Chemical additives manufacturer American Nano Silicon Technologies Inc. says it does not currently have the money to pay $13.5 million in loans due in 2014.

The Sichuan, China-based company manufactures nano-technology chemicals. American Nano’s main product is micro nano silicon, an ultra-fine crystal that can be used as an additive for different purposes in detergents, cement, rubber, plastics and paint. The product is meant to replace more expensive and less environmentally-friendly additives in those products, the company says.

American Nano’s auditor raised substantial doubt about the company’s ability to continue as a going concern, or without the threat of liquidation, because of American Nano’s negative cash flows, according to a Jan. 24 filing with the U.S. Securities and Exchange Commission. The company has about $13.5 million in loans due in 2014, but cash from operating activities won’t be enough to pay the loans, according to the SEC filing.

The manufacturer needs more money to continue operations, which it expects will be provided by its president, Pu Fachun – who would either personally provide the loans or secure them from third- parties. Fachun’s abilities to provide enough funds are not certain, the company says.

The company’s assets and liabilities have both increased. Assets, between Sept. 30, 2012 and 2013 increased from $418,637 to about $1.3 million, respectively, while liabilities during the same time period increased from $8.4 million to $14.6 million, respectively.

American Nano is currently working on developing more uses for micro nano silicon through a research and development agreement with the China Academy of Science, and Southwest University of Science and Technology. The company only produced additives for detergents until 2013, when manufacturing operations were moved to a new facility that allowed the company to expand its product offerings to include flame-retardant products. Because of the manufacturing period, the company’s revenues and production decreased.

The company faces competition from other chemical suppliers that have greater name recognition and resources. American Nano is also unsure that using micro nano silicon as a flame-retardant additive will gain market acceptance, it says in the SEC filing. “Our market is uncertain; new customers will have to be secured.”

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