S-1/A

As filed with the Securities and Exchange Commission on September 27, 2021.

Registration No. 333-259220

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 1

to

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

iFIT Health & Fitness Inc

(Exact name of registrant as specified in its charter)

Delaware	3600	06-1556976
(State or Other Jurisdiction of Incorporation or Organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

1500 South 1000 West

Logan, Utah 84321

(435) 786-5000

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

Everett Smith, Esq.

Senior Vice President, General Counsel, Secretary

1500 South 1000 West

Logan, Utah 84321

(435) 786-5000

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

Copies to:

Alexander D. Lynch, Esq. Corey R. Chivers, Esq. Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000 (Phone)
(212) 310-8007 (Fax) Michael Kaplan, Esq. Richard J. Truesdell, Jr., Esq. Jeffrey S. Ramsay, Esq. Davis Polk & Wardwell LLP
450 Lexington Avenue New York, New York 10017
(212) 450-4000 (Phone) (212) 701-5800 (Fax)

Approximate date of commencement of proposed sale to the public:

As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☐ Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act.  ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount To Be Registered	Proposed Maximum Aggregate Offering Price Per Share	Proposed Maximum Aggregate Offering Price(1)(2)	Amount of Registration Fee(2)
Class A Common stock, $0.001 par value per share	35,384,615(1)	$21.00	$743,076,915	$81,070

(1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) promulgated under the Securities Act of 1933, as amended. Includes shares of Class A common stock that may be issuable upon exercise of an option to purchase additional shares granted to the underwriters.

(2) The Registrant previously paid $10,910 of this amount in connection with the initial filing of the Registration Statement.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS Subject to Completion, Dated September 27, 2021 iFIT CLASS A COMMON STOCK 30,769,231 SHARES This is an initial public offering of Class A common stock by iFIT Health & Fitness Inc (the “Company”). We are offering shares of our Class A common stock. We will have two classes of authorized common stock, Class A common stock and Class B common stock. The rights of holders of Class A common stock and Class B common stock are substantially identical, except with respect to voting and conversion rights. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to ten votes per share and is convertible into one share of Class A common stock. Outstanding shares of Class B common stock will represent approximately 85.1% of the voting power of our outstanding capital stock immediately following the completion of this offering, with our Chief Executive Officer and certain affiliated stockholders holding approximately 85.1% of the voting power of our outstanding capital stock immediately following the completion of this offering, assuming in each case no exercise of the underwriters’ option to purchase additional shares. Prior to this offering, there has been no public market for our Class A common stock. It is currently estimated that the initial public offering price per share will be between $18.00 and $21.00 We intend to apply to have our Class A common stock listed on the NASDAQ Global Select Market (“NASDAQ”) under the symbol “IFIT.” We qualified as an “emerging growth company” as defined under the federal securities laws at the time we furnished the initial draft of the registration statement of which this prospectus forms a part and, as such, are subject to reduced disclosure requirements for purposes of this offering. See “Prospectus Summary—Implications of Being an Emerging Growth Company.” After the completion of this offering, we expect to be a “controlled company” within the meaning of the corporate governance standards of NASDAQ. See “Risk Factors” beginning on page 22 to read about factors you should consider before buying shares of our Class A common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Initial public offering price$ $ Underwriting discount(1) $ $ Proceeds, before expenses, to us $ $ (1) We refer you to “Underwriting,” beginning on page 201 of this prospectus, for additional information regarding total underwriter compensation. To the extent that the underwriters sell more than 30,769,231 shares of Class A common stock, the underwriters have an option to purchase up to an additional 4,615,384 shares from us at the initial public offering price less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on , 2021. Morgan Stanley BofA Securities Barclays Citigroup Credit Suisse Jefferies Baird

TABLE OF CONTENTS

	Page
Prospectus Summary		1
Risk Factors		25
Cautionary Note Regarding Forward-Looking Statements		75
Use of Proceeds		76
Dividend Policy		77
Capitalization		78
Dilution		80
Unaudited Pro Forma Condensed Consolidated Financial Information		82
Selected Consolidated Financial and Other Data		92
Management’s Discussion and Analysis of Financial Condition and Results of Operations		97
Business		131
Management		157
Executive and Director Compensation		165
Principal Stockholders		175
Certain Relationships and Related Party Transactions		177
Description of Material Indebtedness		181
Description of Capital Stock		187
Shares Eligible for Future Sale		194
Material U.S. Federal Income Tax Consequences to Non-U.S. Holders of Our Class A Common Stock		196
Underwriting		201
Legal Matters		212
Experts		213
Where You Can Find More Information		214
Index to Financial Statements		F-1

Neither we nor the underwriters (or any of our or their respective affiliates) have authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. Neither we nor the underwriters (or any of our or their respective affiliates) take any responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We and the underwriters (or any of our or their respective affiliates) are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any free-writing prospectus is accurate only as of its date, regardless of its time of delivery or the time of any sale of shares of our Class A common stock. Our business, financial condition, results of operations and prospects may have changed since that date.

Basis of Presentation

We have a fiscal year end of May 31. Fiscal years are identified in this prospectus according to the calendar year in which they end. For example, fiscal 2020 refers to the fiscal year ended May 31, 2020. Fiscal quarters may be identified by the quarter and fiscal year in which they occur. For example, fiscal Q1 2022 refers to the first fiscal quarter ended August 31, 2021. Please see our audited consolidated financial statements and related notes thereto included elsewhere in this prospectus for the full description of the basis of presentation. References to “GAAP” are to Generally Accepted Accounting Principles issued by the Financial Accounting Standards Board (“FASB”).

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Trademarks and Trade Names

We and our subsidiaries own or have the rights to various trademarks, trade names, service marks and copyrights, including the following brands: iFIT^®, NordicTrack^®, ProForm^®, Freemotion^®, Weider^®, Weslo^®, 29029^® and Sweat^®, which are our principal brands, as well as iFIT ActivePulse^™, iFIT Mind^™, LiveAdjust^TM, SmartAdjust^TM, SpaceSaver^™, FreeStride^™, Vue^™, Vault^™ and various logos used in association with these terms. Solely for convenience, the trademarks, trade names, service marks and copyrights referred to herein may be listed without the ^©, ^® and ^™ symbols, but such references are not intended to indicate, in any way, that we, or the applicable owner, will not assert, to the fullest extent under applicable law, our or their, as applicable, rights to these trademarks, trade names, service marks and copyrights. Other trademarks, trade names, service marks or copyrights appearing in this prospectus are the property of their respective owners.

Market and Industry Information

Unless otherwise indicated, market data and industry information used throughout this prospectus is based on management’s knowledge of the fitness industry and the good faith estimates of management. We also relied, to the extent available, upon management’s review of independent industry surveys and publications, other publicly available information prepared by a number of sources. Market share data, unless otherwise indicated, are provided by TraqLine and are estimated market shares for calendar 2020 based on unit share. The data we provide regarding the NordicTrack brand recognition is based on a survey we commissioned. To determine our Total Addressable Market (“TAM”) and Serviceable Addressable Market (“SAM”), we relied upon management’s review of independent industry surveys and publications as well as a report conducted by Frost & Sullivan Inc., a third-party research partner. We conducted comprehensive analysis across the supply and demand sides, including primary research with market participants and secondary research on the marketplace on the supply side, and in-depth customer surveys on the demand side. The geographic scope of our study includes North America, Latin America, Europe and Asia Pacific, and we define the segments of the fitness economy as fitness, wellness, nutrition and recovery.

All of the market data and industry information used in this prospectus, including our methodology of determining TAM and SAM, involves a number of assumptions and limitations and you are cautioned not to give undue weight to such estimates. Although we believe that these sources are reliable, neither we nor the underwriters can guarantee the accuracy or completeness of this information and neither we nor the underwriters have independently verified this information. While we believe the estimated market position, market opportunity and market size information included in this prospectus is generally reliable, such information, which is derived in part from management’s estimates and beliefs, is inherently uncertain and imprecise. Projections, assumptions and estimates of our future performance and the future performance of the fitness industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors,” “Cautionary Note Regarding Forward-Looking Statements” and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in our estimates and beliefs and in the estimates prepared by independent parties.

Certain Definitions

For definitions of our key business metrics and additional information regarding how we calculate these key business metrics, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics and Non-GAAP Financial Measures.” Below are definitions of certain of these key business metrics:

“Billings” is an operating measure we use that is equal to total amounts billed for subscription and extended warranty contracts in the period.

“Touchscreen products” means interactive fitness equipment that comes installed with a high-definition touchscreen.

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“Gross Merchandise Value” or “GMV” means the total dollar value of the merchandise sold to end consumers in a given period in all distribution channels.

“iFIT Subscribers,” “Sweat Subscribers,” and “Total Fitness Subscribers” are those subscribers who have full access to all paid iFIT content and/or Sweat content, as applicable, which is available on the digital app, TV app and on equipment, who are either in an active paid account or a trial and are the primary account holder. Unless otherwise specified, Total Fitness Subscribers for historical periods through and including fiscal 2021 do not include Sweat Pty Ltd (“Sweat”), which was acquired on June 30, 2021, but our figure for current Total Fitness Subscribers represents the combined figure of both iFIT Subscribers and Sweat Subscribers, each as of August 31, 2021.

“Interactive Fitness Products,” when referring to units, includes units of all products sold, including interactive fitness equipment, together with units of ancillary products including weights, apparel, nutrition products and other accessories.

“Subscription Contribution” is a non-GAAP measure that is defined as subscription revenue less cost of subscription revenue, adjusted to exclude depreciation and amortization expense from cost of subscription revenue.

“Subscription Contribution Margin” is a non-GAAP measure that is calculated by dividing Subscription Contribution by subscription revenue.

“Total Members” means all individuals who have an active iFIT account and/or Sweat subscription, which includes Total Fitness Subscribers, their respective secondary members and members who consume free content. Unless otherwise specified, Total Members for historical periods through and including fiscal 2021 do not include Sweat, which was acquired on June 30, 2021, but our figure for current Total Members represents the combined members of both iFIT and Sweat, each as of August 31, 2021.

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A LETTER FROM SCOTT WATTERSON, IFIT CO_FOUNDER, CHAIRMAN, AND CEO: My life has been guided by the benefits of balancing physical, mental, emotional, and spiritual health, so I can be at my best for my family, my community, and our company. I have seen, first-hand, how improving your physical and mental well-being can change your life for the better. This passion is both real and enduring, and it's what inspired us to found this company. We believe that the path to real self-improvement involves combining all of the building blocks of well-being: fitness, nutrition, mindfulness, active recovery, and community. We have a vision of creating a proprietary technology - a holistic platform - that connects the key aspects of health and fitness to make it simple for consumers to begin and continue their fitness journeys and enjoy lifelong well-being. The result of that vision is iFIT: a mission-driven fitness technology company that's focused on providing comprehensive solutions to our subscribers. We are passionate about helping our ever-growing community of more than six million members improve their fitness and health. That's our mission. That's why we're growing. Growth requires vision, critical optimism, and action. The iFIT company includes more than 2,700 purpose-driven team members, including our deep bench of leaders who perpetuate our mission with their actions every day. Our focus and talent keep us at the forefront of the industry, allowing us to create innovative technologies and hardware that truly improve people's well-being. With more than 400 issued and pending patents, we have a powerful foundation of innovation to build upon as we continue to serve our members in the future. We've pioneered interactive, connected fitness to guide our members on their fitness journeys and built a community. Our iFIT technology platform is distinctive because of the way we integrate our proprietary software, experiential content, and interactive hardware. Our patented integration provides what we call an "automagical" fitness experience for the consumer - one they can see, hear, and feel. For example, when our members stream the iFIT trek to the summit of Mt. Kilimanjaro on their treadmill, the speed and incline of their machines automatically adjusts in sync with the natural topography of the trail - all while their personal exercise data is streamed back to the iFIT platform thousands of times per second. We believe that one thing about consumers is certain - they need and want new and better workouts. That's why we o_er a suite of connected fitness brands and products that allows us to reach customers globally across an expansive range of distribution channels, exercise preferences, and price points. Today, we sell our connected fitness products and memberships in 120 countries and produce content in eight languages. Our iFIT platform is the technology foundation of our multi-brand, multi-product, and multi-channel strategy and provides us with the

largest serviceable, addressable market in the industry. Regardless of consumer preferences, our unique business model creates a broad funnel to continue growing and engaging our worldwide community of members. Global interest and participation in wellness and commitment to personal health are on an unprecedented trajectory. When we founded the company in the late 1970s, the original running boom had just begun, and fitness was a new trend. Today, wellness is a growth industry approaching six trillion dollars. All generations and demographics want to participate. Expansion opportunities are real and abundant. Our opportunity to grow has never been greater. An Asian proverb I learned long ago has influenced the company and me through the years: bu jln ze tul, which means, "If you're not progressing forward, you're moving backward." iFIT's unique, seamless technology, workout series, and continual innovation embody forward movement and progress. We are humbled by the role iFIT plays in our members' lives in keeping them moving forward, empowering them to change for the better, and enjoying the benefits of better physical, mental, and emotional fitness and well-being. Because when we do that, we make a di_erence. Scott R. Watterson Co-Founder, Chairman, and CEO

PROSPECTUS SUMMARY

This summary highlights information appearing elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before making a decision to participate in the offering. You should carefully read the entire prospectus, including the information presented under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and notes related thereto included elsewhere in this prospectus, before making an investment decision. Unless the context requires otherwise, references to “our Company,” “we,” “us,” “our” and “iFIT” refer to iFIT Health & Fitness Inc and its direct and indirect subsidiaries on a consolidated basis, including Sweat from its date of acquisition.

Our Mission and Vision

Our mission is to improve your fitness and well-being.

Our vision is to create the world’s most holistic health and fitness platform.

Who We Are

We are a health and fitness subscription technology company, fueled by our passion to innovate, grow and provide meaningful solutions for our members. iFIT is an integrated health and fitness platform, designed to connect our proprietary software, experiential content and interactive hardware to deliver an unmatched connected fitness experience.

We are a growing community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers with members in over 120 countries. We deliver our patented interactive experiences on the industry’s broadest range of fitness modalities including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories.

Driven by the adoption of our iFIT platform, we are the #1 provider of large fitness equipment in the United States, with approximately 40% market share based on units. In fiscal 2021, we sold approximately 10.1 million Interactive Fitness Products with a Gross Merchandise Value of $2.8 billion. Our brands, including iFIT, NordicTrack, ProForm and Freemotion, are leaders in the fitness equipment industry, and 83% of our total revenue was generated by sales of our connected fitness products and iFIT subscriptions.

Our iFIT operating system provides interactive experiences on all of our connected equipment brands, allowing members to gain access to our full library of iFIT live and on-demand content for $15/month for individuals or $39/month for families of up to five (or $396 when paid annually). We believe the combination of our proprietary software and experiential content connected with our interactive hardware creates a compelling value proposition for our rapidly growing member base and generates attractive recurring subscription revenue.

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Proprietary Software

Our innovative iFIT software is the common operating system that unites our experiential content and interactive hardware into one integrated platform. Our software is the connective tissue that provides members with a unique two-way experience with iFIT’s authentic trainers. Through iFIT’s patented software, biometric data is monitored and workout variables including speed, incline, resistance and digital weight are dynamically adjusted in real time. Our interactive software optimizes our members’ workout experience by removing the guesswork and providing personalized training. We further personalize workouts with our patent-pending SmartAdjust^{TM and ActivePulseTM technologies, which automatically adjust our equipment based on members’ real-time fitness levels and heart rates. Our distinctive leaderboard allows members to connect and interact with a global community of like-minded people.}

Experiential Content

We strive to create the most compelling interactive content in the health and fitness industry. Our highly differentiated content seamlessly integrates with our proprietary software and interactive hardware, delivering a unique media form that we call “experiential content.” Our members enjoy patented live interactive studio and outdoor workouts. Further, our members can access iconic fitness experiences with workouts filmed in more than 50 countries across seven continents. Our experiential content creates multi-sensory experiences that allow our members to see, hear and feel interactive workouts. Our content is developed and led by a team of over 180 world-class trainers in more than 60 categories including running, cycling, high-intensity interval training (HIIT), strength, boot camp and yoga, as well as new categories including mindfulness, nutrition and active recovery. Our recent acquisition of Sweat also gives our members access to additional differentiated content with over 5,000 unique workouts led by instructors who are globally recognized as top female fitness icons.

During fiscal 2021, we (including Sweat) streamed 142 million live and on-demand interactive workouts across our fitness products. We have begun offering content in eight different languages including Mandarin Chinese, Spanish and French. Our expanding mindfulness, nutrition and recovery content provides a complete experience for our members. In fiscal 2021, our iFIT members participated in 112 million workouts, reflecting growth of

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229% year over year. Our community has given our experiential iFIT content more than 4.1 million member reviews with an average rating of 4.7 stars out of 5.

Interactive Fitness Hardware

We generate recurring subscription revenue on the industry’s broadest range of connected fitness hardware, including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories. Our interactive hardware is intelligent—specifically designed and engineered to respond to our proprietary software and experiential content. This unique combination allows our members to have an immersive experience that can only be found on our hardware. For example, when our content streams the trail to the summit of Mt. Kilimanjaro, our interactive drive systems automatically adjust the speed and incline in sync with our content. Our hardware and technology are protected by over 400 issued and pending patents.

Our Brands

We market our iFIT platform with our industry-leading brands: NordicTrack, ProForm, Freemotion, Weider and Sweat. We intentionally segment our brands across a wide range of channels, products and price points to attract consumers from a variety of fitness and income levels. Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. The breadth of our product portfolio and multi-brand strategy provides us with the largest addressable market in the fitness industry, and creates a broad funnel to acquire interactive fitness members at scale.

Our Direct-to-Consumer and Multi-Channel Distribution Model

Our global distribution model is unmatched in our industry, combining both domestic and international direct-to-consumer capabilities with wholesale distribution. In fiscal 2021, we generated 44% of our interactive hardware revenue through our own direct-to-consumer channels, 54% of our interactive hardware revenue through more than 50 select retailers globally and 2% of our interactive hardware revenue through our strategic partnerships in the commercial channel. Our multi-channel distribution mitigates our dependence on any single channel and allows us to meet consumers wherever they want to shop. We also have a first-mover advantage globally, with 16% of our fiscal 2021 revenue coming from international markets.

Our Growth, Revenue and Scale

Our ability to connect with our community of health and fitness members through our cutting-edge iFIT technology and immersive experiences has fueled our growth as one of the largest connected health and fitness platforms in the world.

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Our strong financial performance is underpinned by the rapid growth in our member base and consistent increase in member engagement on our platform, as seen through:

• Total Fitness Subscribers growing from approximately 103 thousand to 1.1 million between May 31, 2017 and May 31, 2021, representing a CAGR of 81.3%; and

• Total number of workouts on our platform growing from 12.1 million during fiscal 2019 to 34.1 million during fiscal 2020, representing 181% growth. In fiscal 2021, our members participated in 112 million workouts, reflecting growth of 229% year over year.

• We generated total revenue of $700.0 million and $851.7 million during fiscal 2019 and fiscal 2020, respectively, representing an increase of 21.7%, and $1,745.1 million in fiscal 2021, representing an increase of 104.9%;

• We generated net income of $56.6 million during fiscal 2019, and incurred net losses of $98.5 million and $516.7 million during fiscal 2020 and 2021, respectively; and

• We generated Billings of $92.7 million and $183.7 million during fiscal 2019 and fiscal 2020, respectively, representing an increase of 98.2%, and $382.3 million in fiscal 2021, representing an increase of 108.1%.

The Global Wellness Economy

We operate in the global wellness industry which has demonstrated sustained, consistent growth through a range of economic cycles over many years. According to a Frost & Sullivan report, during 2021 the total global health and wellness market is projected to achieve estimated spend of $5.9 trillion.

We believe the breadth of our equipment range across modalities, brands, price points and distribution channels gives us the largest SAM among our primary competitors in the fitness industry. We believe we are the only provider delivering a seamless solution of software, content and hardware with offerings across treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories in the global market. We have a growing international presence with distribution in over 120 countries.

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Our Competitive Differentiators

Seamlessly Integrated Health and Fitness Platform

iFIT is a global health and fitness platform which seamlessly integrates our proprietary software, experiential content and interactive hardware to deliver an unmatched connected fitness experience.

We design and develop our own software, content, and hardware to ensure these elements work in harmony across our portfolio of brands and products. Our software utilizes biometric inputs (including heart rate), adaptive fitness technology, artificial intelligence (AI) and scalable cloud-based infrastructure to create an unmatched user experience that is highly engaging and valued by our members. Our content is delivered by our patented streaming technology that connects our wide range of connected devices. This comprehensive technology stack allows our devices to seamlessly connect to our network of products and members. This network effect of interactive fitness devices drives high engagement, retention, and social interaction. We believe our member-centric platform is difficult to replicate and highly scalable into adjacent categories and verticals.

Differentiated Experiential Content

We have invented experiential content, creating a new media form that is highly differentiated from passive streaming. We believe we create the best interactive content in the fitness industry, which includes live and on-demand studio classes and digital outdoor experiences. Our world-class production teams, including Emmy award-winning talent and cinematographers, film iFIT experiential content in more than 50 countries across seven continents, led by more than 180 iFIT trainers, including Olympians, top female fitness icons and other elite athletes. iFIT members can trek to Mt. Everest base camp or walk with elephants on safari in South Africa on their treadmills and ellipticals. They can join live studio cycle classes or ride the Swiss Alps on their bikes. iFIT members can row the River Thames on their rowers or join a studio boot camp class from their fitness mirrors. Our constantly growing library includes more than 17,000 interactive workouts in more than 60 categories including running, cycling, HIIT, strength, boot camp class and yoga, as well as new categories including mindfulness, nutrition and active recovery, allowing iFIT members to benefit from a complete content solution. Our proprietary LiveAdjust^TM streaming technology allows iFIT trainers to control members’ equipment variables including speed, incline, resistance and digital weight which creates an authentic interactive workout.

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Innovation Pipeline That Drives Growth

We are innovators—and consider ourselves the original pioneers—of connected health and fitness technology. We have compiled a portfolio of more than 400 issued and pending patents in areas ranging from interactive streaming to adaptive fitness technology. These patents provide a competitive moat to our business. Our vertically integrated software, content and hardware teams launch new innovative products and services in multiple categories each year with industry-leading speed to market. This multidisciplinary team of over 2,500 employees includes more than 600 research and development professionals, with engineering teams across three continents, focusing on improving the user experience. Our robust innovation pipeline is unique in the fitness industry and positions us to stay at the forefront of health and fitness technology.

Advantaged Business Model

We believe our multi-brand, multi-product and multi-channel business model provides us with the largest addressable market in the fitness industry and creates a broad funnel to acquire subscribers, generating highly attractive recurring revenue. We believe our strategy is highly scalable and difficult to replicate. Our proven approach delivers a compelling financial model.

Our brands—We market our iFIT platform with our industry-leading brands: NordicTrack, ProForm, Freemotion, Weider and Sweat. We address the premium at-home market with NordicTrack, the mass market with ProForm, strength training with Weider and commercial verticals with Freemotion. With Sweat, we market our iFIT platform to the extensive global Sweat community of 450,000 paid subscribers as of May 31, 2021 and more than 50 million followers across its social media channels, the majority of which are women. We intentionally segment our brands across a wide range of channels, products and price points to attract members from a variety of fitness and income levels.

Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. ProForm is the number one unit volume brand at retail. Our portfolio of valuable brands enables us to bring our iFIT platform to as many members as possible, while also providing a flexible and sustainable model for long-term growth.

Our product portfolio— The fitness products in our portfolio are connected by the iFIT operating system, enabling our members to have a unified user experience on every product they purchase from us. We deliver our interactive experiences on the fitness industry’s broadest range of fitness modalities, including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories. During 2020, we ranked #1 in overall market share in the United States in total large exercise equipment units. The breadth of our product and technology portfolio helps insulate us from consumer trends, creating valuable opportunities for expansion and an unrivalled Serviceable Addressable Market.

Our distribution channels—We have an established presence across all major distribution channels to meet our consumers wherever they want to shop. In fiscal 2021, we generated 44% of our interactive hardware revenue through our direct-to-consumer channel via our owned websites. We generated 54% of our interactive hardware revenue through our retail partners including Amazon, Best Buy, Dick’s Sporting Goods, Costco, Canadian Tire, Rebel Sports and Decathlon. We generated 2% of our interactive hardware revenue through our key relationships in the commercial channel including Orangetheory Fitness and 24 Hour Fitness. We also have a first-mover advantage globally, with 16% of our fiscal 2021 revenue coming from international markets. We believe the breadth of our omnichannel distribution is unmatched in the fitness industry and provides multiple avenues for future growth.

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Global Member Community with High Engagement

We have amassed a fast-growing, connected community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers in over 120 countries. Our business is characterized by high growth and strong engagement. Our growth is driven by our efficient customer acquisition and the core value proposition of our proprietary combination of software, content and hardware which have driven substantial expansion in the number of our Total Fitness Subscribers and total workouts participated in on our platform. We offset customer acquisition costs with the gross profit earned on our interactive fitness equipment, generating highly compelling unit economics. In fiscal 2020, total workouts participated in on our platform increased 181% over fiscal 2019. In fiscal 2021, our members participated in 112 million iFIT workouts, reflecting growth of 229% year over year, or 142 million workouts including Sweat.

Well-Established Global Supply Chain with Attractive Speed to Market

We have a robust and resilient supply chain with attractive speed-to-market capabilities. We manufacture both domestically and internationally in seven countries, and maintain 30+ year relationships with long-term strategic partners, with direct purchasing relationships down to the component level. Our in-house engineering expertise allows us to quickly create and adjust designs to streamline production and minimize supply bottlenecks. This network of partnerships combined with our experience, provides us with a considerable competitive advantage and allows us to flexibly respond to fluctuations in market demand. In fiscal 2021, the breadth of our scaled distribution network allowed us to ship 16,600 containers delivering approximately 10.1 million units of Interactive Fitness Products globally—more than anyone in our industry. This capability allowed us to respond quickly and grow during periods of surge demand since the onset of the outbreak of COVID-19 (the “global pandemic”).

Visionary Founder and Experienced Team

Our visionary co-founder and CEO Scott R. Watterson has combined his passions for fitness, technology, design and engineering to make interactive fitness products that positively affect people’s lives. His passion and leadership inspires our entire company, resulting in game-changing innovations. Our senior management team consists of industry veterans with an average of 23 years of experience in our company. Our entrepreneurial culture encourages our multidisciplinary team of over 2,500 employees to push for path-breaking developments across software, content and hardware. All of our efforts are guided by our core desire to provide the most immersive and interactive experiences to our members to guide them on their personal journeys for self-improvement.

Our Growth Strategies

Our goal is to grow our recurring subscriber base globally through the sale of our digital services and Interactive Fitness Products. We will continue to drive member engagement and retention by providing immersive and interactive experiences through our integrated platform.

Scale Marketing to Accelerate Growth

We market our products through a unique combination of performance, brand marketing and retail partnerships, resulting in a best-in-class customer acquisition cost and highly efficient media campaigns. Our low customer acquisition cost allows us to invest more in brand marketing to acquire additional customers. As we significantly scale our marketing efforts in the United States and internationally, we believe we can drive sustainable growth across our subscriber base and product portfolio.

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Accelerate Global Growth by Leveraging Our International Presence

By leveraging our established international presence, we see substantial opportunities to accelerate sales of our iFIT interactive products and services in global markets. With minimal marketing spend in fiscal 2021, our existing international direct-to-consumer business experienced high double digit growth in the UK, France and Australia. In addition to growing our international direct-to-consumer sales, we will enhance our worldwide network of strategic retail partners including Decathlon, Rebel Sports and others. We believe we have significant runway to expand market share, and grow iFIT memberships as we meet increasing global demand through our multi-channel distribution strategy.

Continuously Improve Members’ Experience

We are constantly improving and expanding our members’ experience, which ensures high subscriber engagement, retention and satisfaction. We will continue to enhance our members’ experience by developing new content, deploying new software and continually personalizing the ways our members engage with iFIT. Whether consumers are at home, outside or in commercial facilities, iFIT will provide experiential content on our expanding platform of interactive equipment, mobile apps and digital TV apps.

Continue to Launch New and Disruptive Products

We will continue to launch new products and disrupt existing product categories by innovating software, content and hardware. We invest considerable resources in our research and development, with more than 600 professionals and engineering teams across three continents. We maintain an extensive multi-year innovation pipeline driving advancements across our entire portfolio, as well as emerging verticals, allowing us to continually launch new products embraced by the market.

Leverage Installed Consumer Base to Increase Hardware Sales and Subscription Revenues

Since fiscal 2017 through fiscal 2021, we have sold over 48.3 million units of fitness products to consumers around the world. Our large and growing installed base of members, and our relationship with them, represents distinct opportunities to accelerate additional sales of hardware and conversion to Interactive Fitness Subscriptions. As we increase marketing efforts to our existing base and drive brand awareness of the iFIT platform, we anticipate meaningful adoption of our interactive fitness subscription and additional hardware purchases. Our data shows 16% of the subscribers that have been on the iFIT platform for more than three years have purchased multiple pieces of interactive hardware from us. We intend to leverage Sweat’s globally recognized fitness icons to cross sell iFIT products and memberships to its high-quality member database and over 50 million social media followers.

Grow Commercial Sales and Expand Strategic Partnerships

By expanding our premium commercial brand of Freemotion, we see significant growth opportunities to bring more of our interactive hardware and membership offerings into all verticals in the commercial channel. We have established relationships with best-in-class commercial operators, including Planet Fitness and Orangetheory Fitness, elite training facilities for pro and collegiate teams and more. Orangetheory Fitness uses our patented technologies in their commercial fitness facilities nationwide. Through our exclusive partnership with Planet Fitness, we have made the iFIT experience available to their base of more than 15 million Planet Fitness members nationally by providing select iFIT content through the Planet Fitness app.

Expand the iFIT Platform into Adjacent Categories

We will expand our proven iFIT subscription services and hardware into categories naturally adjacent to fitness, such as mindfulness, nutrition and recovery. Recently we have brought innovation to mindfulness with iFIT

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Mind^TM, creating multi-series workouts on our interactive hardware guided by experts in mental health. Our members responded quickly and positively, adding iFIT Mind^TM to their iFIT routine, further enhancing the retention of our platform and providing an excellent tool to attract new members. We recently acquired “29029,” a premier wellness tourism event and community, which will accelerate our expansion into wellness tourism and corporate wellness. As we expand into adjacent categories, which we believe are currently underserved, we believe we will enhance stickiness of current members and create more on-ramps into the iFIT ecosystem.

The Concurrent Transactions

Concurrently with this offering, we intend to engage in the following transactions (the “Concurrent Transactions”):

• in connection with this offering, we will amend and restate our certificate of incorporation to effect a 37.8-for-one stock split of our outstanding common stock. In addition, immediately prior to the closing of this offering, we will amend and restate our certificate of incorporation to, among other things, redesignate our outstanding common stock as Class A common stock, and we will exchange Class A common held by the Scott R. Watterson holders (as defined below) for a newly designated Class B common stock. All historical financial information in this prospectus has been retroactively restated to give effect to the stock split;

• upon completion of this offering, we will repay in full the promissory note (the “2019 Note”) issued in the 2019 Financing Transaction (as defined herein) with $300 million in consideration, consisting of a combination of (a) cash to the extent available as described in “Use of Proceeds” and (b) new convertible notes (the “New Convertible Notes”) in a principal amount equal to the remaining balance due;

• upon completion of this offering, we will mandatorily repay in full our Series A preferred stock with $262.5 million in consideration, consisting of a combination of (a) 7,918,553 shares of our Class A common stock (calculated based on the midpoint of the range; the actual number of shares will be calculated as $131.25 million divided by 85% of the public offering price of the Class A common

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stock), with the remaining $131.25 million to be paid with (b) cash to the extent available as described in “Use of Proceeds” and (c) New Convertible Notes in a principal amount equal to the remaining balance due;

• upon completion of this offering, we will mandatorily repay in full our Series B preferred stock with 1,602,565 shares of our Class A common stock (calculated based on the midpoint of the range; the actual number of shares will be calculated as $25.0 million divided by 80% of the public offering price of the Class A common stock),

• upon completion of this offering, we will issue 737,180 shares of our Class A common stock as deferred consideration for the 29029 acquisition (calculated based on the midpoint of the range; the actual number of shares will be calculated as $11.5 million divided by 80% of the public offering price of the Class A common stock);

• upon completion of this offering, we will issue 2,279,203 shares of our Class A common stock as deferred consideration for the Sweat acquisition (calculated based on the midpoint of the range; the actual number of shares will be calculated as $40.0 million divided by 90% of the public offering price of the Class A common stock);

• upon completion of this offering, we will issue in aggregate approximately 32,372,117 shares of our Class A common stock to net settle on a cashless basis all outstanding warrants (calculated based on the midpoint of the range; the actual number of shares will be calculated based on the net cashless settlement of warrants to purchase 32,633,610 shares of company stock, using the public offering price of the Class A common stock); and

• immediately prior to the public filing of the registration statement relating to this offering, we forgave loans to management in aggregate principal amount of $53.2 million to comply with the Sarbanes-Oxley Act, and one loan to an executive officer in the amount of $9.3 million was repaid by surrendering the equivalent of 963,673 shares of our common stock. Upon completion of this offering, we will make a $35.0 million payment to our CEO, and we will grant our CEO a restricted interest in $50.0 million of New Convertible Notes, subject to certain vesting conditions described herein. For information regarding these transactions and executive compensation, see “Executive and Director Compensation—Additional Compensation in Fiscal Q1 or Q2 2022.”

The shares of Class A common stock or Class B common stock and the New Convertible Notes issued in the Concurrent Transactions are not being registered in connection with this offering.

In connection with the offering, we also intend to grant options for 6,210,729 shares of our Class A common, with an exercise price equal to the public offering price, and 332,980 restricted shares subject to vesting under a new equity incentive plan, including (i) 678,208 shares of Class A common stock issuable upon exercise of options granted to Scott R. Watterson, (ii) 1,241,957 shares of Class A common stock issuable upon exercise of options granted to David J. Watterson, and (iii) 784,161 shares of Class A common stock issuable upon exercise of options granted to Steven J. Barr, as described in “Executive and Director Compensation—Employment and Benefit Plans—2021 Equity Incentive Plan—IPO Awards.” In addition, we intend to modify and reprice certain grants made under our existing 2014 equity plan and enter into loans and other compensation arrangements with non-executive employees, which we describe in notes (O) and (Q) to our Unaudited Pro Forma Condensed Consolidated Balance Sheet. See “Unaudited Pro Forma Condensed Consolidated Financial Information.”

The total amount of cash paid and principal amount of New Convertible Notes to be issued in connection with the repayment of the 2019 Notes and the Series A preferred stock is expected to be approximately $431.3 million, although the allocation between cash paid and New Convertible Notes issued will depend on the actual net proceeds of this offering (including whether and the extent to which the underwriters exercise their option to purchase additional shares). Based on the midpoint of the range, the amount of total cash paid would be

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approximately $57.3 million (or approximately $141.7 million if the underwriters exercise their option to purchase additional shares in full), and the corresponding principal amount of New Convertible Notes issued would be approximately $374.0 million (or approximately $289.6 million if the underwriters exercise their option to purchase additional shares in full). Any increase or decrease in net proceeds would increase or decrease on a dollar-for-dollar basis the aggregate amount of cash paid to repay the 2019 Notes and the Series A preferred stock, with a corresponding decrease or increase in the principal amount of New Convertible Notes. See “Use of Proceeds.”

For a description of the New Convertible Notes, see “Description of Material Indebtedness – New Convertible Notes.”

The 12,537,501 shares of our Class A common stock to be issued in connection with the repayment of our Series A and Series B preferred stock and the payment of deferred consideration for the 29029 and Sweat acquisitions and the $374.0 million of New Convertible Notes as described above are calculated based on an initial public offering price of $19.50 per share (the midpoint of the price range set forth on the cover of this prospectus). Each $1.00 increase in the public offering price per share would decrease, as applicable, by 611,588 shares, and each $1.00 decrease in the public offering price per share would increase, as applicable, by 677,699 shares, the number of shares of Class A common stock issued in connection with the repayment of our Series A and Series B preferred stock and the payment of deferred consideration for the 29029 and Sweat acquisitions. Each $1.00 decrease or increase in the public offering price per share would decrease or increase, as applicable, by $28.8 million, the amount of New Convertible Notes to be issued. Each $1.00 increase in the public offering price per share would decrease, as applicable, by 1,655,447 shares the number of shares into which such notes will be convertible and each $1.00 decrease in the public offering price per share would increase, as applicable, by 1,834,414 shares the number of shares into which such notes will be convertible.

