Club 7 Fitness – Sarah and I walked away with $20 and stand to receive nothing on the sale of the business

To all Club 7 family members:
Sarah and I wanted to reach out to update all of you on where things stand with Club 7 Fitness. As all of you know, we had to cease operations abruptly and close down Club 7 on October 3rd. The closing was caused by the club’s inability to renew its business license because of owed taxes. We’ve been working with the Department of Revenue for over 2 years trying to resolve this matter. A large portion of this debt we inherited after buying out our partners during the time we were being audited. The state concluded that the previous accounting firm we had hired ended up calculating our sales tax incorrectly in the years 2008, 2009 and 2010. We’ve paid a substantial amount of money towards these back taxes the last couple of years and remained in constant communication with the DOR expressing our desire to pay all taxes owed including all the backdated penalty and interest they tacked on. The DOR had recently made some budget cuts making it difficult for us to make progress in negotiations as it took days to get a call back and any meetings had taken place in Jefferson City which my lawyers and I made several visits in good faith. After lengthy meetings and over the phone conferences, the department corrected all filings which they had applied incorrectly and calculated the correct amounts owed. Finally giving us what we needed to resolve this matter. I had worked on the financing package for over a year with several private lenders finally narrowing it down to two individuals which I had lending relationships with in the past. The commitment to fund this had been in place for months prior to my September 30th deadline. You can understand my dismay when at 4:30 pm on September 29th I was told that one of the individuals receded and could no longer participate. We were devastated. I pleaded with the DOR for an extension, but was denied. They obtained the judgment for me to cease and there was nothing I could do. Had I stayed open I would have been arrested and held in contempt. I tried vigorously over that weekend to find an alternative lending source but was unsuccessful. Friends this is far more detailed than you care to know, but I felt that we owed all of you that, this was as big a shock to Sarah and I as it was to you. What we put our whole life into for 8 years, was destroyed in one day. We apologize for letting you all down, we did all we knew to do.
Now to the business at hand, again Sarah and I never saw this coming and were not prepared for any of this. We continued to negotiate with our landlord and interested parties in resolving these matters quickly so that our Club 7 members would be taken care of. Sarah and I walked away with $20 and stand to receive nothing on the sale of the business. Our only concern is that our prepaid members are compensated for time paid and the last payroll is covered for staff. These negotiations have taken far too long. I think the problem is the parties looking into taking over have little industry experience and are concerned with the amount of capital needed to fund this type of operation successfully the fact that negotiations continue, and there is the possibility of the club not reopening at all I want to reiterate that all members and staff alike will be taken care off. The good news is that paid in full memberships were not emphasized unless the client insisted on that method of payment. The challenging part for Sarah and I is that for 8 years we drew a very small salary in hopes that one day we’d have a financially solid club with minimal or no debt. And unfortunately, we were unable to reach that point. So in lieu of the club opening under new ownership and honoring any time left for Club 7’s paid in full members (the manner in which this is usually done) Sarah and I intend on personally refunding the monies owed to the members in time. I don’t know the exact time frame on when we will have resources available, we but it will top priority to us until this issue is resolved, it’s the right thing to do. Sarah and I always valued each one of our members and we sincerely appreciate the support you’ve shown us thru the years, we never took that for granted. So no matter how hard it is for us to do or no matter how long it may take us, we are committed to see this through. We became friends/family with many of you and those relationships will always be treasured. We hope in some way we made a positive difference in your lives. We apologize for any inconvenience or stress this may have caused you. It was outside of our control and should have never happened like it did. Please continue to have patience with us as we are trying to get back on our feet personally and get our family thru this devastation. We plan to start reaching out to our paid in full members here soon to confirm the amount owed. And then once funds are available, we will personally contact you to arrange a payment. Again, thank you for allowing Sarah and I time to resolve this,

Lastly, I do apologize for the time that has lapsed since my last communication. We were nervous to post anything because things were constantly changing; We were left in a state of shock and disbelief (we still are), we just never imaging having to dismantle Club 7 in this fashion. I do stress, your continued patience and grace is appreciated and necessary during this time. No one will be left out, all members will be made whole.

Sincerely Matthew and Sarah Inman
  • Phone number(s)(816) 229-8585
  • Location(s)1241 SW State Route 7, Blue Springs, Missouri64014
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