North Meridian Hardware is facing financial difficulties and is seeking to reorganize assets under the protection of bankruptcy.
The independently owned store that opened in March 2012 at 1433 N. Meridian St. gives downtown’s growing population a second option to shop for home-improvement items. Fusek’s True Value opened on East New York Street in 2004.
But North Meridian Hardware’s bid to reorganize already is facing a challenge—from its own bank.
Muncie-based First Merchants Bank wants the bankruptcy dismissed and instead is seeking to liquidate the store’s inventory. The bank claims store ownership owes it $295,311, including interest and attorneys’ fees, and hasn’t made a payment in two years.
First Merchants had sought a court-ordered receiver to liquidate the store’s inventory two days before store owner Keith Payne filed to reorganize on July 29, according to court documents.
“The timing of debtor’s filing of the bankruptcy clearly demonstrates that debtor filed the instant case for the sole purpose of evading the effects of the receiver order,” First Merchants wrote in an Aug. 5 filing asking that the bankruptcy be dismissed.
Payne told Property Lines he had no choice but to file for reorganization to stave off the bank’s aggressive attempts to liquidate his inventory. He also said he presented a payment plan to the bank that it rejected and hopes to repay the lender within the next six months.
“It’s going to be a very pointed intent to make sure we take care of them quickly so I can pay them off,” Payne said.
At any rate, Payne said he has no plans to close the store.
The dispute stems from a $250,000 loan First Merchants gave North Meridian Hardware in February 2012. According to court documents, the bank claims the hardware store has paid just $4,000 in principal.
North Meridian Hardware occupies 7,500 square feet on the first floor of the two-story building that Payne bought from Metropolitan Indianapolis Public Broadcasting Inc. It used the building to house part of WFYI's staff until the station moved to a new headquarters in 2008.
Payne, an Indianapolis native, also owns also owns Affordable Building Supplies LLC at 55 S. State Ave. on the near-east side