 
AAI Reaches Agreement with General Contractor
on World Trade Center Contract
July 30, 2012
by Penny Stacey, pstacey@glass.com
American Architectural Inc. (AAI) and Skanska USA, a general contractor
with whom AAI had been working on the interior glass work and interior
glass railing for the World Trade Center's PATH Hall, have reached
a proposed agreement in a dispute about the subcontract. Skanska
had
motioned, as part of AAI's bankruptcy case, for the court to
order AAI to resume or reject the subcontract in an expedited manner.
The two companies now have filed a proposed stipulation agreement
noting their "desire to resolve the motion by fixing a date
certain by which [AAI] must assume or reject the subcontract and,
in the interim, establish a temporary joint check payment procedure
for the payment of trust fund beneficiaries' claims incurred from
the date hereof and to provide for the payment by Skanska to the
debtor and certain trust fund beneficiaries for work performed on
the project during the interim period." The agreement defines
"trust fund beneficiaries" as those who have completed
work as subcontractors for AAI and/or have supplied materials for
the project.
The proposed deadline for AAI to file a motion to assume or reject
the subcontract is now September 14. According to the agreement,
if AAI rejects the subcontractor, the company will be required to
provide "all materials and drawings (in CAD and PDF format)
in [its] possession for the project [to Skanska] and assign any
and all subcontracts and purchase orders as directed by Skanska
to [ensure] a smooth and orderly transition to Skanska or a replacement
contractor." In addition, the parties agree to resolve any
amounts Skanska owed to AAI (as of September 14) within 30 days.
The companies further propose that, once the court approves the
stipulation agreement, through the period of September 4, Skanska
will issue joint checks to the trust fund beneficiaries on the project
and direct checks to the debtor for self-performed work all within
a capped amount of $663,975 for work performed during the interim
period.
In its original motion to expedite the court's consideration of
the matter, Skanska had alleged that it had paid AAI $696,485 for
work completed on the project during the month of May, and that,
at the time of the motion, at least two vendors had ceased work
on the project due to AAI's alleged failure to pay them.
At press time, the court had not yet approved the stipulation agreement.
|