Personal loan pay day loan

Repercussions of 9/11 were felt by businesses throughout the nation, but they nearly put Greg Casten's OceanPro Industries Ltd. out of business.

[ILLUSTRATION OMITTED]

It took an emergency loan backed by the Small Business Administration to keep the Washington, D.C., fish distributor afloat.

Casten, OceanPro's president, was at a hospital at 9:28 a.m. on Sept. 11, 2001, to attend the birth of his son. The day was a confluence of joy and sorrow.

"Things were great in 2001. In fact, Sept. 1 through 10 were probably the best 10 days my company had ever had," Casten recalls. "Then my baby was born. I walked out the door, and I said, 'Where's my business? What just happened?'"

What had happened was the temporary halt of the airline industry, which had accounted for about $1 million a year in business for OceanPro. In an immediate effort to tighten security, the airlines put a hold on all food service after the attacks.

At the same time, Ronald Reagan Washington National Airport closed indefinitely. Many OceanPro hotel and restaurant customers depended on business and convention travel flying into that airport.

"The airlines are what get people into Washington D.C.," says Casten, "No airport means no business."

Within four days, airlines had sent letters saying they were withholding payments until they knew how things were going to shake out.

It was just the kind of situation that the SBA's economic injury disaster loans were meant to address. After 9/11, the loan program was expanded to help small businesses nation-wide that suffered economic injuries as a result of the terrorist attacks.

Companies could borrow up to $1.5 million to pay bills and operating expenses. OceanPro was one of more than 10,000 businesses receiving loans totaling more than $1 billion after 9/11.

"We knew that his operations were not going to return to normal immediately," says Colleen Hiam of the SBA disaster office in Niagara Falls. N.Y. "We were able to provide needed working capital until normal operations could resume."

Casten borrowed $577,000 with only interest due the first year, followed by a 4 percent fixed rate for a 12-year amortization.

Casten had heard about the loan program while holding his newborn son and watching TV at the hospital.

"I saw the SBA come on the news and saw that they were setting up disaster relief areas, including one at National Airport. I said to my wife: 'Hold my baby!'" he recalls. "I was the first in line."

A Boston native who started selling fish out of his pickup truck in 1988, Casten knew that a break in his cash flow could be disastrous.

"In this business, if you don't pay your supplier today, he won't sell you a piece of fish tomorrow. He will take it to the next guy, even if you have done business together for years. It is very cutthroat," he says.

"There I am loading up for the weekend inventory, and suddenly the sales are gone." On Sept. 12, he had 75,000 pounds of fish on hand.

Casten worried, too, that he would be forced to lay off employees. He's down 13 employees from a high of 75 in 2001. But it could have been worse.

The disaster loan "gave us the comfort to be able to take less dramatic steps, to lay off fewer people and to keep our core business intact, because we knew we had a nice chunk of money that we didn't have to pay back for a year." says Casten.

Even with the SBA help, it has been a slow recovery. Before 9/11, OceanPro was growing 15 to 20 percent annually. It grew less than 5 percent in 2002 and 2003.

"It really took the wind out of the sails of the company for a long time," Casten says.

But he's looking ahead. He wants to expand to nearby cities and forge stronger partnerships with retailers. He wouldn't be contemplating these moves, he says, without the help of the SBA.

OCEANPRO INDUSTRIES LTD.

Greg Casten, Tim Lydon, Tony Cibel, Nick Cibel

1900 Fenwick St. N.E., Washington, D.C. 20003

(202) 529-3003

www.oceanpro.com

Year founded: 1988

Annual revenue: $30 million

Number of employees: 62

SBA-backed loan: $577,000; interest only for first year; 4 percent fixed rate for 12-year amortization

RELATED ARTICLE: About this program ...

What: Disaster loans help homeowners, renters, businesses of all sizes and nonprofits rebuild after a disaster is declared. SBA makes two types of disaster loans:

* Physical disaster loans for rebuilding and replacement of real and/or personal property.

* Economic injury disaster loans for working capital to small businesses until normal operations resume. SBA works to get on the disaster scene and process applications quickly.

How: Loans have low interest rates and long terms. SBA tailors repayment to a borrower's financial capability. For more information, visit www.sba.gov/disaster_recov/loaninfo/property.html.

Loan limits: Home loans are limited to $200,000 to repair/replace real estate and $40,000 to repair/replace personal property. Business loans are limited to $1.5 million for real estate, machinery and equipment, inventory and other physical losses. Economic injury disaster loans are limited to $1.5 million.

Story by Adam Stone