Recent Developments

Preliminary Estimated Results for Fiscal Q1 2022 (Unaudited)

Set forth below are certain preliminary estimated unaudited financial results and other data for fiscal Q1 2022. Our unaudited interim consolidated financial statements as of August 31, 2021 and for the three months of fiscal Q1 2022 are not yet available. These ranges are based on the information available to us as of the date of this prospectus. We have provided ranges, rather than specific amounts, because these results are preliminary and subject to change as we have not yet completed our financial closing process and our auditors have not yet reviewed our results. Our actual results may vary from the preliminary estimated results presented below due to items identified as we complete our financial closing and other operational procedures, final adjustments, and due to other developments that may arise between now and the time the financial results for fiscal Q1 2022 are finalized. Such adjustments could be material.

In addition, these preliminary estimated financial results set forth below are not necessarily indicative of the results we may achieve in any future periods. This information should be read in conjunction with our consolidated financial statements and the related notes. See “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Cautionary Note Regarding Forward-Looking Statements” for additional information regarding factors that could result in differences between the preliminary estimated ranges of certain of our financial results that are presented below and the actual financial results we will report. Accordingly, we caution you about unduly relying on these preliminary estimated results.

All of the data presented below has been prepared by and is the responsibility of management. Our independent registered public accounting firm, Deloitte & Touche LLP, has not audited, reviewed, compiled or performed any procedures with respect to the estimated preliminary financial results. Accordingly, Deloitte & Touche LLP does not express an opinion or any other form of assurance with respect thereto.

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The following includes our preliminary estimated results for fiscal Q1 2022:

	Three Months Ended August 31,
	2020 (actual)		2021 (estimated low)		2021 (estimated high)
	(in thousands)
Preliminary Estimated Financial Results:
Revenue:
Interactive fitness products	$	261,730	$	284,000	$	296,000
Subscription		44,592		87,000		96,000
Total revenue		306,322		371,000		392,000
Cost of revenue:
Interactive fitness products		157,381		229,000		237,000
Subscription		4,776		13,000		15,000
Total cost of revenue		162,157		242,000		252,000
Gross profit		144,165		134,000		139,000

The following operational metrics should be read in connection with “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Key Business Metrics and Non-GAAP Financial Measures.”

	Three Months Ended August 31,
	2020			2021(1)
Other preliminary data:
Total Fitness Subscribers (at period end)		631,429			1,580,373
Total members (at period end)		3,810,760			6,489,013
Total workouts on platform		20,176,229			32,332,485
Average net monthly churn by cohort, Touchscreen $1,999+ (based on 13 month retention)		3.38	%		2.69	%

(1) Except for average net monthly churn by cohort, fiscal Q1 2022 includes Sweat and iFIT on a combined basis.

• For fiscal Q1 2022, we expect to report total revenue in the range of $371.0 million to $392.0 million, representing growth of approximately 21.1% to 28.0% over fiscal Q1 2021. These preliminary results represent continued strong growth, particularly relative to the strong performance we posted in fiscal Q1 2021, and a decrease sequentially reflecting a more typical seasonality pattern. Revenue growth was led by an increase in subscription revenue, which grew both over the prior year and sequentially, driven by significant growth in the iFIT subscriber base as well as the acquisition of Sweat on June 30, 2021. On a combined basis, Total Fitness Subscribers increased slightly sequentially compared to fiscal 2021 year end, with an increase in iFIT subscribers offset in part by a decrease in Sweat subscribers, reflecting seasonal patterns. Our interactive fitness products revenue benefited from strong treadmill and bike sales with particular strength across our retail partners segment as consumers have returned to shopping in store, further highlighting the strength of our brands in what is typically a seasonally low quarter. We also experienced significant growth internationally compared to the prior year, with continued direct-to consumer growth in both Europe and Australia.

• For fiscal Q1 2022, we expect to report gross profit in the range of $134.0 million to $139.0 million, as compared to $144.2 million for fiscal Q1 2021. Our gross profit was heavily impacted by an industry wide increase in freight and commodity costs as well as overall channel mix, with our retail partners representing a larger portion of the business in the first quarter of 2022. These higher input costs reflect various pandemic-driven global supply chain disruptions as well as global container and chip shortages

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resulting in supply backlogs. We expect these challenges to improve as conditions begin to normalize in the second half of the fiscal year, with our deep vendor relationships as well as our multiple sourcing strategy for key components across manufacturing processes serving as mitigants against supply chain bottlenecks.

• On June 30, 2021, we completed the acquisition of Sweat, a leading platform for women’s health and fitness. The acquisition of Sweat expands our presence into the global digital fitness market and accelerates our delivery of best-in-class interactive fitness experiences for consumers worldwide. With this acquisition, we are now able to market our platform to the extensive global Sweat community of over 450,000 paid subscribers at May 31, 2021 and more than 50 million followers across social media channels. Sweat also gives our members access to additional differentiated content with over 5,000 unique workouts by instructors who are globally recognized as top female fitness icons.

• At August 31, 2021, we had an estimated cash balance of approximately $74.0 million, compared to $146.5 million at May 31, 2021. We had outstanding borrowings under our revolving credit facility of $210.0 million at August 31, 2021, compared to $0.3 million at May 31, 2021, and available borrowing capacity of $82.8 million. Our change in net debt reflects seasonal cash requirements as well as increased strategic investments in marketing and inventory to continue to fuel the business.

Corporate Information

Scott R. Watterson and Gary E. Stevenson founded Weslo, Inc. in 1977 and acquired ProForm Fitness Inc. in 1987. When these entities were sold to Bain Capital Inc. in 1994, they were renamed ICON Health & Fitness, Inc and changed their name to iFIT Inc. in August 2021. The parent entity of iFIT Inc., HF Holdings, Inc., was incorporated in Delaware in 1999 and changed its name to iFIT Health & Fitness Inc in May 2021. Our principal executive offices are located at 1500 South 1000 West, Logan, Utah 84321, and our telephone number is (435) 786-5000. Our corporate website address is www.ifit.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus. You should not rely on any such information in making your decision whether to purchase our Class A common stock.

Controlled Company

Prior to the completion of this offering, we will amend our amended and restated certificate of incorporation to redesignate our outstanding common stock as Class A common stock and issue Class B common stock in exchange for certain outstanding shares of Class A common stock. Following the offering, our Co-Founder and Chief Executive Officer, Scott R. Watterson and certain affiliated stockholders (which we refer to as the “Scott R. Watterson holders”) will hold 114,402,561 shares of our Class B common stock. The dual class structure of our common stock will have the effect of concentrating voting control with the Scott R. Watterson holders. The Scott R. Watterson holders will hold in the aggregate approximately 85.1% of the voting power of our outstanding capital stock immediately following this offering. This will limit or preclude your ability to influence corporate matters.

Summary of Risk Factors

An investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled “Risk Factors,” alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition and operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to:

• changes in the fitness industry as well as developments in consumer demand for and preferences in fitness content or decreases in demand for our products post-pandemic;

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• failure to anticipate consumer preferences in products and services;

• changes or developments in our relationships with or the businesses of third-party suppliers, manufacturers, logistics partners and retail partners, and our reliance on these parties;

• damage to our brands and reputation;

• inability to manage our growth and failure to execute our continued growth strategy;

• inability to attract and retain subscribers;

• the highly competitive nature of our industry;

• inability to achieve and maintain profitability in the future;

• the seasonality of our business, including the Sweat business, and short product life cycles;

• inability to manage increases in raw materials and component costs, long lead times, supply shortages or transportation and logistical issues;

• changes in the socioeconomic, political and environmental landscape;

• unfavorable or otherwise costly outcomes of lawsuits, claims, regulatory disputes and governmental inquiries that arise from our products and services;

• reputational harm or liabilities relating to our products or their use or misuse or defects;

• import and export controls, tariffs, import or customs duties, international taxation, economic sanctions and changes in income tax laws or enforcement;

• failure to comply with applicable anti-corruption and anti-money laundering laws;

• failure to comply with applicable privacy, security, and data laws, regulations, and standards;

• the inability to integrate the Sweat acquisition or achieve the desired benefit from the acquisition;

• the occurrence of cyberattacks, privacy or data breaches or any disruption or interference with our computing, storage, processing and similar services;

• adverse changes to or loss of our intellectual property rights, including our licenses, trademarks and trade names; and

• adverse publicity or other adverse consequences related to our dual class structure or “controlled company” status.

Implications of Being an Emerging Growth Company

When we furnished the initial draft of the registration statement of which this prospectus forms a part, we qualified as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such we are able to take advantage of specified reduced disclosure requirements applicable to this offering. These reduced requirements include, among others:

• exemption from the adoption of certain new or revised financial accounting standards that do not yet apply to private companies;

• exemption from compliance with certain new requirements adopted by the Public Company Accounting Oversight Board requiring a supplement to the auditor’s report in which the auditor is required to provide additional information about the audit and the financial statements of the issuer; and

• reduced disclosure about executive compensation arrangements.

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As a result of our decision to avail ourselves of these disclosure accommodations, the information that we provide may be different than what you may receive from other public companies in which you may hold an equity interest.

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THE OFFERING

Issuer iFIT Health & Fitness Inc

Class A common stock offered by us 30,769,231 shares of Class A common stock (35,384,615 shares if the underwriters exercise their option to purchase additional shares in full).

Underwriters’ option to purchase additional shares of Class A common stock The underwriters have an option to purchase an additional 4,615,384 shares of Class A common stock from us. The underwriters can exercise this option at any time within 30 days from the date of this prospectus.

Class A common stock to be outstanding after this offering (including Class A common stock issued in the Concurrent Transactions) 200,488,123 shares of Class A common stock (205,103,507 shares if the underwriters exercise their option to purchase additional shares in full).

Class B common stock to be outstanding after this offering (including Class B common stock issued in the Concurrent Transactions) 114,402,561 shares of Class B common stock, all of which will be held by the Scott R. Watterson holders.

Total Class A and Class B common stock to be outstanding after this offering (including Class A and Class B common stock issued in the Concurrent Transactions) 314,890,684 shares (319,506,068 shares if the underwriters exercise their option to purchase additional shares in full).

Voting Rights Shares of Class A common stock are entitled to one vote per share.

Shares of Class B common stock are entitled to ten votes per share.

Holders of our Class A common stock and Class B common stock will generally vote together as a single class, unless otherwise required by law or our amended and restated certificate of incorporation. Following the completion of this offering, each share of our Class B common stock will be convertible into one share of our Class A common stock at any time and will convert automatically upon transfers (other than certain permitted transfers) and upon the earlier of (i) the date specified by a vote of the holders of not less than two-thirds of the voting power of the then outstanding shares of Class B common stock and (ii) the date on which we first become aware the shares of Class B common stock cease to represent at least 15% of all outstanding shares of our common stock. The Scott R. Watterson holders, as holders of our outstanding Class B common

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stock, will hold 85.1% of the voting power of our outstanding capital stock immediately following this offering. The Scott R. Watterson holders will have the ability to control the outcome of matters submitted to our stockholders for approval, including the election of our directors and the approval of any change of control transaction. See the sections titled “Principal Stockholders” and “Description of Capital Stock” for additional information.

Directed Share Program At our request, the underwriters and their respective affiliates (the “DSP Underwriters”) have reserved up to 5% of the shares offered by this prospectus, for sale through a directed share program at the initial public offering price to individuals, including certain of our senior management and employees, as well as friends and family members of our executive officers, founders and certain members of senior management, and persons with whom we have a business relationship, including certain partners. The reserved shares will not be subject to a lock-up, except if purchased by our directors, officers or employees. The number of shares of Class A common stock available for sale to the general public will be reduced by the number of reserved shares sold to these individuals. Any reserved shares of our Class A common stock that are not so purchased will be offered by the DSP Underwriters to the general public on the same terms as the other shares of our Class A common stock offered by this prospectus. We have agreed to indemnify the DSP Underwriters against certain liabilities and expenses, including liabilities under the Securities Act, in connection with sales of the reserved shares.

Use of proceeds We estimate that the net proceeds from the sale of our Class A common stock in this offering, after deducting the underwriting discount and estimated offering expenses payable by us, will be approximately $557.3 million ($641.7 million if the underwriters exercise their option to purchase additional shares in full) based on an assumed initial public offering price of $19.50 per share (the midpoint of the price range set forth on the cover of this prospectus).

We intend to use the net proceeds in the following order of priority:

• approximately $465.0 million of the net proceeds will be retained by the Company and used for general corporate purposes;

• $35.0 million will be used to make a required payment to our CEO; and

• approximately $57.3 million ($141.7 million if the underwriters exercise their option to purchase additional shares in full) to make a cash payment, which together with the issuance of New Convertible Notes, will repay in full the 2019 Note.

See “Use of Proceeds.”

Dividend policy We do not currently intend to pay cash dividends on our common stock in the foreseeable future. However, in the future, subject to a

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number of factors and our future liquidity and capitalization, we may change this policy and choose to pay dividends.

Our ability to pay dividends is currently restricted by the terms of our Senior ABL Revolving Credit Facility (as defined herein), is subject to consent by the required holders of New Convertible Notes and may be further restricted by any future indebtedness we incur.

In addition, under Delaware law, our board of directors may declare dividends only to the extent of our surplus (which is defined as total assets at fair market value minus total liabilities, minus statutory capital) or, if there is no surplus, out of our net profits for the then current and/or immediately preceding fiscal year. See “Dividend Policy.”

Risk Factors Investing in our common stock involves a high degree of risk. See the “Risk Factors” section of this prospectus for a discussion of factors you should carefully consider before investing in our common stock.

Listing We intend to apply to have our common stock listed on NASDAQ under the symbol “IFIT.”

Except as otherwise indicated, the number of shares of our Class A common stock and Class B common stock outstanding after this offering:

• excludes 10,865,601 shares of our Class A common stock issuable upon the exercise of outstanding stock options at a weighted average exercise price of $2.21 per share and 10,662,624 shares of our Class B common stock issuable to Scott R. Watterson upon the exercise of outstanding stock options at a weighted average exercise price of $9.06 per share;

• excludes shares of Class A common stock issuable upon conversion of the New Convertible Notes to be issued as described herein, which have an initial conversion price equal to 85% of the public offering price of our Class A common stock in this offering; based on the midpoint of the price range, we would have $374.0 million of outstanding New Convertible Notes, which would be immediately convertible into 22,561,086 shares of Class A common stock, and a restricted grant to our CEO in $50.0 million principal amount of New Convertible Notes which would, upon vesting, be convertible into 3,016,592 shares of Class A common stock;

• excludes an aggregate of 45,000,000 shares of our Class A common stock that will be available for future equity awards under the iFIT 2021 Equity Incentive Plan, that we plan to adopt (the “2021 Plan”), including approximately 332,980 restricted shares and approximately 6,210,729 shares of common stock issuable upon exercise of options that we intend to grant under the 2021 Plan to certain directors, executive officers and employees at the time of this offering, with the public offering price as the exercise price, including (i) 678,208 shares of Class A common stock issuable upon exercise of options granted to Scott R. Watterson, (ii) 1,241,957 shares of Class A common stock issuable upon exercise of options granted to David J. Watterson, and (iii) 784,161 shares of Class A common stock issuable upon exercise of options granted to Steven J. Barr, as described in “Executive and Director Compensation—Employment and Benefit Plans —2021 Equity Incentive Plan—IPO Awards”; and

• gives effect to the issuance of Class A common stock and Class B common stock in the Concurrent Transactions, as described above (which shares are not being registered in connection with this offering).

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Except as otherwise indicated, all information in this prospectus assumes:

• an initial public offering price of $19.50 per share (the midpoint of the price range set forth on the cover of this prospectus);

• the completion of the Concurrent Transactions; and

• no exercise of outstanding stock options after August 31, 2021.

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SUMMARY HISTORICAL AND PRO FORMA CONSOLIDATED FINANCIAL AND OTHER DATA

The following tables present certain summary historical and pro forma financial and other data for our business. We derived the summary consolidated statements of operations data for fiscal 2019, 2020 and 2021 and the summary consolidated balance sheet data as of May 31, 2020 and 2021 from our audited consolidated financial statements included elsewhere in this prospectus. The pro forma data presented below have been derived from our unaudited pro forma condensed consolidated financial statements included elsewhere in this prospectus. The pro forma data is presented for illustrative purposes only and is not necessarily indicative of the results of operations or financial position that would have occurred if the relevant transactions had been completed on the dates indicated, nor is it indicative of future operating results or financial position. Our historical results are not necessarily indicative of the results that may be expected in the future. You should read this data in conjunction with the section titled “Unaudited Pro Forma Condensed Consolidated Financial Information”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes appearing elsewhere in this prospectus.

	Year Ended May 31,
	2019			2020			2021
	(in thousands, except share and per share amounts)
Consolidated Statements of Operations Data:
Revenue:
Interactive fitness products	$	626,189		$	727,703		$	1,515,288
Subscription		73,776			123,977			229,768
Total revenue		699,965			851,680			1,745,056
Cost of revenue:
Interactive fitness products(1)		444,908			503,353			989,873
Subscription(1)		13,226			19,362			28,980
Total cost of revenue		458,134			522,715			1,018,853
Gross profit		241,831			328,965			726,203
Operating expenses:
Sales and marketing		193,173			278,492			619,431
Research and development(2)		20,898			23,122			36,274
General and administrative(1)		48,892			77,105			198,132
Total operating expenses		262,963			378,719			853,837
Loss from operations		(21,132	)		(49,754	)		(127,634	)
Other expense (income):
Gain on sale of subsidiary		(111,800	)		—			—
Other expense, net(3)		13,368			46,320			387,089
Total other expense (income)		(98,432	)		46,320			387,089
Income (loss) before provision for income taxes		77,300			(96,074	)		(514,723	)
Provision for income taxes		20,733			2,469			1,983
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Undistributed earnings allocated to participating securities		(7,496	)		—			—
Net income (loss) attributable to common stockholders	$	49,071		$	(98,543	)	$	(516,706	)
Net income (loss) per share
Basic	$	0.23		$	(0.46	)	$	(2.32	)
Diluted	$	0.23		$	(0.46	)	$	(2.32	)

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	Year Ended May 31,
	2019		2020		2021
	(in thousands, except share and per share amounts)
Weighted-average common shares outstanding
Basic		213,654,521		213,111,562		222,511,893
Diluted		213,654,521		213,111,562		222,511,893
Pro forma per share/share data(4)
Pro forma net loss per share, basic and diluted (unaudited)(4)					$	(1.67	)
Pro forma weighted average common shares outstanding, basic and diluted (unaudited)(4)						295,746,503

(1) Includes depreciation and amortization expense as follows:

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Cost of revenue
Interactive fitness products	$	1,933	$	1,466	$	1,852
Subscription		5,468		7,833		6,314
Total cost of revenue		7,401		9,299		8,166
General and administrative		9,319		8,732		8,183
Total	$	16,720	$	18,031	$	16,349

(2) In fiscal 2019, 2020 and 2021, we invested $35.8 million, $45.1 million, and $91.7 million, respectively, in research and development and to enhance our iFIT platform, develop new products, content and features, and improve our platform infrastructure, a portion of which was capitalized.

(3) Includes a loss in fiscal 2021 of $178.2 million related to the issuance of the Series A and B preferred stock and the 2020 Warrants. The loss is due to the excess of the fair value of the instruments issued over the proceeds received. In fiscal 2020 and 2021, we also incurred losses of $9.4 million and $142.2 million, respectively, related to the change in the fair value of our warrant liabilities and losses of $20.2 million and $39.3 million, respectively, related to the change in fair value of our embedded derivative liabilities. Total other expense (income) also includes interest expense (income) of $15.4 million, $15.5 million and $31.0 million for fiscal 2019, 2020 and 2021, respectively, and other expense (income) of $(2.0) million, $1.2 million and $(3.6) million, for fiscal 2019, 2020 and 2021, respectively.

(4) We have presented the unaudited pro forma net loss per share, basic and diluted, which has been computed to give effect to the Concurrent Transactions and this offering as though they had occurred as of the beginning of the period on June 1, 2020. For further information on our unaudited pro forma net loss per share, refer to the “Unaudited Pro Forma Condensed Consolidated Financial Information” included elsewhere in this registration statement.

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This pro forma data is presented for informational purposes only and does not purport to represent what our net loss or net loss per share actually would have been had the offering and use of proceeds therefrom occurred on June 1, 2020 or to project our net loss or net loss per share for any future period.

	Year Ended May 31,
	2019			2020			2021			2021 (Combined)(2)
	(dollars in thousands)
Certain Business Metrics and Non-GAAP Financial Measures:(1)
Total Fitness Subscribers (at period end)(3)		262,181			530,490			1,118,519			1,569,127
Total members (at period end)(4)		2,474,504			3,456,816			5,670,616			6,125,067
Total workouts on platform(5)		12,132,471			34,098,117			112,218,822			141,920,650
Subscription gross profit	$	60,550		$	104,615		$	200,788			N/A
Subscription gross margin		82.1	%		84.4	%		87.4	%		N/A
Subscription contribution(6)	$	66,018		$	112,448		$	207,102			N/A
Subscription contribution margin(6)		89.5	%		90.7	%		90.1	%		N/A
Billings(7)	$	92,720		$	183,727		$	382,275			N/A

(1) See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics and Non-GAAP Financial Measures” for more information.

(2) Except as set forth in the combined column, which includes Sweat on a combined basis, the historical data set forth in this table do not give effect to the Sweat acquisition, which occurred subsequent to fiscal 2021 on June 30, 2021. Certain additional information regarding Sweat is provided herein.

(3) Total Fitness Subscribers are defined as those who have full access to all paid iFIT and/or Sweat content, which is available on the digital app, TV app and on equipment, who are either in an active paid account or a trial and are the primary account holder. Our digital-only iFIT members and trial members each represent less than 5% of our iFIT Subscriber base for all periods presented.

(4) We define Total Members as all individuals who have an active iFIT account and/or Sweat subscription, which includes Interactive Fitness Subscribers, their respective secondary members and members who consume free content.

(5) We define a workout as a single program participated in by our members across our entire platform.

(6) Subscription Contribution and Subscription Contribution Margin are non-GAAP financial measures. We define Subscription Contribution as subscription revenue less cost of subscription revenue, adjusted to exclude depreciation and amortization expense from cost of subscription revenue. Subscription Contribution Margin is calculated by dividing Subscription Contribution by subscription revenue. See the section titled “Selected Consolidated Financial and Other Data—Non-GAAP Financial Measures” for information regarding our use of Subscription Contribution and Subscription Contribution Margin and a reconciliation of Subscription Contribution to subscription gross profit.

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(7) We use billings as a key operating metric in evaluating the performance of our business because it enables an analysis of performance based on the timing of actual transactions with our customers and may be seen as an early indicator of trends in our operating results. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics and Non-GAAP Financial Measures” for how we calculate billings.

	May 31, 2020			May 31, 2021			Pro Forma
	(in thousands)
Consolidated Balance Sheets Data:
Cash and cash equivalents	$	100,321		$	146,453		$	586,540
Working capital(1)		16,197			70,944			514,002
Total assets		372,129			992,566			1,424,138
Long-term debt, net		139,842			157,133			271
Deferred revenue, current and non-current		161,739			314,246			314,246
Mandatorily redeemable preferred stock		—			234,041			—
Warrant liabilities		54,349			327,313			—
Embedded derivative liabilities		31,600			121,000			—
New convertible notes		—			—			373,950
Total stockholders’ (deficit) equity	$	(181,156	)	$	(670,159	)	$	240,769

(1) Working capital is total current assets less total current liabilities

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RISK FACTORS

Risks Related to Our Business, Our Brands, Our Products and Our Industry

If we are unable to anticipate consumer preferences and successfully develop and introduce new, innovative, and updated products and services in a timely manner or effectively manage the introduction of new or enhanced products and services, our business may be adversely affected.

Our success in maintaining and increasing our subscriber base and product sales depends on our ability to identify and originate trends as well as to anticipate and react to changing consumer demands in a timely manner. Our products and services are subject to changing consumer preferences that cannot be predicted with certainty. If we are unable to introduce new or enhanced offerings in a timely manner, or our new or enhanced offerings are not accepted by our members, our competitors may introduce similar offerings faster than us, or that are preferred by consumers, which could negatively affect our rate of growth. In addition, the success of new or enhanced offerings may depend on a number of other factors including, the success of our sales and marketing efforts, timely and successful research and development, effective forecasting and management of product demand, purchase commitments, and inventory levels, effective management of manufacturing and supply costs, and the quality of or defects in our products. The development of our products and services is complex and costly. Unanticipated problems in developing products and services could also divert substantial research and development resources, which may impair our ability to develop new products and services and enhancements of existing products and services, and could substantially increase our costs.

Our new offerings may not receive consumer acceptance as preferences could shift rapidly to different types of health and fitness offerings or away from these types of offerings altogether, and our future success depends in part on our ability to anticipate and respond to these changes. Failure to anticipate and respond in a timely manner to changing consumer preferences could lead to, among other things, lower iFIT subscription rates, lower sales, pricing pressure, lower gross margins, discounting of our existing products, and excess inventory levels. Further, if new or enhanced product and service introductions are delayed or not successful, we may not be able to achieve an acceptable return, if any, on our research and development efforts, and our business may be adversely affected.

Even if we are successful in anticipating consumer preferences, our ability to adequately react to and address them will partially depend upon our continued ability to develop and introduce innovative, high-quality offerings. Development of new or enhanced products and services may require significant time and financial investment, which could result in increased costs and a reduction in our profit margins. For example, we have historically incurred higher levels of sales and marketing expenses accompanying each product and service introduction. Further, negative reviews online or via social media or otherwise of new or enhanced products and services could have a negative impact on our business, which, particularly during the initial phase of a new or enhanced product launch, could take time or significant expense to counteract and address, or could otherwise delay or impede consumer take up of the new or enhanced products and services.

Moreover, while we have experienced a significant increase in our member base since the start of the global pandemic, it remains uncertain how the global pandemic will impact consumer demand for our products and services and consumer preferences generally and the effect on demand following the pandemic. In addition, we have experienced and may continue to experience delays in the development and introduction of new, updated or enhanced products and services due to the effects of the current global pandemic. We must successfully manage introductions of new, updated and enhanced products and services, which could adversely impact the sales of our existing products and services. For instance, consumers may decide to purchase new, updated or enhanced products and services instead of our existing products and services, which could lead to excess product inventory and discounting of our existing products and services.

In addition, we expect to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan. Currently, when customers purchase

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select iFIT interactive equipment, they purchase an annual subscription to iFIT. After the conclusion of the initial subscription period, customers may, at their election, enter into a monthly or annual subscription arrangement. Under our new plan, customers who purchase select iFIT interactive equipment will purchase a monthly subscription to iFIT and will renew monthly or upgrade to annual membership plans. Our transition to a new plan may not be successful. The inclusion of a monthly membership instead of an annual membership as part of a product purchase may decrease sales velocity and result in fewer subscribers once implemented. We may also experience higher churn on our members due to the monthly renewal period as compared to annual subscriptions.

Additionally, our relationships with our retail partners are important to our business. If we are unable to introduce differentiated offerings for our retail partners, our relationships with those partners may suffer, which may cause us to lose key retail partnerships, or have difficulty developing new retail partnerships.

We operate in a highly competitive market and we may be unable to compete successfully against existing and future competitors.

Our products and services are offered in a highly competitive market. We face significant competition in every aspect of our business, including at-home fitness equipment and content, fitness clubs, in-studio fitness classes, fitness travel and events, and health and wellness apps as well as, with respect to our iFIT technology, specialized consumer electronic device companies. The market for every aspect of our business has multiple participants. Moreover, we expect the competition in our market to intensify in the future as new and existing competitors introduce new or enhanced products and services that compete with ours. Further, as we expand our product offerings in the health and wellness category, we will face additional competitors within the overall health market, including from participants in the medical, nutritional health, healthcare and pharmaceutical industries. Our competitors may develop, and have already developed, products, features, content, services, or technologies that are similar to ours or that achieve greater acceptance, may undertake more successful product development efforts, create more compelling employment opportunities, or marketing campaigns, or may adopt more aggressive pricing policies. Our competitors may develop or acquire, or have already developed or acquired, intellectual property or other proprietary rights that significantly limit or prevent our ability to compete effectively in the public marketplace. In addition, our competitors may have significantly greater resources than us, allowing them to identify and capitalize more efficiently upon opportunities in new markets and consumer preferences and trends, quickly transition and adapt their products and services, devote greater resources to marketing and advertising, or be better positioned to withstand substantial price competition. Some of our competitors may even aggressively discount their products and services in order to gain market share, which could result in pricing pressures, reduced profit margins, lost market share, or a failure to grow market share for us. Additionally, our retail partners may develop direct relationships with suppliers and begin to market private label fitness equipment products under their own brand names in competition with our products. If we are not able to compete effectively against our competitors, they may acquire and engage customers or generate revenue at the expense of our efforts, which could have an adverse effect on our business, financial condition, and results of operations.

The market for subscription-based interactive health and fitness services such as those delivered through our iFIT platform is still in the early stages of growth and if it does not continue to grow, grows more slowly than we expect, or fails to grow as large as we expect, our business, financial condition, and results of operations may be adversely affected.

The market for subscription-based interactive health and fitness services is relatively new and rapidly growing, and it is uncertain whether it will sustain high levels of demand and achieve wide market acceptance. Our success depends substantially on the willingness of consumers to widely adopt our products and services. In part, adoption of our products and services will depend on an increased profile of both the market as a whole and our own platform. To be successful, we will have to educate consumers about our products and services through investment, and provide quality content that is superior to the content and experiences provided by our competitors. With respect to our iFIT platform, some individuals may be reluctant or unwilling to use connected

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health and fitness devices because they have concerns regarding the risks associated with data privacy and security. If the wider public does not perceive the benefits of our connected health and fitness devices or chooses not to adopt them as a result of concerns regarding data privacy and security or for other reasons, this could limit our growth potential and adversely affect our results of operations. The development and growth of this relatively new market may also prove to be a short-term trend. Additionally, the health and fitness market at large is highly competitive, and the demand for and market acceptance of new products and services in the market is uncertain. It is difficult to predict the future growth rates, if any, and size of our market. We cannot assure you that our market will develop, that the public’s interest in connected health and fitness will continue, or that our products and services will be widely adopted. In particular, our subscribers that obtain annual memberships in bundles with equipment purchases may not renew. If our market does not develop, develops more slowly than expected, or becomes saturated with competitors with whom we cannot remain competitive, or if our products and services do not achieve market acceptance, our business, financial condition, and results of operations could be adversely affected.

We may be unable to attract and retain subscribers, which could have an adverse effect on our rate of growth, business and results of operations.

Our continued business and revenue growth is dependent on our ability to attract and retain subscribers and grow product sales, and we may not be successful in these efforts, or member retention levels may materially decline. A purchase of iFIT equipment may be bundled with a purchase of an annual iFIT subscription; however, these members may not renew their iFIT subscriptions after the first year and/or subsequent months, and a decline in the rate of renewals would have an adverse effect on our business. While our subscriptions generally provide for renewal, our customers may opt-out of automatic renewal and customers have no obligation to renew a subscription after its expiration. We expect to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan. While we believe this will generate benefits for us, it could lead to fewer subscriptions, lower sales or higher churn. Further, new laws and regulations by states, the federal government, or international authorities, that are being considered or that have been recently enacted, related to automatic renewal practices, which in some cases may not allow for automatic renewal and would require customers to opt-in to each month, could impact the rate of renewal by our customers and certain of our business practices, and therefore our revenues. There are a number of factors that could lead to a decline in subscriber levels or that could prevent us from increasing our subscriber levels or product sales, including, but not limited to:

• our inability to deliver quality products or content;

• a potential reversal of the trend toward in-home fitness following the global pandemic;

• harm to our brands and reputation;

• pricing and perceived value of our offerings;

• the success of our sales and marketing efforts;

• concerns by consumers or members regarding privacy or data security;

• our members engaging with competitive products and services;

• technical or other problems preventing members from accessing our content and services in a rapid and reliable manner or otherwise affecting the member experience;

• interruptions in our ability to sell or deliver our products or to create content and services for our members as a result of the global pandemic; and

• deteriorating general economic conditions or a change in consumer spending preferences or buying trends including available product financing, whether as a result of the global pandemic or otherwise.

A decline in subscriber levels or product sales could have an adverse effect on our business, financial condition, and results of operations.

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We rely on a limited number of suppliers, manufacturers, and logistics partners for our products. A loss of any of these partners could negatively affect our business.

We rely on a limited number of suppliers, manufacturers, and logistics partners, including in some cases only a single supplier for some of our products, components and raw materials. While we own and operate our own manufacturing facilities for certain of our products, we depend upon independent contract manufacturers to manufacture the substantial majority of products we sell. Further, we have a significant concentration with one contract manufacturer. Our reliance on a limited number of manufacturers, in particular with our main contract manufacturer, increases our risks, since we may face timing delays or difficulties transferring to or finding alternate or replacement manufacturers, and we do not currently have alternative or replacement manufacturers beyond these key parties. In the event of interruption from any of our manufacturers, we may not be able to increase capacity from other sources or develop alternate or secondary sources without incurring material additional costs and substantial delays. Additionally, if our contract manufacturers fail to make timely shipments, do not meet our quality standards, or otherwise fail to deliver us product in accordance with our plans, there could be a material adverse effect on our results of operations.

Our interactive fitness equipment is finished in multiple facilities located in seven countries, but the majority of our top suppliers are located in China. Our business could be adversely affected if one or more of our suppliers is impacted by adverse political developments, a natural or man-made disaster, including climate change, or other interruption at a particular location. In the past we have experienced some disruptions from suppliers due to natural disasters and labor disruptions. Our business is experiencing shortages of shipping containers, lack of available space on transport ships, and the disruption of global logistics and supply chains that may result in a material adverse effect on our operations including increased lead times. The costs and lead times of steel, cast iron, aluminum, and plastics have increased substantially. Consequently, we are seeing shortages and longer lead times in our acquisition of components necessary in the manufacture of our products. In addition, we have begun experiencing difficulty in ordering integrated circuits (“ICs”) for future use and that difficulty is continuing. The global shortage of ICs and increasing costs and lead times of raw materials and components is affecting a multitude of industries. While we are identifying other sources and taking other production and inventory control steps in order to mitigate the effects caused by these shortages, we cannot guarantee that we will find alternative sources to meet our short and longer-term needs and/or without experiencing increases in the prices we pay for these components. If we are not able to find these alternative sources or are not able to purchase sufficient quantities from our current and alternative suppliers, we may not be able to produce sufficient quantities of products to meet our customers’ demands.

As our ability to meet our customers’ needs depends on our ability to maintain a steady supply of products from our independent contract manufacturers, if one or more of our suppliers or vendors were to close or sever their relationship with us or significantly alter the terms of our relationship, we may not be able to obtain replacement products in a timely manner, which could have a material adverse effect on our business, financial condition, and results of operations. Additionally, if we experience significantly increased demand, or if we need to replace an existing supplier, manufacturer or logistics partner for any reason, we may be unable to supplement or replace them on terms that are acceptable to us, which may undermine our ability to deliver our products to members in a timely manner. For example, it may take a significant amount of time to identify a manufacturer that has the capability and resources to build our products to our specifications in sufficient volume. Identifying suitable suppliers, manufacturers, and logistics partners is an extensive process that requires us to become satisfied with their quality control, technical capabilities, responsiveness and service, financial stability, regulatory and legal compliance, and labor and other ethical practices. Even if we are able to find a new supplier, manufacturer or logistics partner on terms that are acceptable to us, we may be required to incur higher, or additional costs, which may be long-term, which may have an adverse effect on our subscription levels, financial condition and results of operations. In addition, in the absence of exclusivity arrangements, our suppliers, contract manufacturers, and logistics providers may have or may seek at any time to have relationships with our competitors and potential competitors, and as a result of such relationships, such suppliers, contract manufacturers, and logistics providers may choose to limit or terminate their relationship with us. Accordingly, a loss of any of our significant suppliers, manufacturers, or logistics partners could have an adverse effect on our business, financial condition and results of operations.

