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Loki Speaks up on Chapter 11
The following is an email sent by Scott Draeker of Loki
Dear Friend of Loki:
As you may know, on August 3, 2001, Loki filed a Chapter 11 reorganization. As our valued customer, we wanted to let you know why we have elected to reorganize and how, if at all, it will impact our ongoing business.
Under US law there are two kinds of bankruptcy:
- Chapter 7 is a liquidation. We have not filed a Chapter 7 and have no intention of doing so.
- Chapter 11 is a reorganization. This will allow us to deal with our creditors fairly and equitably and at the same time continue to operate the company. We are still shipping products and porting new games and expect to be doing so for a long, long time.
Most of the debts we are restructuring through the Chapter 11 are well over a year old. They represent mistakes made by a young company. We've learned from our mistakes and become cash positive. Going forward we have every confidence that Loki will continue to be successful and grow.
We cannot say for certain how long Loki will remain in Chapter 11. It depends on many factors. However we do intend to bring the process to a conclusion as quickly as possible. Once our plan of reorganization is accepted by the court, our creditors will receive an agreed upon settlement and all other prepetition obligations will be fully and finally discharged.
During and after the reorganization your orders will continue to be honored. We will continue to provide end user support, bug fixes and new products. Negotiations are in progress to guarantee Loki a steady stream of additional AAA games to bring to Linux.
Most importantly, we'd like to thank each of you for your support over the years. Without our customers, we are nothing. The outpouring of support we have received in the last few days has been overwhelming, and we will continue to do everything we can to merit that support.
Kind regards,
Scott Draeker
President, Loki Software
Also, LinuxGames did a retrospective article the night that the Loki news first broke. It covers history, achievements, difficulties, and the possible future of Loki. Read it here
Curmudgeon Gamer: Not happy
I'd suggest instead buying the games you think you'd like to play, and not buying the ones you won't.
I don't fully understand the idea of supporting a company on principle, or based on who is in charge. If they produce quality product that I want, I'll buy it.
I can see arguments for not buying from companies whose owners have political or ethical stances you disagree with, like Dave Thomas of Wendy's (outspoken anti-homosexual). But because their president has poor business sense? That's the sort of thing that either they'll straigten out, or the market will straighten out for them, but doesn't seem like a worthwhile use of, effectively, a boycott. But hey, if you have moral and ethical issues with people who can't manage a company and its debts, knock yourself out.
-- Kate
Besides, if the company is as Scott said, Cash positive the line of credit is probably not a huge concern. They already have their shop setup, which is most of the costs of any company. They have employees, and are "balanced" out. All expansion and everything can come from their profit margin.
I'd be more surprised to see Loki sold than Loki buying or expanding their business model in the next 2 years. Chapter 11 isn't the end-all-you're-screwed, you still deal with your creditors. Everyone should walk away mostly pleased. That's what the purpose of it is.
Dacels Jewelers can't be trusted.
IT's for when you owe people money, and you can't pay. The idea is that you can stave off the creditors for a while, deal with them all fairly and evenly, and allow your company to start making some money. This doesn't mean 'making money because they don't have to pay bills'... it is designed to give them breathing room in order to dig their way out.
A *seriously* troubled company wouldn't bother with Chapter 11... they would just dissolve.