PROVIDENCE, R.I. (WPRI) - Former Red Sox ace Curt Schilling pleaded for additional state assistance on Wednesday morning at an emergency meeting the R.I. Economic Development Corporation held to discuss its $75 million loan guarantee for 38 Studios, Schilling's video-game company.
The EDC board took no immediate action to aid 38 Studios after hours of closed-door meetings but "asked many probing questions," the agency said in a statement. Chafee said the state is still trying to decide whether it's worth risking more to help the company. Officials declined to specify what assistance the company sought.
Schilling hurriedly left the meeting around 12:30 p.m. after briefing the board along with other 38 Studios executives. He declined to answer questions from a throng of reporters as he left, saying: "My priority right now is to get back to my team." 38 Studios has yet to make any public statement on the developments.
38 Studios still has the option of making an overdue $1.125 million payment that was due to the EDC on May 1, which would "cure the existing default," the agency's statement said. Chafee, who said he would have preferred the discussions to take place in public, said the question is: "How do we avoid throwing good money after bad?"
The EDC board will continue discussing 38 Studios' situation at its regularly scheduled meeting on Monday at 5 p.m., and in the meantime "will continue to talk with 38 Studios and develop additional information," the agency said, adding that board members are not allowed to discuss what they heard in the private session.
38 Studios CEO Jennifer MacLean is on a leave of absence from the company that began in mid-March which is unrelated to the company's current problems, a person with direct knowledge of the situation told WPRI.com. MacLean joined 38 Studios in March 2008 and got the CEO job in August 2009.
The meeting on Wednesday comes nearly two years after the EDC gave 38 Studios a $75 million loan guarantee and two weeks after the company failed to make the $1.125 million payment .
Chafee said Tuesday that while he was strongly opposed to the EDC granting the loan guarantee as a candidate in 2010, he is now "a cheerleader" for the company and is trying to help it survive because taxpayer money is at risk. The EDC said $12.8 million from the $75 million was put aside in case of a default.
So far, 38 Studios has received $49.8 million of the $75 million in loan proceeds, according to bond documents obtained by WPRI.com. The governor said he doesn't know if the game 38 Studios is supposed to create in Rhode Island is on schedule.
It's unclear what if any action the EDC board could take to help 38 Studios. House Speaker Gordon Fox said Tuesday there's been some talk of using state tax credits to bolster the company's cash flow, though he cautioned that he was not sure of the details.
Chafee tried not to criticize the $75 million loan guarantee on Tuesday but did express reservations about its size. "Well we had a very generous proposal that 38 Studios took advantage of," he said. "Now we're in some difficulty with that. Very generous proposal."
The former governor who supported the 38 Studios deal, Donald Carcieri, has not responded to requests for comment on the situation. Speaker Fox said Tuesday he has no regrets about helping to push through the new $125 million loan-guarantee program used to assist Schilling's firm.
38 Studios released its first game - "Kingdoms of Amalur: Reckoning" - in February to solid reviews and sales. But Rhode Island is funding its second game - tentatively named "Project Copernicus" - and the company has yet to offer details about it or schedule a release date.
Sean Daly, Walt Buteau, Nancy Krause and The Associated Press contributed to this report.
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