Midway In Trouble Over Dodgy Executive Bonuses

As we told you at the start of the month, Midway are - despite poor sales and a bankruptcy filing - still finding ways to pay their top brass nearly $4 million in bonuses.

Which a government-appointed trustee (who is overseeing the company's financial and legal proceedings) is not happy with. Echoing similar government distaste for big corporate bonuses at other failing companies like AIG, the trustee - along with a committee made up of representatives from all the companies Midway owes money to - have come up with this shopping list of complaints:

- "The notion that a bonus program designed to reward employees for past accomplishments could be considered an 'incentive' is simply disingenuous". Translation: it's stupid paying a bonus for selling Wheelman when it turns out Wheelman had already been sold before the bonus plan was drawn up.

- "Senior management should not be paid incentive bonus payments... to perform duties required to be performed by their obligations under the Bankruptcy Code." Translation: Midway executives shouldn't be paid for trying to sell the Mortal Kombat franchise, since under the terms of their bankruptcy filing, they should be trying to do that anyway.

- "The Debtors seek authority to pay bonuses to a selected group of officers and managers which are four hundred percent greater than bonuses paid to the same group in 2008 when the Debtors were not before the Bankruptcy Court. Given the current state of the general economy, coupled with historical data related to incentive bonuses paid by these Debtors, the Motion constitutes an outrageous request and is not justified by the facts and circumstances of the case."

- "In a survey prepared by the Committee's financial advisor, FTI Consulting, of compensation plans proposed in some twenty comparable bankrupcty cases in recent years, the Proposed Plan is, by far, the richest compensation plan that has been proposed, despite the unusually poor conditions of the current economy."

In light of these complaints, Midway execs have formulated a "revised" bonus plan, which should be out later this week. Maybe this one will more accurately reflect the recent performance of the company, and instead of rewarding failure with millions of dollars, will punish failure via ancient, diabolical methods.

Feds, creditors call proposed Midway executive bonuses "outrageous," "disingenuous" [The Cut Scene]