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We have limited control over our suppliers, manufacturers, and logistics partners, which may subject us to significant risks, including the potential inability to produce or obtain or produce quality products and services on a timely basis or in sufficient quantity.

We have limited control over our suppliers, manufacturers, and logistics partners, including aspects of their specific manufacturing processes and their labor, environmental, or other practices, which subjects us to risks, such as the following:

• inability to satisfy demand for our products;

• reduced control over delivery timing and product reliability;

• reduced ability to oversee or monitor the manufacturing process and components used in our products;

• limited ability to develop comprehensive manufacturing specifications that take into account any materials shortages or substitutions;

• variance in the manufacturing capability of our third-party manufacturers;

• price increases;

• failure of a significant supplier, manufacturer, or logistics partner to perform its obligations to us for technical, market, regulatory, or other reasons;

• variance in the quality of last mile services provided by our third-party logistics partners;

• difficulties in establishing additional supplier, manufacturer, or logistics partner relationships if we experience difficulties with our existing suppliers, manufacturers, or logistics partners;

• shortages of materials or components;

• shortages of shipping containers and the disruption of global logistics and supply chains;

• infringement, misappropriation or other violation of our intellectual property or proprietary rights;

• exposure to natural catastrophes, political unrest, terrorism, labor disputes, and economic instability resulting in the disruption of trade from foreign countries in which our products are manufactured or the raw materials/components thereof are sourced;

• changes in local economic conditions in the jurisdictions where our suppliers, manufacturers, and logistics partners are located;

• the imposition of new laws and regulations, including those relating to labor conditions, quality and safety standards, environmental, health and safety, imports, duties, tariffs, taxes, and other charges on imports, as well as trade restrictions and restrictions on currency exchange or the transfer of funds; and

• insufficient warranties and indemnities on raw materials or components supplied to our manufacturers or performance by our partners.

If there are defects in the manufacture of our products by our contract manufacturers, we may face negative publicity, government investigations, and litigation and we may not be fully compensated by our contract manufacturers for any financial or other liability that we suffer as a result. Further, we also rely on our logistics partners, including last mile warehouse and delivery partners, to complete substantially all of our deliveries to customers, with the rest of the deliveries handled by our own last mile team. Our primary last mile partners rely on a network of independent contractors to perform last mile services for us in many markets. If any of these independent contractors, or the last mile partners as a whole, do not perform their obligations or meet the expectations of us or our members, our reputation, brands and business could suffer. The occurrence of any of these risks, especially during seasons of peak demand, could cause us to experience a significant disruption in our ability to produce and deliver our products to our members, which could have an adverse effect on our subscriptions, business, financial condition and results of operations.

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Increases in raw materials and component costs, long lead times, supply shortages, transportation and logistical issues and supply changes could disrupt our supply chain and have an adverse effect on our business, financial condition, and results of operations.

Meeting customer demand partially depends on our ability to obtain timely and adequate delivery of raw materials and components for our products. We generally procure certain key electronic components for our products. We are therefore subject to the risk of holding these components in our inventory. Some of these components come from limited or sole sources of supply. In addition, we rely on manufacturers to assemble such components into our final end products. In addition, the lead times associated with certain raw materials and components or the manufacturing of such various components into our final end products are lengthy and preclude rapid changes in design, quantities, and delivery schedules. Our business is experiencing shortages of shipping containers, lack of available space on transport ships, and the disruption of global logistics and supply chains that may result in a material adverse effect on our operations including increased lead times. The costs and lead times of steel, cast iron, aluminum, and plastics have increased substantially. Consequently, we are seeing shortages and longer lead times in our acquisition of components necessary in the manufacture of our products. In addition, we have begun experiencing difficulty in ordering integrated circuits (“ICs”) for future use and that difficulty is continuing. The global shortage of ICs and increasing costs and lead times of raw materials and components is affecting a multitude of industries. While we are identifying other sources and taking other production and inventory control steps in order to mitigate the effects caused by these shortages, we cannot guarantee that we will find alternative sources to meet our short and longer-term needs and/or without experiencing increases in the prices we pay for these components. If we are not able to find these alternative sources or are not able to purchase sufficient quantities from our current and alternative suppliers, we may not be able to produce sufficient quantities of products to meet our customers’ demands. We may continue to and in the future experience component shortages, and the predictability of the availability of these raw materials and components is and may be limited. In the event of a component shortage, we may not be able to develop alternate sources in a timely manner. Developing alternate sources of supply for these raw materials and components may be time-consuming, difficult, and costly and we may not be able to source these raw materials and components on terms that are acceptable to us, or at all, which may undermine our ability to fill our orders in a timely manner. Any interruption or delay in the supply of any of these raw materials or components, or the inability to obtain these raw materials or components from alternate sources at acceptable prices and within a reasonable amount of time, would harm our ability to meet our scheduled product deliveries to our customers. Moreover, volatile economic conditions may make it more likely that our suppliers may be unable to timely deliver supplies, or at all, and there is no guarantee that we will be able to timely locate alternative suppliers of comparable quality at an acceptable price. Several of the raw materials or components that go into the manufacturing of our products are sourced internationally, including from China, where the United States has imposed tariffs on specified products imported therefrom following the U.S. Trade Representative Section 301 Investigation. These issues have been exacerbated by the global pandemic. These tariffs have an impact on our raw materials and component costs and have the potential to have an even greater impact depending on the outcome of the current trade negotiations, which have been protracted and recently resulted in increases in U.S. tariff rates on specified products from China. We have seen, and may continue to see, an increase in transportation and logistical issues, including strikes, congestion and new import/export restrictions implemented at ports that we rely on for our business, as well as union action, trucker and transportation strikes, and other obstacles affecting transportation infrastructure. In many cases, we have had to secure alternative transportation, such as air freight, or use alternative routes, at increased costs to run our supply chain. Increases in our raw materials or component costs, or delays or disruptions or increased costs relating to transportation and logistics, could have a material effect on our gross margins. The loss of a significant supplier, an increase in raw material or component costs, or delays or disruptions in the delivery of raw materials or components or finished goods, could adversely impact our ability to generate future revenue and have an adverse effect on our business, financial condition, and results of operations.

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Our success depends on our ability to maintain our brands. If events occur that damage our brands, our business and financial results may be harmed.

Our success depends on our ability to maintain the value of the “iFIT” brand as well as other key product brands like “NordicTrack,” “ProForm,” “Freemotion,” “Weider,” “Sweat” and “29029” as well as other brands that we may acquire or develop in the future. The “iFIT” name and our product brands are integral to our business as well as to the implementation of our strategies for expanding our business. Maintaining, promoting, and positioning our brands will depend largely on the success of our marketing efforts, our ability to provide consistent, high-quality, reliable products, services, features, content, and customer support, our ability to maintain our customers’ trust, our ability to successfully differentiate our services and platform capabilities from competitive products and services, and our ability to successfully obtain, maintain, and protect our rights to use the “iFIT” name and other trademarks that are important to our business. We believe that the importance of our brands will increase as competition further intensifies and brand promotion activities may require substantial expenditures. Our brands could be harmed if we fail to achieve these objectives or if our public image, reputation or brands were to be tarnished by negative publicity, including negative online reviews or any viral negative publicity on social media or otherwise. Unfavorable publicity about us, our products or our trainers could diminish confidence in, and the use of, our products and services. Obtaining, maintaining, protecting, defending and enhancing our brands may require us to make substantial investments, and these investments may not be successful. If we fail to successfully promote our brands and protect our reputation or if we incur significant expenses in this effort, our business, financial condition and results of operations may be adversely affected and it also could have an adverse effect on subscription and retention rates and the size, engagement and loyalty of our member base.

We track certain operational and business metrics internally and our members use our products, subscriptions, and fitness accessories to track and record other certain metrics, including their workouts, and any real or perceived inaccuracies in such metrics and data may harm our reputation and negatively affect our business and ability to retain our members.

We track certain operational and business metrics, including workouts per user per month and total number of workouts on our platform, with internal methods, which are not independently verified by any third party and are often reliant upon an interface with mobile operating systems, networks and standards that we do not control. Similarly, our members use our products, subscriptions, and fitness accessories, such as our heart rate monitor, to track and record certain metrics related to their workouts.

Our internal methods have limitations and our process for tracking these metrics may change over time, which could result in unexpected changes to our metrics, including the metrics we report. If the internal methods we use under-count or over-count metrics related to our workouts per user per month and total number of workouts on our platform or other metrics as a result of algorithm or other technical errors, the operational and business metrics that we report may not be accurate. Furthermore, if the software used in our products or on our platform malfunctions and fails to accurately track, display, or record member workouts and metrics, we could face claims alleging that our products and services do not operate as advertised. Such reports and claims could result in negative publicity, product liability claims, and, in some cases, may require us to expend time and resources to refute such claims and defend against potential litigation. In addition, limitations or errors with respect to how we measure certain operational, business and user metrics may affect our understanding of certain details of our business, which could affect our longer term strategies. If our operational and business metrics are not accurate representations of our business, market penetration, retention or engagement; if we discover material inaccuracies in our metrics; if the metrics we rely on to track our performance do not provide an accurate measurement of our business; if our products and services fail to provide accurate metrics and data to our members; or if there are reports or claims of inaccurate metrics and data or claims of inaccuracy regarding the overall health benefits of our products and services in the future, our reputation may be harmed, we may become the subject of negative publicity, litigation, regulatory proceedings, and warranty claims, and our results of operations could be adversely affected. Further, while we disclose that our heart rate monitor is not a medical device, and that certain of our metrics, such as estimated calories burned, are only estimates, any real or

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perceived inaccuracies in any metrics we provide, or the undue reliance by members on such metrics, could result in the loss of members, negative publicity or litigation.

Finally, despite our efforts and processes to prevent breaches and other security incidents, our devices, as well as our servers, computer systems, and those of third parties that we use in our operations to track such metrics are vulnerable to cybersecurity risks. Despite our efforts to create security barriers to such threats, any breach or security incident may result in negative publicity, adversely affect our brand, decrease demand for our products and services, negatively impact consumer confidence, cause us to incur significant costs and liabilities and adversely affect our business, financial condition and results of operations. See “Risks Related to Information Technology and Intellectual Property—Any cybersecurity attack, disruption or failure of our or our third-party service providers’ information technology systems, or our failure to successfully implement upgrades and new technology effectively, could adversely affect our business and operations.”

Changes in our marketing approach could increase our marketing expenses and potentially decrease subscription levels, and our marketing campaigns may not be successful.

We employ a range of marketing and other brand-building measures to reach and retain members. We use traditional television, broadcast and online advertising, as well as third-party social media platforms such as Facebook, Twitter, and Instagram, as marketing tools. As television advertising, online, and social media platforms continue to evolve or grow more competitive, we must maintain a presence on these platforms and establish a presence on any new or emerging social media, advertising and marketing platforms. We also rely on third-party marketing service providers to communicate with our customers by methods such as email, SMS text messages and mobile push notifications. Any delay or errors in the delivery of such emails or other messaging we send may occur and be beyond our control, which could damage our reputation or harm our business, financial condition and results of operations. We additionally market and run promotions with our retail partners. If we cannot employ these and new marketing tools in a cost-effective way, or if we fail to promote our products and services efficiently and effectively, our member acquisition and, therefore our financial condition, may be negatively impacted. In addition, an increase in the use of television, online, and social media for product promotion and marketing may increase the burden on us to monitor compliance of such materials and increase the risk that such materials could contain problematic product or marketing claims in violation of applicable regulations or be placed near other content that harms our brand. Online and social media advertising platforms also may restrict our use of cookies and similar technologies for advertising purpose or significantly increase the level of compliance or requirements necessary to use those platforms, which could reduce the effectiveness of our marketing efforts. Additionally, if any consumers have a negative reaction to any of our advertising, whether or not intended, this could result in negative publicity, which could harm our reputation and brand, and could result in additional expense to counteract any such negative reaction or publicity. Further, if for any reason any of our advertising campaigns prove less successful than anticipated in attracting new members or retaining existing members, we may not be able to recover our advertising spend, and our member acquisition rate may fail to meet market expectations, either of which could negatively impact our business. There can be no assurance that our advertising and other marketing efforts will result in increased sales of our products and services.

We sell our products through multiple channels and a significant reduction in orders from any major customer in our third-party channels could adversely affect our financial results.

We sell our products through multiple channels, and the loss of, or reduction in orders from, any major customer for any reason (including, for example, changes in a retailer’s strategy, claims or allegations that our products or products we market on behalf of third parties are unsafe, a decline in consumer demand, regulatory, legal or other external pressures or a change in marketing strategy) could have a material adverse effect on our business, financial condition, results of operations and cash flows, as could customer disputes regarding shipments, fees, merchandise condition or related matters. Our inability to collect accounts receivable from one of our major customers, or a significant deterioration in the financial condition of one of these customers, including a bankruptcy filing or a liquidation, could also have a material adverse effect on our financial condition, results of operations and cash flows.

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We do not have long-term sales agreements with, or other contractual assurances as to future sales to, any of our major retail partners. In addition, continued consolidation in the retail industry has resulted in an increasingly concentrated retail base, and as a result, we are significantly dependent upon sales to key retailers who have significant bargaining strength. To the extent such concentration continues to occur, our net sales and income from operations may be increasingly sensitive to deterioration in the financial condition of, or other adverse developments involving our relationship with, one or more of our major customers. In addition, our business may be negatively affected by changes in the policies of our retailers, such as inventory destocking, limitations on access to shelf space, price demands and other conditions.

We have grown rapidly in recent periods. If we are unable to manage our growth effectively, our brands, company and financial performance may suffer.

We recently have grown our sales rapidly. To effectively manage and capitalize on our growth, we must continue to expand our sales and marketing, continue to focus on innovative product and content development, continue to improve and update our software and technology and upgrade our management information systems and other processes. Moreover, the vertically integrated nature of our business, where we design our own products, conduct research and development, develop our own software and technology, produce original health and fitness programming and deliver and service our products, exposes us to risk and disruption at many points that are critical to successfully operating our business. If we do not adapt to meet these evolving challenges, we may experience erosion to our brands, and the quality of our products and services may suffer. Further, as we continue to grow, we may face challenges acquiring adequate and timely supplies of our products to satisfy the levels of demand, which may negatively affect our revenue, and this risk may be exacerbated by the fact that we may not carry sufficient levels of inventory, either directly or with our manufacturers or logistics partners to satisfy demand increases. The rapidly evolving nature of the market in which we sell our products and services, substantial uncertainty concerning how these markets may develop, and other factors beyond our control, reduces our ability to accurately forecast quarterly or annual revenue. Failure to manage our future growth effectively could have an adverse effect on our business, financial condition, and results of operations.

Our profitability may suffer as a result of competitive pricing, the price sensitive nature of our sales and other pressures.

The introduction of lower-priced alternative products or services by other companies can hurt our competitive position in all of our businesses. We are constantly subject to competitive pressures in which other manufacturers may pursue a strategy of aggressive pricing, particularly during periods when their local currency weakens versus the U.S. dollar. We may set product prices at a different time from when we purchase raw materials and components. After we have established prices, we may be unable to pass cost increases along to our customers, or to compete as effectively if we seek to pass such costs along, which could have a material adverse effect on us. Such pricing pressures may limit our ability to increase prices for our products in response to raw material and other cost increases and negatively affect our profit margins. Further, due to competitive pressure or otherwise, we may choose to reduce our pricing and sell certain of our products at a loss, including, for example, to increase the volume of products sold, remain competitive or for other strategic reasons. Any price compression in the market could have an adverse effect on our profit margin, financial condition and results of operations.

We face risks, such as unforeseen costs and potential liability, in connection with content we produce, license, and distribute through our iFIT platform.

As a producer and distributor of content, we face potential liability for negligence, copyright, and trademark infringement, or other claims based on the nature and content of materials that we acquire, produce, license, and/or distribute through our iFIT platform. We also may face potential liability for content used in promoting our service, including marketing materials. We produce interactive original content. We believe that original content can help differentiate our service from other offerings, enhance our brands and otherwise attract and retain members. To the extent our original content does not meet our expectations, in particular, in terms of costs,

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viewing and popularity, our business, our brands and results of operations, may be adversely impacted. This risk may be exacerbated for new content we create for our international markets. We also may decide to remove content from our platform, not to place certain content on our platform, or to discontinue or alter our production of certain types of content if we believe such content might not be well received by our members or could be damaging to our brands and business. To the extent we do not accurately anticipate costs or mitigate risks, including for content that we obtain or produce, but that ultimately does not appear on or is removed from our platform, or if we become liable for content we acquire, produce, license and/or distribute, our business may suffer. Litigation to defend these claims could be costly, could divert management’s attention, and the expenses and damages arising from any liability could harm our results of operations. We may not be indemnified against claims or costs of these types and we may not have insurance coverage for these types of claims.

Our products and services may be affected from time to time by design and manufacturing defects that could adversely affect our business and result in harm to our reputation.

We offer a wide variety of complex hardware and software products and services that can be affected by design and manufacturing defects. Product defects can occur through either our own or third-party product development, design and manufacturing processes. Sophisticated operating system software and applications, such as those offered by us, often have issues that can unexpectedly interfere with the intended operation of hardware or software products. Although we extensively and rigorously test new and enhanced products and services before their release, there can be no assurance we will be able to detect, prevent, or fix all defects. Defects may also exist in raw materials, components and products that we source from third parties. Any such defects could make our products and services unsafe, create a risk of personal injury, property damage and subject us to the hazards and uncertainties of product liability claims and related litigation. In addition, from time to time we may experience outages, service slowdowns, or errors that affect our content streaming. As a result, our services may not perform as anticipated and may not meet customer expectations. Failure to detect or prevent these issues could result in technical and performance issues affecting our products and services, a greater number of returns of products than expected from members and retailers, regulatory proceedings, product recalls, and litigation, which could harm our business, financial condition and results of operation. Quality problems could adversely affect the experience for users of our products and services, and result in harm to our reputation, loss of competitive advantage, poor market acceptance, reduced demand for our products and services, delay in new product and service introductions, and lost revenue. Further, the occurrence of real or material defects or even just perceived quality problems in our current and future products could create negative publicity related to the perceived quality and safety of our products, which could affect our brands and decrease demand for our products and services, and adversely affect our business, financial condition and results of operations.

We maintain general liability and product liability insurance; however, design and manufacturing defects, and claims related thereto, may subject us to judgments or settlements that result in damages materially in excess of the limits of our insurance coverage. In addition, we have in the past and may in the future be exposed to recalls, product replacements or modifications, write-offs of inventory, property, plant and equipment, or intangible assets, and significant warranty and other expenses such as litigation costs and regulatory fines. If we cannot successfully defend any large claim, maintain our general liability insurance on acceptable terms, or maintain adequate coverage against potential claims, our business, financial condition and results of operations could be adversely impacted.

We incur various expenses related to product defects, including product warranty costs, product recall and retrofit costs and product liability costs, which can have an adverse impact on our results of operations. In addition, the reputation of our brands may be diminished by product defects and recalls, in particular with respect to any negative publicity associated with the product defects or recalls. Our inability to cure a product defect could result in the failure of a product line or the temporary or permanent withdrawal from a product category or market.

We maintain a reserve for our product warranty costs based on certain estimates and our knowledge of current events and actions, but our actual warranty costs may exceed our reserve, resulting in a need to increase our

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reserves for warranty charges. We purchase insurance coverage to reduce our exposure to significant levels of product liability claims and maintain a reserve for our self-insured losses based upon estimates of the aggregate liability using claims experience and actuarial assumptions. Incorrect estimates or any significant increase in the rate of our product defect expenses could have a material adverse effect on our results of operations. Further, our assumptions for new types of products may also be less reliable, and therefore there may be an increased risk of incorrect estimates anytime we launch a new product. Given our focus on our research and development efforts on building new software and hardware products, a launch of any new product may increase the risk that our estimates are incorrect, and increase the rate of our product defect expenses, which could have a material adverse effect on our results of operations.

Due to the global pandemic, we may experience higher product returns as consumer discretionary spending decreases. Moreover, in light of changes we have made to our delivery procedures in connection with the current global pandemic, it is possible that warranty claims may increase above historical rates, and we may be unable to satisfactorily validate and resolve warranty claims where the global pandemic prevents us from performing in-home service appointments. For example, because the global pandemic may prevent us from entering purchasers’ homes, if a customer wants to return a product, we require such customer to move their product to their door, so we can collect such product without direct physical interaction, which may negatively impact customer satisfaction. Additionally, if we are unable to resolve warranty claims through in-home service appointments, in some cases, we have sent the member a replacement product and have requested that they hold the impaired product until a later date when we can safely retrieve it.

Short product life cycles can make it difficult to maintain continued interest in our products.

Product life cycles can be short in the fitness industry and innovation is an important component of competition. While we emphasize new product innovation and product repositioning (i.e., design changes or revised marketing strategies), we may be unable to continue to develop competitive products in a timely manner or to respond adequately to market trends. In addition, we may not be able to ensure that repositioned products will gain initial market acceptance, that interest in our products will be sustained, or that significant start-up costs with respect to new products will be recouped. Moreover, although our management believes that fitness and health activities have become important for consumers, we cannot ensure that interest in any particular fitness modality will be sustained.

Although we offer a range of fitness modalities, certain modalities, including treadmills, constitute a substantial portion of our interactive equipment sales. We could be adversely affected if we were to experience a significant decline in the popularity of treadmills these modalities and were unable to replace any decline with growth in the other modalities we offer or may offer in the future.

We have been and may be subject to claims resulting from injuries experienced by our customers, which could damage our reputation and have other adverse effects on our business.

As we offer a variety of interactive fitness equipment, we face an inherent business risk of exposure to product liability claims or reputational risk in the event that our products result in injury and we are currently subject to such claims. As with any fitness equipment, there are health and safety issues, which include injuries that could result from misuse of our fitness equipment by our customers, failure of users to properly assemble equipment, the failure by users to follow safety protocols, including the use or misuse of our equipment by children, and defects in the manufacture of our equipment. While the safety of our customers is important to us, the safety protocols we have in place may not be sufficient, and, due to the interactive nature of many of our products, which allows for the automatic adjustment to the speed, resistance and incline of iFIT-enabled equipment in sync with certain of our content, or the adjustment to the speed, resistance and incline of iFIT-enabled equipment by our trainers, if one of our subscribers experiences a serious injury or harm while following a trainer recommended protocol, or as a result of engaging in content that automatically makes such adjustments, they could initiate a product liability or other claim against us. Injury may also occur if an individual uses our

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equipment for purposes such as cardio or heart rate training at a level that is not appropriate for that individual in light of underlying health conditions or fitness levels. Any such claims, whether meritless or not, could harm our reputation and brand and result in losses as a result of expenses incurred in defending claims or the award of damages. And while we maintain general liability and product liability insurance, we cannot make assurances that they will be sufficient to cover all claims, that such claims will not exceed our insurance coverage limits or that such insurance will continue to be available on commercially reasonable terms, if at all.

Our results of operations could be materially harmed if we are unable to accurately forecast consumer demand for our products and services and adequately manage our inventory.

To ensure adequate inventory supply, we must forecast inventory needs and expenses and place orders sufficiently in advance with our suppliers and contract manufacturers based on our estimates of future demand for particular products. Our ability to accurately forecast demand for our products and services could be affected by many factors, including an increase or decrease in customer demand for our products and services or for products and services of our competitors, product and service introductions by competitors, unanticipated changes in general market conditions, and the weakening of economic conditions or consumer confidence in future economic conditions. Due to the recent rapid growth in demand for our interactive health and fitness devices, we face challenges acquiring adequate and timely supplies of our products to satisfy the levels of demand, which we believe negatively affects our revenue. This risk may be exacerbated by the fact that we may not carry a significant amount of final end products inventory, either directly or with our contract manufacturers or logistics providers to satisfy short-term demand increases. For example, we have experienced an unexpected increase in demand for our products as a result of government shelter-in-place orders and other stay-at-home dynamics in response to the global pandemic, which has resulted in inventory shortages, delayed delivery timelines and delays in fulfilling support requests. We are in particular subject to raw material inventory risk as well; we or our contract manufacturers may not hold enough raw material inventory, or may hold too much raw material inventory, at any point in time. If we fail to accurately forecast customer demand, we may experience excess inventory levels or a shortage of products available for sale.

Inventory levels in excess of customer demand may result in inventory write-downs or write-offs and the sale of excess inventory at discounted prices, which would cause our gross margin to suffer and could impair the strength of our brand. Conversely, if we underestimate customer demand for our products and services, our contract manufacturers may not be able to deliver products to meet our requirements, and this could result in damage to our brands and customer relationships and adversely affect our revenue and results of operations.

We rely on the skills and capabilities, as well as the creativity, of our trainers to generate our experiential content. If we are unable to attract and retain high-quality trainers, we may not be able to generate interesting and attractive content for our workouts.

Production of the health and fitness content on our platform is reliant on the skills and capabilities, as well as creativity, of our trainers who, with the support of our production team, plan and lead our live and on-demand content. Our standard independent contractor agreement with our trainers is for specific projects and time periods. If we are unable to attract or retain creative and experienced trainers, we may not be able to generate content on a scale or of a quality sufficient to grow our business. Additionally, if the quality of our trainers comes into question, whether due to discrediting of their credentials, negative publicity regarding their actions or the views they express, whether or not relating to their work for us, our content and our brand could suffer. Also, our trainers have sustained injuries in the past, and if this happens in the future it may impact our ability to produce certain content, and given that some of our members prefer to stream content by certain of our trainers, the temporary or permanent loss of such preferred trainers to stream or record content due to injury could have an adverse effect on our members’ experiences, and therefore our ability to retain our members or attract new members. Our trainers are important to our success, as we rely on them to bring new, innovative health and fitness content to our iFIT platform. If we fail to produce and provide our members with interesting and attractive content led by quality trainers with whom they can relate, then our business, financial condition, and results of operations may be adversely affected.

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The insolvency, credit problems, or other financial difficulties and general economic conditions confronting our retail partners, distributors and other purchasers of our products could expose us to financial risk.

Some of our retailers, distributors and other purchasers of our products have experienced financial difficulties in the past. The retail industry in general is changing. More people are shopping online and there is a general consolidation of major brands and a large number of well-known brands are stressed, including former industry giants. Commercial fitness facilities, some of which are our customers, have experienced financial difficulties, in particular recently, as a result of the global pandemic. The insolvency, credit problems, or other financial difficulties and general economic conditions confronting our retail partners, distributors or other purchasers of our products could expose us to financial risk. Financial difficulties of our retail partners, distributors or other purchasers of our products could impede their effectiveness and also expose us to risks if they are unable to pay for the products they purchase from us. The difficulties of retail partners, distributors or other purchasers of our products may also lead to price cuts of our products and adverse effects on our brands and results of operations. Retail businesses may also be adversely affected by unfavorable local, regional or national economic developments which result in reduced consumer spending. We cannot ensure that an economic downturn would not have a material adverse effect on our customers and, therefore, on the retailers with which we work, and on us. Any reduction in sales by our current retail partners, distributors or joint venture partner, loss of large resellers or distributors, or decrease in revenue from our retail partners, distributors and other purchasers of our products could adversely affect our revenue, results of operations, and financial condition.

If we fail to offer high-quality member support, our business and reputation will suffer.

Once our products are purchased, they must be assembled by the purchaser or our white glove delivery team. Our members also rely on our support services to resolve any issues related to the use of our products and content. Providing a high-quality member experience is important to our success in generating word-of-mouth referrals to drive sales and for retaining existing members and in maintaining the strength of our brand. Due to the global pandemic, our ability to provide high-quality member support has been significantly impacted. For example, due to the global pandemic, our ability to provide in-home installation and servicing of our products has been restricted, and delivery procedures for our products are still limited to curbside and threshold delivery. In addition, the closure of our offices has forced some of our member support staff to work from home, which may result in work-productivity issues or a decrease in efficiencies, particularly during times of high call volume as we have seen when delivery lead times get longer. As a result of the global pandemic or otherwise, purchasers may have unsatisfactory experiences with the delivery, installation, or servicing of our products, including due to prolonged delivery timelines and limitations on or the suspension of the in-home installation, return, and warranty servicing processes. Further, the importance of high-quality support will increase as we expand our business and introduce new products and services. If we do not help our members quickly resolve issues and provide effective ongoing support, our reputation may suffer and our ability to retain and attract members, or to sell additional products and services or add-on products or services to existing members, could be harmed.

We depend on key personnel, the loss of whom would harm our business.

Our future success will depend in part on the continued service of key executive officers and personnel. In particular, we are highly dependent on the contributions of members of our management team. The loss of the services of any key individual could harm our business. Our future success also depends on our ability to recruit, retain, and motivate our personnel, as well as ultimately to put in place succession plans, both to maintain our current business and to execute our strategic initiatives. Competition for employees in our industry is intense and we may not be successful in attracting and retaining such personnel. If members of our senior management team become ill, we may not be able to manage our business effectively and, as a result, our business and results of operations could be harmed.

Our business is affected by seasonality which results in fluctuations in our results of operations.

Historically, we have experienced fluctuations in aggregate sales volume during the year. Sales are typically strongest in the second and third fiscal quarters, including the holiday period and new calendar year. However,

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the mix of product sales may vary considerably from time to time as a result of changes in seasonal and geographic demand for particular types of fitness equipment. Similarly, we have experienced higher churn in iFIT subscriptions during the third and fourth fiscal quarters, following the expiration of annual subscriptions purchased with fitness equipment purchases. Sweat experiences similar seasonality. As a result, we may not be able to accurately predict our quarterly sales. Accordingly, our results of operations are likely to fluctuate significantly from period to period.

Our quarterly results of operations and other operating metrics may fluctuate from quarter to quarter, which makes these metrics difficult to predict.

Our quarterly results of operations and other operating metrics have fluctuated in the past and may continue to fluctuate from quarter to quarter. Additionally, our significant growth in sales recently makes it difficult to forecast our future results. As a result, you should not rely on our past quarterly results of operations as indicators of future performance. You should take into account the risks and uncertainties frequently encountered by companies in rapidly evolving markets. Our financial condition and results of operations in any given quarter can be influenced by numerous factors, many of which we are unable to predict or are outside of our control, including:

• the continued market acceptance of, and the growth of the interactive health and fitness market;

• our ability to maintain and attract new members;

• the impact of the reopening following the pandemic;

• our development and improvement of the quality of the iFIT experience, including, enhancing existing and creating new products, services, technology, features, and content;

• the continued development and upgrading of our proprietary technology platform;

• our ability to successfully obtain, maintain and protect our intellectual property and other proprietary rights, including third-party licenses;

• the timing and success of new product, service, feature, and content introductions by us or our competitors or any other change in the competitive landscape of our market;

• pricing pressure as a result of competition or otherwise;

• delays or disruptions in our supply, manufacturing or distribution chain;

• errors in our forecasting of the demand for our products and services, which could lead to lower revenue or increased costs, or both;

• increases in marketing, sales, and other operating expenses that we may incur to grow and expand our operations and to remain competitive;

• continued expansion into international markets or variations in our international markets;

• seasonal fluctuations in subscriptions and usage of our products by our members, each of which may change as our products and services evolve or as our business grows;

• the diversification and growth of our revenue sources;

• our ability to maintain gross margins and operating margins;

• constraints on the availability of consumer financing or increased down payment requirements to finance purchases of our products;

• system failures, cybersecurity breaches or other security or privacy incidents that may result in unauthorized access to our systems or unauthorized access to or compromise, misuse or loss of personal information;

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• adverse litigation judgments, settlements, or other litigation-related costs, including costs for past use of third-party content;

• changes in the legislative or regulatory environment, including with respect to privacy, information security, consumer product safety, and advertising, or enforcement by government regulators, including fines, orders, or consent decrees;

• product recalls, regulatory proceedings, or other adverse publicity about our products;

• fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies;

• changes in our effective tax rate;

• changes in accounting standards, policies, guidance, interpretations, or principles;

• changes in business or macroeconomic conditions, including lower consumer confidence, recessionary conditions, increased unemployment rates, or stagnant or declining wages;

• insolvency, credit, or other difficulties faced by our distributors and retailers, affecting their ability to purchase or pay for our products;

• insolvency, credit, or other difficulties confronting our suppliers, contract manufacturers, or logistics providers leading to disruptions in our supply or distribution chain;

• levels of product returns, stock rotation, and price protection rights; and

• costs related to the acquisition of businesses, talent, technologies, or intellectual property, including potentially significant amortization costs and possible write-downs.

Any one of the factors above or the cumulative effect of some of the factors above may result in significant fluctuations in our results of operations. The variability and unpredictability of our quarterly results of operations or other operating metrics could result in our failure to meet our expectations or those of analysts that cover us or investors with respect to revenue or other results of operations for a particular period. If we fail to meet or exceed such expectations for these or any other reasons, the market price of our Class A common stock could fall substantially, and we could face costly lawsuits, including securities class action suits.

The growth of the global health and fitness economy may not continue.

Though the total global health and wellness market is projected to achieve estimated spend of $5.9 trillion in 2021, we cannot be certain consumers’ interest in health and fitness will be sufficient to sustain continued growth in the future. If consumers’ interest in health and fitness activity declines, we cannot assure you that such a decline would not have a material adverse effect on our cash flow, financial condition, and results of operations.

Failure of our contractors or our licensees’ contractors to comply with local laws of various countries and jurisdictions and other standards could harm our business.

We work with third-party contractors to manufacture our products, and we also have license agreements that permit unaffiliated parties to manufacture or contract for the manufacture of our products using our intellectual property. From time to time, the contractors that manufacture our products and our licensees that make our products using our intellectual property may not comply or may be perceived to fail to comply with applicable environmental, health, or safety standards, labeling and content requirements relating to our products, or other applicable laws, or our licensees may fail to enforce such standards or applicable laws on their contractors. Significant or continuing noncompliance with such standards and laws by one or more contractors could cause us to fail to meet customer expectations, harm our reputation or result in a product recall or a disruption in our supply chain and, as a result, could have an adverse effect on our sales and financial condition.

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We have engaged and may continue to engage in merger and acquisition activities, joint ventures and other strategic ventures and investments which could require significant management attention, disrupt our business, dilute stockholder value, and adversely affect our results of operations.

As part of our business strategy we have made and intend to make investments in other companies, products, or technologies in the future, as opportunities rise to the extent we believe they are beneficial to our business. For example, we recently acquired Sweat and 29029, and we have formed a Chinese joint venture. However we may not be able to find suitable acquisition or investment candidates and we may not be able to complete acquisitions or investments on favorable terms, if at all, in the future. If we do complete acquisitions or investments, we may not ultimately strengthen our competitive position or achieve our goals, and any acquisitions or investments we complete could be viewed negatively by members or investors. In addition, any acquisition, investment, or business relationship, including our recent acquisitions, may result in unforeseen operating difficulties and expenditures, particularly if we cannot retain the key personnel of an acquired company, including disrupting our ongoing operations, diverting management from their primary responsibilities, subjecting us to additional liabilities, increasing our expenses, and adversely impacting our business, financial condition, and results of operations. The integration of acquisitions requires time and focus from our management team and may divert attention from the day-to-day operations of our business. We may not successfully integrate the acquisitions we have made or make. Our business may be negatively impacted following an acquisition if we are unable to effectively manage our expanded operations. In addition, even if our operations are integrated successfully with acquired companies, such as Sweat, we may not realize the full benefits of the acquisition, including the synergies, operating efficiencies, or sales or growth opportunities that are anticipated.

Moreover, we may be exposed to unknown liabilities and the anticipated benefits of any acquisition, investment, or business relationship may not be realized, if, for example, we fail to successfully integrate such acquisitions, or the technologies or products associated with such acquisitions, into our company. Unforeseen negative impacts of any acquisition could have a negative impact on our brands, reputation, competitive position or customer relationships, or cause a diversion of management attention. To pay for any such acquisitions, we would have to use cash, incur debt, or issue equity securities, each of which may affect our financial condition or the value of our capital stock and could result in dilution to our stockholders. If we incur more debt it would result in increased fixed obligations and could also subject us to covenants or other restrictions that could impede our ability to manage our operations and impose restrictions on our capital raising activities, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. We may not successfully evaluate or utilize the acquired business or technology and accurately forecast the financial impact of an acquisition transaction, including accounting charges. Additionally, we may receive indications of interest from other parties interested in acquiring some or all of our business. The time required to evaluate such indications of interest could require significant attention from management, disrupt the ordinary functioning of our business, and could have an adverse effect on our business, financial condition, and results of operations.

