NEW YORK — Cinergi Pictures Entertainment Inc. finalized a settlement on “Broadway Brawler,” it said in an SEC filing Wednesday, recouping the $14.8 million it invested in the pic, which shut down unfinished in February.
News of the settlement came in an SEC filing on Cinergi’s first quarter result, which showed that the indie’s losses rose sharply to $5.1 million, up from $637,000 a year earlier. Cinergi is preparing to liquidate and has agreed to sell its film library, except “Die Hard With a Vengeance,” to Walt Disney Co.
Cinergi said in Wednesday’s SEC filing that it settled the “Broadway Brawler” discussions May 15, when it was paid $11.8 million for the rights to the now abandoned film, which were transferred to “a performer in the film and an affiliate of such individual.” Cinergi also won’t have to repay $3 million in production advances to Disney related to the pic, it said in the filing.
The indie did not identify the performer, but it is believed to be Bruce Willis, who initiated the shutdown of the pic. Daily Variety reported March 13 that Willis was willing to pay the $14 million owed on the film and that Disney would put up the cash and take it out of Willis’ fees on two pics he agreed to do for Disney (including “Armageddon”). Cinergi chief financial officer Warren Braverman refused to comment.
Cinergi said it used most of the cash it received to pay off bank debt related to the production. Cinergi stock rose 9¢ to 78¢ Wednesday.
Cinergi blamed its higher quarterly loss on a 138% increase in its overhead, to $3.5 million, and higher interest expense. Cinergi said these costs rose because, with no films in production, the indie has to write off all its overhead and interest costs against earnings rather than allocating a portion of the costs to the film investment as it has done in the past.
The overhead reduced Cinergi’s cash reserves by about $2 million in the quarter to $25.4 million. Braverman would not comment on whether the overhead would be reduced in coming months.