24 Hour Fitness has closed an out-of-court deal to tackle its fast approaching debt maturities and pad working capital needs, according to 9fin sources.

The fitness chain raised a new $30m revolver and $275m first lien term loan from private credit lender TCW, sources said. Proceeds will help refinance its debt maturing this year, including a roughly $76m super priority loan due September and around $223m term loan due December.

Piper Sandler has been gauging financing and strategic interest on behalf of the company, as reported last September. 24 Hour Fitness went through a turbulent period since it emerged from bankruptcy late 2020, first hit by Covid-driven lockdowns and then market volatility and surging interest rates.

Certain existing post-reorg owners including Monarch Alternative Capital provided bridge financing in the form of super senior debt to help the company weather the storm, sources said. Those claims have been converted to equity as part of the refinancing deal, they said.

The fitness chain is expected to grow its earnings and membership count this year, as it is a relatively affordable gym option, not impacted by the ongoing trade wars, and is focused on accommodating workouts that are seeing popular demand in its existing locations, sources said.

S&P analysts wrote in February that 24 Hour Fitness’ performance and memberships have begun to recover from its pandemic lows, with revenues likely to grow a low-single-digit percent over the next 12 months.

The company's bottom-line swung positive after cost-cutting measures and increased efficiencies, though its liquidity remained thin, according to S&P.

Monarch, Sculptor Capital, and Cyrus Capital Partners were among creditors who took control and gained board seats out of 24 Hour Fitness’s bankruptcy in 2021. The holders have been supporting the company’s liquidity through PIK interest and new loans, according to Moody’s downgrade in January.

Representatives at 24 Hour Fitness, Piper Sandler and TCW didn’t respond to requests for comment. Monarch declined to comment.