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FXLV.US

id: 494

F45 Training Holdings ($FXLV) $10,5M Investor Settlement

The settlement terms have been submitted to the court for approval.

$10,500,000

Cash Settlement

W.D. Texas

Court

1:22-cv-01291

Case number

07/16/2021

Class period Start

08/14/2023

Class period End

F45 Training Holdings and $FXLV investors reached a $10.5M settlement to resolve claims tied to F45’s IPO Offering Documents and later statements about how it generated franchise-growth revenue.

Outline:

F45 Training Holdings has agreed to a $10.5M settlement with $FXLV investors over alleged misstatements tied to its franchise growth/revenue model. After its July 2021 IPO, F45 promoted rapid studio expansion and “upfront” franchise payments. On July 26, 2022, F45 cut guidance, reduced opening plans, and said a $250M credit line wouldn’t be available. Shares fell over 60% the next day; the case later settled in February 2026.

Timeline:
July 16, 2021: F45 completes IPO (priced at $16/share).
May 16, 2022: F45 announces a $150M franchise financing facility with Fortress and reiterates growth targets at that time.
July 26, 2022: F45 issues a “Strategic Update,” cutting revenue guidance, reducing planned openings, stating a $250M credit line “will not be available, announcing layoffs, and disclosing the CEO's resignation.
July 27, 2022: $FXLV plunged over 60%.
Dec. 8, 2022: Lawsuit date referenced in the settlement materials’ statutory calculations (date of suit).
Aug. 14, 2023: F45 stock is voluntarily delisted from the NYSE.
Feb. 13, 2026: Stipulation of the settlement agreement.
Background:

When F45 Training Holdings, Inc. went public in July 2021, it was presented to investors as an Austin, Texas-based fitness franchisor with a model designed to scale quickly through franchise studio openings.

In its IPO materials, F45 emphasized that its franchising strategy could support accelerated studio growth and that most franchise sales generated upfront payments—including an upfront establishment fee payable when a new franchise agreement was signed.

The prospectus also highlighted a plan to increase the mix of multi-unit franchisees over time, reinforcing the idea that the company could expand faster through larger franchise commitments.

Investors later alleged, however, that F45 did not disclose that it was offering “modified” payment terms for certain large multi-unit deals, which they claim contributed to rising accounts receivable and weaker cash flow—undermining the idea that growth reliably translated into “upfront” revenue.

They also alleged that F45’s rapid-expansion strategy depended heavily on franchisees opening multiple locations quickly and/or franchisees needing near-100% financing, which the complaint characterizes as unsustainable.

On July 26, 2022, F45 announced a major strategic reset—cutting guidance and studio-opening targets, stating a $250M credit line “will not be available,” and announcing layoffs and leadership changes.

The stock allegedly fell more than 60% the next day (from $3.51 to $1.35), after which shareholders filed suit claiming F45 misled investors about the sustainability of its franchise growth and revenue model.

What Can Investors Expect Now?
F45 Training Holdings and $FXLV investors reached a $10.5M settlement to resolve claims tied to F45’s IPO Offering Documents and later statements about how it generated franchise-growth revenue.

If you were damaged due to this situation, you may be able to file for a payout and get your share of the settlement. You can check whether you are eligible and review other details in the FAQ section.

Case Type

US Securities Class Action

Case Status

Stipulative Settlement

Alleged Offence

Mismanagement,

Misleading Statements,

Financial Misrepresentation,

Failure to Disclose,

Malpractice,

Negligence,

Breach of Fiduciary duty,

Omissions

Suspected Party

Directors,

Management,

Shareholder,

Influencer,

Investment Bank,

Service Provider,

Research Entity

Security Type

Stocks

Trade Direction

Long

Payout per Share

0.06

Filing date

12/08/2022

Plaintiffs

Kenzie Goer

Attorneys

Barrack, Rodos & Bacine (San Diego, CA), Steckler Wayne Cherry & Love PLLC (Dallas, TX)

Defendants

Adam Gilchrist, Chris Payne, Michael Raymond, Darren Richman, Mark Wahlberg

Administrator

Strategic Claims Services

Attorney fee

$3,350,000

Trades matching type

FIFO

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