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The State Journal- Register (Springfield, IL)
The owner of Gold's Gym Inc. of Springfield vowed Monday to keep the fitness center alive after filing for voluntary bankruptcy reorganization.
Maureen Suhadolnik said a series of financial setbacks - including the 2012 failure of Crazy Horse Concrete, another Suhadolnik company - forced the Chapter 11 filing on Friday.
The gym at 1600 Clear Lake Ave. opened in 2005.
"This will allow time for a company reorganization," Suhadolnik said in a formal statement, "and also enable a number of mechanisms for us to use, in order to successfully restructure the business side of the club and move forward."
Suhadolnik said operations and memberships would not be affected.
The petition filed in the Central District of U.S. Bankruptcy Court indicated debts of $1 million to $10 million on assets of no more than $50,000. Mortgage-holder Illini Bank of Springfield was listed among the 20-largest creditors at nearly $4.5 million, including $2.5 million in secured debt, according to the bankruptcy filing.
Another $406,000 in unsecured debt claimed by the Central State Pensions Fund of Des Plaines was listed as "disputed." The Internal Revenue Service, Illinois Department of Revenue and Sangamon County Treasurer's Office were also listed among creditors.
Gold's Gym is part of a Dallas-based franchise that operates more than 650 locations in 37 states and 28 countries, according to the corporate website.
Suhadolnik said fallout from the 2012 foreclosure and shutdown of Crazy Horse Concrete contributed to financial problems at Gold's Gym. Crazy Horse Concrete had provided collateral for the Gold's Gym loan. The shutdown of Crazy Horse Concrete resulted from the down housing market and recession, according to Suhadolnik.
Illini Bank also held the mortgage on Crazy Horse and later sold the business and assets at auction.
Suhadolnik said she decided to file for bankruptcy protection after she was unable to get new financing with new investors.
Increased local competition - including from national franchises Planet Fitness and LA Fitness - was not a factor, according to Suhadolnik. She said membership numbers held up well despite the economy.
"The majority of people still don't work out at health clubs," said Suhadolnik, "so there is plenty of business to go around. However, the Springfield market certainly does have a lot of clubs for this size town."
She said the gym has 35 to 40 employees, when contract-trainers are included.
Several outside organizations also use Gold's Gym, including the Springfield Basketball Association men's league. The Andre Iguodala Youth Foundation, named for the Springfield native and NBA star, holds a summer youth basketball camp at the gym.
Suhadolnik said Benedictine University at Springfield and Robert Morris College also use the facility for basketball and volleyball practice.
She said while a series of financial reversals - including the 2005 bankruptcy of Construx of Illinois, operated by her husband, Mike - have been difficult, she is confident Gold's Gym will emerge from bankruptcy stronger.
"Gold's is my life, my passion, my dream," said Suhadolnik. "I want nothing more than for it to succeed."
An initial meeting of creditors has been scheduled for May 2, according to court documents.
Contact Tim Landis: 788-1536, email@example.com, twitter.com/timlandisSJR.