Source: Pwinsider.com
The United States Bankruptcy court in Delaware moved to approve the plan to sever WWE’s ties to THQ, allowing them to sign a new deal with Take Two Games for their video game franchise, starting with WWE ’14. The move was made official yesterday. THQ had been working on transferring the rights for a while now, including creating a list of ten potential buyers. Three of those buyers completed due diligence with THQ, WWE and Yukes but none wanted to take over existing contracts due to the huge amount of debt owed to WWE and Yukes.
Take Two wanted to work with both and were allowed to enter into a new, fresh contract with new terms. THQ arranged the negotiations while also working on getting released from their contractual obligations with WWE and Yukes. They help set them up with a new company in exchange for having some of their debt cleared. They claimed that they would save millions by reducing claims against them and the court agreed.
Here is what happened:
- THQ terminated their relationship with WWE and gave up the rights to all future games.
- WWE waved any rights to go after THQ for damages.
- WWE will get a payment of $650,000 for royalties owed for sales of WWE ’13 during the bankruptcy process.
- THQ also terminated their relationship with Yukes, which worked on the WWE games. Yukes will now sign a deal with Take Two.
- THQ will transfer all ownership of Yukes stock in exchange for Yukes giving up claims of damages of $15-20 million against them.
- THQ will pay Yukes $250,000 in royalties for sales of WWE ’13.
Take Two will now take over employing the team that worked on the games, saving THQ from firing them and removing a potential six figure severance payday from THQ’s financial ledgers. THQ is currently selling off its assets piece by piece after not selling it all off to an investment firm that would have saved the company.
WWE and Take Two should make an official announcement soon.
The United States Bankruptcy court in Delaware moved to approve the plan to sever WWE’s ties to THQ, allowing them to sign a new deal with Take Two Games for their video game franchise, starting with WWE ’14. The move was made official yesterday. THQ had been working on transferring the rights for a while now, including creating a list of ten potential buyers. Three of those buyers completed due diligence with THQ, WWE and Yukes but none wanted to take over existing contracts due to the huge amount of debt owed to WWE and Yukes.
Take Two wanted to work with both and were allowed to enter into a new, fresh contract with new terms. THQ arranged the negotiations while also working on getting released from their contractual obligations with WWE and Yukes. They help set them up with a new company in exchange for having some of their debt cleared. They claimed that they would save millions by reducing claims against them and the court agreed.
Here is what happened:
- THQ terminated their relationship with WWE and gave up the rights to all future games.
- WWE waved any rights to go after THQ for damages.
- WWE will get a payment of $650,000 for royalties owed for sales of WWE ’13 during the bankruptcy process.
- THQ also terminated their relationship with Yukes, which worked on the WWE games. Yukes will now sign a deal with Take Two.
- THQ will transfer all ownership of Yukes stock in exchange for Yukes giving up claims of damages of $15-20 million against them.
- THQ will pay Yukes $250,000 in royalties for sales of WWE ’13.
Take Two will now take over employing the team that worked on the games, saving THQ from firing them and removing a potential six figure severance payday from THQ’s financial ledgers. THQ is currently selling off its assets piece by piece after not selling it all off to an investment firm that would have saved the company.
WWE and Take Two should make an official announcement soon.
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