[Editor's Note: This story was updated on May 3 with details noting the financials agreed to by Adam Gilchrist and F45 Training in Gilchrist's separation agreement when he stepped down as CEO in July 2022.]
Adam Gilchrist, one of the founders of F45 Training, resigned as a member of the board of directors on April 21, the company announced.
No terms were shared about Gilchrist’s departure from the board, but when he stepped down as CEO in July 2022, the following terms were set out for Gilchrist, as noted in a July 26, 2022 Form 8-K filed with the Securities and Exchange Commission: he was eligible for a one-time cash payment of $4.8 million, subject to certain agreed upon conditions; he would receive a one-time cash payment of $1 million (no conditions stated); starting Aug. 1, 2022, F45 would pay a 12-month lease on his residence in Florida with an annual lease amount of $1.2 million; F45 would reimburse COBRA premiums for Gilchrist and his covered dependents for up to 12 months; he would receive relocation expenses up to $20,000; his legal fees related to the separation agreement would be paid by the company.
In February, the Daily Mail Australia shared that it had obtained court documents from the Federal Court of Australia showing that Gilchrist’s financial company Ironbark Advisory and security company Oracle Investigations in Australia contend that the native Australian had promised to pay them $15 million over several years and had been making irregular payments but stopped paying them completely in July 2022.
The Austin, Texas-based F45 Training, which originally was founded in Australia and went public in July 2021, has been trading on the New York Stock Exchange (NYSE) at under $1 since April 20.
On April 14, F45 received a notice from the NYSE that the company is not in compliance with NYSE rules because it had yet to file its Form 10-K for its fourth quarter 2022 and full-year 2022 financials with the Securities and Exchange Commission (SEC). As of May 2, it still has not filed the form, even as many other public companies are now filing their 10-K forms reporting their first quarter 2023 financials.
F45 Training announced on March 16 that it was unable to finalize the 2022 Form 10-K by the deadline because the company and its independent registered public accounting firm required additional time to complete certain items.
In February, F45 Training closed on a new $90 million subordinated debt facility that was provided by a consortium of existing investors led by affiliates of Kennedy Lewis Management LP, which made an unsolicited bid in September to purchase the publicly traded company.
At the close of the deal on the debt facility, three board members resigned and were replaced by four new independent board members. Gene Davis, who joined the board in November, was appointed chairman of the board. Gilchrist remained on the board at that time.
When the company appointed a new CEO, Tom Dowd, and moved actor and entrepreneur Mark Wahlberg into the role of chief brand officer on March 30, the announcement indicated that Gilchrist would remain on the board. However, less than a month later, he resigned.
Gilchrist had big plans for F45 Training when the company went public.
In July 2021, Gilchrist told Club Industry, “We are going to be bigger than McDonald's. That's our goal, and I think we will breeze past Planet in the not-too-distant future.”
He planned to roll out about 25,000 locations in traditional locations, but he also planned to expand F45’s college, high school and military locations. With those school and military opportunities, he projected the number of F45 Training locations could total 40,000 to 50,000.
At that time, he told Club Industry that F45 had been “very conservative fiscally,” and “probably one of the lowest leveraged companies when the pandemic hit.”
“We think this IPO will give us the horsepower in terms of cash to go out and really assist our franchisees in growing their businesses,” he said at that time.