Press of Atlantic City Wednesday, November 19, 1997 by William Ehart A very condensed version of the article is reproduced below. Contact the Press of Atlantic City for a copy of the complete article.Two former executives at the boat-building company confirmed Tuesday that the production plant at Philadelphia Avenue and Duerer Street closed Friday. All of the company's 130 employees -- including the executives -- were laid off.
With encouragement from area and state politicians, the U.S. Department of Housing and Urban Development gave Egg Harbor Yacht a $3 million loan in 1993. The loan has not been repaid.
"We are closed," former Chief Financial Officer Marita Bevans confirmed as she answered the door at the plant Tuesday. Asked if the company hoped to resume production, Bevans said, "We're just negotiating right now (with lenders). We have some legal matters we're discussing. We are not in bankruptcy." Bevans directed further inquiries to former Senior Vice President of Marketing Mark Sweeney, who worked from the company's sales office in Pompano, Florida.
"As I understand it, (HUD) swooped in (Tuesday) morning," Sweeney said. "They have taken control of the building and its contents."
A group called Marine Acquisitions acquired the company 18 months ago for all debt and no equity, according to Sweeney. The level of debt turned out to be so high the company couldn't continue operations -- even though it had orders for more than 18 boats, he said.
Egg Harbor Yacht's debts are approximately $10 million, Sweeney said.
Just 11 days ago, Sweeney, who was based in Pompano, had told The Press that the company had resolved its financial difficulties and was "off and running" with a surge of new orders.
In 1993, New Jersey became one of the first states to obtain HUD funding on behalf of its industries under the recently expanded federal Section 108 loan program. The program was designed to provide jobs for low- and moderate-income workers in rural and small communities. Egg Harbor Yacht was one of the first companies to apply for such a loan.
Copyright (©) 1997 South Jersey Publishing Co.