Cash-strapped Carolco Pictures is trying to sell its interest in the big-budget film "Showgirls" to Metro-Goldwyn-Mayer so it can fund another big-budget film, "Cutthroat Island," documents filed Monday with the U.S. Securities and Exchange Commission show.
The documents reveal that Carolco's cash situation is precarious and that several steps to ease its liquidity crunch must occur if the company is to have sufficient money for "Cutthroat Island."
The company said that if it cannot achieve its goals, it will probably be forced to stop production of "Cutthroat Island" and "Showgirls." It also suggested that if it cannot pull the financing together, it will be unable to meet its other obligations and "may be unable to continue to operate as a going concern."
Sources say Carolco missed a payment Friday to actress Geena Davis, who is scheduled to star in "Cutthroat Island." A Carolco spokesman did not return telephone calls.
"Cutthroat Island" was to start shooting this month. The pirate adventure is to be directed by Davis' husband, Renny Harlin. Matthew Modine was tapped as co-star after Michael Douglas dropped out of the production, reportedly over script problems.
Carolco said it has reached agreement on a production loan for "Cutthroat Island" with a group of lenders that includes the French bank Credit Lyonnais, but it said it lacks a completion bond to guarantee against budget overruns. Sources said a new script reflecting a new budget is being submitted to the bond company.
Carolco said it is funding pre-production of "Cutthroat Island" and "Showgirls" out of its own pocket. At the rate of spending, with even more expenses looming, "Carolco will face an extreme cash shortage" and "will be unable to complete either film" if it continues shelling out money, it said.