We may need additional capital to support the growth of our business and the achievement of our goals, which we may not be able to source on reasonable terms, if at all, and the terms of such additional capital may be disadvantageous to our existing stockholders.

Though we expect the proceeds from this offering, as well as our cash and cash equivalents, will be adequate to meet our anticipated funding needs for the foreseeable future, we may need additional capital to support the growth of our business, achieve our business objectives and respond to competitive challenges. Accordingly, we may need to engage in equity or debt financings to raise additional funds. If we do require additional capital, the terms of such capital may be unduly expensive or burdensome to us or disadvantageous to our existing stockholders, or that funding may not be available at all. Our inability to obtain additional funding when needed could negatively impact our business, financial condition, and results of operations. If additional funds are raised through the issuance of equity or convertible debt securities, holders of our Class A common stock could suffer significant dilution, and any new shares we issue could have rights, preferences, and privileges superior to those

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of our Class A common stock. Any debt financing secured by us in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions.

We have incurred operating losses in the past, and may not achieve or maintain profitability in the future.

We incurred operating losses of $(21.1) million, $(49.8) million, and $(127.6) million for fiscal 2019, 2020 and 2021, respectively. We had a total stockholders’ deficit of $(670.2) million at May 31, 2021. We expect our operating expenses to increase in the future as we increase our sales and marketing efforts, continue to invest in research and development, expand our operating and retail infrastructure, integrate acquisitions such as Sweat and 29029, add content and software features to our iFIT platform, expand into new geographies, and continue to develop our iFIT technology. Further, as a public company, we will incur additional legal, accounting, compensation and other expenses that we did not incur as a private company. These efforts and additional expenses may be more costly than we expect, and we cannot guarantee that we will be able to increase our revenue to offset our operating expenses. Our revenue growth may slow or our revenue may decline for a number of other reasons, including reduced demand for our products and services, increased competition, a decrease in the growth or reduction in size of our overall market, the impacts to our business from the global pandemic, or if we cannot capitalize on growth opportunities. If our revenue does not grow at a greater rate than our operating expenses, we will not be able to maintain profitability.

The forecasts of market growth included in this prospectus may prove to be inaccurate, and even if the market in which we compete achieves the forecasted growth, we cannot provide assurances that our business will grow at a similar rate, if at all.

Growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The forecasts in this prospectus relating to the expected growth in the health and fitness market, including estimates based on our own internal survey data, may prove to be inaccurate. Even if the market experiences the forecasted growth described in this prospectus, we may not grow our business at a similar rate, or at all. Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. Accordingly, the forecasts of market growth included in this prospectus should not be taken as indicative of our future growth.

We are subject to payment processing risk.

Our customers purchase our products and services using a variety of payment methods, including credit and debit cards and online wallets. We depend on internal systems as well as those of third parties to process payments. Payment processing and acceptance of these payment methods are subject to certain rules and regulations, including the Payment Card Industry Data Security Standard, and necessitate payment of interchange and other fees. Any disruptions in our payment processing systems, increases in payment processing fees, material changes in the payment ecosystem, such as large re-issuances of payment cards, failure to receive or delays in receiving payments from payment processors, and/or modifications to rules or regulations surrounding payment processing could impact our revenue, operating expenses and results of operations adversely. We utilize third-party payment processors to bill members on our behalf. If these third parties become unwilling or unable to continue processing payments for us, we would have to resort to alternative methods of collecting payments, which could preclude the ability of potential customers to make purchases and negatively and materially impact member acquisition and retention. For example, we have experienced an increase in credit card defaults associated with automatic annual subscription renewals (as subscribers declined to pay), which default rates are above the limits established by a major credit card processor. If not remedied, including as a result of our shift to monthly billing, this could lead to a refusal by that company to process payments in connection with a substantial majority of our direct to consumer online business. In addition, from time to time, we encounter fraudulent use of payment methods, which could negatively impact our results of operations and, if not adequately controlled and managed, could create negative consumer perceptions of our business.

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The payment methods that we offer also subject us to potential fraud and theft by criminals, who are becoming increasingly more sophisticated, seeking to obtain unauthorized access to or exploit weaknesses that may exist in our or our third-party payment processors’ payment systems. If we fail to comply with applicable rules or requirements for the payment methods we accept, or if payment-related data is compromised due to a data breach or other security incident, we may be liable for significant costs incurred by payment card issuing banks and other third parties (including impacted individuals), subject to fines and higher transaction fees, and our ability to accept or facilitate certain types of payments may be impaired. In addition, our customers could lose confidence in certain payment types, which may result in a shift to other payment types or potential changes to our payment systems that may result in higher costs. If we fail to adequately control fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures, and significantly higher credit card-related costs, each of which could harm our business, financial condition and results of operations.

Further, and typically in connection with the goal of reducing fraud, credit card companies may not process renewal charges. Similarly, if a customer has experienced fraud in the past, and has either placed a fraud alert on their credit report, or been placed into a fraud monitoring program, charges from us, including renewal charges, may not initially be accepted. These issues have occurred in the past, and we expect they will continue to occur in the future, and any difficulty in processing such payments, may result in the loss of members, increased costs to resolve such issues, and ultimately could have an adverse effect on our financial condition and results of operations.

Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations.

As of May 31, 2021, we had U.S. federal net operating loss carryforwards (“NOLs”), and state NOLs of approximately $88.3 million and $134.1 million, respectively, due to prior period losses. The federal NOLs have an indefinite carryforward period but may be utilized to offset no more than 80% of federal taxable income annually, and the state NOLs have varying expiration periods. Realization of these NOLs depends on future income, and there is a risk that our existing state NOLs could expire unused and be unavailable to offset future income tax liabilities, which could adversely affect our results of operations. In general, under Section 382 of the Internal Revenue Code of 1986, as amended, a corporation that undergoes an “ownership change” is subject to limitations on its ability to utilize its NOLs to offset future taxable income. This offering, as well as future changes in our stock ownership, which may be outside of our control, could result in such an ownership change. Our NOLs may also be impaired under state laws. There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs, or other unforeseen reasons, our existing NOLs could expire or otherwise be unavailable to offset future income tax liabilities. For these reasons, we may not be able to realize a tax benefit from the use of our NOLs, regardless of our profitability.

If our estimates or judgments relating to our critical accounting policies prove to be incorrect, our results of operations could be adversely affected.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, as provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates.” The results of these estimates form the basis for making judgments about the carrying values of assets, liabilities, and stockholders’ equity/deficit, and the amount of revenue and expenses that are not readily apparent from other sources. Significant assumptions and estimates used in preparing our consolidated financial statements include, but are not limited to those related to realizability of inventory, sales returns, allowance for doubtful accounts, reserves for advertising discounts, fair value measurements including common stock, embedded derivatives and warrant liability valuations, product warranty, useful lives of property and equipment including internal use software, capitalized iFIT content, and finite-lived intangible assets, accounting for income taxes, impairment analyses of goodwill and other long-lived assets, stock-based compensation expense, standalone selling price for contracts with multiple performance

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obligations and timing of revenue recognition, and commitments and contingencies. See Note 2 of the notes to our audited consolidated financial statements included elsewhere in this prospectus for additional information. Our results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the price of our Class A common stock.

Our sales in China are conducted by a joint venture.

We share ownership and management responsibilities with a jointly owned company, in which we hold a non-controlling stake, for the sale of our products in China. Our joint venture partners may not have the same goals, strategies, priorities, or resources as we do within this respective territory because they are intended to be operated for the benefit of all co-owners, rather than for our exclusive benefit. If such a conflict occurred, it could negatively impact our sales or financial results in this territory. While this joint venture is in early stages, the potential for conflicts may increase as the business develops, and the joint venture or we may face or create additional risks relating to competition and the use of intellectual property, including with respect to any licenses or grants of intellectual property we may make to the joint venture.

Risks Related to Socioeconomic, Political and Environmental Factors

Our business is subject to the risk of earthquakes, fire, power outages, floods, typhoons, public health crises, including the current global pandemic, or any other pandemics in the future, and other catastrophic events, and to interruption by manmade problems such as terrorism. A disruption at our production facilities could adversely impact our results of operations, cash flows and financial condition.

Our business is vulnerable to damage or interruption from earthquakes, fires, floods, typhoons, climate change, power losses, telecommunications failures, terrorist attacks, acts of war, human errors, break-ins, public health crises, including the current global pandemic, or any other pandemics in the future, and similar events. The third-party systems, operations and manufacturers we rely on are subject to similar risks. For example, a significant natural or man-made disaster, such as an earthquake, fire, flood or typhoon, could have an adverse effect on our business, financial condition and results of operations, and our insurance coverage may be insufficient to compensate us for losses that may occur. Acts of terrorism, which may be targeted at metropolitan areas that have higher population density than rural areas, could also cause disruptions in our or our suppliers’ and manufacturers’ businesses or the economy as a whole. The loss of a substantial amount of inventory—through fire, other natural or man-made disaster, contamination, or otherwise—could result in a significant reduction in supply of the affected product or products and our inability to meet consumer demand for the affected products for a period of time. Similarly, if we experience a disruption in the supply of our raw materials or components, our business could suffer. We may not have sufficient protection or recovery plans in some circumstances, such as natural disasters affecting locations that store significant inventory of our raw materials or products, that house our servers, or from which we generate content. In particular, our live content is currently generated entirely from our Logan, Utah headquarters. As we rely heavily on our computer and communications systems, and the internet to conduct our business and provide high-quality customer service, these disruptions could negatively impact our ability to run our business and either directly or indirectly disrupt suppliers’ and manufacturers’ businesses, which could have an adverse effect on our business, financial condition, and results of operations.

The global pandemic, or any other pandemics in the future, could have an adverse effect on our business, results of operations, and financial condition.

The global pandemic has caused significant volatility in financial markets and caused a global recession. Public health problems resulting from the global pandemic and precautionary measures instituted by governments and businesses to mitigate its spread, including travel restrictions and quarantines, has and could further contribute to a general slowdown in the global economy, adversely impact our members, third-party suppliers, vendors, contract manufacturers, logistics providers and other business partners, and disrupt our operations. Changes in

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our operations in response to the global pandemic or employee illnesses resulting from the pandemic have resulted in inefficiencies or delays, including in sales, delivery, and product development efforts, and additional costs related to business continuity initiatives, that cannot be fully mitigated through succession and business continuity planning, employees working remotely or teleconferencing technologies. Moreover, certain occurrences outside of our control may result in the closure of our retail partner’s stores. For example, as a result of the ongoing global pandemic, certain of our retail partners closed all or a subset of their stores, and while many have reopened, it has been under new operating limitations such as shorter operating hours, mask guidelines for employees and customers, and other constraints on their previous retail sales strategies. Certain of our retail partners have also had to temporarily close certain stores due to employee illness, and may need to do so in the future. We are unable to predict whether consumer shopping behaviors will change as our retail partners make these changes to adjust to the global pandemic.

The global pandemic and related governmental reactions have had and may continue to have some negative impacts on our business due to the occurrence of some or all of the following events or circumstances, among others:

• our and our third-party suppliers’, contract manufacturers’, logistics providers’, and other business partners’ inability to operate worksites, including manufacturing facilities, shipping and fulfillment centers, and our retail showrooms and production studios, due to employee illness or reluctance to appear at work, or “stay-at-home” regulations;

• our inability to provide our members with high-quality member support due to delivery delays, changes to the delivery experience and our inability to provide in-home servicing of our products due to safety risks and local government regulations related to the global pandemic;

• prolonged delivery timelines and the implementation of threshold delivery to the front doorway of customers’ homes, which requires our customers to self-install their machines;

• increased return rates due to a decrease in consumer discretionary spending;

• increased IT costs and systems and data security risk related to employees working remotely;

• inventory shortages caused by a combination of increased demand for our products and longer lead-times in the manufacturing of our products, due to work restrictions related to the global pandemic, import/export conditions such as port congestion, and local government orders;

• interruptions in our ability to produce new content;

• interruptions in manufacturing (including the sourcing of raw materials) and shipment of our products;

• disruptions of the operations of our third-party suppliers, which could impact our ability to purchase components at efficient prices and in sufficient amounts; and

• incurrence of significant increases to employee health care and benefits costs.

The extent of the impact of the global pandemic, or any other pandemics in the future, on our business and financial results will depend largely on future developments, including the duration of the spread of the outbreak, the impact on capital and financial markets, and the related impact on the financial circumstances of our members, all of which are highly uncertain and cannot be predicted. The situation with respect to the global pandemic is changing rapidly, and additional impacts may arise that we are not aware of currently.

An economic downturn or economic uncertainty may adversely affect consumer discretionary spending and demand for our products and services.

Our products and services may be considered discretionary items for consumers. Factors affecting the level of consumer spending for such discretionary items include general economic conditions, and other factors, such as consumer confidence in future economic conditions, fears of recession, the availability and cost of consumer

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credit and financing options, levels of unemployment, and tax rates. In particular, we believe that the current global pandemic and its resulting global macroeconomic impact may adversely affect consumer discretionary spending and, though demand for our products and services has remained high due to government shelter-in-place orders and other stay at home trends, may result in decreased demand for our products in the long-term. In recent years, the United States and other significant economic markets have experienced cyclical downturns and worldwide economic conditions remain uncertain, including due to the global pandemic. As global economic conditions continue to be volatile or economic uncertainty remains, trends in consumer discretionary spending also remain unpredictable and subject to reductions. Unfavorable economic conditions may lead consumers to delay or reduce purchases of our products and services and consumer demand for our products and services may not grow as we expect. Our sensitivity to economic cycles and any related fluctuation in consumer demand for our products and services could have an adverse effect on our business, financial condition, and results of operations.

Our financial performance is subject to risks associated with changes in the value of the U.S. dollar versus local currencies.

Though in the past we have transacted principally in U.S. dollars with the majority of our members and suppliers, we have transacted in some foreign currencies, such as the Canadian Dollar, the Euro and the Renminbi, and may transact in additional foreign currencies in the future. Further, certain of our manufacturing agreements stipulate fixed costs of our products and hardware in foreign currencies but provide for payment in U.S. dollars. Any changes in the value of foreign currencies relative to the U.S. dollar can affect our revenue, expenses and results of operations. For example, in some circumstances, for competitive or other reasons, we may decide not to raise local prices to fully offset the dollar’s strengthening, or at all, which would adversely affect the U.S. dollar value of our foreign currency denominated sales and earnings. Additionally, in some circumstances, where we incur costs, for example, related to manufacturing, if the contracted costs increase due to a change in the strength of the dollar, we may experience increased costs. Further, as a result of such foreign currency exchange rate fluctuations, it could be more difficult to detect underlying trends in our business and results of operations. In addition, to the extent that fluctuations in currency exchange rates cause our results of operations to differ from our expectations or the expectations of our investors, the trading price of our Class A common stock could be lowered. We currently are party to various forward purchase contracts to hedge transactional exposures in foreign currencies and in the future, we may continue to use derivative instruments to hedge exposures to fluctuations in foreign currency exchange rates. Such hedging activities may not offset any or more than a portion of the adverse financial effects of unfavorable movements in foreign exchange rates over the time the hedges are in place and may introduce additional risks if we are unable to successfully and effectively structure hedges with such instruments.

Risks Related to Legal and Government Regulation

From time to time, we are subject to legal proceedings, regulatory disputes, and governmental inquiries that could cause us to incur significant expenses, divert our management’s attention, and materially harm our business, financial condition, and results of operations.

From time to time, we are subject to claims, lawsuits, regulatory disputes, government investigations, and other proceedings involving products liability, competition and antitrust, intellectual property, privacy, consumer protection, securities, tax, labor and employment, commercial disputes, and other matters in the ordinary course of our business. We similarly also face inquiries with respect to the conduct of our business or may be subject to disputes with our suppliers, vendors and manufacturers, which may result in the diversion of management’s attention, and potentially litigation. As we have grown, we have seen a rise in the number and significance of these disputes and inquiries. Litigation and regulatory proceedings, and particularly the intellectual property-related matters that we are currently facing or could face in the future, may be protracted and expensive, and the results are difficult to predict. Certain of these matters include speculative claims for substantial or indeterminate amounts of damages and include claims for injunctive relief. Further, consumer protection matters have been and may be brought by the Federal Trade Commission (the “FTC”) against us, and we are currently subject to an

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FTC order. If the FTC determines that any of our promotional claims are false, misleading, not substantiated or not permissible, we may be subject to enforcement action and we may be required to revise our promotional claims and make other corrections or restitutions. Additionally, our litigation and compliance costs could be significant. Adverse outcomes with respect to litigation or any of these legal or regulatory proceedings may result in significant settlement costs or judgments, penalties and fines, or require us to modify our products or services, make content unavailable, or require us to stop offering certain features, all of which could negatively affect our membership and revenue growth. The results of litigation, investigations, claims, and regulatory proceedings cannot be predicted with certainty, and determining reserves for pending litigation and other legal and regulatory matters requires significant judgment. There can be no assurance that our expectations will prove correct, and even if these matters are resolved in our favor or without significant cash settlements, these matters, and the time and resources necessary to litigate or resolve them, could harm our business, financial condition, and results of operations.

We collect, store, share, disclose, transfer, use and otherwise process personal information and other member data, which subjects us to legal obligations and laws and regulations related to data security and privacy, and any actual or perceived failure by us or our third-party service providers to meet those obligations could harm our business.

We collect, store, share, disclose, transfer, use and otherwise process a wide variety of data from current and prospective members, including personal information, such as workout statistics, home addresses and geolocation. Federal, state, local and international laws, directives, rules, policies, industry standards and regulations, as well as contractual obligations, relating to privacy, data protection and e-commerce transactions require us to safeguard, and impose a variety of other obligations with respect to, our data, including members’ personal information. The regulatory framework for data privacy and security worldwide is continuously evolving and developing and, as a result, interpretation and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future. The occurrence of unanticipated events and the development of evolving technologies often rapidly drives the adoption of legislation or regulation affecting the use, collection or other processing of data. New laws, amendments to or reinterpretations of existing laws, regulations, standards and other obligations may require us to change our business operations with respect to how we use, collect, store, transfer or otherwise process certain types of personal information, implement new processes, and incur additional costs to comply with those laws and our members’ exercise of their rights thereunder.

Internationally, many jurisdictions have established their own data security and privacy legal frameworks with which we may need to comply. For example, the European Union (“EU”) has adopted the General Data Protection Regulation (“GDPR”), which went into effect in May 2018 and contains numerous requirements and changes from previously existing EU law, including more robust obligations on data processors (i.e., those who process personal information on behalf of a controller) and heavier documentation requirements for data protection compliance programs. The GDPR requires data controllers (i.e., those who determine the purpose and means of data processing) to implement more stringent operational requirements, and to impose more stringent operational requirements on processors. For example, the GDPR requires, among other things, that controllers of personal data ensure that data subjects are provided with transparent and expanded disclosure (in a concise, intelligible and easily accessible form) about how their personal information is to be used and concerning their rights with respect to their data, imposes limitations on retention of information, introduces mandatory data breach notification requirements, and sets higher standards for data controllers to demonstrate that they have obtained valid consent for certain data processing activities. The GDPR also imposes strict rules on the transfer of personal data to countries outside the European Economic Area (“EEA”), including the United States. In 2016, the EU and United States agreed to a transfer framework for data transferred from the EEA to the United States, called the Privacy Shield, but the Privacy Shield was invalidated in July 2020 by the Court of Justice of the EU (“CJEU”). The standard contractual clauses issued by the European Commission for the transfer of personal data, a potential alternative to the Privacy Shield, may be similarly invalidated by the CJEU, and it remains to be seen whether additional means for lawful data transfers will become available. Fines for noncompliance with the

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GDPR are significant and can be up to the greater of €20 million or 4% of annual global turnover. The GDPR also provides that EU member states may introduce further conditions, including limitations, and make their own laws and regulations further limiting the processing of ‘special categories of personal data,’ including personal data related to health, biometric data, and genetic information, which could limit our ability to collect, use and share EU data, and could cause our compliance costs to increase, ultimately having an adverse impact on our business, and causing harm to our business and financial condition.

Further, the United Kingdom’s vote in favor of exiting the EU, often referred to as Brexit, and ongoing developments in the United Kingdom have created uncertainty with regard to data protection regulation in the United Kingdom. As of January 1, 2021, following the expiry of transitional arrangements agreed to between the United Kingdom and EU, data processing in the United Kingdom is governed by a United Kingdom version of the GDPR (combining the GDPR and the United Kingdom’s Data Protection Act 2018), exposing us to two parallel regimes, each of which authorizes similar fines and other potentially divergent enforcement actions for certain violations. With respect to transfers of personal data from the EEA, on June 28, 2021, the European Commission issued an adequacy decision in respect of the United Kingdom’s data protection framework, enabling data transfers from EU member states to the United Kingdom to continue without requiring organizations to put in place contractual or other measures in order to lawfully transfer personal data between the territories. While it is intended to last for at least four years, the European Commission may unilaterally revoke the adequacy decision at any point, and if this occurs it could lead to additional costs and increase our overall risk exposure. Other countries have also passed or are considering passing laws requiring local data residency or restricting the international transfer of data.

In the United States, numerous states have enacted or are in the process of enacting state level data privacy laws and regulations governing the collection, use, and other processing of personal information regarding residents of the respective state. For example, the California Consumer Privacy Act (“CCPA”), which went into effect on January 1, 2020, established a new privacy framework for covered businesses such as ours, and may require us to modify our data processing practices and policies and incur compliance related costs and expenses. The CCPA provides new and enhanced data privacy rights to California residents, such as affording California residents the right to access and delete their information and to opt out of certain sharing and sales of personal information. The CCPA defines the term “sale” very broadly to include any disclosure of personal information for monetary or other valuable consideration, and therefore in light of this expansive definition, we are deemed to sell certain categories of personal information within the meaning of the CCPA. The law also prohibits covered businesses from discriminating against California residents (for example, by charging more for services) for exercising any of their rights under the CCPA. The CCPA imposes severe civil penalties and statutory damages, and contains a private right of action for certain data breaches that result in the loss of personal information. This private right of action is expected to increase the likelihood of, and risks associated with, data breach litigation. However, it remains unclear how various provisions of the CCPA will be interpreted and enforced. Furthermore, in November 2020, California voters passed the California Privacy Rights Act of 2020 (“CPRA”). Effective in most material respects starting on January 1, 2023 (but with a lookback to January 1, 2022), the CPRA imposes additional obligations on companies covered by the legislation and will significantly modify the CCPA, including by expanding the CCPA to include additional data privacy compliance requirements that may impact our business. The CPRA also establishes a regulatory agency dedicated to enforcing the CCPA and the CPRA. The effects of the CPRA, the CCPA, other similar state or federal laws and other future changes in laws or regulations relating to privacy, data protection and information security, particularly any new or modified laws or regulations that require enhanced protection of certain types of data or new obligations with regard to data retention, transfer or disclosure, are significant and may require us to modify our data processing practices and policies and could greatly increase the cost of providing our offerings, require significant changes to our operations or even prevent us from providing certain offerings in certain jurisdictions in which we currently operate and in which we may operate in the future, and require us to incur significant costs in an effort to comply with such legislation and significant liability in connection with a failure to so comply.

The CCPA and the CPRA may lead other states to pass comparable legislation, with potentially greater penalties and more rigorous compliance requirements relevant to our business, and we cannot yet determine the impact

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that the CCPA, CPRA or other such future laws, regulations and standards may have on our business. We expect that new industry standards, laws and regulations will continue to be proposed and implemented regarding privacy, data protection and information security in many jurisdictions. For example, many state legislatures have adopted legislation that regulates how businesses operate online, including measures relating to privacy, data security, data breaches and the protection of sensitive and personal information. The laws are not consistent, as certain state laws may be more stringent, broader in scope or offer greater individual rights with respect to sensitive and personal information than federal, international or other state laws, which may complicate compliance efforts. For instance, expanding definitions and interpretations of what constitutes “personal data” (or the equivalent) within the United States may increase our compliance costs and potential legal liability. Such changes in the laws and regulations that govern our collection, use, and disclosure of member data could impose additional requirements with respect to the retention and security of member data, limit our marketing activities, and have an adverse effect on our business, financial condition, and results of operations.

Additionally, depending on the nature of the information compromised, in the event of a data breach or other unauthorized access to our member data, we may also have obligations to notify members about the incident, which has occurred in the past and may occur in the future. We may also need to provide some form of remedy, such as a subscription to a credit monitoring service, for the individuals affected by the incident. A growing number of legislative and regulatory bodies have adopted consumer notification requirements in the event of unauthorized access to or acquisition of certain types of personal information. For example, laws in all 50 states require businesses to provide notice to customers whose personally identifiable information has been disclosed as a result of a data breach. Such breach notification laws continue to evolve and may be inconsistent from one jurisdiction to another. Complying with these obligations could cause us to incur substantial costs and could increase negative publicity surrounding any incident that compromises member data. Furthermore, we may be required to disclose personal data pursuant to demands from individuals, privacy advocates, regulators, government agencies, and law enforcement agencies in various jurisdictions with conflicting privacy and security laws. This disclosure, or refusal to disclose personal data, may result in a breach of privacy and data protection policies, notices, laws, rules, court orders, and regulations and could result in proceedings or actions against us in the same or other jurisdictions, damage to our reputation and brand, and inability to provide our products and services to consumers in certain jurisdictions.

Failure to comply with federal, state, local and international laws regarding privacy, data protection and information security could expose us to significant penalties under such laws. Any such failure by us or our third-party processors to comply with privacy, data protection and information security laws could result in significant government-imposed fines or orders requiring that we change our practices, claims for damages or other liabilities, regulatory investigations and enforcement action, litigation and significant costs for remediation, and reputational harm, any of which could adversely affect our business. Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which may materially and adversely affect our business, financial condition and results of operations.

Import and export controls or economic sanctions imposed by governmental authorities could subject us to liability and hinder our ability to compete in international markets if we are not in full compliance with applicable laws.

The United States and various foreign governments have imposed, and may in the future impose, controls, export license requirements, duties and restrictions on the import or export of certain technologies. Our products may be subject to U.S. export controls, which may require submission of a product classification and annual or semiannual reports. The regulatory requirements surrounding the import and export of our products and services impose compliance burdens that may create delays in the introduction of our products and services in international markets, prevent our international members from accessing our products and services, and, in some cases, prevent the export of our products and services to some countries entirely. Furthermore, economic sanctions imposed by the United States may prohibit the provision of products and services to certain countries,

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governments, and persons targeted by such sanctions. We also offer products, particularly online digital applications and subscriptions, that become or may become accessible in countries where certain persons or entities are subject to sanctions that restrict or prohibit transactions with these parties. Even though we take reasonable measures to prevent our products from being provided to countries that are the targets of U.S. sanctions, our products and services, including our software and platform updates, can be provided to those targets or provided by our members despite such measures. Any such provision or other prohibited transactions with sanctioned persons or entities could have negative consequences, including government investigations, penalties, reputational harm. Our failure to obtain required import or export approval for our products and services could harm our international and domestic sales and adversely affect our revenue. We could be subject to future enforcement action with respect to compliance with governmental export and import controls and economic sanctions laws that result in penalties, costs, and restrictions on export privileges that could have an adverse effect on our business, financial condition, and results of operations.

Our business could be adversely affected from an accident, safety incident, or workforce disruption.

Our internal manufacturing processes and related activities, as well as our in-house warehousing, could expose us to significant personal injury claims that could subject us to substantial liability. The global pandemic increases our exposure to these risks; for example, various local government orders have been implemented in areas where we operate that require us to secure personal protective equipment, such as face masks and gloves and to implement new methods of monitoring employee health, such as temperature checks. As these government orders have come down, a global shortage of personal protective equipment has resulted, and we have experienced delays and increased costs in obtaining these materials for our teams. Our inability to timely adapt to changing norms and requirements around maintaining a safe workplace during the global pandemic could cause employee illness, accidents, or team discontent if it is perceived that we are failing to protect the health and safety of our employees. While we maintain general liability insurance in amounts and of the type generally consistent with industry practice, the amount of such coverage may not be adequate to cover fully all claims, and we may be forced to bear substantial losses from an accident or safety incident resulting from our manufacturing or warehousing activities. Additionally, if our employees decide to join or form a labor union, we may become party to a collective bargaining agreement, which could result in higher employee costs and increased risk of work stoppages. It is also possible that a union seeking to organize one subset of our employee population, could also mount a corporate campaign, resulting in negative publicity or other actions that require attention by our management team and our employees. Negative publicity, work stoppages, or strikes by unions could have an adverse effect on our business, prospects, financial condition, and results of operations.

A variety of uncontrollable events may reduce demand for our fitness event services, impair our ability to provide fitness event services or increase the cost of providing fitness event services.

Demand for our fitness event services, particularly our 29029 events, is highly dependent on the general environment for travel and tourism. The environment for travel and tourism can be significantly adversely affected in the U.S. as a result of a variety of factors beyond our control, including: adverse weather conditions arising from short-term weather patterns or long-term change, catastrophic events or natural disasters (such as excessive heat or rain, fire, floods, and earthquakes); health concerns; and terrorist attacks.

There is a risk of accidents occurring at our fitness events or competing fitness events which may reduce attendance and negatively impact our operations.

Our brand and our reputation are among our most important assets. Our ability to attract and retain customers depends, in part, upon the external perceptions of the Company, the quality and safety of our venues, services and our corporate and management integrity. An accident or an injury at any of our fitness events or at fitness events operated by competitors, particularly an accident or injury involving the safety of guests and employees, that receives media attention, could negatively impact our brand or reputation, cause loss of consumer confidence in the Company, reduce attendance at our fitness events, and negatively impact our results of operations. The considerable expansion in the use of social media over recent years has compounded the impact of negative publicity. We obtain insurance against the risk of losses relating to physical damage to property, certain injuries occurring on venue property, and liability for alleged breach of legal responsibilities. When insurance is obtained

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it is subject to deductibles, exclusions, terms, conditions and limits of liability. The types and levels of coverage we obtain vary from time to time depending on our view of the likelihood of specific types and levels of loss in relation to the cost of obtaining coverage for such types and levels of loss.

Our warranty business is subject to regulatory oversight and changes in industry practice.

As part of our business, we offer extended warranty contracts on some of our fitness products through Universal Technical Services. See “Business—Our Brands and Product Offerings—Warranties”. This business is subject to regulatory oversight in certain jurisdictions where our products are offered. Future changes in such oversight may make it more costly for us to offer extended warranties. Any development that negatively impacts our ability to offer extended warranties or the margins provided by that product in the future could have a material adverse effect on our results of operations.

Failure to comply with anti-corruption and anti-money laundering laws, including the United States Foreign Corrupt Practices Act (“FCPA”) and similar laws associated with our activities outside of the United States, could adversely affect our business, subject us to penalties and have other adverse consequences.

We operate our business on a global scale and have direct or indirect interactions with government officials and employees of government agencies or state-owned or affiliated entities. We are subject to the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the USA PATRIOT Act, the U.K. Bribery Act, and possibly other local anti-bribery and anti-money laundering laws in countries where we do business. Such laws generally prohibit companies and their employees and third-party intermediaries from corruptly promising, authorizing, offering, or providing, directly or indirectly, improper payments or anything of value to foreign government officials, political parties, and private-sector recipients for the purpose of obtaining or retaining business, directing business to any person, or securing any advantage. In addition, U.S. public companies must maintain records that accurately and fairly represent their transactions and maintain an adequate system of internal accounting controls. In many foreign countries, including countries in which we do business, it is a common local practice or custom that businesses or their agents make payments to, or otherwise participate in practices with, governmental authorities that are prohibited by the FCPA or other applicable laws and regulations. We face significant risks if we or any of our directors, officers, employees, agents or other partners or representatives fail to comply with these laws. Governmental authorities in the United States and elsewhere impose substantial civil and/or criminal fines and penalties which could have a material adverse effect on our business, reputation, results of operations and financial condition. We have begun to implement an anti-corruption compliance program and policies, procedures and training designed to support compliance with these laws, particularly as we have recently expanded our business activities internationally. However, our employees, contractors, agents, and consultants who interact with foreign government officials on our behalf, and companies to which we outsource certain of our business operations, may take actions in violation of our policies or applicable law, and our controls may not be adequate to prevent any such future or past actions by such persons. Any such violation could have an adverse effect on our reputation, business, financial condition and results of operations. Any violation of the FCPA, other applicable anti-corruption laws, or anti-money laundering laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions and, in the case of the FCPA, suspension or debarment from U.S. government contracts, any of which could have a materially adverse effect on our reputation, including our brand, our business, financial condition and results of operations. In addition, the need to respond to any enforcement action could result in a significant diversion of management’s attention and resources and significant defense costs and other professional fees.

Changes in income tax laws or enforcement could have a material adverse impact on our financial results.

The Tax Cuts and Jobs Act (the “TCJA”), enacted on December 22, 2017, significantly affected U.S. federal tax law, including by changing how the U.S. imposes tax on certain types of income of corporations and by reducing the U.S. federal corporate income tax rate to 21%. It also imposed new limitations on a number of tax benefits, including deductions for business interest, deductibility of compensation to certain executives, use of net operating losses, taxation of foreign income, and the foreign tax credit, among others. The CARES Act, enacted on March 27, 2020, in response to the global pandemic, further altered U.S. federal tax law, including in respect

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of certain changes that were made by the TCJA, generally on a temporary basis. There can be no assurance that future domestic tax law changes will not increase the rate of the corporate income tax significantly, impose new limitations on deductions, credits or other tax benefits, or make other changes that may adversely affect our business, cash flows or financial performance. Further, the Internal Revenue Service (“IRS”) has yet to issue guidance on a number of important issues regarding the changes made by the TCJA and the CARES Act. In addition, other changes in international and domestic tax laws, including the reaction by states to the corporate tax changes in the TCJA or CARES Act, and changes in tax law enforcement or interpretation, could negatively impact our business operations, cash flows, and financial performance. Changes in U.S. tax law will likely have broader implications, including impacts to the economy, currency markets, inflation environment, consumer behavior, and/or competitive dynamics, which are difficult to predict, and may positively or negatively impact the Company and our results.

Various international and domestic tax risks could adversely affect our earnings and cash flows.

We generally conduct our international operations through wholly owned subsidiaries, branches, or representative offices and report our taxable income in various jurisdictions worldwide. As a result, we are subject to international and domestic tax risks. For instance, the intercompany relationships between our legal entities are subject to complex transfer pricing regulations administered by taxing authorities in various jurisdictions. Moreover, we could be subject to double taxation on income related to operations in certain countries that do not have tax treaties with the country of the trading partner. In addition, we may have a higher effective income tax rate than that of other companies in our industry if losses incurred by one operating company are not available to offset the income of an operating company located in another country. Also, distributions of earnings and other payments received from our subsidiaries may be subject to withholding taxes imposed by the countries where they are operating or are incorporated. If these foreign countries do not have income tax treaties with the United States or the countries where our subsidiaries are incorporated, we could be subject to high rates of withholding taxes on these distributions and payments. Additionally, the amount of the credit that we may claim against our U.S. federal income tax for foreign income taxes paid or accrued is subject to many limitations which may significantly restrict our ability to claim a credit for all of the foreign taxes we pay. Any changes in these laws and rules, may require us to modify our international structure in the future, which will incur costs, may increase our worldwide effective tax rate, and may adversely affect our financial position and results of operations. In addition, significant judgment is required in evaluating our tax positions and determining our provision for income taxes.

During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. For example, our effective tax rates could be adversely affected by earnings being lower than anticipated in countries where we have lower statutory rates and higher than anticipated in countries where we have higher statutory rates, by changes in foreign currency exchange rates, or by changes in the relevant tax, accounting, and other laws, regulations and interpretations of the law. As we operate in numerous taxing jurisdictions, the application of tax laws can be subject to diverging and sometimes conflicting interpretations by tax authorities of these jurisdictions. It is not uncommon for taxing authorities in different countries to have conflicting views with respect to, among other things, the manner in which the arm’s-length standard is applied for transfer pricing purposes, or with respect to the valuation of intellectual property.

