Late last week, Midway Games made a deal with National Amusements to essentially borrow up to $40 million by the end of this year by selling its accounts receivable at a discount. Back in March, it opened a credit line with National Amusements for up to $90 million. That's as much as $130 million in one year.

What's National Amusements? It's a chain of movie theaters, but it's also an investment vehicle for the Redstone family. Sumner Redstone, of course, owns about 90% of Midway's stock, either directly or indirectly. So basically, Sumner is borrowing from Sumner.

Last December the media mogul installed his daughter Shari as chairman to try and fix the beleagured company, which has consistently lost money since he took control of it in 2004 and lost a LOT of his equity value (there's a chart of its stock performance for the past five years above, courtesy of TheStreet.com).

Keep in mind that Midway is borrowing this new $40 million from NAI just to manufacture its fall slate of games ("TNA Impact," "Blitz II," and "Mortal Kombat vs. DC.") We're talking about a company so short on cash, and losing money so fast, it can't even afford to manufacture its own games. As of June 30, it had just $14.6 million in cash on hand and if it's borrowing this new money, you can safely assume that figure is down substantially in the current quarter, which ends September 30 (we'll probably get the official report in early November).

This is, quite obviously, not a sustainable business plan. Shari Redstone said in a statement last week that "Midway's lineup for this holiday season represents an important launchpad for the company to regain market leadership." And it's worth noting that Midway recently delayed "Wheelman" and "This is Vegas" into 2009. That's actually a good sign, since a truly desperate publisher would have released those games in sub-standard form just to get the quick money. But even if all five of those titles do well (unlikely, of course), Midway still has a long way to go to get back to earning consistent profits.

If that's the company's goal, though it's not really clear how they plan to get there. While Midway borrows money and cuts back on projects (such as the recently eliminated "Career Criminal" game developed with Tony Scott at the Austin studio), Shari Redstone hasn't made any moves of note since firing CEO David Zucker back in March. Matt Booty has been interim CEO for a pretty long time now.

Are they trying to sell the company? Does Shari have some bold new plan or partnership in the works that would include an infusion of talent and capital? She hasn't done any interviews since taking over, so unfortunately we don't really have any idea. But right now, all we can see is respected publisher struggling to stay afloat.