CHATTANOOGA, Tenn. (BRAIN) — Titanium frame maker Lynskey Performance Products, LLC, filed for Chapter 11 bankruptcy protection on April 30, saying the cashflow challenges after launching an e-commerce business with Shopify contributed to its troubles.
Unsecured debts are owed to industry suppliers including Cane Creek Cycling Components ($12,600), Full Speed Ahead ($162,000), and SRAM ($108,000), as well as industrial suppliers, shipping companies and a credit card company.
As of Wednesday, the company had not filed a list of secured creditors with the court. On its initial petition, it listed estimated assets at less than $50,000 and estimated liabilities between $1 million and $10 million. The company had about 31 employees at the time of its filing.
According to court filings by the company, the company's woes beganwhen co-founder and managing member David Lynskey’s health began to decline.
It said the decision to use Shopify to develop e-commerce sales led to the bankruptcy. “With reduced cashflow, the Debtor began falling behind on order fulfillment as it was unable to purchase components for same. Furthermore, supplier invoices began and accumulating and Shopify instituted arbitrary reserve deposits and egregious chargebacks for delayed orders, to the tune of at least approximately $550,000.00 within the 90 days prior to the filing of the Debtors Bankruptcy Petition," reads a company profile filed with the bankruptcy court.
A meeting of creditors by telephone is planned for June 2. The deadline to submit claims is August 28.
The Lynskey family had operated a machine shop for decades before founding the Litespeed titanium bike business in 1986, then sold Litespeed in 1999, before opening under their own name in 2005. Litespeed, owned by the American Bicycle Group, is still based in Tennessee.
