Metalforming asset sale draws objection from promissory noteholder General Motors

By Caroline Salls

Pittsburgh, Oct. 13 - Metalforming Technologies, Inc.'s proposed sale of its assets drew objections from General Motors Corp. on the grounds the sale agreement does not require the buyer to assume a promissory note to be paid to GM under an accommodation agreement.

According to the objection filed Wednesday with the U.S. Bankruptcy Court for the District of Delaware, the accommodation agreement requires Metalforming to issue a $2 million promissory note to GM in connection with its liability for steel resale purchase orders of PeCo.

"The sale motion ignores a key requirement of the sale process - the purchaser's assumption of the GM note - which has been specifically required by the court in the accommodation agreement approval order," GM said in the objection.

Metalforming, a Chicago-based automobile parts manufacturer, filed for bankruptcy on June 16. Its Chapter 11 case number is 05-11697.

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