees reap reduced bonuses, but company first needs to survive or sell for at least $30 million.
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Last month, bankrupt publisher Midway's proposed $8 million worth of employee incentive plans raised a number of eyebrows, most notably those of the company's creditors. Given that the highest outstanding bid for Midway is $30 million--just enough to cover the secured debt owed to owner Mark Thomas--other creditors cried foul at the idea of more than a quarter of the company's total worth being given away in bonuses.
Court filings this week revealed that the publisher has an amended incentive plan in place. Earlier this month, the bankruptcy court approved changes to the plan that would throttle back the bonuses severely.
According to a GameSpot review of court filings, the revised plan consists of two milestone criteria. The first milestone will be reached if Midway enters into agreements to sell off assets that total $30 million or more. The second milestone will be reached when such deals close, so long as the net sale proceeds still total at least $30 million. If Midway can present a plan to get out of bankruptcy that is then approved by its creditors, both milestones will be considered met.
As for how much the bonuses are, key employees that are part of the incentive plan will be able to split a collective bonus not to exceed $600,000 within three days of meeting the first milestone. The second milestone payment starts at $1 million to be divvied up by the key employees, with that pool growing by $75,000 for every extra $1 million the asset sale(s) brings in above the $30 million target.
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