Midways Future Plans
|Midway announced today it has completed a private placement of $35.0 million of Series C Convertible Preferred Stock and warrants to purchase Midway common stock.
Midway Games Inc. (NYSE:MWY) announced today it has completed
a private placement of $35.0 million of Series C Convertible Preferred Stock and
warrants to purchase Midway common stock.
The Series C Preferred Stock
is convertible into Midway common stock at $4.60 per share. The conversion price
represents approximately a 30% premium over the May 15, 2003 closing price of
Midway's common stock. The preferred stock was purchased by two institutional
The investors have the option, until May 16, 2004, to
purchase up to an additional $12.5 million of Series C Preferred Stock
convertible into Midway common stock at $5.05 per share. The Series C Preferred
Stock matures March 15, 2006 and carries a 5 3/4% dividend, payable quarterly in
cash. The investors received three-year warrants to purchase up to 1,141,000
shares of common stock at an exercise price of $4.60.
Midway used the
proceeds of the private placement of $35.0 million to redeem the $13,125,000 of
outstanding Series B Preferred Stock and to pay the expenses of the transaction
and expects to use the balance for the creation and development of videogames,
and for working capital to finance inventory and receivables.
on the private placement, Midway CEO and President, David F. Zucker, commented,
"This financing further strengthens our balance sheet and provides additional
resources to bolster our solid pipeline of upcoming releases."
Warburg LLC acted as financial advisor to Midway Games in connection with the
Midway Games Inc. is a leading developer and
publisher of interactive entertainment software. Midway videogames are available
for play on all major videogame platforms including the PlayStation(R)2 computer
entertainment system, Xbox(TM) video game system from Microsoft, and Nintendo
GameCube(TM) and Game Boy(R) Advance.
This press release contains
forward-looking statements concerning future business conditions and the outlook
for Midway Games Inc. (the "Company") based on currently available information
that involve risks and uncertainties. The Company's actual results could differ
materially from those anticipated in the forward-looking statements as a result
of these risks and uncertainties, including, without limitation, the financial
strength of the interactive entertainment industry, dependence on new product
introductions and the ability to maintain the scheduling of such introductions,
technological changes, dependence on major platform manufacturers and other
risks more fully described under "Item 1. Business - Risk Factors" in the
Company's current Annual Report on Form 10-K and the more recent filings made by
the Company with the Securities and Exchange