Beckham and Norman allege in a complaint acquired by The Blast that they entered into promotional agreements with Australia-based F45 Training to help expand the brand.
Beckham joined the company at the urging of his actor friend, Mark Wahlberg, who acquired a 36 percent ownership in the company in 2019 for around $634 million.
The lawsuit says that he has since offered marketing and promotional services, including public and private appearances, picture and video shoots, and promotion of the company via social media and printed materials.
As part of the agreement, the professional athletes would get annual payments of $1.5 million for Beckham and an undisclosed sum for Norman, as well as a portion of the company’s equity.
Since then, they have appeared in a number of advertisements and participated in a number of promotional events for the fitness organization’s growth into the United States. According to the athletes’ attorneys, the company has “significantly benefited” from their agreement.
According to the lawsuit, Beckham and Norman’s promotion of the fitness company ‘enhanced its public profile and credibility, and helped roll out new fitness offerings for F45,’ and as a result, the company went public in 2021 with a valuation nearly three times greater than it had been two years prior.
In the case, however, the elite sportsmen allege that F45 failed to pay them “significant cash and equity compensation” as the company’s stock value declined.
Shares of the fitness behemoth were trading at just $3.07, a decrease of more than 76 percent year-to-date.
David Beckham and Greg Norman are suing F45 Training for more than $20 million, alleging that the company withheld sponsorship payments.
In 2019, Mark Wahlberg acquired a 36 percent stake in the company, which was worth approximately $634 million.
Wednesday, shares of the fitness company were trading at barely $3.07.
By 2021, F45 officially announced that Beckham is a global partner and released images of him training at one of its facilities; cofounder Adam Gilchrist reportedly described the company’s affiliation with Beckham as a’monumental partnership’
According to the Sydney Morning Herald, he was then owed $5 million on July 14, as the company celebrated the first anniversary of its debut on the New York Stock Exchange.
F45 allegedly began withholding millions of dollars from him when the company’s share prices began falling in 2022 due to ‘fiscal mismanagement and macroeconomic pressures,’ as described in the lawsuit.
At the same time, Beckham supposedly lost nearly $10million as the stock prices plummeted from around $11.33million when he vested on January 15, 2022 t just around $1.97million by September 23 ‘a mere fraction of the value [Beckham’s company] would have received had F45 timely complied with its contractual obligations.’
In the lawsuit, Beckham claims he provided marketing, promotional services like public and private appearances, photos and video shoots, as well as promoting the company on his social media and in printed materials, but the company withheld millions of dollars from him
The lawsuit also alleges, according to The Blast, that the company gave ‘preferential treatment’ to other investors, including ‘insiders and directors’ allowing them to profit more off their ownership.
It says the company gave ‘substantially more stock to various entities affiliated with Fortress Investment Group during this same period of time, and had accelerated the vesting of other shares issued to Wahlberg, another celebrity, who is also a board member, director and insider.’
DailyMail.com has reached out to F45 Training for comment.
Former NFL receiver previously filed a suit against the fitness company, claiming it owed him more than $700,000 in unpaid wages
Former NFL receiver Terrell Owens previously filed a similar lawsuit against the fitness company.
He claimed in his 2017 lawsuit that F45 failed to pay him more than $700,000 in unpaid wages, according to Bleacher Report.
In the suit, Owens claimed he agreed to appear in a promotional video for $15,000, which both sides say was paid.
But Owens said the gym was also supposed to pay him $25,000 for each of the first 25 gums opened in the United States and an additional $5,000 for every opening thereafter.
At the time, there were at least 45 gyms in the United States.
Owens asked at least $725,000 in damages, but, Bleacher Report notes, the CEO has denied the allegations saying ‘everything that’s been lodged is a total fabrication of the truth.’
He said the company planned to countersue Owens over the claims, saying: ‘We’re not a company that doesn’t pay our bills.’
But a judge ultimately ruled in Owens’ favor.
The company went public on July 15, 2021. On that day, Darren Richman, Greg Norman, Michael Raymond, Chris Payne, Mark Wahlberg, and F45 Founder and CEO Adam Gilchrist rang the opening bell at the New York Stock Exchange.
However, the company has previously declared that it intends to reduce its workforce and reduce its profitability and sales projections for this year, as a result of offering a number of celebrities hefty compensations for their endorsements.
The Sydney Morning Herald says that former NBA great Magic Johnson received $4 million in cash and $5 million in shares, while American model Cyndi Crawford received $5 million in stocks.
According to the Herald, the company recorded a total of $4.5million in stock-based expenses related to its summer arrangements with celebrities, as well as potential liabilities of $4.5million in stock-based expenses.
And by the end of June, the business was left with only $8.5 million in cash and $60.6 million in debts.
In July, CEO Ben Coates said that the company no longer has expansion plans, as it switches its focus to saving cash and profitability.