$90 Million Credit card debt Facility Supplied by Consortium of Present Investors, Led by Kennedy Lewis
Gene Davis Appointed Chairman of the Board, Which Has Been Refreshed with Addition of 4 Expert Independent Directors
Bob Madore, Seasoned Finance Government, Named as Interim CFO
AUSTIN, Texas, February 15, 2023–(Enterprise WIRE)–F45 Teaching Holdings Inc. (NYSE: FXLV) (“F45” or the “Corporation”) now announced the closing of a new $90 million subordinated personal debt facility furnished by a consortium of current buyers, led by affiliates of Kennedy Lewis Administration LP (the “New Facility”). This financing will make improvements to the Company’s harmony sheet and boost liquidity as the strengthened Board and management team drive the company ahead and position F45 for prolonged-expression sustainable progress.
“The financing transaction, merged with our recently carried out operational realignment and value reduction initiative, enable us to enhance the assistance we provide our valued franchisee community and go on to produce on our mission of supplying the world’s ideal exercise routine,” reported Ben Coates, F45’s Interim Main Government Officer. “We are glad to have secured this major funding from traders who share our vision.”
Darren Richman, Co-Founder, Co-Portfolio Manager, and Co-Controlling Lover of Kennedy Lewis, added, “We’re delighted to deepen our partnership with F45, an innovator with a differentiated brand name that is uniquely positioned to capitalize on the expanding trend of shoppers prioritizing wellbeing and health and fitness in their daily lives. As extensive-time buyers in F45, we have a deep knowing of, and ongoing self confidence in, the organization and the opportunity in advance for F45 as a disruptor in the physical fitness place.”
Refreshing Company’s Board of Directors and Strengthening Leadership Staff
In relationship with the closing of the transaction, current Board member Gene Davis – who has much more than four many years of strategic setting up, organization transformation, and governance experience – was appointed Chairman, and 4 new impartial directors ended up appointed to the Board: Timothy Bernlohr, Lisa Gavales, Steven Scheiwe, and Ray Wallander. These new directors, who with each other carry a prosperity of management and consumer sector working experience, exchange Angelo Demasi, Vanessa Douglas, and Lee Wallace, who each resigned at closing. Remaining on the Board with Mr. Davis are Ben Coates, Adam Gilchrist, Elizabeth Josefsberg, and Michael Raymond, as perfectly as F45 investor, enthusiast, and manufacturer ambassador Mark Wahlberg.
The Organization has named Bob Madore as Interim Main Fiscal Officer. Mr. Madore is a seasoned govt with far more than 30 a long time of administration experience and a proven monitor document of escalating models in world-wide marketplaces, as perfectly as leading and scaling financial operations even though strengthening organization efficiency to produce financially rewarding growth. Prior to becoming a member of F45, he served as CFO of Ralph Lauren, American Eagle Outfitters and, most lately, The Cronos Team.
Board Chairman Gene Davis stated, “With the Organization on more powerful money footing, I look ahead to performing with my fellow Board customers and the management crew, including Bob, to refine F45’s go-forward small business method to provide sustainable progress, enhance opportunities for our franchisees and workforce, and drive lengthy-expression value for shareholders.”
The New Facility has a 5-and-a-fifty percent-yr phrase, with fascination to be compensated in sort. Web proceeds will be made use of for, amongst other factors, normal corporate needs and a partial paydown of the Company’s present Senior Secured Revolving Credit score Facility with JP Morgan Chase Bank, N.A. (the “JPM Facility”). Concurrent with the closing of the New Facility and the partial paydown, the Organization amended the JPM Facility to be structured as a $70 million senior secured facility with a two-calendar year expression, comprising a $68 million term loan and a $2 million revolving credit history facility. Supplemental detail relating to the New Facility and JPM Facility is provided in the transaction files that are exhibits to the Company’s Sort 8-K, which will be submitted with the SEC now.
Gibson, Dunn & Crutcher LLP served as authorized counsel to F45 on the transaction. Jefferies LLC acted as monetary advisor and Akin Gump Strauss Hauer & Feld LLP served as authorized counsel to Kennedy Lewis.
Strategic Alternate options Update
As an update to the beforehand introduced formation of a Particular Committee to critique and assess the unsolicited proposal F45 gained from Kennedy Lewis and other strategic solutions, the Specific Committee paused its critique and analysis as the Board centered on securing this funding to handle F45’s liquidity needs.