Our operations also subject us to related risks, such as customs and import duties and tariffs. See “—We derive a portion of our revenue from international sales and are subject to the operational risks of doing business in foreign countries” below.

We or our members may be subject to sales and other taxes, and we may be subject to liabilities on past sales and transactions for taxes, surcharges, and fees.

The application of indirect taxes, such as sales and use tax, subscription sales tax, value-added tax, provincial taxes, goods and services tax, business tax, and gross receipt tax, to businesses like ours and to our members is a

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complex and evolving issue. Significant judgment is required to evaluate applicable tax obligations. In many cases, the ultimate tax determination is uncertain because it is not clear how existing statutes apply to our business. One or more states, the federal government, or other countries may seek to impose additional reporting, record-keeping, or indirect tax collection obligations on businesses like ours that offer subscription services and other health and fitness offerings. New taxes could also require us to incur substantial costs to capture data and collect and remit taxes. If such obligations were imposed, the additional costs associated with tax collection, remittance, and audit requirements could have an adverse effect on our business, financial condition, and results of operations.

We derive a portion of our revenue from international sales and are subject to the operational risks of doing business in foreign countries.

International sales account, and are expected to continue to account, for a portion of our total revenues. In addition, with the recent acquisition of Sweat, we have significantly expanded our international sales and operations. Our revenue from non-U.S. ship-to addresses represented approximately 22.7%, 19.0%, and 15.7% of our total revenue for fiscal 2019, 2020 and 2021, respectively. In addition, the majority of our manufacturing is done in China and Taiwan, and as such, any negative impacts in these specific countries could adversely affect our operations in the future. Our international operations overall are, and will continue to be, subject to a variety of risks associated with conducting business internationally, many of which are beyond our control. With the acquisition of Sweat, headquartered in Australia, these risks may increase. These risks, which may adversely affect our ability to achieve and maintain profitability and our ability to sell our products internationally, include:

• changes in regulatory requirements;

• legislation and regulation, including tariffs, relating to the import or export of high technology products, compliance with export laws and controls and trade embargoes in multiple jurisdictions;

• the imposition of government controls;

• political and economic instability, including the impact of the global pandemic coronavirus, the possibility of an economic recession in certain key markets, international hostilities, acts of terrorism and governmental restrictions, inflation, trade relationships and military and political alliances;

• costs and risks of deploying systems in foreign countries;

• limited intellectual property rights and protection;

• regional limitations placed on internet or server access as well as data consumption, which would limit our services from being provided;

• the burden of complying with a wide variety of complex foreign laws and treaties, including with respect to data privacy and security such as the EU’s GDPR and Canada’s Personal Information Protection and Electronic Documents Act; and

• compliance with U.S. and local laws affecting the activities of U.S. companies abroad, including the FCPA, and local anti-bribery laws. See also “—Failure to comply with anti-corruption and anti-money laundering laws, including the FCPA and similar laws associated with our activities outside of the United States, could subject us to penalties and other adverse consequences.”

The United States has implemented tariffs on certain imported goods. These additional tariffs could include items imported by us from China or other countries. In addition, China has imposed tariffs on a wide range of American products in retaliation for these new American tariffs. There is a concern that the imposition of additional tariffs by the United States, could result in the adoption of additional tariffs by China and other countries as well. Any resulting trade war could negatively impact the global market for health and fitness products and could have a significant adverse effect on our business. The imposition of tariffs on items imported by us from China or other countries could increase our costs and could result in lowering our gross margin on

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products sold. See also “—Increases in raw materials and component costs, long lead times, supply shortages, and supply changes could disrupt our supply chain and have an adverse effect on our business, financial condition, and results of operations.”

As noted, we must also comply with the GDPR, which became effective as of May 2018. The goal of the GDPR is to increase individual rights with respect to, and protections for, personal data located in or originating from the EU. The GDPR is extraterritorial in that it applies to all business within the EU and any business located outside of the EU that processes personal data of individuals located within the EU. The GDPR regulates a broad array of data relating directly or indirectly to an individual and imposes stringent data protection requirements and grants individuals extensive rights with respect to their personal data. There are significant fines and penalties (including in connection with potential private rights of action) associated with GDPR non-compliance. See also “—We collect, store, share, disclose, transfer, use and otherwise process personal information and other member data, which subjects us to legal obligations and laws and regulations related to data security and privacy, and any actual or perceived failure by us or our third-party service providers to meet those obligations could harm our business.”

While the impact of these factors is difficult to predict, any one or more of these factors could adversely affect our operations in the future.

Regulations related to conflict minerals may cause us to incur additional expenses and could limit the supply and increase the costs of certain metals used in the manufacturing of our products.

We will become subject to requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which will require us to conduct due diligence on and disclose whether or not our products contain conflict minerals. The implementation of these requirements could adversely affect the sourcing, availability, and pricing of the raw materials used in the manufacture of components used in our products. In addition, we will incur additional costs to comply with the disclosure requirements, including costs related to conducting diligence procedures to determine the sources of minerals that may be used or necessary to the production of our products and, if applicable, potential changes to products, processes, or sources of supply as a consequence of such due diligence activities. It is also possible that we may face reputational harm if we determine that certain of our products contain minerals not determined to be conflict free or if we are unable to alter our products, processes, or sources of supply to avoid such materials.

We and our operations are subject to federal, state, local and foreign environmental, health and safety laws and regulations, which could subject the Company to liabilities or increase its costs.

We and our operations are subject to federal, state, local and foreign environmental, health and safety laws and regulations, including those governing climate change, air emissions, water discharges, the use, management, handling, generation, treatment, storage, disposal, and release of, and exposure to, hazardous substances and wastes, investigation and remediation of contamination, labeling and content requirements of our products and employee health and safety. Failure to comply with such laws and regulations could result in liabilities, civil or criminal fines or penalties, enforcement actions, remedial or corrective measures, or other sanctions or actions. In addition, the Company may be subject to joint and several liability for environmental investigations and remediation of contamination, including at properties that we currently or formerly owned, leased or operated, even if such contamination was not caused by us, and we may also be subject to similar liabilities and claims in connection with locations at which hazardous substances or wastes we have generated have been stored, treated, otherwise managed, or disposed. We also may face claims alleging harm to human health and safety or property or natural resource damages arising out of contamination or exposure to hazardous substances.

Compliance with current or future environmental, health and safety laws and regulations, or liabilities arising thereunder, could require us to incur additional costs or adversely affect the Company’s business, financial condition, and results of operations.

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Risks Related to Information Technology and Intellectual Property

Any cybersecurity attack, disruption or failure of our or our third-party service providers’ information technology systems, or our failure to successfully implement upgrades and new technology effectively, could adversely affect our business and operations.

In providing products and services to our members, we rely on our ability to collect, manage, use, store, disclose, transfer and otherwise process a large volume of member data, including content, personal information and other sensitive information. Threats to network and data security are increasingly diverse and sophisticated. We have experienced cybersecurity incidents in the past, and we may experience such incidents in the future. Our devices, as well as our servers, computer systems, and those of third parties that we rely on in our operations have been and may in the future be vulnerable to cybersecurity risks, including viruses and worms, installation of malicious software, ransomware, spam, phishing attacks, denial-of-service attacks, software errors, source code bugs, physical or electronic break-ins, fraud, negligence, misconduct by employees, other internal sources or other third parties, including state-sponsored organizations with significant financial and technological resources, theft, misuse or improper operation, terrorism, data loss, code or configuration errors, credential stuffing, human error, social engineering attacks, unauthorized access to data, accidental technological failure, natural disasters (including fires, floods, wars, earthquakes, hurricanes, tornadoes or similar catastrophic events) and other security breaches. Further, because of the interactive nature of many of our products, some of our hardware, such as the tablets on certain of our equipment, have a camera, and any inadvertent or unauthorized use or breach of security with respect to such hardware, or any software, such as spyware, could result in a breach of privacy, and, whether or not in our control, any actual or perceived breach of privacy could harm our reputation and brand, and therefore our business, financial condition and results of operation could be adversely effected. In addition, we may be the target of email scams that attempt to acquire personal information or company assets. Any of the foregoing could lead to interruptions, delays, loss of or unauthorized access to critical data, including personal information, and loss of consumer confidence.

Although we have established security procedures to protect member data, our or our third-party service providers’ security and testing measures, controls, efforts, policies and processes may not be adequate and may not be able to prevent security breaches or the unauthorized access to personal information. Further, advances in computer capabilities, new discoveries in the field of cryptography, inadequate facility security, or other developments may result in a compromise or breach of the technology that we or our third-party service providers use to protect member data. Additionally, the increasing sophistication and resources of cyber criminals and other non-state threat actors and increased actions by nation-state actors make keeping up with new threats difficult and could result in a breach of security. We cannot guarantee that inadvertent or unauthorized use or disclosure of such data, including personal information, will not occur, or that third parties will not gain unauthorized access to such information. Any compromise of our security or breach of our members’ privacy could harm our reputation or business, financial condition and results of operations. In addition, a party who circumvents our security measures or exploits inadequacies in our security measures, could, among other effects, misappropriate member data or other proprietary or personal information, cause interruptions in our operations, or expose members to computer viruses or other disruptions. Actual or perceived vulnerabilities may lead to claims against us and we may become subject to costly litigation, member complaints, indemnity obligations, damages for contract breach or penalties for violation of applicable laws or regulations, which could result in significant fines, penalties, or damages and harm to our reputation. In addition, we have in the past and may in the future become subject to data breach notification obligations and regulatory inquires, orders or investigations with respect to cybersecurity incidents. Additionally, we cannot guarantee that our insurance coverage would be sufficient to cover all losses. Further, we could be forced to expend significant financial and operational resources in response to a security breach, including repairing system damage, increasing security protection costs by deploying additional personnel and modifying or enhancing our protection technologies, investigating and remediating any information security vulnerabilities and defending against and resolving legal and regulatory claims, all of which could divert resources and the attention of our management and key personnel away from our business operations and materially and adversely affect our business, financial condition and results of operations.

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Additionally, due to the current global pandemic, there is an increased risk that we may experience cybersecurity related incidents as a result of our employees, third-party service providers and other third parties working remotely on less secure systems. Any cybersecurity attack that attempts to obtain our or our members’ data and assets, disrupt our service, or otherwise access our systems, or those of third parties we use, if successful, could be expensive to remedy, decrease demand for our products and services and negatively impact consumer confidence and adversely affect our business, financial condition and results of operations.

As cybersecurity-related threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities. In addition, our remediation efforts may not be successful or may not be completed in a timely manner. Certain measures that could increase the security of our systems take significant time and resources to deploy broadly, and such measures may not be deployed in a timely manner or be effective against an attack. The inability to implement, maintain and upgrade adequate safeguards could have a material and adverse impact on our business, financial condition and results of operations. Moreover, there could be public announcements regarding any cybersecurity related incidents and any steps we take to respond to or remediate such incidents, and if securities analysts or investors perceive these announcements to be negative, it could, among other things, have a substantial adverse effect on the price of our common stock. Consumers are generally concerned with security and privacy of the internet, and any publicized security problems affecting our businesses or those of third parties with whom we are affiliated or otherwise conduct business may discourage consumers from doing business with us, which could have a material and adverse effect on our business, financial condition and results of operations.

Additionally, certain of our information technology systems are designed and maintained by us and are critical for the efficient functioning of our business, including the manufacture and distribution of our products, online sales of our products, and the ability of our members to access content on our platform, and our rapid growth has, in certain instances, strained these systems. As we grow, we continue to implement modifications and upgrades to our systems, and these activities subject us to inherent costs and risks associated with replacing and upgrading these systems, including, but not limited to, impairment of our ability to fulfill member orders and other disruptions in our business operations. Further, our system implementations may not result in productivity improvements at a level that outweighs the costs of implementation, or at all. If we fail to successfully implement modifications and upgrades or expand the functionality of our information technology systems, we could experience increased costs associated with diminished productivity and operating inefficiencies related to the flow of goods through our supply chain. Additionally, if we are unable to address our members’ needs or preferences in a timely fashion or further develop and enhance our technology solutions, or if a member is not satisfied with the quality of work performed by us or with the technical support services rendered, we could incur additional costs to address the situation and our business may be impaired and members’ dissatisfaction with our technology solutions could damage our ability to maintain or expand our member base.

Any unexpected technological interruptions to our systems or websites would disrupt our operations, including our ability to timely ship and track product orders, project inventory requirements, manage our supply chain, sell our products online, provide services to our members, and otherwise adequately serve our members. The operation of our direct-to-consumer e-commerce business through our websites depends on our ability to maintain the efficient and uninterrupted operation of online order-taking and fulfillment operations. Any system interruptions or delays could prevent potential members from purchasing our products. Moreover, the ability of our members to access the content on our platforms could be diminished by a number of factors, including members’ inability to access the internet, the failure of our network or software systems, security breaches, variability in member traffic for our platform and other security incidents. Platform failures would be most impactful if they occurred during peak platform use periods, which generally occur before and after standard work hours. During these peak periods, there are a significant number of members concurrently accessing our platform and if we are unable to provide uninterrupted access, our members’ perception of our platform’s reliability may be damaged, our revenue could be reduced, our reputation could be harmed, and we may be required to issue credits or refunds, or risk losing members. In the event we experience significant disruptions,

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we may be unable to repair our systems in an efficient and timely manner which could have a material adverse effect on our business, financial condition, and results of operations.

Any disruption of or interference with our computing, storage, processing and similar services, including those provided by third-party service providers, could have an adverse effect on our business, financial condition, and results of operations, and our reliance on such third-party service providers subjects us to additional risks.

We rely heavily on third parties for most of our computing, storage, processing, and similar services. We have outsourced our cloud infrastructure to third-party service providers, and we currently use these providers to host and stream our services and content. We also conduct some of our own processing and similar services. We are vulnerable to service interruptions and other security incidents, including those experienced by our third-party service providers or by our own servers and infrastructure, and we have experienced and expect to experience interruptions, delays, or outages in service availability in the future due to a variety of factors, include human error, hardware or software errors, hosting disruptions, technical failures and capacity constraints. Regular interruptions in that service, could also affect the use of, and our members’ satisfaction with, our products and services and could harm our business and reputation. Frequent or persistent interruptions in our products and services could cause members to believe that our products and services are unreliable, leading them to switch to our competitors or to avoid our products and services, and could permanently harm our reputation and business. In addition, hosting costs will increase as membership engagement grows, which could harm our business if we are unable to grow our revenue faster than the cost of using these services or the services of our existing or similar third-party service providers.

The lack of renewal, or termination, of one or more of our agreements with our third-party service providers, or the renewal of an agreement on less favorable terms, also could seriously harm our business. Our third-party service providers may also take actions beyond our control that could seriously harm our business, including limiting our access to one or more services or altering how we are able to process data in a way that is unfavorable or costly to us. Although we expect that we could obtain similar services from other third parties, if our arrangements with our current third-party service providers were terminated, we could experience interruptions on our platform and in our ability to make our content available to members, as well as delays and additional expenses in arranging for alternative cloud infrastructure services. Any of these factors could further harm our reputation, reduce our revenue, subject us to member complaints, significant fines, litigation, disputes, claims, regulatory investigations or inquiries or other legal liability, result in decreased member satisfaction and increased member attrition, and cause our members to decline to renew their subscriptions, any of which could have a material adverse effect on our business, financial condition, and results of operations.

Other third-party risks may include insufficient security measures, data location uncertainty, and the possibility of data storage in inappropriate jurisdictions where laws or security measures may be inadequate, and our ability to monitor our third-party service providers’ data security practices are limited. Although we generally have agreements relating to cybersecurity and data privacy in place with our third-party service providers, they are limited in nature and we cannot guarantee that such agreements will prevent the accidental or unauthorized access to or disclosure, loss, destruction, disablement or encryption of, use or misuse of or modification of data (including personal information) or enable us to obtain adequate, or any reimbursement, from our third-party service providers in the event we should suffer any such incidents. Due to applicable laws and regulations or contractual obligations, we may be held responsible for any information security failure or cybersecurity attack attributed to our third-party service providers as they relate to the information we share with them. A vulnerability in or breach of our or our third-party service providers’ software or systems, a failure of our or our third-party service providers’ safeguards, policies or procedures could result in the compromise of the confidentiality, integrity or availability of our systems or the data housed in our third-party solutions, including personal information.

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We may face claims by others that we infringe, misappropriate or otherwise violate third-party intellectual property rights, and may incur significant expenses as a result of ongoing or future intellectual property-related litigation.

Our success depends, in part, on our ability to develop and commercialize our products and services without infringing, misappropriating or otherwise violating the intellectual property rights of third parties. However, we may not be aware that our products or services are infringing, misappropriating or otherwise violating third-party intellectual property rights and third parties have in the past and may in the future bring claims alleging such infringement, misappropriation or violation. Third parties may be able to successfully challenge, oppose, invalidate, render unenforceable, dilute, misappropriate or circumvent our patents, trademarks, copyrights, and other intellectual property rights. Companies in the technology industry own large numbers of patents, copyrights, trademarks, and trade secrets and frequently enter into litigation based on allegations of infringement or other violations of intellectual property rights. As we face increasing competition and become increasingly high profile, the possibility of receiving a larger number of intellectual property claims against us grows. In addition, various “non-practicing entities,” and other intellectual property rights holders have in the past and may in the future attempt to assert intellectual property claims against us or seek to monetize the intellectual property rights they own to extract value through licensing or other settlements.

We are currently, and may in the future become, involved in litigation and other disputes relating to alleged infringement, misappropriation or other violation by us of a third party’s patents, confidential information, trade secrets and other intellectual property rights. Additionally, third parties have in the past and may in the future initiate adversarial proceedings, known as an inter partes review, in the United States Patent and Trademark Office to challenge the validity of our patent claims in the United States. We have in the past and may in the future be unsuccessful in such proceedings, resulting in a loss of some portion or all of our patent rights in the United States. Intellectual property litigation is frequently expensive to both the winning and losing parties and could consume significant amounts of management’s time and attention. We cannot predict the outcome of lawsuits and cannot ensure that the results of any such disputes will not have an adverse effect on our business, financial condition, results of operations, cash flows or prospects. Any claims or litigation, even those without merit and regardless of the outcome, could cause us to incur significant expenses and, if successfully asserted against us, could require us to pay substantial costs or damages, significant ongoing royalty payments, settlement or licensing fees, prevent us from offering our products or services or using certain essential technologies, force us to implement expensive work-arounds or re-designs, impose other unfavorable terms, distract management from our business, or satisfy indemnification obligations. For these and other reasons, intellectual property-related disputes could seriously harm our business, financial condition and results of operations.

If any of our technologies, products or services are found to infringe, misappropriate or violate a third party’s intellectual property rights, we may seek to obtain a license under such third party’s intellectual property rights in order to bring an end to certain claims or actions asserted against us to continue commercializing or using such technologies, products and services. However, we may not be able to obtain such a license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us, and it could require us to make substantial licensing and royalty payments.

In addition, we could be found liable for significant monetary damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a patent or other intellectual property right. Claims that we have misappropriated the confidential information or trade secrets of third parties, which we have been subject to in the past and may be subject to in the future, could similarly harm our business. If we are required to make substantial payments or undertake any of the other actions noted above as a result of any intellectual property infringement, misappropriation or violation claims against us, such payments, costs or actions could have a material adverse effect on our competitive position, business, financial condition and results of operations.

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Our intellectual property rights are valuable, and any failure to adequately obtain, maintain, protect, defend or enforce our intellectual property rights could adversely affect our business, financial condition and results of operations.

Our success and ability to compete depends in part on our ability to obtain, maintain, protect, defend and enforce our intellectual property rights and technology. We rely on, and expect to continue to rely on, a combination of trademark, trade dress, copyright, trade secret and patent laws in the United States and internationally, as well as technological measures and contractual provisions, such as confidentiality agreements with our employees, contractors, consultants, and third parties with whom we have relationships, to establish and protect our brand, maintain our competitive position and protect our intellectual property rights from infringement, misappropriation or other violation. However, despite our efforts to protect our intellectual property rights, various factors outside our control pose a threat to our intellectual property rights.

The steps we take to protect our intellectual property rights may not be sufficient to effectively prevent third parties from infringing, misappropriating or otherwise violating our intellectual property or to prevent unauthorized disclosure or unauthorized use of our trade secrets or other confidential information. There can be no assurance that our intellectual property rights will be sufficient to protect against others offering products or services that are substantially similar to ours and competing with our business, and unauthorized parties may attempt to copy aspects of our technology and use information that we consider proprietary. For example, it is possible that third parties, including our competitors, may obtain patents relating to technologies that overlap or compete with our technology. If third parties obtain patent protection with respect to such technologies, they may assert, and have in the past asserted, that our technology infringes their patents and seek to charge us a licensing fee or otherwise preclude the use of our technology.

We seek patent, trade secret and other intellectual property protection for, for example, our trade names, products, manufacturing technologies, services and product features. The process of seeking patent protection can be long and expensive, and we cannot be certain that any currently pending or future applications will actually result in issued patents, or that, even if patents are issued, they will be of sufficient scope or strength to provide meaningful protection or any commercial advantage to us. In addition, any of our intellectual property rights may be challenged, which could result in them being narrowed in scope or declared invalid or unenforceable. Furthermore, others may develop technologies that are similar or superior to our technology or design around the patents we own. There is also a risk that we do not establish an unbroken chain of title from inventors to us. An inventorship or ownership dispute could arise that may permit one or more third parties to practice or enforce our intellectual property rights, including possible efforts to enforce rights against us. Additionally, errors in inventorship or ownership can sometimes also impact priority claims, and if we were to lose our ability to claim priority for certain patent filings, intervening art or other events may preclude us from issuing patents.

Effective protection of intellectual property rights is expensive and difficult to maintain, both in terms of application and registration costs as well as the costs of defending and enforcing those rights. As we have grown, we have sought to obtain and protect our intellectual property rights in an increasing number of countries, a process that can be expensive and may not always be successful. We may fail to maintain or be unable to obtain adequate protections for certain of our intellectual property rights in certain foreign countries because effective intellectual property protection may not be available to us in every country in which our products and services are available, and our intellectual property rights may not receive the same degree of protection in foreign countries as they would in the United States because of the differences in foreign patent, trademark, copyright, and other laws concerning intellectual property and proprietary rights. Further, many countries limit the enforceability of patents against certain third parties, including government agencies or government contractors.

In addition to registered intellectual property rights, we rely on non-registered proprietary information and technology, such as trade secrets, confidential information, know-how and technical information. We attempt to protect our intellectual property, technology, and confidential information in part through confidentiality,

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non-disclosure and invention assignment agreements with our employees, consultants, contractors, corporate collaborators, advisors and other third parties who develop intellectual property on our behalf or with whom we share information. However, we cannot guarantee that we have entered into such agreements with each party who has developed intellectual property on our behalf or each party that has or may have had access to our confidential information, know-how and trade secrets. These agreements may be breached, or may not effectively prevent unauthorized access to or unauthorized use, disclosure, misappropriation or reverse engineering of, our confidential information, intellectual property, or technology. Moreover, these agreements may not provide an adequate remedy for breaches or in the event of unauthorized use or disclosure of our confidential information or technology or infringement of our intellectual property. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret or know-how is difficult, expensive, and time-consuming, and the outcome is unpredictable. In addition, trade secrets and know-how can be difficult to protect and some courts inside and outside the United States are less willing or unwilling to protect trade secrets and know-how. Also, others may come to know about or determine our trade secrets through a variety of methods. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor or other third party, we would have no right to prevent them from using that technology or information to compete with us, and our competitive position would be materially and adversely harmed. The loss of trade secret protection could make it easier for third parties to compete with our products and services by copying functionality. Additionally, individuals not subject to invention assignment agreements and other third parties may make adverse ownership claims to our current and future intellectual property, and, to the extent that our employees, independent contractors or other third parties with whom we do business use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

We will not be able to protect our intellectual property rights if we are unable to enforce our rights or if we do not detect unauthorized use, infringement, misappropriation or other violation of our intellectual property rights. Any of our intellectual property rights may be challenged or circumvented by others or invalidated or held unenforceable through administrative processes or litigation in the United States or in foreign jurisdictions. Furthermore, legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain and any changes in, or unexpected interpretations of, intellectual property laws may compromise our ability to enforce our intellectual property and other proprietary rights.

In order to protect our brands and intellectual property rights, we may be required to spend significant resources to monitor and protect these rights. Litigation brought to protect and enforce our intellectual property rights could be costly, time-consuming, and distracting to management and could result in the impairment or loss of portions of our intellectual property. We have been and may continue to become involved in litigation to enforce our patents or other intellectual property rights, to protect our trade secrets and know-how, to determine the validity or scope of the proprietary rights of others or to defend against claims of invalidity. This type of litigation can be expensive regardless of whether we win or lose. Additionally, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. Furthermore, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims, and countersuits attacking the validity and enforceability of our intellectual property rights. An adverse outcome in such litigation or proceedings may expose us to a loss of our competitive position, expose us to significant liabilities or require us to seek licenses that may not be available on commercially acceptable terms, if at all. Accordingly, we may not be able to prevent third parties from infringing upon or misappropriating our intellectual property. Our failure to obtain, maintain, defend, protect and enforce our intellectual property rights could seriously damage our brands and our business and could have a materially adverse effect on our business, financial condition and results of operations.

Trademark and trade name protection is critical to our business, and any failure to adequately obtain, maintain and protect our trademark rights could adversely affect our business, financial condition and results of operations.

The market for our products depends to a large extent upon the goodwill associated with our trademarks and trade names, and we believe that the protection of our trademark rights is an important factor in product

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recognition and the protection of our brand. We own or license the material trademarks and trade names used in connection with the packaging, marketing and sale of our products. Therefore, trademark and trade name protection is critical to our business. Although certain of our trademarks are registered in the United States and in certain foreign countries or an application for such registration is pending, we may not always be successful in asserting trademark or trade name protection. We may be unable to obtain trademark protection for our technologies, logos, slogans and brands, and our existing trademark registrations and applications, and any trademarks that may be used in the future, may not provide us with competitive advantages or distinguish our products and services from those of our competitors. Further, we may not timely or successfully register our trademarks. In addition, there could be potential trade name or trademark infringement claims brought by owners of other trademarks that are similar to ours and we could also incur substantial costs to enforce our trademarks and trade names to protect against potential dilution and prevent unauthorized use by third parties. If we do not adequately protect our rights in our trademarks from infringement or unauthorized use, any goodwill that we have developed in those trademarks could be lost or impaired, which could harm our brands and our business. Additionally, we may not be able to renew our material trademark licenses, and failure to renew our licenses may have a material effect on our business.

Our trademarks may be opposed, contested, circumvented or found to be unenforceable, weak or invalid, and we may not be able to prevent third parties from infringing or otherwise violating them or using similar marks in a manner that causes confusion or dilutes the value or strength of our brand. See also “—Our intellectual property rights are valuable, and any failure to adequately obtain, maintain, protect, defend or enforce our intellectual property rights could adversely affect our business, financial condition and results of operations.”

Our member growth and engagement on mobile devices depends upon effective operation with mobile operating systems, networks, technologies, products, hardware, and standards that we do not control.

A significant and growing portion of our members access our platform through our iFIT and Sweat applications on mobile devices and there is no guarantee that popular mobile devices will continue to support iFIT or that mobile device users will use iFIT rather than competing products. We are dependent on the interoperability of iFIT with popular mobile operating systems, networks, technologies, products, hardware and standards that we do not control, such as Android and iOS. Any changes, bugs or technical issues in such systems, or changes in our relationships with mobile operating system partners, device manufacturers or mobile carriers, or in their terms of service or polices that degrade the functionality of our digital offering, give preferential treatment to competitors, limit our ability to target or measure the effectiveness of applications, or impose fees or other charges related to our delivery of our applications could adversely affect our platform’s usage on mobile devices.

Further, we are subject to the standard policies and terms of service of these operating systems, as well as policies and terms of service of the various application stores that make our applications and experiences available to our developers, creators, and users. These policies and terms of service govern the availability, promotion, distribution, content, and operation generally of applications and experiences on such operating systems and stores. Each provider of these operating systems and stores has broad discretion to change and interpret its terms of service and policies with respect to our platform and those changes may be unfavorable to us and our developers’, creators’, and users’ use of our platform. If we were to violate or if an operating system provider or application store believes that we have violated its terms of service or policies, that operating system provider or application store could limit or discontinue our access to its operating system or store. In some cases, these terms and policies may not be clear or our interpretation of these terms and policies may not align with the interpretation of the operating system provider or application store, which could lead to inconsistent enforcement of these terms of service or policies against us, and could also result in the operating system provider or application store limiting or discontinuing our access to its operating system or store. Any limitation on or discontinuation of our access to any third-party platform or application store could adversely affect our business, financial condition or results of operations. We cannot assure you that the platforms through which we distribute our applications will maintain their current structures or terms of access, that such marketplaces will continue to make our mobile applications available for download, or that such marketplaces will not charge us fees to list our applications for download, or charge us fees to offer products and services through our applications.

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Additionally, in order to deliver high-quality mobile content, it is important that our digital offering is designed effectively and works well with a range of mobile technologies, products, systems, networks, hardware and standards that we do not control. We may not be successful in maintaining or developing relationships with key participants in the mobile industry or in developing products that operate effectively with these technologies, systems, networks, hardware or standards. In the event that it is more difficult for our members to access and use our platform on their mobile devices or members find our mobile offerings do not effectively meet their needs, if our competitors develop products and services that are perceived to operate more effectively on mobile devices, or if our members choose not to access or use our platform on their mobile devices or use mobile products that do not offer access to our platform, our member growth and member engagement could be adversely impacted and our business could be harmed.

We depend upon a number of third-party intellectual property licenses for our business operations, and our licensed intellectual property is an important part of our business. An adverse change to or loss of our intellectual property rights, including our licenses, may have an adverse effect on our business, financial condition, and results of operations.

We license certain of our intellectual property to a number of third parties that manufacture or market fitness equipment, and we receive licenses from third parties for certain intellectual property to develop our products. We believe that our licenses with third parties increase market recognition of our brands, enhance our ability to market our core products and generate attractive, high margin income. We anticipate that we will continue to enter into these kinds of licensing arrangements in the future. It is possible, however, that licenses we desire will not be available to us on commercially reasonable terms or at all. If we lose existing licenses to key technology, or are unable to enter into new licenses that we deem important, our business, financial condition and results of operations could be harmed.

Our relationship with our third-party licensors and our licensees may deteriorate and we cannot guarantee that our agreements with such third parties will continue to be renewed indefinitely. It also is possible that such agreements will not be renewed at all. The rates and terms available to us today under our licensing agreements may not be available to us in the future. Additionally, if we fail to comply with any of the obligations under our license agreements, we may be required to pay damages and the applicable licensor or licensee may have the right to terminate the license. Termination by our licensors or licensees would cause us to lose valuable rights, and could prevent us from selling our products and services, or inhibit our ability to commercialize future products and services. Our business would suffer if any of our current or future licenses terminate, if our licensors or licensees fail to abide by the terms of the license, if our licensors fail to enforce the licensed intellectual property rights against infringing third parties, if our licensed intellectual property rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms. In addition, our rights to certain technologies are licensed to us on a non-exclusive basis. The owners of these non-exclusively licensed technologies are therefore free to license them to third parties, including our competitors, on terms that may be superior to those offered to us, which could place us at a competitive disadvantage. Moreover, our licensors may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing, misappropriating or otherwise violating the licensors’ rights. In addition, the agreements under which we license intellectual property or technology from third parties are generally complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement. The lack of renewal, or termination, of one or more of our license agreements, or the renewal of a license agreement on less favorable terms, could have a material adverse effect on our business, financial condition, and results of operations.

In particular, the ability to continue to make our content accessible to our members is an important element of our business. While we own the rights to stream most of the fitness and related content produced by us or on our behalf in perpetuity, if this were to be disrupted, it would have an impact on our business and what we are able to provide to our members.

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To secure the rights to use music in our content, we have licenses with third-party providers, which allows us to provide music.

The process of obtaining our music licenses with third-party providers involved negotiations. While there are other providers available to provide such content, any change in our music provider would require a substantial amount of time and resources.

Although we expend significant resources to seek to comply with the various statutory, regulatory, and judicial frameworks with respect to music licensing, we cannot guarantee that we currently hold, or will always hold, every necessary right to use all of the music that is used on our service, and we cannot assure you that we are not infringing, misappropriating or otherwise violating any third-party intellectual property rights, or that we will not do so in the future. These challenges, and others concerning the licensing of music on our platform, may subject us to significant liability for copyright infringement, breach of contract, or other claims.

In the future, we may identify additional third-party intellectual property we may need to license in order to engage in our business, including to develop or commercialize new products or services. However, such licenses may not be available on acceptable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These companies may have a competitive advantage over us due to capital resources, development or commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties based on sales of our products and services. Such royalties are a component of the cost of our products or services and may affect the margins on our products and services. If we are unable to enter into the necessary licenses on acceptable terms or at all, if any necessary licenses are subsequently terminated, if our licensors fail to abide by the terms of the licenses, or if the licensed intellectual property rights are found to be invalid or unenforceable, our business, financial condition, and results of operations could be materially and adversely affected.

Some of our products and services contain open source software, which may pose particular risks to our proprietary software, technologies, products, and services in a manner that could harm our business.

We use open source software in our products and services and anticipate using open source software in the future. Some open source software licenses require those who distribute open source software as part of their own software product to publicly disclose all or part of the source code to such software product or to make available any derivative works of the open source code on unfavorable terms or at no cost, and we may be subject to such terms. The terms of many open source licenses to which we are subject have not been interpreted by U.S. or foreign courts, and there is a risk that open source software licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to provide or distribute our products or services. Any actual or claimed requirement to disclose our proprietary source code or pay damages for breach of the applicable license could harm our business and could help third parties, including our competitors, develop products and services that are similar to or better than ours. While we monitor our use of open source software and try to ensure that none is used in a manner that would require us to disclose our proprietary source code or that would otherwise breach the terms of an open source license, such use could inadvertently occur, or could be claimed to have occurred, in part because open source license terms are often ambiguous.

From time to time, companies that incorporate open source software into their products have faced claims challenging the ownership of open source software or compliance with open source license terms. We could face claims from third parties claiming ownership of, or demanding release of, the open source software or derivative works that we developed using such software, which could include our proprietary source code, or otherwise seeking to enforce the terms of the applicable open source license. These claims could result in litigation and could require us to make our software source code freely available, purchase a costly license, or cease offering

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the implicated products or services unless and until we can re-engineer them to avoid infringement. This re-engineering process could require us to expend significant additional research and development resources, and we cannot guarantee that we will be successful.

Additionally, the use of certain open source software can lead to greater risks than use of third-party commercial software, as open source licensors generally do not provide warranties or controls on the origin of software. There is typically no support available for open source software, and we cannot ensure that the authors of such open source software will implement or push updates to address security risks or will not abandon further development and maintenance. Many of the risks associated with the use of open source software, such as the lack of warranties or assurances of title or performance, cannot be eliminated, and could, if not properly addressed, negatively affect our business. We have processes to help alleviate these risks, including a review process for screening requests from our developers for the use of open source software, but we cannot be sure that all open source software is identified or submitted for approval prior to use in our products and services. Any of these risks could be difficult to eliminate or manage, and, if not addressed, could have an adverse effect on our business, financial condition, and results of operations.

We are in the process of updating our Enterprise Resource Planning (“ERP”) system. Significant additional costs, cost overruns and delays in connection with the implementation of our new ERP system may adversely affect results of operations.

We are in the process of updating our company-wide ERP system. This is a lengthy and expensive process that will result in a diversion of resources from other operations. Any disruptions, delays or deficiencies in the design and/or implementation of the new ERP system, particularly any disruptions, delays or deficiencies that impact operations, could adversely affect our ability to run and manage our business effectively. The implementation of a new ERP system has and will continue to involve substantial expenditures on system hardware and software, as well as design, development and implementation activities. There can be no assurance that other cost overruns relating to the new ERP system will not occur. Our business, financial condition and results of operations may be adversely affected if we experience operating problems, additional costs, or cost overruns during the ERP implementation process.

Risks Related to this Offering and Ownership of Our Class A Common Stock

Future offerings of debt or equity securities by us may have a material adverse effect on the market price of our Class A common stock.

