Moon River Studios has announced it will make a documentary on legendary singer James Brown even as the company hits some hard deadlines for proving to the Effingham County Industrial Development Authority that it is a viable business.
The IDA soon will consider whether to downsize the project or quit working with the startup.
FONU2, which does business as Moon River Studios, has a lease on 1,600 acres that IDA owns at Old River Road and Interstate 95.
The company, based in Rincon, on Tuesday announced it was making a documentary on Brown, which will feature concert footage from the Godfather of Soul’s last live performance. The agreement also includes shared rights on up to 16 never-before-released songs performed by Brown.
“If they want people to be excited about their announcements, they’ve got to come to fruition,” said David Harris, one of the members of the IDA board.
Moon River has signed agreements with the IDA promising to invest $20 million in the project and create 50 jobs by the end of the year. The company also said the first stages and warehouses would be operational by the end of the year.
None of those requirements will be met, according to the IDA and Jake Shapiro, chairman of the board of FONU2 (OTC: FONU).
Shapiro said Tuesday the company has fewer than 10 employees.
He has said previously that the company has streamlined grandiose plans that were pushed by its founder, Manu Kumaran, under the name Medient. Shapiro said the company has aimed at more realistic goals since the company was reorganized in February.
Chap Bennett, chairman of the IDA, said Wednesday he hopes Moon River will be able to meet its obligations, but he said some changes must be made to the agreement between the two parties.
He said a revised agreement would have to address the amount of land that is leased, the financial investment and the number of jobs.
“We’re getting at a point where we don’t have a lot of stock to put in all this stuff,” Bennett said.
Moon River reported to the Securities and Exchange Commission that it received a default notice on Sept. 3 for a $600,000 subordinated note owed to AppleBox Production. The company said in an Aug. 13 filing with the SEC that the default would be cured “shortly.” Shapiro said Tuesday the default will be addressed “in the immediate future.”
The company touted the acquisition of AppleBox as a major step in its efforts to build film production studios in Effingham. AppleBox has the equipment needed to make movies, including cameras, trucks, lights and generators. Moon River has said it will use the equipment on its own movie projects and rent it to other movie makers.
Harris said time is running out and the board has to protect taxpayers’ investment. “They can only hold us hostage so long,” he said.
The Effingham Industrial Development Authority will meet at 6 p.m. today in the authority’s board room at 520 West Third St. in Springfield.