SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
October 20, 1998
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Date of Report (Date of earliest event reported)
CONTROLLED ENVIRONMENT AQUACULTURE
TECHNOLOGY, INC.
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(Exact name of registrant as specified in its charter)
Colorado 0-25868 84-1293167
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(State or other (Commission I.R.S.Employer
jurisdiction File Number) Identification No.)
of incorporation)
Airport Industrial Park
3375 Koapake Street, Suite H402
Honolulu HI 96819
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Address of principal executive offices) (Zip Code)
(808) 836-3707
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Registrant's telephone number, including area code
7 Waterfront Plaza, Suite 400
500 Ala Moana Blvd, Honolulu, HI 96813
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Former name or former address, if changed since last report
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ITEM 5. OTHER EVENTS
On October 20, 1998, Ceatech Plantations, Inc., a wholly owned
subsidiary of the Registrant, executed a loan agreement with Bank of America,
Bank of America Community Development Bank, of Rancho Cordova, California,
for a $3.0 million loan. The loan is structured as a one-year construction loan
converting to a seven-year term loan. Proceeds from the loan will be used for
construction of additional facilities at the Kekaha Agricultural Park in Kekaha,
Kauai, Hawaii, and the Company currently believes that the proceeds of the loan
will be sufficient to enable it to complete construction of fifteen additional
one-acre growout ponds and a 4,800 square foot warehouse building.
During the construction phase, the Registrant may make draws based upon
progress and inspections, and although interest will accrue, no payments are
required to be made. At the end of one year, or upon completion of construction
(in the event construction is completed in less than one year), the loan will
convert into a seven-year fully-amortizing term loan requiring monthly payments
of principal and interest.
During the construction period and for the first two years of the term
loan, the interest rate is based upon a specified margin over the Prime Lending
Rate of Bank of America. Beginning on September 9, 2001, the Registrant may
elect to change the terms of the loan to have the interest rate based upon a
specified margin over the current rate on one-year Treasury Notes. The Company
anticipates that such an election is likely to result in a reduction of the
applicable interest rate on the loan.
The Rural Development Agency of the United States Department of
Agriculture has provided Bank of America with a 90% loan guarantee. In
addition, the Registrant and its subsidiaries have pledged substantially all of
their assets, including all inventory and accounts receivable, as collateral for
repayment of the loan.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONTROLLED ENVIRONMENT AQUACULTURE TECHNOLOGY, INC.
/s/_________________________________________________
Ronald Ilsley, Chief Financial Officer
December 11, 1998