In the future, we may attempt to obtain financing or to further increase our capital resources by issuing additional shares of our Class A common stock or by offering debt or other equity securities, including senior or subordinated notes, debt securities convertible into equity or shares of preferred stock.

Any future debt financing could involve restrictive covenants relating to our capital-raising activities and other financial and operational matters, which might make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. Moreover, if we issue debt securities, the debt holders would have rights to make claims on our assets senior to the rights of our holders of our Class A common stock. The issuance of additional shares of our Class A common stock or other equity securities or securities convertible into equity may dilute the economic and voting rights of our existing stockholders or reduce the market price of our Class A common stock or both. Debt securities convertible into equity could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities issuable upon conversion. Preferred shares, if issued, could have a preference with respect to liquidating distributions or a preference with respect to dividend payments that could limit our ability to pay dividends to the holders of our Class A common stock. Our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may have a material adverse effect on the amount, timing, or nature of our future offerings. Thus, holders of our Class A common stock bear the risk that our future offerings may reduce the market price of our Class A common stock and dilute their stockholdings in us.

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The dual class structure of our common stock will have the effect of concentrating voting control with the Scott R. Watterson holders who will hold in the aggregate 85.1% of the voting power of our capital stock following the completion of this offering, which will limit or preclude your ability to influence corporate matters, including the election of directors and the approval of any change of control transaction.

Our Class B common stock has ten votes per share, and our Class A common stock, which is the stock we are offering in this offering, has one vote per share. Following this offering, the Scott R. Watterson holders, as holders of our outstanding Class B common stock, will hold 85.1% of the voting power of our outstanding capital stock. Because of the ten-to-one voting ratio between our Class B and Class A common stock, the holders of our Class B common stock collectively will continue to control a majority of the combined voting power of our common stock and therefore be able to control all matters submitted to our stockholders for approval until the earlier of (i) the date specified by a vote of the holders of not less than two-thirds of the voting power of the then outstanding shares of Class B common stock, and (ii) the date on which we first have actual knowledge that the shares of Class B common stock cease to represent at least 15% of all outstanding shares of our common stock. This concentrated control will limit or preclude your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval. In addition, this may prevent or discourage unsolicited acquisition proposals or offers for our capital stock that you may feel are in your best interest as one of our stockholders. Holders of Class B common stock may have interests that conflict with or are different than the interests of other stockholders.

Future transfers by holders of Class B common stock will generally result in those shares converting to Class A common stock, subject to certain exceptions. See the section titled “Description of Capital Stock—Anti-Takeover Provisions” for additional information.

The dual class structure of our common stock may adversely affect the trading market for our Class A common stock.

Certain stock index providers, such as S&P Dow Jones, exclude companies with multiple classes of shares of common stock from being added to certain stock indices, including the S&P 500. In addition, several stockholder advisory firms and large institutional investors oppose the use of multiple class structures. As a result, the dual class structure of our common stock may prevent the inclusion of our Class A common stock in such indices, may cause stockholder advisory firms to publish negative commentary about our corporate governance practices or otherwise seek to cause us to change our capital structure, and may result in large institutional investors not purchasing shares of our Class A common stock. Any exclusion from stock indices could result in a less active trading market for our Class A common stock. Any actions or publications by stockholder advisory firms or institutional investors critical of our corporate governance practices or capital structure could also adversely affect the value of our Class A common stock.

As a controlled company, we will not be subject to all of the corporate governance rules of NASDAQ.

Upon the listing of our common stock on NASDAQ in connection with this offering, we will be considered a “controlled company” under the rules of NASDAQ, as applicable. Controlled companies are exempt from NASDAQ corporate governance rules requiring that listed companies have (i) a majority of the board of directors consist of independent directors under the listing standards of NASDAQ, (ii) a nominating/corporate governance committee composed entirely of independent directors and a written nominating/corporate governance committee charter meeting NASDAQ requirements, as applicable and (iii) a compensation committee composed entirely of independent directors and a written compensation committee charter meeting the requirements of NASDAQ, as applicable. Following this offering, we intend to use some or all these exemptions. As a result, we may not have a majority of independent directors, our nomination and corporate governance committee and compensation committee may not consist entirely of independent directors and such committees may not be subject to annual performance evaluations. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of NASDAQ. See “Management.”

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We do not anticipate paying any dividends on our Class A common stock in the foreseeable future.

We do not expect to declare or pay any cash or other dividends in the foreseeable future on our Class A common stock. Our Senior ABL Revolving Credit Facility restricts our ability to pay cash dividends on our Class A common stock. The payment of dividends is also subject to consent by holders of the New Convertible Notes. We may also enter into other credit agreements or other borrowing arrangements in the future that restrict or limit our ability to pay cash dividends on our Class A common stock. As a result, you may not receive any return on an investment in our Class A common stock unless you sell our Class A common stock for a price greater than that which you paid for it. See “Dividend Policy.”

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our Class A common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage of us, the trading price for our Class A common stock would be negatively impacted. If we obtain securities or industry analyst coverage and if one or more of these analysts ceases coverage of our Company or fails to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. Moreover, if our results of operations do not meet the expectations of the investor community, or one or more of the analysts who cover our Company downgrade our Class A common stock, our stock price could decline. As a result, you may not be able to sell shares of our Class A common stock at prices equal to or greater than the initial public offering price.

No market currently exists for our Class A common stock, and we cannot assure you that an active market will develop for such stock.

Prior to this offering, there has been no public market for our Class A common stock. The initial public offering price for our Class A common stock has been determined through negotiations among us and the representatives of the underwriters and may not be indicative of the market price of our Class A common stock after this offering or to any other established criteria of the value of our business. If you purchase shares of our Class A common stock, you may not be able to resell those shares at or above the initial public offering price. We cannot predict the extent to which investor interest in us will lead to the development of an active trading market on NASDAQ or otherwise or how liquid that market might become. An active public market for our Class A common stock may not develop or be sustained after this offering. If an active public market does not develop or is not sustained, it may be difficult for you to sell your shares of our Class A common stock at a price that is attractive to you or at all.

The market price and trading volume of our Class A common stock may be volatile, which could result in rapid and substantial losses for our stockholders, and you may lose all or part of your investment.

Shares of our Class A common stock sold in this offering may experience significant volatility on NASDAQ. An active, liquid and orderly market for our Class A common stock may not be sustained, which could depress the trading price of our Class A common stock or cause it to be highly volatile or subject to wide fluctuations. The market price of our Class A common stock may fluctuate or may decline significantly in the future and you could lose all or part of your investment. Some of the factors that could negatively affect our share price or result in fluctuations in the price or trading volume of our Class A common stock include:

• variations in our quarterly or annual results of operations;

• changes in our earnings estimates (if provided) or differences between our actual results of operations and those expected by investors and analysts;

• the contents of published research reports about us or our industry or the failure of securities analysts to cover our Class A common stock;

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• additions or departures of key management personnel;

• any increased indebtedness we may incur in the future;

• announcements by us or others and developments affecting us;

• actions by institutional stockholders;

• litigation and governmental investigations;

• legislative or regulatory changes;

• judicial pronouncements interpreting laws and regulations;

• changes in government programs;

• changes in market valuations of similar companies;

• speculation or reports by the press or investment community with respect to us or our industry in general;

• announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic relationships, joint ventures or capital commitments; and

• general market, political and economic conditions, including local conditions in the markets in which we operate.

These broad market and industry factors may decrease the market price of our Class A common stock, regardless of our actual financial performance. The stock market in general has from time to time experienced extreme price and volume fluctuations, including recently. In addition, in the past, following periods of volatility in the overall market and decreases in the market price of a company’s securities, securities class action litigation has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources, which could have a material adverse effect on our business, financial condition and results of operations.

The market price of our Class A common stock could be negatively affected by sales of substantial amounts of our Class A common stock in the public markets.

After this offering, we will have 200,488,123 shares of Class A common stock outstanding and 114,402,561 shares of Class B common stock that may be convertible into Class A common stock upon transfer (calculated assuming the offering price is $19.50 per share, the actual number of shares will vary if the offering price is changed). Of our issued and outstanding shares, all the Class A common stock sold in this offering will be freely transferable, except for any shares held by our “affiliates,” as that term is defined in Rule 144 under the Securities Act. Following closing of this offering, approximately 15.3% of our outstanding Class A common stock, or 17.3% if the underwriters exercise their option to purchase additional shares in full, will be immediately available for sale in the public market.

We and all directors and officers and holders of substantially all of our outstanding stock and stock options have agreed, subject to specified exceptions, not to directly or indirectly:

• sell, offer, contract or grant any option to sell (including any short sale), pledge, transfer, establish an open “put equivalent position” within the meaning of Rule 16a-l(h) under the Exchange Act,

• otherwise dispose of any shares of Class A common stock, options or warrants to acquire shares of Class A common stock, or securities exchangeable or exercisable for or convertible into shares of Class A common stock currently or hereafter owned either of record or beneficially, or

• publicly announce an intention to do any of the foregoing

for a period of 180 days after the date of this prospectus without the prior written consent of the representatives of the underwriters.

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This restriction terminates after the close of trading of the Class A common stock on and including the 180th day after the date of this prospectus. The representatives of the underwriters may, in their sole discretion and at any time or from time to time before the termination of the 180-day period release all or any portion of the securities subject to lock-up agreements. See “Underwriting—Selling Restrictions.”

Immediately following this offering, the holders of approximately 160.7 million shares of our Class A common stock and 114.4 million shares of our Class B common stock which is convertible into shares of our Class A common stock, subject to certain lock-up restrictions and conditions, will have rights, subject to some conditions, to require us to file registration statements for the public resale of the Class A common stock issuable upon conversion of such shares or to include such shares in registration statements that we may file for us or other stockholders.

The market price of our Class A common stock may decline significantly when the restrictions on resale by our existing stockholders lapse. A decline in the price of our Class A common stock might impede our ability to raise capital through the issuance of additional Class A common stock or other equity securities.

The future issuance of additional Class A common stock in connection with outstanding securities, any equity plans, acquisitions or otherwise will dilute all other stockholdings.

After this offering, we will have an aggregate of 45,000,000 shares of Class A common stock authorized under our equity incentive plans, including appoximately 332,980 restricted shares and options issued for approximately 6,210,729 shares of Class A common stock to be granted in connection with this offering . We may issue all these shares of Class A common stock without any action or approval by our stockholders, subject to certain exceptions. The issuance of any Class A common stock in connection with any equity incentive plan, the exercise of outstanding stock options, the exercise of outstanding warrants, the conversion of the New Convertible Notes or otherwise would dilute the percentage ownership held by the investors who purchase Class A common stock in this offering.

You will incur immediate dilution as a result of this offering.

If you purchase Class A common stock in this offering, you will pay more for your shares than the amounts paid by existing stockholders for their shares. As a result, you will incur immediate dilution of $18.85 per share, representing the difference between the assumed initial public offering price of $19.50 per share (the midpoint of the estimated initial public offering price range set forth on the cover of this prospectus) and our pro forma as adjusted net tangible book value (deficit) per share after giving effect to this offering. See “Dilution.”

We will have broad discretion in the use of the net proceeds we receive in this offering and may not use them effectively.

We will have broad discretion in the application of the net proceeds we receive in this offering, including for any of the purposes described in the section titled “Use of Proceeds,” and you will not have the opportunity as part of your investment decision to assess whether the net proceeds are being used appropriately. Because of the number and variability of factors that will determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently intended use. If we do not use the net proceeds that we receive in this offering effectively, our business, financial condition, results of operations, and prospects could be harmed, and the market price for our Class A common stock could decline. Pending their use, we may invest the net proceeds from this offering in short-term, investment-grade interest-bearing securities such as money market accounts, certificates of deposit, commercial paper, and guaranteed obligations of the U.S. government that may not generate a high yield to our stockholders. These investments may not yield a favorable return to our investors.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members and officers.

As a public company, we will incur legal, accounting and other expenses that we did not previously incur. We will become subject to the reporting requirements of the Exchange Act, and the Sarbanes-Oxley Act, the listing requirements of NASDAQ and other applicable securities rules and regulations. Compliance with these rules and

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regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. The Exchange Act requires that we file annual, quarterly and current reports with respect to our business, financial condition and results of operations. The Sarbanes-Oxley Act requires, among other things, that we establish and maintain effective internal controls and procedures for financial reporting. Furthermore, the need to establish the corporate infrastructure demanded of a public company may divert our management’s attention from implementing our growth strategy, which could prevent us from improving our business, financial condition and results of operations.

We are evaluating these rules and regulations and cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. These rules and regulations are often subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Further, if our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate legal proceedings against us and could have a material adversely effect on our business, financial condition and results of operations.

In addition, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may have to choose between reduced coverage or substantially higher costs to obtain coverage. These factors could make it more difficult for us to attract and retain qualified executive officers and members of our board of directors, particularly to serve on our audit committee and compensation committee.

Risks Related to Our Company and Organizational Structure

The requirements of being a public company, including maintaining adequate internal control over our financial and management systems, may strain our resources, divert management’s attention, and affect our ability to attract and retain executive management and qualified board members.

As a public company we will incur significant legal, accounting, and other expenses that we did not incur as a private company. We will be subject to reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the rules subsequently implemented by the Securities and Exchange Commission (“SEC”), the rules and regulations of the listing standards of NASDAQ, and other applicable securities rules and regulations. Compliance with these rules and regulations will likely strain our financial and management systems, internal controls, and employees. The Exchange Act requires, among other things, that we file annual, quarterly, and current reports with respect to our business and results of operations. Moreover, the Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures, and internal control over financial reporting. In order to maintain and, if required, improve our disclosure controls and procedures, and internal control over financial reporting to meet this standard, significant resources and management oversight may be required. If, in the future, we have material weaknesses or deficiencies in our internal control over financial reporting, we may not detect errors on a timely basis and our consolidated financial statements may be materially misstated. Effective controls are necessary for us to produce reliable financial reports and prevent fraud. In addition, we will be required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. We expect to incur significant expenses and devote substantial management effort toward ensuring compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. As a result of the complexity involved in complying with the rules and regulations applicable to public companies, our management’s attention may be diverted from other business concerns, which could harm our business, financial condition and results of operations. Although we have already hired additional employees to assist us in complying with these requirements and engaged outside consultants, our finance team is small and we may need to hire more employees in the future, or engage outside consultants, which will increase our operating expenses. We also

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expect that being a public company and complying with applicable rules and regulations will make it more expensive for us to obtain director and officer liability insurance, and we may be required to incur substantially higher costs to obtain and maintain the same or similar coverage. These factors could also make it more difficult for us to attract and retain qualified members of our board of directors and qualified executive officers.

We have identified deficiencies in our internal control over financial reporting, including material weaknesses and if our remediation of such deficiencies is not effective, or if we fail to develop and maintain an effective system of disclosure controls and procedures and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable laws and regulations could be impaired.

In the course of preparing our financial statements for fiscal 2021, we identified material weaknesses in our internal control over financial reporting. The material weaknesses have not been remediated. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. We identified a material weakness in our control environment due to a lack of a sufficient complement of accounting and financial reporting resources commensurate with our financial reporting requirements as a public company. This material weakness contributed to the following additional material weaknesses:

• Our controls over the reviews of the accounting for certain transactions were not designed to operate at a sufficiently precise level, including those for inventory and stock compensation.

• Our controls related to our procurement process were not designed to appropriately document and review the contractual terms and related approvals for significant contracts.

These material weaknesses resulted in adjustments to our financial statements and could result in a misstatement of our accounts or disclosures that would result in a material misstatement to the annual or interim consolidated financial statement that would not be prevented or detected.

To address these material weaknesses, we have added personnel and implemented business process controls. We intend to continue to take steps to remediate the material weaknesses described above through hiring additional qualified accounting and financial reporting personnel and thoroughly evaluating the design of existing controls and implementing more robust controls and processes supporting internal controls over financial reporting. We will not be able to fully remediate these material weaknesses until these steps have been completed and have been operating effectively for a sufficient period of time. Furthermore, we cannot assure you that the measures we have taken to date, and actions we may take in the future, will be sufficient to remediate the control deficiencies that led to our material weaknesses in our internal control over financial reporting or that they will prevent or avoid potential future material weaknesses. Our current controls and any new controls that we develop may become inadequate because of changes in conditions in our business. Further, weaknesses in our disclosure controls and procedures and internal control over financial reporting may be discovered in the future. Any failure to develop or maintain effective controls or any difficulties encountered in their implementation or improvement could harm our operating results or cause us to fail to meet our reporting obligations and may result in a restatement of our financial statements for prior periods.

Our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal control over financial reporting until after we are no longer an “emerging growth company” as defined in the JOBS Act. At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed, or operating. Any failure to implement and maintain effective internal control over financial reporting also could adversely affect the results of periodic management evaluations and annual independent registered public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that we will eventually be required to include in our periodic reports that are filed with the SEC.

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Ineffective disclosure controls and procedures and internal control over financial reporting could also cause investors to lose confidence in our reported financial and other information, which would likely have a negative effect on the trading price of our Class A common stock. In addition, if we are unable to continue to meet these requirements, we may not be able to remain listed on the Nasdaq Global Select Market.

Our current resources may not be sufficient to fulfill our public company obligations.

Following the closing of this offering, we will be subject to various regulatory requirements, including those of the SEC and NASDAQ. These requirements include record keeping, financial reporting and corporate governance rules and regulations. Historically, our management team has not had the resources typically found in a public company. Our internal infrastructure may not be adequate to support our increased reporting obligations and we may be unable to hire, train or retain necessary staff and may be reliant on engaging outside consultants or professionals to overcome our lack of experience or employees. If our internal infrastructure is inadequate, we are unable to engage outside consultants at a reasonable rate or attract talented employees to perform these functions or are otherwise unable to fulfill our public company obligations, it could have a material adverse effect on our business, financial condition and results of operations.

This prospectus takes advantage of certain reduced disclosure accommodations applicable to emerging growth companies, including those relating to accounting standards and disclosure about our executive compensation, that do not apply to other public companies.

When we furnished the initial draft of the registration statement of which this prospectus forms a part, we qualified as an “emerging growth company” as defined in the JOBS Act. As such we are able to take advantage of specified reduced disclosure requirements applicable to this offering. These reduced requirements include, among others:

• an exemption from the adoption of certain new or revised financial accounting standards that do not yet apply to private companies;

• an exemption from compliance with certain new requirements adopted by the Public Company Accounting Oversight Board requiring a supplement to the auditor’s report in which the auditor is required to provide additional information about the audit and the financial statements of the issuer; and

• reduced disclosure about executive compensation arrangements.

As a result of our decision to avail ourselves of these disclosure accommodations, the information that we provide may be different than what you may receive from other public companies in which you may hold an equity interest. Following this offering, we will no longer be able to take advantage of the accommodations available to emerging growth companies.

Provisions in our amended and restated certificate of incorporation and amended and restated bylaws and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult, limit attempts by our stockholders to replace or remove our current management, and limit the market price of our Class A common stock.

Provisions in our amended and restated certificate of incorporation and amended and restated bylaws that will be in effect upon the completion of this offering may have the effect of delaying or preventing a merger, acquisition or other change of control of our company that the stockholders may consider favorable. In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors. Among other things, our amended and restated certificate of incorporation and amended and restated bylaws include provisions that:

• provide for a classified board with staggered three-year terms;

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• permit the board of directors to establish the number of directors and fill any vacancies and newly-created directorships;

• authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan;

• provide that only our chief executive officer or a majority of our board of directors will be authorized to call a special meeting of stockholders;

• Our amended and restated certificate of incorporation will provide that our stockholders may take action by written consent only for so long as the outstanding shares of Class B common stock represent at least 40% of the combined voting power of our common stock after which stockholders will only be able to take action at annual or special meetings of our stockholders;

• certain litigation against us can only be brought in Delaware;

• prohibit cumulative voting;

• provide for a dual class common stock structure in which holders of our Class B common stock may have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets (see the section titled “Description of Capital Stock”);

• provide that the board of directors is expressly authorized to make, alter, or repeal our bylaws;

• establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings; and

• provide that the vote of holders of a majority of the then outstanding shares of Class B common stock, voting as a separate class, will be required to amend provisions of our amended and restated certificate of incorporation and amended and restated bylaws affecting the rights of holders of Class B common stock, and that any other amendments to our amended and restated certificate of incorporation or amended and amended and restated bylaws will require the approval of the majority of the combined vote of our then-outstanding shares of Class A and Class B common stock.

In addition, our Senior ABL Revolving Credit Facility imposes, and we anticipate that documents governing our future indebtedness may impose, limitations on our ability to enter into change of control transactions. The occurrence of a change of control transaction could constitute an event of default thereunder permitting acceleration of the indebtedness, thereby impeding our ability to enter into certain transactions.

Our amended and restated certificate of incorporation will designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, and will designate the federal district courts of the U.S. as the sole and exclusive forum for claims arising under the Securities Act, which, in each case could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees, agents, or other stockholders.

Our amended and restated certificate of incorporation will provide that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (a) derivative action or proceeding brought on our behalf; (b) action asserting a claim of breach of a fiduciary duty owed by or other wrongdoing by any current or former director, officer, employee, agent or stockholder to us or our stockholders; (c) action asserting a claim arising under any provision of the DGCL or our amended and restated certificate of incorporation or amended and restated bylaws (as either may be amended from time to time), or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware; or (d) action asserting a claim governed by the internal affairs doctrine. For

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the avoidance of doubt, our amended and restated certificate of incorporation will also provide that the foregoing exclusive forum provision does not apply to actions brought to enforce any liability or duty created by the Securities Act or the Exchange Act, or any rules or regulations promulgated thereunder, or any other claim or cause of action for which the federal courts have exclusive jurisdiction.

Our amended and restated certificate of incorporation will also provide that, unless we consent in writing to an alternative forum, the federal district courts of the United States of America shall be the sole and exclusive forum for the resolution of any action asserting a claim arising under the Securities Act or the rules and regulations promulgated thereunder. Pursuant to the Exchange Act, claims arising thereunder must be brought in federal district courts of the United States of America.

To the fullest extent permitted by law, any person or entity purchasing or otherwise acquiring or holding any interest in any shares of our capital stock shall be deemed to have notice of and consented to the forum provision in our amended and restated certificate of incorporation. This choice of forum provision may limit a stockholder’s ability to bring a claim in a different judicial forum, including one that it may find favorable or convenient for a specified class of disputes with us or our directors, officers, other stockholders, or employees, which may discourage such lawsuits, make them more difficult or expensive to pursue, and result in outcomes that are less favorable to such stockholders than outcomes that may have been attainable in other jurisdictions. By agreeing to this provision, however, stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable. If a court were to find the choice of forum provisions in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could have a material adverse effect on our business, financial condition and results of operations.

Our ability to issue preferred stock may deter takeover attempts.

Our Board is empowered to issue, without stockholder approval, preferred stock with dividends, liquidation, conversion, voting or other rights, which could decrease the amount of earnings and assets available for distribution to holders of our Class A common stock and adversely affect the relative voting power or other rights of the holders of our Class A common stock. In the event of issuance, the preferred stock could be used as a method of discouraging, delaying or preventing a change in control. Our certificate of incorporation authorizes the issuance of shares of “blank check” preferred stock with such designations, rights and preferences as may be determined from time to time by our board of directors. Although we have no present intention to issue any shares of our preferred stock, we may do so in the future under appropriate circumstances.

Risks Related to Our Indebtedness

Any default under our debt agreements could have significant consequences.

Our Senior ABL Credit Agreement contains covenants imposing certain restrictions on our business. These restrictions may affect our ability to operate our business and may limit our ability to take advantage of potential business opportunities as they arise. The Senior ABL Credit Agreement contains restrictive covenants including, with specified exceptions, limitations on our ability to incur debt and liens, pay dividends or make other distributions, enter into affiliate transactions, consolidate, merge or acquire or dispose of assets and make certain investments, acquisitions and loans. Our New Convertible Notes also provide consent rights to the required holders thereunder with respect to the incurrence of certain indebtedness. The Senior ABL Credit Agreement under certain circumstances also requires us to maintain a minimum consolidated fixed charge coverage ratio of 1.00 to 1.00.

Our ability to comply with these covenants under the Senior ABL Credit Agreement may be affected by events beyond our control, including prevailing economic, financial and industry conditions. The breach of any of these

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covenants could result in a default, which would permit the lenders to declare all outstanding debt to be due and payable, together with accrued and unpaid interest. Our obligations under the Senior ABL Credit Agreement are secured by liens on substantially all of our assets, subject to agreed-upon exceptions. Any default by us under the Senior ABL Credit Agreement could have a material adverse effect on our business, financial condition and results of operations.

The transition away from LIBOR may adversely affect our cost to obtain financing.

On March 5, 2021, the U.K. Financial Conduct Authority announced the future cessation or loss of representativeness of the 35 London Interbank Offered Rate (“LIBOR”) benchmark settings currently published by ICE Benchmark Administration, immediately after December 31, 2021 for certain Euro settings, and immediately after June 30, 2023 for US dollar LIBOR settings. While there is no consensus on what rate or rates may become accepted alternatives to LIBOR, the Alternative Reference Rates Committee, a steering committee comprised of U.S. financial market participants, selected and the Federal Reserve Bank of New York started in May 2018 to publish the Secured Overnight Finance Rate, or SOFR, as an alternative to LIBOR. SOFR is a broad measure of the cost of borrowing cash in the overnight U.S. treasury repo market. At this time, it is impossible to predict whether SOFR or another reference rate will become an accepted alternative to LIBOR. The manner and impact of this transition may materially adversely affect the trading market for LIBOR-based securities, which may result in an increase in borrowing costs under our Senior ABL Credit Agreement. Any replacement for LIBOR may result in an effective increase in the applicable interest rate on our current or future debt obligations, including our Senior ABL Credit Agreement, impact our ability to refinance some or all of our existing indebtedness or otherwise have a material adverse impact on our business, financial condition and results of operations.

In addition, we partner with a third-party consumer finance company to offer 0% APR financing programs for certain products, for which we pay a fee to the consumer finance company. These programs allow our qualified customers to pay in monthly payments. To the extent the transition away from LIBOR increases the consumer finance company’s cost of financing or result in increased fees to us, these financing programs may become unavailable, less attractive or more costly to us.

Our level of indebtedness could have a material adverse effect on our business, financial condition and results of operations.

The total principal amount of debt outstanding under our Senior ABL Revolving Credit Facility, excluding unamortized debt issuance costs, as of May 31, 2021 was $0.3 million, with capacity to borrow up to $261.3 million. In addition, we will incur additional indebtedness in connection with the issuance of the New Convertible Notes. Our indebtedness could have significant effects on our business, such as:

• limiting our ability to borrow additional amounts to fund capital expenditures, acquisitions, debt service requirements, execution of our growth strategy and other purposes;

• limiting our ability to make investments, including acquisitions, loans and advances, and to sell, transfer or otherwise dispose of assets;

• requiring us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our borrowings, which would reduce availability of our cash flow to fund working capital, capital expenditures, acquisitions, execution of our growth strategy and other general corporate purposes;

• making us more vulnerable to adverse changes in general economic, industry and competitive conditions, in government regulation and in our business by limiting our ability to plan for and react to changing conditions;

• placing us at a competitive disadvantage compared with our competitors that have less debt; and

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• exposing us to risks inherent in interest rate fluctuations because our borrowings are at variable rates of interest, which could result in higher interest expense in the event of increases in interest rates.

In addition, we may not be able to generate sufficient cash flow from our operations to repay our indebtedness when it becomes due and to meet our other cash needs. If we are not able to pay our borrowings as they become due, we will be required to pursue one or more alternative strategies, such as selling assets, refinancing or restructuring our indebtedness or selling additional debt or equity securities. We may not be able to refinance our debt or sell additional debt or equity securities or our assets on favorable terms, if at all, and if we must sell our assets, it could have a material adverse effect on our business, financial condition and results of operation.

Pursuant to our Senior ABL Credit Agreement, under certain circumstances, we are required to maintain, on a consolidated basis, a minimum ratio of consolidated EBITDA (with certain adjustments as set forth in the Senior ABL Credit Agreement) to total fixed charges (as set forth in the Senior ABL Credit Agreement), tested as of the last day of each fiscal quarter. Our ability to borrow under our Senior ABL Revolving Credit Facility depends on our compliance with this financial covenant. Events beyond our control, including changes in general economic and business conditions, may affect our ability to satisfy the financial covenant. We cannot assure you that we will satisfy the financial covenant in the future, or that our lenders will waive any failure to satisfy the financial covenant.

The failure to comply with the covenants under our Senior ABL Credit Agreement or volatility in the credit and capital markets could have a material adverse effect on our business, financial condition and results of operation.

Our ability to manage our debt is dependent on our level of positive cash flow from the sale of our products. An economic downturn may negatively impact our cash flows. Credit and capital markets can be volatile, which could make it more difficult for us to refinance our existing debt or to obtain additional debt or equity financings in the future. Such constraints could increase our costs of borrowing and could restrict our access to other potential sources of future liquidity. Future volatility or disruption in the credit and capital markets could require us to take measures to conserve cash until the markets stabilize or until alternative credit arrangements or other funding for our business needs can be arranged. Our failure to comply with the covenants under the Senior ABL Credit Agreement or to have sufficient liquidity to make interest and other payments required by our debt could result in a default of such debt and acceleration of our borrowings, which could have a material adverse effect on our business, financial condition and results of operations.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods, or by the inclusion of forecasts or projections. Examples of forward-looking statements include, but are not limited to, statements we make regarding the outlook for our future business and financial performance, such as those contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions and the following:

• the inability to manage or maintain our growth and failure to execute our continued growth strategy;

• changes in our market opportunity, including our TAM and SAM and forecasts of market growth;

• failure to retain and expand our Interactive Fitness Subscriber base;

• decreased perception of or inability to increase sales of our Interactive Fitness Products and services;

• the effects of the continued pandemic on our business and the global economy;

• the effects of political and policy changes that could limit our growth opportunities;

• changes in our beliefs and objectives for future operations;

• our ability to develop new and enhance existing Interactive Fitness Products and services and bring them to market in a timely manner;

• the effects of seasonality on our operating results;

• failure to maintain or enter into new partnerships with third parties;

• failure to maintain, protect, and enhance our intellectual property;

• failure to comply with applicable privacy, security, and data laws, regulations, and standards;

• cybersecurity breaches of our and our partners’ information and technology systems; and

• the effects of increased competition in our markets and our ability to compete in those markets.

See “Risk Factors” for a further description of these and other factors. For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this prospectus. Any forward-looking statement made by us in this speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

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USE OF PROCEEDS

We estimate that the net proceeds to us from our sale of 30,769,231 shares of Class A common stock in this offering will be approximately $557.3 million, after deducting underwriting discounts and commissions and estimated expenses payable by us in connection with this offering. This assumes a public offering price of $19.50 per share, which is the midpoint of the price range set forth on the cover of this prospectus. The underwriters also have an option to purchase up to 4,615,384 additional shares of Class A common stock from us.

We estimate that the net proceeds to us, if the underwriters exercise their right to purchase the maximum of additional shares of Class A common stock from us, will be approximately $641.7 million, after deducting underwriting discounts and commissions and estimated expenses payable by us in connection with this offering. This assumes a public offering price of $19.50 per share, which is the midpoint of the price range set forth on the cover of this prospectus.

We intend to use the net proceeds in the following order of priority:

• approximately $465.0 million of the net proceeds will be retained by the Company and used for general corporate purposes;

• $35.0 million will be used to make a required payment to our CEO; and

• approximately $57.3 million ($141.7 million if the underwriters exercise their option to purchase additional shares in full) to make a cash payment, which together with the issuance of New Convertible Notes, will repay in full the 2019 Note.

Assuming no exercise of the underwriters’ option to purchase additional shares, a $1.00 increase (decrease) in the assumed initial public offering price of $19.50 per share (the midpoint of the price range set forth on the cover of this prospectus) would increase (decrease) the net proceeds to us from this offering by approximately $28.8 million, assuming the number of shares offered by us, as set forth on the cover of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated expenses payable by us. An increase or decrease of 1,000,000 shares in the number of shares offered by us would increase or decrease the net proceeds to us by approximately $18.3 million, assuming no change in the assumed initial public offering price of $19.50 per share and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. The information discussed above is illustrative only and will change based on the actual initial public offering price and other terms of this offering determined at pricing. The foregoing use of proceeds does not include approximately $10.6 million of expenses that have already been paid.

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DIVIDEND POLICY

We do not currently intend to pay cash dividends on our common stock in the foreseeable future. However, in the future, subject to the factors described below and our future liquidity and capitalization, we may change this policy and choose to pay dividends.

Our ability to pay dividends is currently restricted by the terms of our Senior ABL Revolving Credit Facility and may be further restricted by any future indebtedness we incur.

In addition, under Delaware law, our board of directors may declare dividends only to the extent of our surplus (which is defined as total assets at fair market value minus total liabilities, minus statutory capital) or, if there is no surplus, out of our net profits for the then current and/or immediately preceding fiscal year.

Any future determination to pay dividends will be at the discretion of our board of directors and will take into account:

• restrictions in our debt instruments, including our Senior ABL Revolving Credit Facility;

• general economic business conditions;

• our earnings, financial condition, and results of operations;

• our capital requirements;

• our prospects;

• legal restrictions; and

• such other factors as our board of directors may deem relevant.

See “Risk Factors—Risks Related to this Offering and Ownership of Our Class A Common Stock—We do not anticipate paying any dividends on our Class A common stock in the foreseeable future,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources,” “Description of Material Indebtedness,” and “Description of Capital Stock.”

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CAPITALIZATION

The following table sets forth our cash and cash equivalents and our capitalization as of May 31, 2021:

• on an actual basis; and

• a pro forma basis to give effect to (1) the Concurrent Transactions as follows: the redesignation of our outstanding common stock as Class A common stock and the subsequent exchange of certain Class A common stock for Class B common stock; the repayment of the 2019 Note with cash and New Convertible Notes; the repayment of the Series A preferred stock with a combination of Class A common stock and New Convertible Notes; the repayment of the Series B preferred stock with Class A common stock; the payment of deferred consideration for the 29029 and Sweat acquisitions with Class A common stock; the filing and effectiveness of our amended and restated certificate of incorporation; the cashless net settlement of all outstanding warrants; and the payment of $35 million to our CEO; and (2) the issuance and sale by us of 30,769,231 shares of our Class A common stock offered in this offering at an assumed initial price of $19.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting the estimated underwriting discount and estimated offering expenses.

The pro forma information below is illustrative only, and our cash and cash equivalents, additional paid-in capital, total stockholders’ (deficit) equity, and total capitalization following the completion of this offering will be adjusted based on the actual initial public offering price and other terms of the offering determined at the pricing of this offering. This table should be read in conjunction with “Use of Proceeds,” “Selected Consolidated Financial and Other Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Capital Stock,” “Unaudited Pro Forma Condensed Consolidated Financial Information” and the consolidated financial statements and notes thereto appearing elsewhere in this prospectus.

	As of May 31, 2021
	Actual			Pro Forma(1)(3)
	(unaudited)
	(in thousands, except share and per share amounts)
Cash and cash equivalents	$	146,453		$	586,540
Debt:
Long-term debt, net(2)	$	157,133		$	271
New convertible notes		—			373,950
Mandatorily redeemable preferred stock		234,041			—
Warrant liabilities		327,313			—
Embedded derivative liabilities		121,000			—
Other non-current liabilities		25,612			14,493
Stockholders’ equity (deficit):
Common stock, $0.0001 par value per share; 1,000,000,000 authorized shares, 240,175,493 issued and outstanding, actual; no shares authorized, no shares issued and outstanding, pro forma		240			—
Class A common stock, $0.001 par value per share; no authorized shares, no issued and outstanding, actual; 3,000,000,000 shares authorized, 200,488,123 shares issued and outstanding, pro forma		—			202
Class B common stock, $0.001 par value per share; no authorized shares, no issued and outstanding, actual; 3,000,000,000 shares authorized, 114,402,561 shares issued and outstanding, pro forma		—			114
Additional paid-in capital		324,368			1,800,946
Accumulated deficit		(909,011	)		(1,460,694	)
Accumulated other comprehensive loss		(4,996	)		(4,996	)
Treasury stock		(80,760	)		(94,803	)
Total stockholders’ equity (deficit)		(670,159	)		240,769
Total capitalization	$	194,940		$	629,483

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(1) Each $1.00 increase or decrease in the public offering price per share would increase or decrease, as applicable, our net proceeds, after deducting the underwriting discount and estimated offering expenses payable by us, by $28.8 million (assuming no exercise of the underwriters’ option to purchase additional shares). Similarly, an increase or decrease of one million shares of Class A common stock sold in this offering by us would increase or decrease, as applicable, our net proceeds, after deducting the underwriting discount and estimated offering expenses payable by us, by $18.3 million, based on an assumed initial public offering price of $19.50 per share, which is the midpoint of the price range set forth on the cover of this prospectus.

