An Ulster County contractor that says it is earning a 20% gross profit margin on current projects is citing a series of setbacks that put it into bankruptcy.
Dynamism LLC, Kingston, has about $391,000 in assets and $952,000 in liabilities, according to a balance sheet included with a Chapter 11 bankruptcy petition filed on Sept 8 in U.S. Bankruptcy Court, Poughkeepsie.
The company was formed in 2016 by architect Michael Lockwood and draftsman Joshua Thibault. The two-man firm designs and builds commercial and residential buildings and subcontracts the work, Lockwood, the president, states in an affidavit.
But in 2018 it began experiencing financial problems, “following a client dispute that resulted in non-payment for completed project work,” according to Lockwood. Dynamism had to borrow money to keep operating.
Then an estimator hired for a project submitted incomplete and inaccurate bids, and the project manager made costly “layout mistakes” that had to be corrected. As expenses accumulated, Lockwood says, the firm was unable to pay taxes or repay high-interest loans.
Dynamism owes Titan Funding LLC2 $172,616; the U.S. Small Business Administration, $159,733; Pinnacle Business Funding, $70,835; Ulster Savings Bank, $50,000; and New York Department of Labor, $13,706.
The firm is working on seven projects worth $4.9 million and for which $1.1 million is still owed. It is negotiating new deals that could generate more than $1.9 million.
Lockwood stated that the firm expects to break even in September, with projected revenues and expenses of $212,728.
Dynamism is fighting Williams Lumber Inc., Rhinebeck, in a lawsuit filed this past July in Dutchess Supreme Court. Williams claims that Dynamism owes $109,547 for building materials. Dynamism denied the allegations in a formal answer filed on the same day it filed for bankruptcy protection.
Now Dynamism plans to operate without employees.
“As owners, we will personally develop estimates and manage projects,” Lockwood states in the affidavit. “We will incorporate additional financial contingencies into our estimated costs to absorb potential losses during construction.”
