What are the Xponential Entities collectively called in the context of the AKT Lawsuit mentioned in the Body20 FDD?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
AKT Franchise SPV, LLC; (ii) Xponential, Xponential Fitness, Inc., XPOF Assetco, LLC, and Xponential Intermediate Holdings, LLC (collectively, the "Xponential Entities"); (iii) H&W Franchise Intermediate Holdings LLC, H&W Investco LP, and H&W Investco II LP (collectively, the "H&W Entities"); (iv) LAG Fit, Inc.; (v) MGAG LLC; and (vi) Anthony Geisler, Mark Grabowski, Melissa Chordock, Elizabeth "Liz" Batterton Cooper, Alexander Cordova, Lance Freeman, Ryan Junk, Megan Moen, John Meloun, Sarah Luna, Tori Johnston, Justin LaCava, Bobby Tetsch, Brandon Wiles, Jason Losco, Brittney Holobinko, Amy Wehrkamp, Scott Svilich, Sarah Nolan, Emily Brown, Rachel Markovic, and Brenda Morris (collectively, (i) through (vi), the "AKT Defendants") after AKT Franchise, LLC initiated an arbitration against and sought damages from certain of them for breaches of their franchise agreements. The AKT Plaintiffs alleged that one or more of the AKT Defendants (a) violated pre-sale disclosure obligations under the California Franchise Investment Law, the Florida Franchise Act, and the Michigan Franchise Investment Law by failing to provide a compliant Franchise Disclosure Document, making statements that they contend were erroneous or prohibited, and failing to disclose information that they contend necessitated disclosure; (b) fraudulently induced them to invest in franchises; (c) breached the implied covenant of good faith and fair dealing; (d) breached a purported agreement to provide certain financing; and (e) engaged in unfair and deceptive trade practices. The AKT Plaintiffs seek (1) declaratory and injunctive relief regarding the enforcement of the mandatory arbitration provisions in their franchise agreements; (2) rescission of their franchise agreements; (3) actual and special damages; and (4) attorneys' fees, costs, and interest. The AKT Defendants have all filed a demurrer to the complaint.
Source: Item 3 — LITIGATION (FDD pages 13–17)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, in the context of the AKT Lawsuit, the Xponential Entities are collectively referred to as "the "Xponential Entities"". This group includes Xponential, Xponential Fitness, Inc., XPOF Assetco, LLC, and Xponential Intermediate Holdings, LLC.
The AKT Lawsuit involves allegations from former AKT franchisees against several parties, including the Xponential Entities. These allegations include violations of pre-sale disclosure obligations under franchise laws, fraudulent inducement to invest in franchises, breach of the implied covenant of good faith and fair dealing, breach of a purported agreement to provide financing, and unfair and deceptive trade practices. The plaintiffs in the AKT Lawsuit seek declaratory and injunctive relief, rescission of their franchise agreements, actual and special damages, and attorneys' fees, costs, and interest.
It is important for a prospective Body20 franchisee to understand the nature of these lawsuits and the potential implications for Body20, even though Body20 states they are not affiliated with Xponential and these lawsuits do not involve them or their affiliates. While the FDD states that Body20 is not affiliated with Xponential, the litigation involving Xponential and its related entities could indirectly impact Body20's reputation or business practices. Therefore, a potential franchisee should carefully review the litigation disclosures and consider seeking legal counsel to assess the risks associated with these ongoing lawsuits.