(2) For a description of debt facilities, see “Description of Material Indebtedness.” At August 31, 2021, we had borrowings under our 2021 Revolver of $210.0 million and available borrowing capacity of $82.8 million.

(3) For further information on our pro forma capitalization, refer to the “Unaudited Pro Forma Condensed Consolidated Financial Information” included elsewhere in this registration statement.

The shares of Class A common stock or Class B common stock and the New Convertible Notes issued in the Concurrent Transactions are not being registered in connection with this offering.

Each $1.00 increase in the public offering price per share would decrease, as applicable, by 611,588 shares, and each $1.00 decrease in the public offering price per share would increase, as applicable, by 677,699 shares, the number of shares of Class A common stock issued in connection with the repayment of our Series A and Series B preferred stock, and the payment of deferred consideration for the 29029 and Sweat acquisitions.

The number of shares of our Class A common stock and Class B common stock to be outstanding after this offering is based upon our shares of stock outstanding as of May 31, 2021, after giving effect to the Concurrent Transactions, and does not include:

• 9,741,051 shares of our Class A common stock issuable upon the exercise of options to purchase shares of our Class A common stock outstanding as of May 31, 2021, with a weighted-average exercise price of $1.41 per share or 1,124,550 options granted between June 1, 2021 and August 31, 2021 with a weighted-average price of $9.06 per share;

• 10,662,624 shares of our Class B common stock issuable upon the exercise of options to purchase shares of our Class B common stock outstanding as of May 31, 2021 with an exercise price of $9.06 per share;

• 22,561,086 shares of our Class A common stock issuable upon the conversion of our New Convertible Notes, which will have an initial conversion price equal to 85% of the public offering price of the Class A common stock in this offering; based on the midpoint of the price range, we would have $374.0 million of outstanding New Convertible Notes, which would be convertible into 22,561,086 shares of Class A common stock; and

• 45,000,000 shares of our Class A common stock that will be available for future equity awards under the 2021 Plan, including approximately 332,980 restricted shares and approximately 6,210,729 shares of common stock issuable upon exercise of options that we intend to grant under the 2021 Plan to certain directors, executive officers and employees at the time of this offering, with the public offering price as the exercise price, including (i) 678,208 shares of Class A common stock issuable upon exercise of options granted to Scott R. Watterson, (ii) 1,241,957 shares of Class A common stock issuable upon exercise of options granted to David J. Watterson, and (iii) 784,161 shares of Class A common stock issuable upon exercise of options granted to Steven J. Barr, as described in “Executive and Director Compensation—Employment and Benefit Plans—2021 Equity Incentive Plan—IPO Awards.”

See the section titled “Executive and Director Compensation—Employment Benefit Plans” for additional information.

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DILUTION

If you invest in our Class A common stock, your interest will be diluted to the extent of the difference between the initial public offering price per share of our Class A common stock and the net tangible book value per share of our Class A common stock upon the consummation of this offering. Dilution results from the fact that the per share offering price of our Class A common stock is in excess of the book value per share attributable to new investors.

Our net tangible book value as of May 31, 2021 was $(782.2) million, or $(3.26) per share of common stock. Net tangible book value represents the amount of total tangible assets less total liabilities. Pro forma net tangible book value per share represents pro forma net tangible book value divided by the number of shares of common stock outstanding as of May 31, 2021 after giving effect to (1) the redesignation of our outstanding common stock as Class A common stock and the subsequent exchange of certain Class A common stock for Class B common stock, (2) repayment of the 2019 Note and our outstanding Series A and Series B preferred stock with a combination of 9,521,118 shares of our Class A common stock, $57.3 million in cash and the issuance of $374.0 million principal amount of New Convertible Notes, (3) payment of deferred consideration for the 29029 and Sweat acquisitions with 3,016,383 shares of our Class A common stock, (4) payment of $35 million bonus to our chief executive officer in connection with this offering, (5) loans in the aggregate amount of $19.9 million made to certain non-executive employees in connection with the offering, and (6) the filing and effectiveness of our amended and restated certificate of incorporation. After giving effect to the above, our pro forma net tangible book value as of May 31, 2021 would have been $(352.0) million, or $(1.24) per share.

After giving effect to the sale of 30,769,231 shares of Class A common stock in this offering at the assumed initial public offering price of $19.50 per share (the midpoint of the price range set forth on the cover of this prospectus) after deducting the underwriting discount and estimated offering expenses payable by us, and the application of the net proceeds from this offering, as described in the “Use of Proceeds” section, our pro forma as adjusted net tangible book value as of May 31, 2021 would have been $203.3 million, or $0.65 per share. This represents an immediate increase in pro forma as adjusted net tangible book value of $1.89 per share to our existing investors and an immediate dilution in pro forma as adjusted net tangible book value of $18.85 per share to new investors.

The following table illustrates this dilution on a per share of Class A common stock basis:

Assumed initial public offering price per share				$	19.50
Historical net tangible book value (deficit) per share as of May 31, 2021	$	(3.26	)
Pro forma increase in net tangible book value per share as of May 31, 2021 attributable to the pro forma transactions described above		2.02
Pro forma net tangible book value per share as of May 31, 2021		(1.24	)
Increase in pro forma net tangible book value per share attributable to new investors participating in this offering		1.89
Pro forma as adjusted net tangible book value per share after this offering					0.65
Dilution in net tangible book value per share to new investors in this offering				$	18.85

A $1.00 increase (decrease) in the assumed initial public offering price of $19.50 per share would increase (decrease) our pro forma net tangible book value by $28.8 million, the pro forma net tangible book value per share after this offering by $0.09 and the dilution per share to new investors by $0.91 assuming the number of shares offered by us, as set forth on the cover of this prospectus, remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The following table illustrates, on a pro forma basis as of May 31, 2021, our existing stockholders after giving effect to the Concurrent Transactions and the sale by us of shares of our Class A common stock in this offering at the midpoint of the range, the difference between the existing stockholders and the investors purchasing shares of

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our Class A common stock in this offering with respect to the number of shares of our common stock purchased from us, the total consideration paid to us or to be paid, and the average price per share paid or to be paid, before deducting the estimated underwriting discounts and commissions:

	Shares Purchased					Total Consideration					Average Price Per Share
	Number		Percent			Amount		Percent
Existing stockholders		284,121,453		90.2	%	$	138,833,622		18.8	%	$	0.49
Investors purchasing shares of our Class A common stock in this offering		30,769,231		9.8			600,000,000		81.2			19.50
Total		314,890,684		100.0	%		$738,833,622		100.0	%	$	2.35

If the underwriters were to fully exercise their option to purchase 4,615,384 additional shares of our Class A common stock, the percentage of shares of our Class A common stock held by existing investors would be 88.9%, and the percentage of shares of our Class A common stock held by new investors would be 11.1%.

Assuming the exercise of all outstanding options as of May 31, 2021 and the issuance of 22,561,086 shares of Class A common stock to settle $374.0 million of New Convertible Notes and the issuance of 3,016,592 shares of Class A common stock to settle the vesting of the restricted interest of $50.0 million of New Convertible Notes held by our chief executive officer expected to be issued in the offering, the information set forth in the foregoing table would be as follows:

	Shares Purchased					Total Consideration						Average Price Per Share
	Number		Percent			Amount			Percent
Existing stockholders		330,102,815		91.5	%	$	618,883,409	(1)		50.8	%	$	1.87
Investors purchasing shares of our Class A common stock in this offering		30,769,231		8.5			600,000,000			49.2			19.50
Total		360,872,046		100.0	%	$	1,218,883,409			100.0	%	$	3.38

(1) Excluding the $50.0 million of New Convertible Note issuable to our chief executive officer as no cash consideration will be received.

The above discussion and tables are based on the number of shares outstanding at May 31, 2021. In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the issuance of such securities could result in further dilution to our stockholders.

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

The following unaudited pro forma condensed consolidated financial information have been derived by the application of pro forma adjustments to our historical audited financial statements included elsewhere in this registration statement, after giving effect to the transactions as further described herein.

The unaudited pro forma condensed consolidated balance sheet as of May 31, 2021 (the “Unaudited Pro Forma Condensed Consolidated Balance Sheet”) and the unaudited pro forma condensed consolidated statement of operations for the year ended May 31, 2021 (the “Unaudited Pro Forma Condensed Consolidated Statement of Operations”) present our financial position and results of operations after giving effect to the following pro forma transactions (“Transaction Accounting Adjustments”):

• The Concurrent Transactions as defined elsewhere in this registration statement; and

• The sale and issuance of 30,769,231 shares of our Class A common stock to the purchasers in this offering in exchange for net proceeds approximating $546.7 million, at an assumed initial offering price of $19.50 per share (the midpoint of the price range listed on the cover page of this prospectus), after deducting $53.3 million of underwriting discounts and commissions and estimated offering expenses. Except as otherwise indicated, the unaudited pro forma condensed consolidated financial information presented assumes no exercise by the underwriters of their option to purchase additional shares of Class A common stock.

The Transaction Accounting Adjustments and such other adjustments as described in the accompanying notes are reflected in the Unaudited Pro Forma Condensed Consolidated Balance Sheet as if these Transaction Accounting Adjustments occurred on May 31, 2021. The Unaudited Pro Forma Condensed Consolidated Statement of Operations for the year ended May 31, 2021 gives effect to the Transaction Accounting Adjustments as if they had occurred on June 1, 2020.

The unaudited pro forma condensed consolidated financial information was prepared in accordance with Article 11 of Regulation S-X using the assumptions set forth in the notes to the unaudited pro forma condensed consolidated financial information. The unaudited pro forma condensed consolidated financial information has been adjusted to include estimated accounting adjustments, which reflect the application of the accounting required by generally accepted accounting principles in the United States (“US GAAP”), linking the effects of the Transaction Accounting Adjustments listed above to the Company’s historical consolidated financial statements.

The pro forma adjustments are based upon currently available information and includes certain estimates and assumptions that the Company’s management believes are reasonable and are subject to change as additional information becomes available. We describe in greater detail the assumptions underlying the pro forma adjustments in the accompanying notes, which should be read in conjunction with this unaudited pro forma condensed consolidated financial information. The actual effect on our consolidated financial statements in the period(s) in which the Concurrent Transactions occur will depend upon a number of factors and additional information that will be available only upon or after the closing of this offering. Accordingly, the actual adjustments that will appear in our financial statements will differ from these pro forma adjustments, and those differences may be material. The unaudited pro forma condensed consolidated financial information does not give effect to the potential impact of current financial conditions, or any anticipated revenue enhancements, cost savings or operating synergies that may result from the Transaction Accounting Adjustments.

We are in the process of assessing the accounting related to the New Convertible Notes issued in exchange for the 2019 Notes and the Series A preferred stock and the restricted interest in the New Convertible Notes held by our chief executive officer, including the accounting on the settlement of the existing securities and the compensation elements of the restricted interest arrangement. For purposes of this Registration Statement, we have included preliminary adjustments within the unaudited pro forma condensed consolidated financial

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information to reflect these Concurrent Transactions. Additionally, valuations that have been performed are preliminary and based on estimates subject to change. The final determination of the accounting and fair value and allocation to the various components of these arrangements will be determined upon the successful completion of our initial public offering. Accordingly, the pro forma adjustments are preliminary and subject to further revision as additional information becomes available and given the complexity of the transaction. Refer to the footnotes to this unaudited pro forma condensed consolidated financial information for further details as to the accounting and valuation presented herein. The accounting and valuation related to the above will be finalized and reported when the Company files its report on Form 10-Q for the quarter ended November 30, 2021.

The unaudited pro forma condensed consolidated financial information is presented for information purposes only and are not necessarily indicative of iFIT’s financial position or results of operations that would have occurred had the events been consummated as of the dates set forth above. In addition, the unaudited pro forma condensed consolidated financial information is not necessarily indicative of iFIT’s future financial condition or operating results.

As a public company, we will be implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. We expect to incur additional annual expenses related to these steps and, among other things, additional directors’ and officers’ liability insurance, director fees, reporting requirements of the SEC, transfer agent fees, hiring additional accounting, legal and administrative personnel, increased auditing and legal fees and similar expenses. We have not included any pro forma adjustments relating to these expenses.

The unaudited pro forma condensed consolidated financial information should be read together with “The Concurrent Transactions”, “Capitalization”, “Summary Historical Consolidated Financial and Other Data”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and the historical audited consolidated annual financial statements of the Company and the related notes thereto included elsewhere in this Registration Statement.

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Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of May 31, 2021

(Amounts in thousands, except par value and share amounts)	iFIT Health & Fitness Inc Historical		Transaction Accounting Adjustments			Pro Forma iFIT Health & Fitness Inc
ASSETS
Current assets:
Cash and cash equivalents	$	146,453	$	562,500	(A)	$	586,540
				(35,000	)(B)
				(57,300	)(E)
				(10,215	)(F)
				(19,898	)(P)
Accounts receivable, net		167,297		—			167,297
Inventories		403,437		—			403,437
Prepaid expenses		8,881		—			8,881
Other current assets		50,885		—			50,885
Total current assets		776,953		440,087			1,217,040
Property and equipment, net		79,002		—			79,002
Goodwill		29,639		—			29,639
Intangible assets, net		5,336		—			5,336
Other non-current assets		101,636		(8,515	)(F)		93,121
Total assets	$	992,566	$	431,572		$	1,424,138
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable		425,967		(2,971	)(F)		422,996
Accrued expenses and other current liabilities		56,144		—			56,144
Current portion of deferred revenue		223,898		—			223,898
Total current liabilities		706,009		(2,971	)		703,038
Long-term debt, net		157,133		4,766	(D)		271
				(161,628	)(E)
Convertible notes		—		242,700	(E)		373,950
				131,250	(G)
Mandatorily redeemable preferred stock		234,041		5,105	(D)		—
				(213,904	)(G)
				(25,242	)(H)
Deferred income tax liabilities		1,269		—			1,269
Deferred revenue		90,348		—			90,348
Warrant liabilities		327,313		303,943	(C)		—
				(631,256	)(I)
Embedded derivative liabilities		121,000		3,100	(C)		—
				(72,800	)(E)
				(46,700	)(G)
				(4,600	)(H)
Other non-current liabilities		25,612		(11,119	)(J)		14,493
Total liabilities	$	1,662,725	$	(479,356	)	$	1,183,369
Stockholders’ (deficit) equity:
Common stock, $0.001 par value		240		(240	)(N)		—
Class A common stock, $0.001 par value		—		31	(A)		202
				8	(G)
				2	(H)
				32	(I)
				1	(J)
				2	(K)
				126	(N)
Class B common stock, $0.001 par value		—		114	(N)		114
Additional paid-in capital		324,368		562,469	(A)		1,800,946
				(15,760	)(F)
				154,404	(G)

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(Amounts in thousands, except par value and share amounts)	iFIT Health & Fitness Inc Historical			Transaction Accounting Adjustments			Pro Forma iFIT Health & Fitness Inc
					31,249	(H)
					631,224	(I)
					14,374	(J)
					(2	)(K)
					(31,930	)(L)
					5,048	(M)
					313	(O)
					92,860	(P)
					32,329	(Q)
Accumulated deficit		(909,011	)		(35,000	)(B)		(1,460,694	)
					(307,043	)(C)
					(9,872	)(D)
					(65,572	)(E)
					(25,058	)(G)
					(1,408	)(H)
					(3,256	)(J)
					(34,861	)(L)
					(5,048	)(M)
					(313	)(O)
					(31,923	)(P)
					(32,329	)(Q)
Accumulated other comprehensive loss		(4,996	)		—			(4,996	)
Treasury stock, at cost		(80,760	)		66,790	(L)		(94,803	)
					(80,833	)(P)
Total stockholders’ (deficit) equity		(670,159	)		910,928			240,769
Total liabilities and stockholders’ (deficit) equity	$	992,566		$	431,572		$	1,424,138

Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet

(A) Reflects the net effect on cash of the receipt of offering proceeds of $600.0 million, based on the assumed sale of 30,769,231 shares of Class A common stock with a par value of $0.001 at an initial public offering (“IPO”) price of $19.50 per share, the midpoint of the estimated range set forth on the cover page of this prospectus, after deducting an estimated $37.5 million of underwriting discounts and commissions.

(B) Reflects the cash payment and related compensation expense for the $35.0 million bonus to the chief executive officer which is contingent on the IPO.

(C) Reflects the fair value adjustment of $303.9 million to the warrants and $3.1 million to the embedded derivative liabilities immediately before the IPO.

(D) Reflects the accretion of the debt discount and issuance costs of $4.8 million on the 2019 Note and $5.1 million on the Series A and Series B preferred stock up through the IPO date.

(E) Upon the initial public offering and in conjunction with the issuance of the New Convertible Notes, the Company will settle in full the outstanding 2019 Note. The 2019 Note must be paid at a price equal to $300.0 million, which is equal to the principal amount to be prepaid plus the Make-whole provision which will be paid in a combination of cash and New Convertible Notes, depending on the net proceeds of this offering. The pro forma adjustments reflect the cash payment of $57.3 million, the issuance of New Convertible Notes of $242.7 million, the removal of $161.6 million for the 2019 Notes, the write-off of the embedded derivative liability of $72.8 million and a loss on extinguishment of $65.6 million. The amount of extinguishment loss will be finalized upon the Company completing the valuation procedures related to the issuance of the New Convertible Notes.

(F) Reflects (i) the reduction of cash of $10.2 million for the payment of offering expenses, (ii) reclassification of $8.5 million from other non-current assets for previously capitalized deferred offering costs, (iii) reduction of $3.0 million from accounts payable for the payment of accrued offering costs and (iv) $15.8 million to additional paid-in capital for costs directly related to the transaction.

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(G) Upon the initial public offering, the Company must pay in full all outstanding shares of Series A preferred stock. The Series A preferred stock must be paid at a price equal to $262.5 million, which is equal to 125% of the liquidation value of such Series A preferred stock. Of this amount, $131.3 million will be paid in a combination of cash and New Convertible Notes, depending on the net proceeds of this offering, and the remaining $131.3 million will be paid with shares of Class A common stock (based on the midpoint of the price range set forth on the cover of this prospectus), which number of shares is equal to $131.3 million, divided by 85% of the public offering price of the Class A common stock. The adjustments reflect the issuance of New Convertible Notes of $131.3 million, the issuance of 7,918,553 shares of Class A common stock with a fair value of $154.4 million, the settlement of $213.9 million of Series A preferred stock, the write-off of the embedded derivative liability of $46.7 million and loss on extinguishment of $25.1 million.

(H) Upon the initial public offering, the Company must pay in full all outstanding shares of Series B preferred stock at a price per share of $1.0 million for a total of $25.0 million. The Company will pay in full the Series B preferred stock with shares of Class A common stock (based on the midpoint of the price range set forth on the cover of this prospectus), which number of shares is equal to $25.0 million divided by 80% of the public offering price of the Class A common stock. The adjustments reflect the issuance of 1,602,565 shares of Class A common stock with a fair value of $31.3 million, the settlement of $25.2 million of Series B preferred stock, the write-off of the embedded derivative liability of $4.6 million and loss on extinguishment of $1.4 million.

(I) Represents the cashless net exercise of the 2019 Warrant and 2020 Warrants upon the initial public offering resulting in issuance of 32,372,117 Class A common shares.

(J) Reflects the settlement of deferred consideration of $11.5 million for the 29029 acquisition with 737,180 shares of Class A common stock (based on the midpoint of the price range set forth on the cover of this prospectus), which number of shares is equal to $11.5 million divided by 80% of the public offering price of the Class A common stock. The pro forma adjustments reflect the settlement of the sellers’ financing liability and contingent consideration of $11.1 million, the issuance of $14.4 million in Class A common shares, and the net impact to accumulated deficit, which includes $0.3 million in interest expense, a loss on settlement of $2.5 million in other expense, and the mark to market adjustment for the contingent consideration of $0.5 million.

(K) Reflects the issuance of 2,279,203 shares of Class A common stock for the Sweat acquisition (based on the midpoint of the price range set forth on the cover of this prospectus), which number of shares is equal to $40.0 million divided by 90% of the public offering price of the Class A common stock. As Sweat was acquired in July 2021, there was no liability recorded for the deferred purchase consideration as of May 31, 2021 and therefore we have not reflected a pro forma adjustment to the balance sheet for the issuance of the shares other than to record the par value of the Class A common stock issued. Additionally, we have not reflected the acquisition of Sweat and related purchase accounting adjustments in these unaudited condensed consolidated pro forma financial statements as the acquisition of Sweat was not significant under Rule 3-05 and Article 11 of Regulation S-X.

(L) Represents the forgiveness of the non-recourse loans issued to members of management in the aggregate amount of $53.2 million and the repayment of an executive loan with a principal amount of $9.3 million originally secured by 963,673 shares of the Company’s common stock to comply with the Sarbanes-Oxley Act. The non-recourse loans that were forgiven were secured by a total of 15,504,955 shares of the Company’s common stock as well as 550,670 stock options of the Company. Upon forgiveness of the loans, the collateral shares and options pledged were released and such shares will be considered outstanding for accounting purposes resulting in compensation expense of $34.9 million and release of Treasury stock of $66.8 million. The $9.3 million loan was repaid by the surrender of the 963,673 shares of common stock pledged to secure such loan which has no net effect on shares outstanding because such shares for accounting purposes were not previously treated as outstanding. The transaction is effectively a cancellation of the options that were previously granted when the loan was made on May 17, 2021. Since the number of collateralized shares is the same number of shares to settle the loan, there is no further accounting impact. However, these shares are no longer considered outstanding for legal purposes.

(M) Reflects the impact of stock options that will vest as a result of the performance-based vesting conditions being satisfied in connection with this offering, resulting in $5.0 million in compensation expense.

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(N) Reflects the redesignation of our common stock to Class A common stock and the exchange of Class A common stock held by the Scott R. Watterson holders for newly designated Class B common stock in connection with this offering.

(O) Reflects the impact of 5,313,507 new stock options that will be issued in conjunction with this offering, with an estimated aggregate grant date fair value of $48.4 million, of which $0.3 million of stock-based compensation expense will be recognized immediately as 38,140 of the options vest upon grant. These new stock options are in addition to the new stock options of 897,222 and new restricted shares of 332,980 further described in note Q (iii) below.

(P) Reflects the impact of non-recourse loans made to non-executive employees of the Company in connection with this offering in the amounts of $11.0 million and $8.9 million. In exchange for the loans, the non-executive employees pledged 2,702,738 and 1,442,561 shares of the Company’s common stock, respectively, and 2,327,913 and 1,345,491 of unvested stock options, respectively. The pledge of the aggregate 4,145,299 shares of the Company’s common stock was accounted for as a repurchase of stock with a fair value of $80.8 million which is reflected within treasury stock and the issuance of 4,145,299 vested options. The pledge of the aggregate 3,673,404 unvested stock options was accounted for as a cancellation of the existing stock options and the issuance of an equal number of unvested stock options to the loan recipients. The Company will recognize an aggregate amount of compensation expense of $31.9 million upon issuance of these loans which is reflected within accumulated deficit.

(Q) Reflects the impact of (i) the modification to the exercise price of 1,867,887 stock options, (ii) the modification to extend the vesting dates of 3,131,919 stock options, and (iii) the issuance of 897,222 new options and 332,980 restricted shares to the same option holders regarding the forgoing items (i) and (ii). The modification to reprice the options in (i) and to extend the vesting dates of options in (ii) are accounted for as the cancellation of the historical award and the grant of a new replacement award with the modified terms in accordance with ASC 718, Compensation-Stock Compensation, as the vesting of the historical awards were subject to a performance condition which was not probable at the time of modification. The modification of the exercise price of 1,867,887 stock options in (i) above will result in the recognition of $32.3 million of stock-based compensation expense, all of which will be recognized immediately as the options vest upon an initial public offering and is reflected within accumulated deficit and additional paid-in capital. The modifications in (ii) and issuances of additional options and restricted shares in (iii) do not result in the immediate recognition of any expense, but will result in the recognition of stock-based compensation expense prospectively over the vesting term of the awards.

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Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Year Ended May 31, 2021

(Amounts in thousands, except share and per share amounts)	iFIT Health & Fitness Inc Historical			Transaction Accounting Adjustments			Pro Forma iFIT Health & Fitness Inc
Revenue
Interactive fitness products	$	1,515,288		$	—		$	1,515,288
Subscription		229,768			—			229,768
Total revenue		1,745,056			—			1,745,056
Cost of revenue
Interactive fitness products		989,873			—			989,873
Subscription		28,980			—			28,980
Total cost of revenue		1,018,853			—			1,018,853
Gross profit		726,203			—			726,203
Operating expenses:
Sales and marketing		619,431			—			619,431
Research and development		36,274			—			36,274
General and administrative		198,132			34,861	(F)		443,361
					5,048	(G)
					35,000	(H)
					475	(I)
					11,751	(K)
					13,001	(L)
					56,281	(M)
					88,812	(N)
Total operating expenses		853,837			245,229			1,099,066
Loss from operations		(127,634	)		(245,229	)		(372,863	)
Other expense (income):
Interest expense		31,016			(29,239	)(A)		29,288
					318	(I)
					27,193	(K)
Change in fair value of warrant		142,150			(142,150	)(C)		—
Change in fair value of embedded derivative liabilities		39,300			(39,300	)(D)		—
Loss on issuance of mandatorily redeemable preferred stock and warrants		178,200			(178,200	)(B)		—
Other expense (income), net		(3,577	)		2,463	(I)		(1,114	)
Loss on extinguishment of long-term debt and mandatorily redeemable preferred stock		—			92,037	(E)		92,037
Total other expense (income)		387,089			(266,878	)		120,211
Income (loss) before provision for income taxes		(514,723	)		21,649			(493,074	)
Provision (benefit) for income taxes		1,983			—	(J)		1,983
Net income (loss)	$	(516,706	)	$	21,649		$	(495,057	)
Net income (loss) per share attributable to common shareholders
Basic	$	(2.32	)		0.30	(O)		(1.67	)
Diluted	$	(2.32	)	$	0.30	(O)	$	(1.67	)
Shares used to compute net income (loss) per share attributable to common stockholders
Basic		222,511,893			73,234,611	(O)		295,746,504
Diluted		222,511,893			73,234,611	(O)		295,746,504

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Notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations

(A) Reflects the elimination of $17.2 million, $11.7 million, and $0.4 million in interest expense, including PIK interest, for the 2019 Note, amortization of debt issuance costs, the amortization of the debt discounts and amortization of premiums recorded during fiscal 2021 related to the 2019 Notes, Series A preferred stock, and Series B preferred stock, respectively. Offsetting the elimination, is the incremental interest expense of $27.2 million expected to be incurred on the New Convertible Notes issued in connection with this offering. Such New Convertible Notes in the face amount of $374.0 million will incur 7% interest annually per the New Convertible Notes agreement and if paid in common shares, it will be paid in common shares at 85% of the 10-day VWAP at the interest payment date. However, the Company may pay interest due on the New Convertible Notes in cash, PIK (compounding quarterly) or shares of common stock at the holders’ discretion. For purposes of the pro forma adjustment, we have assumed the interest will be paid in common shares. As discussed further in the notes to the Unaudited Condensed Consolidated Pro Forma Balance Sheet, the 2019 Notes, Series A preferred stock and Series B preferred stock and related embedded derivative liabilities are being settled in connection with this offering and the New Convertible Notes are being issued.

(B) Reflects the elimination of the $173.4 million and $4.8 million losses recorded on the issuance of the Series A and B preferred stock, respectively, assuming settlement of these securities in connection with this offering.

(C) Represents the elimination of the historical change in fair value of the 2019 Warrant and 2020 Warrants, as the warrants are being exercised in connection with this offering. For purposes of calculating the shares included in the pro forma basic net loss per share denominator, the shares are included on a weighted average basis for the period of time the warrants were outstanding during fiscal 2021. The number of shares in pro forma net loss per share include 27,891,575 shares related to the 2019 and 2020 Warrants.

(D) Reflects the elimination of $35.6 million and $3.7 million in losses recorded during fiscal 2021 related to the change in the fair value of outstanding embedded derivative liabilities on the 2019 Notes and Series A preferred stock, respectively. As discussed further in the notes to the Unaudited Condensed Consolidated Pro Forma Balance Sheet, the 2019 Notes and Series A preferred stock and related embedded derivative liabilities are being settled in connection with this offering.

(E) Reflects the loss on extinguishment expected to be recorded of $65.6 million, $25.1 million, and $1.4 million on the 2019 Notes, Series A preferred stock and Series B preferred stock, respectively, which are all expected to be settled in connection with this offering.

(F) Represents $34.9 million of stock-based compensation expense related to the forgiveness of $53.2 million of loans historically issued to members of management. For the purpose of calculating the pro forma net loss per share denominator, the 15,504,955 shares which collateralized the loans are included in the denominator of the calculation of the weighted average of shares outstanding from the later of June 1, 2020 or the loan issuance date.

(G) Represents $5.0 million of stock-based compensation expense related to the vesting of 1,469,475 stock options with a performance vesting condition which is satisfied immediately upon the consummation of our initial public offering.

(H) Represents $35.0 million of compensation expense related to the payment of a $35.0 million cash bonus to our chief executive officer in conjunction with the consummation of our initial public offering.

(I) Reflects the issuance of 737,180 shares of Class A common stock in settlement of the deferred purchase consideration related to the acquisition of 29029 in fiscal 2021. As a result of the settlement, we estimate we will record a loss of $2.5 million related to the excess of the fair value of the shares issued over the carrying value of the obligation. The number of shares included in pro forma net loss per share is weighted to reflect the period of time during fiscal 2021 such shares would have been outstanding should they have been issued upon acquisition of 29029. Refer to footnote (J) in the Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet for more information.

(J) The Company is in a full valuation position in the jurisdiction of the United States and therefore no income tax impact related to the Transaction Accounting Adjustments is reflected.

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(K) Reflects the grant of the restricted interest in the New Convertible Notes, in an aggregate principal amount of $50.0 million to our chief executive officer in connection with the offering to compensate his services provided to us. As such, the restricted interest is accounted for as a stock compensation arrangement. The restricted interest is restricted as (a) our chief executive officer may not sell, pledge, transfer or dispose of the restricted interest, and (b) our chief executive officer’s right to retain the restricted interest is subject to forfeiture upon our termination of the chief executive officer’s employment for cause at the earlier of six years or the occurrence of a certain event. The principal amount of the restricted interest is considered a combination award under ASC 718 which is comprised of: (i) a fixed repurchase price (i.e., the amount due at maturity of the New Convertible Notes underlying the restricted interest) of the award of $50.0 million with a fair value of $23.7 million on grant date, (ii) a call option with an exercise price equal to the fixed amount for which our chief executive officer can require us to repurchase his shares (i.e., share options of 61,501 shares with an exercise price of $16.27) with an aggregate fair value of $29.7 million on grant date. The interest payments of 7% annually to be paid in common shares at 85% of the 10-day VWAP at the interest payment date is considered a separate component with a fair value of $17.1 million on grant date. The fair value of the three components will be recognized over the period of applicability of the forfeiture restrictions. The adjustment reflects compensation expense of $11.8 million expected to be recognized in fiscal 2021 as if the restricted interest was granted on June 1, 2020.

(L) Reflects the issuance of 5,313,507 stock options to members of management and our employees in conjunction with this offering with an aggregate grant date fair value of $48.4 million. As a result of this issuance, we estimate we will record share-based compensation expense of $13.0 million during the first year subsequent to the initial public offering.

(M) Reflects compensation expense of $56.3 million related to the issuance of loans to non-executive employees by the Company collateralized with 4,145,299 shares and 3,673,404 options of which $31.9 million will be recognized immediately and $24.4 million will be recognized during the first year following the issuance of these loans.

(N) Reflects the stock-based compensation expense associated with the modification of certain stock options and grants of restricted shares in connection with the offering. See note (Q) to the Unaudited Condensed Consolidated Pro Forma Balance Sheet. We expect to recognize $32.3 million of expense related to 1,867,887 stock options that will vest immediately upon the consummation of an initial public offering. Additionally, we expect to recognize $56.5 million of stock compensation expense in the first year following the initial public offering related to 4,029,140 stock options and 332,980 restricted shares that will continue to vest.

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(O) Unaudited pro forma net loss per share, basic and diluted, has been computed to give effect to the Transaction Accounting Adjustments as if they had occurred as of the beginning of the period on June 1, 2020. The calculation of pro forma weighted average shares outstanding, basic and diluted, assumes that the shares issuable relating to the Transaction Accounting Adjustments have been outstanding as of the later of June 1, 2020 or the date the related transaction was entered into. Basic and diluted pro forma net loss per share and weighted average shares outstanding for the year ended May 31, 2021 are calculated as follows:

(Amounts in thousands, except share and per share amounts)	Year Ended May 31, 2021
Numerator:
Pro forma net loss	$	(495,057	)
Denominator:
Weighted average shares of common stock outstanding (basic and diluted)		222,511,893
Pro forma adjustment to reflect the redemption of the 2019 Note and Series A and B preferred stock (1)		5,612,904
Pro forma adjustment to reflect shares issued for the forgiveness of loans (2)		13,044,768
Pro forma adjustment to reflect the exercise of the 2019 and 2020 Warrants (3)		27,891,575
Pro forma adjustment to reflect the shares issued for the acquisition deferred and contingent consideration (4)		61,432
Pro forma adjustment to reflect the shares issued at IPO (5)		30,769,231
Pro forma adjustment to reflect the shares repurchased for the loans to non-executive employees (6)		(4,145,299	)
Weighted-average shares used in computing pro forma net loss per share, basic and diluted		295,746,504
Pro forma net loss per share, basic and diluted	$	(1.67	)

(1) Reflects (i) partial repayment of the Series A preferred stock with 7,918,553 shares of Class A common stock (calculated based on the midpoint of the range; the actual number of shares will be calculated as $131.3 million divided by 85% of the public offering price of the Class A common stock) and (ii) 1,602,565 shares that will be issued to repay the Series B preferred stock (calculated based on the midpoint of the range; the actual number of shares will be calculated as $25.0 million divided by 80% of the public offering price of the Class A common stock). The number of shares included in pro forma net loss per share is weighted to reflect the period of time during fiscal 2021 such shares would have been outstanding if issued at the time of the Series A and Series B preferred stock issuances.

(2) Reflects shares of Class A common stock deemed to be issued for accounting purposes upon forgiveness of management loans and the release of these shares as collateral. One executive loan in the principal amount of $9.3 million was repaid by the surrender of the 963,673 shares of common stock pledged to secure such loan, which has no net effect on shares outstanding because such shares for accounting purposes were not previously treated as outstanding.

(3) Represents the cashless net exercise of the 2019 and 2020 Warrants upon consummation of the initial public offering which resulted in the issuance of 32,372,117 shares of Class A common stock. The number of shares included in pro forma net loss per share is weighted to reflect the period of time the warrants were outstanding during fiscal 2021 for which the shares would have been issued.

(4) Reflects the 737,180 shares of Class A common stock that will be issued to former owners of 29029 (calculated based on the midpoint of the range; the actual number of shares will be calculated as $11.5 million divided by 80% of the public offering price of the Class A common stock). The number of shares included in pro forma net loss per share is weighted to reflect the period of time during fiscal 2021 such shares would have been outstanding if issued at the time of the acquisition.

(5) Represents the sale and issuance of 30,769,231 shares of Class A common stock in connection with our initial public offering.

(6) Reflects the 4,145,299 shares pledged by non-executive employees of the Company in exchange for loans in the aggregate amount of $19.9 million. The pledge of the Company’s common shares was accounted for as a repurchase and as such, was reflected in treasury stock.

