Interplay Details Dire Financial Situation
A new SEC filing from struggling game publisher and Fallout Online
developer Interplay highlights a dire financial situation that could lead the company to cease operations if new financing is not secured in the near future.
A lack of available credit caused Interplay's cash-on-hand to dwindle to $3,000 at the end of 2010, the filing states, as the company accumulated operating deficits of over $2.8 million over the past few years.
That number includes roughly $239,000 in promised compensation that has not been paid to the company's board of directors, $410,000 in unpaid federal taxes and penalties since 2008, and over $80,000 in unpaid California state taxes, the filing states.
The publisher's financial status puts future releases in jeopardy, most notably an embattled Fallout
MMO, the rights to which Interplay licensed from Bethesda Softworks.
"We currently have some obligations that we are unable to meet without generating additional income or raising additional capital," the company warned stockholders. "If we cannot generate additional income or raise additional capital in the near future, we may become insolvent and/or be made bankrupt and/or may become illiquid or worthless."
Interplay said it may have to further cut back on its staff of 11 people, including 7 developers, or sell other assets if new financing can't be found.
The company seems to be pinning its hopes of financial survival on licensing out owned properties, with the filing noting new entries in the Battlechess, Clayfighter, Dark Alliance, Descent, Earthworm Jim, MDK2
franchises that are out for "production or pre-production" with various game studios.
The company continues work on the Fallout
MMO code-named "Project: V13," which has been in development since late 2007, and has plans to enter the 3DS and Facebook spaces in the future, according to the document.
Interplay also warned of continuing risk from an ongoing legal complaint
filed by Bethesda Softworks over the company's right to publish a Fallout MMO.