Office Concepts of Missouri files Chapter 11 bankruptcy

Office Concepts of Missouri, an 11-year-old Kyocera Mita dealership, filed for Chapter 11 bankruptcy Nov. 5.

The firm has 16 full-time employees and leases 5,250 square feet of space in the Elfindale Center at 1701 W. Sunshine St. It subleases 800 square feet to Edward Jones.

Precipitating circumstances

Chapter 11 was considered the best option available after the corporation was brought into a protracted divorce case, said Steve Moore, president and sole shareholder of the firm.

The 4-year-old divorce case between Steve and Martha Moore "precipitated the Chapter 11," said Moore's attorney, David Schroeder of David Schroeder's Law Offices.

Moore's preoccupation with that situation "had an adverse effect on the business," Schroeder said. "Some of the basic formulas became out-of-ratio and that created, obviously, a domino effect with some of the company's creditors.

"Chapter 11 was filed to orchestrate and stabilize the business ratios and separate the domestic issue from the business operation."

Brad Tuck, of Tuck & Lukachick PC, attorney for Office Concepts, said: "The wife has alleged that the business was a marital asset. As such, it was dragged into the divorce. Unfortunately, the litigation cost of the divorce, for the most part on both parties, has drained the asset that is the most valuable."

The business was launched after the marriage, Tuck said. "It's a situation where the ownership will most likely vest in the husband, and that is what the wife is fighting for."

John Pratt, attorney for Martha Moore, said, "we have joined Office Concepts as a party to the dissolution" but declined further comment.

Balance sheet

Office Concepts has debts of $1,114,432, including $845,922 in secured claims, $24,915 in unsecured priority claims and $243,915 in unsecured nonpriority claims, according to the filing.

Great Southern Bank holds the lion's share of debt at $720,736, which included a promissory note, a U.S. Small Business Administration loan and commercial security agreement.

Behind it is Kyocera Mita America Inc. with debt of $70,841 and General Motors Acceptance Corporation at $54,345.

"Since the filing, the company has entered into an agreement with its secured lenders for continued operations in the normal course of business," Schroeder said.

"It's also entered into an agreement with the manufacturer that supplies the machinery equipment supplies," Schroeder added.

Office Concept's assets stand at $728,940 and include, in part, $121,885 in accounts receivable, $157,446 in notes receivable for the financing of copiers and equipment, 11 vehicles valued at $199,222 and office equipment worth about $200,000.

Continued operations

Moore said schools and education services are the main business among his 3,000 clients, with law firms also figuring prominently.

In addition to selling copiers and digital printers, the firm also provides services and supplies to support these products.

"We do in the sales of equipment and service of supplies in excess of $250,000 a month," Moore said.

"There's no real ups and downs in the business at all" since budget cycles vary with the clientele he has, Moore said. As such, he contemplates no interruption or decline in business activity.

"People have money to spend at the end of the year or else they lose it in their budgets for the next year, " Moore said. Some "people can't spend in the fall, they've got to wait to January (or) February when their new budgets kick in. And then the schools, they're on a fiscal year beginning July 1, so you've got them buying throughout the year."

Restructuring

"The reorganization plan is due, I believe, the first part of March and we anticipate it will be timely filed and customers shouldn't anticipate any interruption of service or product or anything else," Schroeder added.