REBECCA Update: Millions Must Be Raised or Returned by Year's End
According to a new update from Bloomberg News, REBECCA's lead producer, Ben Sprecher, has an approaching deadline to complete capitilization for the musical, or to return the raised funds - some of which have already been spent.
Bloomberg reports that "If Sprecher doesn't raise the minimum $12 million capitalization by year-end, he must return money "forthwith" to any investors who haven't waived their right to a refund, according to offering papers obtained from the office of New York Attorney General Eric Schneiderman through a Freedom of Information Law request. Sprecher has said he's talked to investors about amending the offering papers. He declined to comment for this story. His co-producer, Louise Forlenza, didn't return an e-mail."
They also note that the production has spent $1.3 million to date on items including scenary, production costs, and salaries. Previous reports hat pegged the amount of funds spent at closer to $6 million. They have until December 31 to raise the remaining funds to get the show up, or they will face having to return the spent funds to the show's investors.
Click here for the Bloomberg story.
As BroadwayWord previously reported, following REBECCA's cancellation on Broadway and the news that financier and stock broker Mark C. Hotton was arrested and called 'a considerable threat' to the community, he is now awaiting trial. Hotton was arrested for defrauding the show's producers of $60,000 and for an unrelated $750,000 real estate scheme which prosecutors said featured some of the same deceptions used in the REBECCA fraud. To read the full 19-page criminal indictment on Hotton, click here.
In October, producers filed a $100 million fraud lawsuit in state Supreme Court against Mark C. Hotton, a former stockbroker from Long Island on whom they were relying to raise $4.5 million of the show's $12-million budget. For his criminal trial, Hotton faces 20 years for each of two counts of wire fraud, if convicted.
Earlier in October, Ben Sprecher and Louise Forlenza, producers for Rebecca, the Musical, announced that they were left with no option but to postpone the show. They released a statement at that time, noting that "After Paul Abrams, a major investor, passed away in London, on August 5th, 2012, and who, with three other colleagues, represented the last portion of $4.5 million of the full capitalization for the production... On September 28th, Sprecher and Forlenza were informed that an extremely malicious e-mail, filled with lies and innuendo, had been sent directly to a new investor that morning from an anonymous third party. The e-mail was designed to scare this investor away and it succeeded. The investor withdrew."
Ronald Russo, lawyer for producer Ben Sprecher has since said that "Sprecher had been led to "Abrams" by shadowy Long Island businessman, Mark Hotton, who told him Abrams died before he could hand over the dough, sources have said. There also were three other investors Hotton told Sprecher about who supposedly promised another combined $2 million for the show, the sources have said. But "following an extensive search over the last week, I can now confirm that there is no evidence whatever that "Paul Abrams" or any of the other three investors brought to this production by Mr. Hotton, ever existed," said Sprecher's lawyer, Ronald Russo. The lawyer said they conducted an investigation in both the US and England."
REBECCA, the new musical based on the classic novel by Daphne Du Maurier novel, previously delayed the start of its rehearsals by two weeks due reportedly to the death of a key investor responsible for a $4.5 million investment pool in the production. REBECCA was scheduled to begin rehearsals Monday, September 10 prior to an October 30 first preview and November 18 premiere at the Broadhurst Theatre.