The Organization has not obtained anything additional from Kennedy Lewis with regard to its prior proposal or a revised proposal. In the event Kennedy Lewis engages with the Corporation on its proposal, which includes any revision thereof, the Board will think about this kind of proposal at the correct time and will act in the best interests of the Corporation and its shareholders in accordance with its fiduciary obligations.
The Company does not undertake any obligation to present any updates with respect to a evaluate of strategic options or any other transaction, other than as needed below relevant law.
F45 features buyers practical 45-minute exercise sessions that are helpful, pleasurable and group-pushed. F45 utilizes proprietary systems including a conditioning programming algorithm and a digitally-enabled shipping system that leverages a prosperous information database of thousands of exceptional functional education movements to offer you new routines each working day and give a standardized working experience across F45’s worldwide franchise. For additional information, be sure to visit www.f45training.com.
About Kennedy Lewis
Kennedy Lewis is an investment manager established in 2017 by David K. Chene and Darren L. Richman with about $11 billion underneath administration across private resources and CLOs. Kennedy Lewis’ private funds largely focus on middle-sector firms dealing with disruption, whether it be cyclical, secular or regulatory related. The agency also companions with superior-expansion corporations that are resulting in disruption, delivering structured money methods to match their wants. For far more facts, make sure you go to www.klimllc.com.
Statements in this push launch that refer to F45’s long term designs and anticipations are ahead-searching statements, inside of the indicating of Area 27A of the Securities Act of 1933, as amended, and Area 21E of the Securities Trade Act of 1934, as amended, that include a amount of risks and uncertainties. Terms these types of as “could,” “will,” “ought to,” “expects,” “options,” “anticipates,” “could,” “intends,” “focus on,” “initiatives,” “contemplates,” “thinks,” “estimates,” “predicts,” “possible,” or “keep on” or negatives of these words and phrases and variations of these words and identical expressions are supposed to recognize such ahead-searching statements. Statements that refer to or are dependent on estimates, forecasts, projections, unsure events or assumptions, such as statements relating to F45’s strategy, economical outlook, organization plans, and long run macroeconomic ailments also detect forward-seeking statements. All ahead-hunting statements provided in this push launch are dependent on management’s anticipations as of the day of this push launch and, besides as required by regulation, F45 disclaims any obligation to update these forward-on the lookout statements to replicate long run events or situations.
Ahead-seeking statements are subject to sure dangers, uncertainties and assumptions relating to components that could trigger real effects to differ materially from individuals predicted in these statements, like, devoid of limitation, the subsequent: our dependence on the operational and economic effects of, and our associations with, our franchisees and the achievements of their new and present studios our potential to secure our model and status our ability to identify, recruit and contract with a ample range of capable franchisees our capability to execute our expansion method, together with by means of enhancement of new studios by new and current franchisees our means to manage our growth and the affiliated strain on our methods our capacity to correctly integrate any acquisitions, or recognize their anticipated gains the high stage of level of competition in the health and exercise field economic, political and other risks associated with our worldwide functions modifications to the industry in which we function our reliance on information and facts methods and our and our franchisees’ ability to adequately maintain the confidentiality and integrity of our facts the event of cyber incidents or a deficiency in our cybersecurity protocols our and our franchisees’ ability to bring in and keep users our and our franchisees’ potential to determine and secure appropriate web-sites for new franchise studios challenges similar to franchisees usually our capability to obtain third-bash licenses for the use of songs to supplement our exercise routines specified health and basic safety risks to members that occur even though at our studios our capability to sufficiently defend our mental residence challenges linked with the use of social media platforms in our marketing our capacity to obtain and retain high-profile strategic partnership arrangements our means to comply with present or potential franchise regulations and regulations our potential to foresee and satisfy buyer preferences and shifting sights of overall health and physical fitness our enterprise design remaining vulnerable to litigation the greater charges affiliated with becoming a community enterprise and additional variables mentioned in our filings with the Securities and Trade Fee (the “SEC”). More, many of these aspects are, and may possibly keep on to be, amplified by the COVID-19 pandemic. In-depth data concerning these and other things that could affect F45’s small business and results is integrated in F45’s SEC filings, such as in the part titled “Hazard Components” in F45’s Yearly Report on Form 10-K and other SEC filings.
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