Michael Johnson: Grand Slam Track's financial woes deepen as new filings reveal $31.4 Million debt

Michael Johnson's ambitious Grand Slam Track League is facing mounting pressure as recent bankruptcy filings have unveiled the full scope of its financial crisis, with total debts now reaching approximately $31.4 million.

Since its launch, the league has been plagued by challenges, including low attendance and growing concerns over its long-term viability. These issues culminated in the cancellation of its fourth event in Los Angeles last June and a Chapter 11 bankruptcy filing in early December, which initially cited over $30 million in debt.

The latest reports provide a more detailed breakdown of the league's liabilities. Grand Slam Track owes $11.4 million to its primary financial backer, Winners Alliance, $7 million to its athletes, and another $13 million to various vendors. Compounding the issue, the league's available cash reserves are a mere $143,000, most of which is already committed as collateral to Winners Alliance.

Earlier this year, an unexpected withdrawal by an investor forced the league into a precarious financial position. It used emergency funding to pay athletes about half of what they were owed. Now, in a bid to stay operational, Grand Slam Track is seeking a $2.9 million debtor-in-possession (DIP) loan from Winners Alliance.

However, this proposed loan comes with significant strings attached. According to the filing, the DIP loan carries a high 14.5% interest rate and includes special protections for the lender. A portion of the league's existing debt would also be "rolled up" into this new loan, granting Winners Alliance priority status for repayment.

The league has outlined a 13-week budget projected through March 2026. This plan allocates $1.5 million for operating costs like payroll, marketing, and legal fees, with an additional $1.5 million earmarked for professional and restructuring expenses. After exhausting its cash and the DIP loan, the league anticipates having just under $13,000 remaining—a sum it hopes will be enough to keep the lights on.

The bankruptcy filing was partly prompted by threats of involuntary bankruptcy from vendors. The league's efforts to secure new investors were largely unsuccessful, hindered by its fledgling status, lack of a proven operational track record, and uncertainty surrounding media and sponsorship revenue.