from Bulletin Board
A $1.8 million loan from the
state Agriculture Department is
in limbo and hasn't been awarded
Ceatech USA Inc., which hasn't had a profitable quarter since its inception in 1995, was delisted yesterday by the Over-the-Counter Bulletin Board for failing to submit an independently reviewed quarterly filing with the Securities and Exchange Commission.
The delisting is effective today and Ceatech's shares will be available for trading only on the Pink Sheets, which doesn't require SEC filings for a stock to be quoted. The stock also is being dropped from the Bloomberg Honolulu Star-Bulletin index due to noncompliance with SEC filing requirements.
Ernest Dias, president and chief operating officer of Ceatech, and Chairman Gordon Mau didn't return phone calls.
Kevin Yokoyama, acting loan division administrator for the state Board of Agriculture, also said yesterday no money from a previously approved $1.8 million loan has been dispersed to the company because the Kauai shrimp producer hasn't yet demonstrated it has met loan conditions. Those criteria include obtaining loan guarantees from Ceatech's major shareholders and meeting financial and performance guidelines. Half of the loan amount is required to be drawn by the end of the year or the Agriculture Department can lend it to other applicants. All the money must be dispersed by June 2004.
Among performance benchmarks that must be met for the three-month period prior to initial loan disbursement are sales of no less than $1.2 million, an operating loss of no more than $425,000 and a total shrimp harvest of at least 250,000 pounds. In its last quarter, Ceatech had sales of $512,816, an operating loss of $1 million and, although it didn't break it out for the quarter, said its shrimp harvest for the six-month period ending July 31 was 80,000 pounds less than the same six-month period a year earlier.
Ceatech is seeking the state money to build as many as 20 more shrimp ponds on Kauai to augment the 40 ponds it cultivates now.
Although Ceatech turned in a quarterly report for its fiscal second quarter that ended July 31, the company noted in the filing that the report had not been reviewed by independent accountants. The SEC requires quarterly filings to be reviewed and annual filings to be audited.
Edward Foley, chief financial officer and executive vice president at Ceatech, resigned his position Sept. 19 while the company's auditor, Pricewaterhouse Coopers LLP, resigned July 28. Ceatech said in its most recent filing that it has not hired an independent accountant.
In last quarter's unreviewed filing, Ceatech reported a loss of $737,419 that increased its losses since inception to more than $12 million.
Ceatech, which had its ticker symbol changed to CEAHE from CEAH after being given a 30-day warning from the OTCBB, had until yesterday to regain compliance. The stock, which has only traded on three days in the last six weeks, was unchanged yesterday at 30 cents on volume of 3,610 shares -- nine times its daily average over the last six months.
A OTCBB spokesman said yesterday that Ceatech could regain its listing if it qualifies for an exemption or if it makes the required SEC filing.