 
American Architectural Inc. Motions for Authorization
of Sale of Company's Assets Via Auction
September 7, 2012
by Penny Stacey, pstacey@glass.com
American Architectural Inc. (AAI) has requested permission from
the U.S. Bankruptcy Court for the Eastern District of Pennsylvania
to sell its assets, including several outstanding subcontracts,
via an auction process. The motion was filed as part of the company's
ongoing Chapter 11 bankruptcy case, filed
in June.
According to the motion, the company had a backlog of approximately
13 subcontracts, with revenues in excess of $29 million, at the
time of the bankruptcy filing. Seven of the projects have been completed,
leaving six "that have work to be performed and will be available
for sale at the auction." Among these is a $7.1 million project
at Carnegie 57 in New York; a $3.9 million project at One World
Trade Center; a $15.4 million on the Cablenet at One World Trade
Center; a $6.2 million project at the World Trade Center Path Hall;
a $3.8 million project at World Trade Center Tower 4; and a $685,000
project on the World Trade Center Path Hall Elevator.
The company previously had been in negotiations
with general contractor Skanska USA about the Path Hall project.
"[AAI] has analyzed the cost of completing the subcontracts,
the lack of adequate financing for the completion of all of these
projects, the inability of [Diamond Indemnity Trust] to provide
financial assistance under the surety bonds, and the overall existing
debt, and have determined that a prompt sale of the assets as a
'going concern' is in the best interest of the debtors and their
estates," writes AAI in the motion.
Company officials say the only items not up for sale are its cash,
pre-petition litigation claims, and claims under Chapter 5 of the
bankruptcy code
"The debtors also believe that offering the assets for sale
at the auction will greatly enhance their ability to reorganize
the affairs," continues the motion.
If the auction is approved and held, AAI officials say they intend
to file a plan (upon the closing of an asset sale) for distribution
of the proceeds from the sale.
At press time, the court had not yet ruled on the motion.
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