American Film May File Chapter 11 Bankruptcy
American Film Technologies Inc., a troubled North Hollywood producer of animation and special effects for movies and television, said Monday that it is temporarily suspending operations in Mexico and has significantly reduced its business in the United States.
Moreover, American Film said it consented to a 45-day court order in which the company is prohibited from transferring or encumbering assets except in the ordinary course of business. The company also said it is considering seeking protection under Chapter 11 of the U.S. Bankruptcy Code.
These steps were taken despite a recent announcement that New York attorney and investment banker Gerald M. Wetzler would acquire 75% of American Film for about $3.3 million. That agreement remains in effect, the company said, but the deal has not yet taken effect pending due diligence.
Also Monday, trading in the common stock of American Film was temporarily halted by NASDAQ at the company’s request.
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