An executive for 38 Studios said he was concerned about adequate funding for the development of the company's multiplayer online game, according to an internal email obtained by NBC 10.
Weeks before a Rhode Island Economic Development Corp. board's vote to award $75 million in bonds to the video game company, Tom Zaccagnino from 38 Studios wrote in an email dated July 1, 2010, "I really do not think we should highlight the fact that we might be undercapitalized." He went on to say that it wouldn't go over well with staff or board of directors.
The $75 million in bonds sold to bring 38 Studios to Providence were approved by the state's EDC.
The state's lawsuit contends principals in the deal knew the proceeds of the bond deal were not enough to take the company to completion of the massively multiplayer online role-playing game it was calling Project Copernicus.
Documents from the case hint at some of the knowledge.
Former Rhode Island Economic Development Corp. Director Keith Stokes said he understood of the bond money that, "it would be sufficient," according to an affidavit.
Former Gov. Don Carcieri also said he considered "the proceeds of the EDC loan would be sufficient to fund the so-called MMORPG game (Project Copernicus) to completion."
However, EDC lawyer Robert Stolzman said Carcieri specifically said that undercapitalization and sales of the game were two risks that the EDC faced.
Once the bonds were sold, $23 million was held to help repay the loan, leaving 38 Studios with only $51,600,000 to try to get its game off the ground -- and it wasn't enough.
38 Studios went bankrupt in May 2012.