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SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following tables present selected historical financial and other data for our business. We derived the selected consolidated statements of operations data for fiscal 2019, 2020 and 2021 and the selected consolidated balance sheet data as of May 31, 2020 and 2021 from our audited consolidated financial statements included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected in the future. You should read this data in conjunction with the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes appearing elsewhere in this prospectus.

	Year Ended May 31,
	2019			2020			2021
	(in thousands, except share and per share amounts)
Consolidated Statements of Operations Data:
Revenue:
Interactive fitness products	$	626,189		$	727,703		$	1,515,288
Subscription(1)		73,776			123,977			229,768
Total revenue		699,965			851,680			1,745,056
Cost of revenue:
Interactive fitness products(2)		444,908			503,353			989,873
Subscription(2)		13,226			19,362			28,980
Total cost of revenue		458,134			522,715			1,018,853
Gross profit		241,831			328,965			726,203
Operating expenses:
Sales and marketing		193,173			278,492			619,431
Research and development(3)		20,898			23,122			36,274
General and administrative(2)		48,892			77,105			198,132
Total operating expenses		262,963			378,719			853,837
Loss from operations		(21,132	)		(49,754	)		(127,634	)
Other expense (income):
Gain on sale of subsidiary		(111,800	)		—			—
Other expense, net(4)		13,368			46,320			387,089
Total other expense (income)		(98,432	)		46,320			387,089
Income (loss) before provision for income taxes		77,300			(96,074	)		(514,723	)
Provision for income taxes		20,733			2,469			1,983
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Undistributed earnings allocated to participating securities		(7,496	)		—			—
Net income (loss) attributable to common stockholders	$	49,071		$	(98,543	)	$	(516,706	)
Net income (loss) per share
Basic	$	0.23		$	(0.46	)	$	(2.32	)
Diluted	$	0.23		$	(0.46	)	$	(2.32	)
Weighted-average common shares outstanding
Basic		213,654,521			213,111,562			222,511,893
Diluted		213,654,521			213,111,562			222,511,893

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(1) We use Billings as a key operating metric in evaluating the performance of our business because it enables an analysis of performance based on the timing of actual transactions with our customers and may be seen as an early indicator of trends in our operating results. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics and Non-GAAP Financial Measures” for how we calculate Billings.

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Billings	$	92,720	$	183,727	$	382,275

(2) Includes depreciation and amortization expense as follows:

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Cost of revenue
Interactive fitness products	$	1,933	$	1,466	$	1,852
Subscription		5,468		7,833		6,314
Total cost of revenue		7,401		9,299		8,166
General and administrative		9,319		8,732		8,183
Total	$	16,720	$	18,031	$	16,349

(3) In fiscal 2019, 2020 and 2021, we invested $35.8 million, $45.1 million, and $91.7 million, respectively, in research and development and to enhance our iFIT platform, develop new products, content and features, and improve our platform infrastructure, a portion of which was capitalized.

(4) Includes a loss in fiscal 2021 of $178.2 million related to the issuance of the Series A and B preferred stock and the 2020 Warrants. The loss is due to the excess of the fair value of the instruments issued over the proceeds received. In fiscal 2020 and 2021, we also incurred losses of $9.4 million and $142.2 million, respectively, related to the change in the fair value of our warrant liabilities and losses of $20.2 million and $39.3 million, respectively, related to the change in fair value of our embedded derivative liabilities. Total other expense (income) also includes interest expense (income) of $15.4 million, $15.5 million and $31.0 million for fiscal 2019, 2020 and 2021, respectively, and other expense (income) of $(2.0) million, $1.2 million and $(3.6) million, for fiscal 2019, 2020 and 2021, respectively.

	May 31, 2020			May 31, 2021
	(in thousands)
Consolidated Balance Sheets Data:
Cash and cash equivalents	$	100,321		$	146,453
Working capital (1)		16,197			70,944
Total assets		372,129			992,566
Long-term debt, net		139,842			157,133
Deferred revenue, current and non-current		161,739			314,246
Mandatorily redeemable preferred stock		—			234,041
Warrant liabilities		54,349			327,313
Embedded derivative liabilities		31,600			121,000
Total stockholders’ deficit	$	(181,156	)	$	(670,159	)

(1) Working capital is total current assets less total current liabilities

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Non-GAAP Financial Measures

To supplement our consolidated financial statements presented in accordance with U.S. GAAP, we monitor and consider Adjusted EBITDA and Adjusted EBITDA Margin, and Subscription Contribution and Subscription Contribution Margin, which are non-GAAP financial measures. These non-GAAP financial measures are not based on any standardized methodology prescribed by U.S. GAAP and are not necessarily comparable to similarly-titled measures presented by other companies.

Adjusted EBITDA and Adjusted EBITDA Margin

We define Adjusted EBITDA as net income (loss) adjusted to exclude the impact of stock-based compensation expense, the revaluation of our warrant and embedded derivative liabilities, depreciation and amortization, interest expense, gain on sale of subsidiary, other expense (income) and provision for income taxes. Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by total revenue.

We use Adjusted EBITDA and Adjusted EBITDA Margin to evaluate our operating performance and trends and make planning decisions. We believe that Adjusted EBITDA and Adjusted EBITDA Margin helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses and other items that we exclude in Adjusted EBITDA and Adjusted EBITDA Margin. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA and Adjusted EBITDA Margin can provide a useful measure for period-to-period comparisons of our business and we use this measure to evaluate our operating performance and trends and make planning decisions. Accordingly, we believe that Adjusted EBITDA and Adjusted EBITDA Margin provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects, and allowing for greater transparency with respect to key financial metrics used by our management in its financial and operational decision-making.

Adjusted EBITDA and Adjusted EBITDA Margin are not prepared in accordance with U.S. GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of these non-GAAP financial measures rather than net income (loss), which is the nearest U.S. GAAP equivalent of Adjusted EBITDA and Adjusted EBITDA Margin. Some of these limitations are:

• Adjusted EBITDA and Adjusted EBITDA Margin exclude stock-based compensation expense, which has recently been, and will continue to be for the foreseeable future, a significant expense for our business and an important part of our compensation strategy;

• Adjusted EBITDA and Adjusted EBITDA Margin exclude depreciation and amortization expense and, although these are non-cash expenses, the assets being depreciated and amortized may have to be replaced in the future and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;

• Adjusted EBITDA and Adjusted EBITDA Margin do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our debt, which reduces cash available to us;

• Adjusted EBITDA and Adjusted EBITDA Margin do not reflect other expense (income), consisting of gains on sales of securities, the gain on extinguishment of mandatorily redeemable preferred stock, and other non-recurring items, that arise outside of the ordinary course of our business;

• Adjusted EBITDA and Adjusted EBITDA Margin do not reflect provision for income taxes;

• Adjusted EBITDA and Adjusted EBITDA Margin do not reflect the gain on sale of subsidiary, the loss on the issuance of the Series A and B preferred stock and the 2020 Warrants, and the gain or loss related to the revaluation of our warrant liabilities and embedded derivative liabilities, which are non-recurring and did not arise in the ordinary course of our business. In connection with the initial public

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offering, the 2019 Note and the Series A preferred stock are required to be settled including the respective embedded derivative liabilities. The classification of the 2019 Warrant and 2020 Warrants will be reassessed and will no longer be required to be remeasured at fair value as the warrants will be net share settled in connection with the offering.

• the expenses and other items that we exclude in our calculation of Adjusted EBITDA and Adjusted EBITDA Margin may differ from the expenses and other items, if any, that other companies may exclude from Adjusted EBITDA and Adjusted EBITDA Margin when they report their operating results.

Because of these limitations, Adjusted EBITDA and Adjusted EBITDA Margin should be considered along with other operating and financial performance measures presented in accordance with U.S. GAAP.

The following table presents a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA and Adjusted EBITDA Margin:

	Year Ended May 31,
	2019			2020			2021
	(in thousands)
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Adjusted to exclude the following:
Stock-based compensation expense(1)		—			18,484			96,714
Increase in fair value of warrant liabilities(2)		—			9,396			142,150
Increase in embedded derivative liabilities(2)		—			20,200			39,300
Loss on issuance of mandatorily redeemable preferred stock and warrants		—			—			178,200
Depreciation and amortization(3)		16,720			18,031			16,349
Interest expense(4)		15,368			15,496			31,016
Other expense (income), net(5)		(2,000	)		1,228			(3,577	)
Provision for income taxes		20,733			2,469			1,983
Gain on sale of subsidiary		(111,800	)		—			—
Adjusted EBITDA	$	(4,412	)	$	(13,239	)	$	(14,571	)
Net income (loss) margin		8.1	%		(11.6	)%		(29.6	)%
Adjusted EBITDA Margin		(0.6	)%		(1.6	)%		(0.8	)%

(1) Includes expense related to the vesting of awards of $17.3 million and $51.5 million, respectively, and expense related to loans issued to members of management of $1.2 million and $45.2 million, respectively, in fiscal 2020 and fiscal 2021.

(2) An initial public offering constitutes a mandatory prepayment event under the terms of the 2019 Note and the Series A and B preferred stock. Upon the occurrence of the mandatory prepayment event, the Company will redeem the 2019 Note and the Series A and B preferred stock, including the embedded derivative instruments. Additionally, the 2019 Warrant and 2020 Warrants will be net share settled in connection with the offering. Please see the section “Liquidity and Capital Resources” for further detail on the 2019 Note and the Series A and B preferred stock.

(3) Includes amortization of internal use software and iFIT software of $9.5 million, $12.0 million, and $9.7 million for fiscal 2019, 2020 and 2021, respectively; and depreciation and amortization of property plant and equipment of $5.5 million, $4.9 million, and $5.8 million for fiscal 2019, 2020 and 2021, respectively.

(4) Includes amortization of debt discount and issuance costs, including the write-off of deferred financing fees, totaling $5.6 million, $2.7 million, and $7.0 million for fiscal 2019, 2020 and 2021, respectively.

(5) Includes the gain on extinguishment of mandatorily redeemable preferred stock of $2.2 million in fiscal 2020.

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Subscription Contribution and Subscription Contribution Margin

We define Subscription Contribution as subscription revenue less cost of subscription revenue, adjusted to exclude depreciation and amortization expense from cost of subscription revenue. Subscription Contribution Margin is calculated by dividing Subscription Contribution by subscription revenue.

We use Subscription Contribution and Subscription Contribution Margin to measure our ability to scale and leverage the costs of our subscriptions. We believe that these non-GAAP financial measures are useful to investors for period-to-period comparisons of our business and in understanding and evaluating our operating results because our management uses Subscription Contribution and Subscription Contribution Margin in conjunction with financial measures prepared in accordance with U.S. GAAP for planning purposes, including the preparation of our annual operating budget, as a measure of our core operating results and the effectiveness of our business strategy, and in evaluating our financial performance.

Subscription Contribution and Subscription Contribution Margin are not prepared in accordance with U.S. GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with U.S. GAAP. Our use of Subscription Contribution and Subscription Contribution Margin have limitations as analytical tools. You should not consider these in isolation or as substitutes for analysis of our financial results as reported under U.S. GAAP. Although depreciation and amortization expense are non-cash charges, the assets being depreciated and amortized will have to be replaced in the future, and Subscription Contribution and Subscription Contribution Margin do not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements.

Because of these limitations, Subscription Contribution and Subscription Contribution Margin should be considered along with other operating and financial performance measures presented in accordance with U.S. GAAP.

The following table presents a reconciliation of Subscription Contribution to subscription gross profit, the most directly comparable financial measure prepared in accordance with U.S. GAAP, for each of the periods indicated:

	Year Ended May 31,
	2019			2020			2021
Subscription revenue	$	73,776		$	123,977		$	229,768
Less:
Cost of subscription revenue		13,226			19,362			28,980
Subscription gross profit	$	60,550		$	104,615		$	200,788
Subscription gross margin		82.1	%		84.4	%		87.4	%
Add back:
Depreciation and amortization	$	5,468		$	7,833		$	6,314
Subscription contribution	$	66,018		$	112,448		$	207,102
Subscription contribution margin		89.5	%		90.7	%		90.1	%

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the section titled “Selected Consolidated Financial and Other Data” and our consolidated financial statements and related notes included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed above in the section titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” included elsewhere in this prospectus. Unless the context otherwise requires, references to “fiscal 2019,” “fiscal 2020” and “fiscal 2021” in this section are intended to mean our fiscal years ended May 31, 2019, 2020 and 2021, respectively.

Overview

iFIT is an integrated health and fitness platform, designed to connect our proprietary software, experiential content and interactive hardware to deliver an unmatched connected fitness experience. We believe the combination of our proprietary software and experiential content connected with our interactive hardware creates a compelling value proposition for our rapidly growing member base and generates attractive recurring subscription revenue. Through our platform, we connect with our growing community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers in over 120 countries.

How We Generate Revenue

Our financial profile is characterized by strong growth, customer retention, recurring subscription revenue and highly efficient customer acquisition.

Interactive Fitness Hardware

We market our interactive hardware under the fitness industry-leading brands NordicTrack, ProForm, Freemotion and Weider. A majority of our large fitness equipment ranges in price from $400 to $13,000 across the primary categories of treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors and yoga equipment. We intentionally segment our brands across a wide range of channels, products and price points to attract consumers from a variety of fitness and income levels and have versions of each major modality in each brand. Our hardware is intelligent—specifically designed and engineered to respond to our proprietary software and experiential content.

We believe that the breadth of our product portfolio and multi-brand strategy provides us with the largest addressable market in our industry and creates a broad funnel to acquire interactive fitness members at scale.

iFIT Member Base

We offer an iFIT membership for $15/month for individuals or $39/month for families of up to five (or $396 when paid annually). The iFIT platform drives interactive experiences on all of our brands, with members gaining access to our full library of live and on-demand content through the membership plan. When a customer purchases select iFIT interactive equipment, they also purchase an annual subscription to iFIT. After the conclusion of the initial subscription period, customers may enter into a monthly or annual subscription arrangement. We expect to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan.

In addition, we have members that use iFIT on other fitness equipment or without having connected equipment, but utilize the content to achieve their health and fitness goals through our iFIT app on a mobile device or smart

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TV. We believe the combination of our proprietary software and experiential content connected with our interactive hardware creates a compelling value proposition for our rapidly growing member base and generates attractive recurring subscription revenue.

Through Sweat, we now offer subscriptions to the Sweat app for $19.99/month or $119.94 when paid annually. The Sweat app offers over 5,000 unique workouts across 26 exercise programs ranging from high-intensity interval training and strength to yoga, barre and Pilates.

Factors Affecting Our Performance

Our financial condition and results of operations have been, and will continue to be, affected by a number of factors, including the following:

Growth in Sales of Interactive Fitness Hardware

We are focused on attracting consumers with function, features, design and modalities that serve as the basis for the engagement of our iFIT members. We have experienced rapid growth of hardware and subscriptions in recent periods and our financial results will continue to be affected by the level of sales of our Interactive Fitness Products. We believe our growth has been driven by an attractive value proposition to our members, our spend on sales and marketing to create awareness of our products and accelerated lifestyle trends in the health and fitness industry toward connected fitness. In addition, unit sales of interactive fitness equipment exceeded our expectations due in part to the global pandemic and an accelerated adoption of connected at-home fitness, particularly in the months of April and May in our fourth quarter of fiscal 2020 and during fiscal 2021. We believe our growth rates will continue to be driven by our ability to create brand and product awareness through additional marketing spend, as well as the continuing lifestyle trend toward connected at-home fitness. If we cannot attract new purchasers of our Interactive Fitness Products as quickly as we expect, our operating results may be adversely affected.

Attracting and Retaining Total Fitness Subscribers

A significant portion of our revenue comes from subscriptions to the iFIT platform. We have amassed over 1.1 million Total Fitness Subscribers as of the end of fiscal 2021, and in fiscal 2021 generated subscription revenue from iFIT subscriptions and extended warranty contracts of $229.8 million, representing an 85% increase from fiscal 2020. We anticipate that over time, the percentage of our revenue represented by subscription income will increase as we enhance our offerings. In addition, our member experience must be compelling enough to attract and retain Total Fitness Subscribers on an ongoing basis. As a result, we expect to continue to invest significantly in our software, experiential content and the related infrastructure. We cannot be sure that we will be successful in attracting and retaining Total Fitness Subscribers or that retention levels will not materially decline due to any number of factors, including our ability to engage our members, implement new software features and launch new content.

Driving Repeat and Adjacent Purchases from Our Customers

We anticipate that an increasing portion of our revenue may come from repeat purchases from existing customers as they build out health and fitness portfolios. Our platform creates an incentive for existing customers to purchase items that can leverage the platform content, and our brands drive loyalty in our customers. As of the end of fiscal 2021, 17% of our Total Fitness Subscribers that joined the iFIT platform had more than one unit of our interactive fitness equipment. As we further expand the offerings of our platform, we will continue to actively market to our Total Fitness Subscribers additional Interactive Fitness Products and adjacent categories of products.

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Investing in Technology and Innovation

Technology development has been the hallmark of our success. During fiscal 2021, we invested $91.7 million in research and development and to enhance our iFIT platform, develop new products, content and features, and improve our platform infrastructure, a portion of which was capitalized. Our investment in new initiatives and technologies is critical to our ongoing success, and we intend to continue to invest meaningfully in the future to fuel our growth.

Impact of Global Pandemic

The global pandemic has significantly impacted the global economy. Governments have introduced measures in an effort to control the spread of the virus, including lockdowns, closures, quarantines and travel bans. Demand for at-home health and fitness solutions has increased as a result of gyms and fitness studio closures. While the adoption of at-home connected fitness has been accelerated by the pandemic, it is possible that increased demand levels could decline and churn rates could increase as economies eventually normalize due to vaccine distribution and consumers spending less time at home.

Seasonality

Historically, our revenue has been higher in the second and third fiscal quarters of our year, due in large part to seasonal holiday demand, New Year’s goals and cold weather. As such, we also expect our revenues to generally decline in the fourth fiscal quarter. In fiscal 2020, due to the atypical environment driven from the global pandemic, we did not experience our typical seasonality, although we have experienced seasonality in fiscal 2021, with higher revenue in the second and third fiscal quarters, and expect seasonality to return in future years. Similarly, we have experienced higher churn in iFIT subscriptions during the third and fourth fiscal quarters, following the expiration of annual subscriptions purchased together with fitness equipment. Sweat is also impacted by similar seasonality.

Impact of the Sweat Acquisition

On June 30, 2021, a subsidiary of the Company completed the acquisition of Sweat Group Pty Ltd, an Australian company and one of the world’s largest digital fitness training platforms for women. Pursuant to the terms of the share sale agreement, the Company indirectly acquired all of the issued share capital in Sweat, for aggregate consideration of (a) $37.5 million in cash; (b) $40 million in Class A common stock to be issued following the initial public offering at a 10% discount to the price per share in such offering; and (c) up to $70 million of deferred consideration, with an upward adjustment of approximately $4 million for debt, working capital (including cash) and transaction expenses. The deferred consideration consists of (i) up to $30 million based on revenues of Sweat’s business during the three years following the acquisition of Sweat and (ii) royalty payments up to $40 million, based on sales of the Company’s interactive fitness equipment generated by the Sweat team during the five years following the acquisition of Sweat. We are currently assessing the accounting treatment of the Sweat acquisition. Included in that assessment is an analysis of the purchase consideration and whether any components of such should be accounted for as compensation for continuing employment rather than as consideration transferred. All payments to the sellers will be paid in Australian dollars at an agreed exchange rate of AU$1.2985 per US$1.00. Under applicable SEC rules, the Sweat acquisition does not meet the significance thresholds for separate financial statement or pro forma reporting purposes.

Because the acquisition occurred subsequent to fiscal 2021, the Sweat results are not included in our historical results, but will be included as of and from the date of acquisition during Q1 fiscal 2022. Through Sweat, we now offer subscriptions to the Sweat app, which we expect to positively impact subscription revenue in future periods. The Sweat acquisition also gives us direct access to Sweat’s community of 450,000 paid subscribers at May 31, 2021 and more than 50 million followers, primarily women, across its social channels, which will expand our ability to market both our iFIT subscriptions and our interactive hardware to the extensive global Sweat community.

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Key Business Metrics and Non-GAAP Financial Measures

In addition to the measures presented in our consolidated financial statements, we use the following key operational metrics and non-GAAP financial measures to evaluate our business, measure our performance, develop financial forecasts, and make strategic and budgeting decisions.

	Year Ended May 31,
	(dollars in thousands)
	2019			2020			2021			2021 (Combined) (1)
Total Fitness Subscribers (at period end)		262,181			530,490			1,118,519			1,569,127
Total members (at period end)		2,474,504			3,456,816			5,670,616			6,121,224
Total workouts on platform		12,132,471			34,098,117			112,194,032			141,895,860
Average monthly workouts(2)		5.5			7.7			13.1			N/A
Billings	$	92,720		$	183,727		$	382,275			N/A
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)		N/A
Net income (loss) margin		8.1	%		(11.6	)%		(29.6	)%		N/A
Adjusted EBITDA	$	(4,412	)	$	(13,239	)	$	(14,571	)		N/A
Adjusted EBITDA Margin		(0.6	)%		(1.6	)%		(0.8	)%		N/A
Subscription gross profit	$	60,550		$	104,615		$	200,788			N/A
Subscription gross margin		82.1	%		84.4	%		87.4	%		N/A
Subscription contribution	$	66,018		$	112,448		$	207,102			N/A
Subscription contribution margin		89.5	%		90.7	%		90.1	%		N/A

(1) Except as set forth in the combined column, which includes Sweat on a combined basis, the historical data set forth in this table do not give effect to the Sweat acquisition, which occurred subsequent to fiscal 2021 on June 30, 2021. Certain additional information regarding Sweat is provided below.

(2) Average monthly workouts attributable to Touchscreen products priced $1,999 and above.

Total Fitness Subscribers. Our number of Total Fitness Subscribers indicates our market penetration and growth of our subscription business. Our number of Total Fitness Subscribers grew 102% from fiscal 2019 to 2020 and grew 111% from fiscal 2020 to fiscal 2021. Total Fitness Subscribers are defined as those who have full access to all paid content, which is available on the digital app, TV app and on equipment who are either in an active paid account or a trial and are the primary account holder. Our digital-only iFIT members and trial members each represent less than 5% of our Total Fitness Subscriber base for all periods presented.

Except as set forth in our combined figure, our Total Fitness Subscribers for historical periods do not include Sweat app subscribers, which amounted to 450,000 at May 31, 2021. Our combined Total Fitness Subscribers were 1.6 million at May 31, 2021.

Total Fitness Subscribers

(As of fiscal quarter end, in thousands)

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Total Members. Our total member count is a key indicator of the size of our global community. Our Total Member count increased at a 51% CAGR from fiscal 2019 to fiscal 2021. We define Total Members as all individuals who have an active iFIT account and/or Sweat subscription, which includes Total Fitness Subscribers, their respective secondary members and members who consume free content.

Except as set forth in the combined figure, our Total Members for historical periods do not include Sweat app subscribers, which amounted to 450,000 at May 31, 2021. Our combined Total Members were 6.1 million at May 31, 2021.

Total Workouts on Platform. This metric allows us to measure our member engagement, which indicates overall satisfaction with our iFIT platform, and provides insight into which content is the most popular among our Total Members. The breadth of our iFIT platform enables us to collect usage data as it pertains to modalities, length of workouts, and other information that can inform our decision-making on future content and products. For fiscal 2019 and fiscal 2020, the total number of workouts participated in on our platform was 12.1 million and 34.1 million, respectively, representing 181% growth. In fiscal 2021, our members participated in more than 112 million workouts, reflecting growth of 229% year over year. We define a workout as a single program participated in by any of our members across our entire platform.

Total Workouts on Platform

(Per fiscal quarter, in millions)

Average Monthly Workouts. We view this metric as a way to measure the engagement of our Total Fitness Subscribers. Over time, our members become more engaged with our platform, as seen through the average number of workouts per Touchscreen product member at the $1,999+ price point, which was 5.5, 7.7 and 13.1 for fiscal 2019, fiscal 2020 and fiscal 2021, respectively. For the same time periods, the average monthly workouts for all Touchscreen product members was 5.0, 6.8 and 10.0. We calculate this metric by summing the total number of workouts in the 12 months preceding each respective period end by all Touchscreen product members (or Touchscreen product members at the $1,999+ price point), divided by the average number of subscribers owning the relevant equipment over same period, divided by 12 months. As we continue to add engaging live and recorded content to our library, we expect this number to continue to increase over time.

Average Monthly Churn. We measure churn on our subscribers who own our interactive fitness equipment with a high-definition touchscreen. Touchscreen product subscribers represent a subset of our total subscriber base, who we believe purchase equipment with the intent of consuming content, giving us a strong indication of member retention and the strength of our content offerings.

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We now sell Touchscreen products across every major modality and with price points starting at $499. The number of Touchscreen product subscribers as of the end of fiscal 2021 represented 71% of our Total Fitness Subscriber base, up from 26% in fiscal 2018. We plan to continue to invest in shifting our product mix toward Touchscreen products.

As of the end of fiscal 2021, Touchscreen products priced $1,999 and above represented approximately 45% of our Touchscreen product subscribers. The chart below highlights monthly churn for subscribers who purchased Touchscreen product units priced $1,999 and above, based on monthly cohorts 13 months prior to each respective period.

Average Net Monthly Churn by Cohort, Touchscreen $1,999+

(Based on 13-month Retention)

Average Net Monthly Churn is calculated based on the 13-month retention rate of our subscribers who use our Touchscreen products priced $1,999 and above. For fiscal Q4 2021, we calculate this figure based on the number of subscribers that renewed their subscription from the monthly cohorts that joined the platform in the 13 months prior (February 2020, March 2020 and April 2020) and include the subscribers from prior cohorts that reactivated their subscriptions during the period. This reflects a 76% annual retention rate, and converts to a 2.3% monthly churn rate. This figure is 2.9% when calculated for Touchscreen product subscribers at all price points of $499 and higher, who joined the platform in the same months.

Given that currently our Touchscreen products are typically sold together with an annual iFIT subscription, we focus on our customers’ propensity to renew their subscriptions after their initial year on the platform.

Our iFIT platform enables us to access subscribers who do not have Touchscreen equipment. These additive subscribers have a lower likelihood of renewing their subscriptions than Touchscreen product subscribers. We may experience an increase in average monthly churn, which we would expect to be temporary, in connection with our plan to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan.

Billings. We define billings as the total amounts billed for subscription and extended warranty contracts in the period. Billings consists of iFIT subscription contracts with existing customers (including renewals), iFIT subscription contracts with new customers and contracts for extended warranty. Customers can either purchase an iFIT subscription in connection with the purchase of certain iFIT Interactive Fitness Products or purchase a subscription independently of purchasing iFIT products. Customers may enter into monthly or annual iFIT subscriptions which are billed at the beginning of the contract period and can be renewed at any time during the contract period. Customers typically purchase extended warranty at the time of the iFIT Interactive Fitness Product purchase, or during the limited warranty period (that comes with the product), which are billed to the customer at that time and can range over terms of 1 to 5 years.

We monitor Billings as a key operating metric in evaluating the performance of our business as it drives deferred revenue which is an important indicator of the health of our subscription business and represents a significant

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percentage of future subscription revenue. It also provides management with a view on the cash flows associated with our subscription business, thereby enabling management to assess continued investment in the business. We believe it is a useful disclosure for our investors as unlike other companies that may be viewed as our peers, our subscription model is largely driven by longer term subscriptions rather than a month-to-month subscription and providing this information allows investors to evaluate the total dollar amount of subscription purchases made by our customers and assess the overall performance of our subscription business.

In connection with our plan to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan, we expect our Billings to decrease as the mix between annual and monthly renewals shifts to monthly renewals.

Unit Economics. When evaluating unit economics for our iFIT subscription offering, we focus on our Touchscreen product line. Our Touchscreen product subscriber lifetime value (“LTV”) is calculated as:

• Our monthly iFIT subscription fee of approximately $32, blended to account for our subscription plan options, monthly and annual - as well as our member plan options, individual and family; multiplied by

• Subscription Gross Margin; multiplied by

• Touchscreen product subscribers added in the period; multiplied by

• Months of subscriber lifetime, calculated as one divided by Average Monthly Churn.

Our Touchscreen product subscriber LTV was $553 million for fiscal 2021, or $909 per Touchscreen product subscriber added during the period. For the category of Touchscreen products priced $1,999 and above, LTV was $1,214 per subscriber added during the same period.

We evaluate customer acquisition cost on a net basis, offsetting marketing investments associated with customer acquisition with gross profit, excluding depreciation and amortization expense, earned on the sale of our iFIT-enabled equipment, which demonstrates an instant payback of our marketing investment. For fiscal 2021, our net customer acquisition cost was negative $43 per Touchscreen product subscriber added. The gross profit, which excludes depreciation and amortization expense, we generate from our Touchscreen products, which was $301.5 million in fiscal 2021, offsets the marketing spend associated with subscriber acquisition. We believe our unit economics profile will continue to improve as we generate operating leverage and experience heightened brand awareness.

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA is a non-GAAP financial measure that represents our performance adjusted for depreciation and amortization, net interest expense, provision for income taxes among other adjustments outlined in the reconciliation referenced below. We calculated Adjusted EBITDA Margin by dividing Adjusted EBITDA by revenue. We use Adjusted EBITDA and Adjusted EBITDA Margin in conjunction with GAAP measures as part of our overall assessment of our performance to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance. See the section titled “Selected Consolidated Financial and Other Data—Non-GAAP Financial Measures” for information regarding our use of Adjusted EBITDA and Adjusted EBITDA Margin and a reconciliation of Adjusted EBITDA to net income (loss).

Subscription Contribution and Subscription Contribution Margin. Subscription Contribution and Subscription Contribution Margin are non-GAAP financial measures. We define Subscription Contribution as subscription revenue less cost of subscription revenue, adjusted to exclude depreciation and amortization expense from cost of subscription revenue. Subscription Contribution Margin is calculated by dividing Subscription Contribution by subscription revenue. We use Subscription Contribution and Subscription Contribution Margin to measure our ability to scale and leverage the costs of our subscriptions. The continued growth of our subscription base will allow us to improve our Subscription Contribution Margin. While there are variable costs associated with our subscriptions, a significant portion of our content creation costs are fixed given that we operate with a limited

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number of production studios and personnel. The fixed nature of those expenses should scale over time as we grow our subscription base. See the section titled “Selected Consolidated Financial and Other Data—Non-GAAP Financial Measures” for information regarding our use of Subscription Contribution and Subscription Contribution Margin and a reconciliation of Subscription Contribution to subscription gross profit.

Percentage of Multi-Equipment Users by Cohort. We view the Percentage of Multi-Equipment Users as a strong indicator of the breadth of our platform and a validation of our vision to serve our members holistically. We calculate this metric at a given date by dividing the number of Total Fitness Subscribers with two or more iFIT-enabled units (excluding our digital app) attached to a single user account as of such date, by the total number of Total Fitness Subscribers who joined the platform with at least one iFIT-enabled unit during a specified period (which we refer to as a “cohort”).

As of the end of fiscal 2021, 17% of our Total Fitness Subscribers that joined the iFIT platform had more than one unit of our interactive fitness equipment. For cohorts of fiscal 2018, 2019 and 2020 this figure is 20%, 18%, and 14% respectively. Our data supports that the longer members are on our platform, the more likely they are to purchase multiple iFIT-enabled units. We define “units” as items that have iFIT functionality, such as bikes, treadmills, ellipticals, climbers and rowers. This metric is an indicator of our ability to drive retention in our member base and increase the touchpoints we have with consumers. We believe we have a competitive advantage as compared to others in our market due to the breadth of high-quality, iFIT-enabled equipment we offer.

Gross Merchandise Value. We define Gross Merchandise Value as the total dollar value of the merchandise sold to end consumers in a given period in all distribution channels. Gross Merchandise Value is calculated by multiplying the number of units sold of a specific stock-keeping unit (“SKU”) in the period by the estimated retail selling price of that SKU in all distribution channels, prior to the deduction of any discounts, fees or expenses. We monitor Gross Merchandise Value as a key operating metric because it provides insights into the overall growth of our business and strength of our brands with end consumers, while normalizing for different billing conventions across our transactions with our customers through our direct and wholesale channels. We believe Gross Merchandise Value is useful to investors as it gives investors a clearer indication of the volume of our business transacted in a period by calculating retail value, regardless of the distribution channel and allows us and investors to make like-for-like sales comparisons to certain competitors who utilize predominantly direct distribution channels.

Components of our Operating Results

We operate and manage our business in two operating and reportable segments: Interactive Fitness Products and Subscription. We identify our reportable segments based on the information used by management to monitor performance and make operating decisions. See Note 22 to our consolidated financial statements included elsewhere in this prospectus for additional information regarding our reportable segments.

Revenue

Interactive Fitness Products. We generate most of our revenue from the sale of our interactive fitness equipment, as well as ancillary products including weights, apparel, nutrition products and other accessories. Interactive fitness products revenue is recognized when control transfers to the customer, which can be either at the time of shipping or the time of delivery, depending upon the terms of our contract with the customer, and is recorded net of returns, discounts and customer sales incentives.

Subscription. Subscription revenue consists of revenue generated from month-to-month and annual iFIT subscriptions. When a customer purchases select iFIT Interactive Fitness Products, they also purchase an annual subscription to iFIT. After the initial one-year period, subscriptions are offered on a month-to-month or annual basis. We also occasionally offer discounts on the purchase of additional years of iFIT with the upfront purchase of an interactive fitness product. We also generate a portion of our subscription revenue from our extended warranties. Revenues associated with our subscription products are deferred at the time of sale and recognized

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ratably over the subscription period, net of customer sales incentives. Commencing in Q1 fiscal 2022, subscription revenue will include revenue generated from subscriptions to the Sweat app. Additionally, in Q2 fiscal 2022, we expect to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan.

Cost of revenue

Interactive Fitness Products. Interactive fitness products cost of revenue consists of inventory and manufacturing costs, tooling costs, duties and import costs, realized cash flow hedge gains and losses, depreciation and amortization, inbound freight, packaging, warranty replacement and servicing costs associated with the manufacturer’s warranty, and certain allocated costs related to management, facilities, and personnel-related expenses. Personnel-related expenses include salaries, bonuses and benefits. In the near term, we expect interactive fitness products cost of revenue to increase in total and as a percentage of revenue due to higher costs related to freight and materials. Additionally, our interactive fitness products cost of revenue and margins will fluctuate based on the channel through which we sell.

Subscription. Subscription cost of revenue includes costs associated with the creation of iFIT content, including associated personnel related expenses, filming and production costs, other iFIT content specific costs, hosting fees, music royalties, amortization of iFIT capitalized software development costs, and warranty replacement and servicing costs associated with extended warranty contracts. We expect subscription cost of revenue to increase both in total and as a percentage of revenue as we continue to invest in video and live fitness content, increases in variable costs such as hosting fees and music royalties, and increasing costs related to updates to and development of our iFIT platform. Commencing in Q1 fiscal 2022, subscription cost of revenue will include the costs associated with the Sweat app.

Operating Expenses

Operating expenses consist of sales and marketing, research and development, and general and administrative expenses.

Sales and Marketing. Sales and marketing expenses represent the largest component of our operating expenses and consist primarily of advertising and marketing expenses and personnel-related expenses, as well as sales incentives, distribution and freight-out, payment processing fees, sponsorship costs, consulting and contractor expenses and travel expenses. We expect our sales and marketing expenses to increase significantly as we continue to actively advertise and market our products and services. Sales and marketing expenses as a percentage of total revenue may fluctuate from period to period based on total revenue and the timing of our investments in our sales and marketing functions as these investments may vary in scope and scale over future periods.

Shipping and handling fees billed to customers are recorded gross and included in Interactive Fitness Products revenue with the associated costs reported in sales and marketing. Shipping and handling fees recorded in sales and marketing were $54.1 million, $66.5 million and $117.9 million for fiscal 2019, 2020 and 2021, respectively.

Research and Development. Research and development expenses consist primarily of personnel-related expenses, facilities-related expenses, and consulting and contractor expenses. Substantially all of our research and development expenses are related to developing new products and services and improving our existing products and services. We capitalize certain qualified costs incurred in connection with the development of internal-use and iFIT software. We expect our research and development expenses to increase in absolute dollars and vary from period to period as a percentage of total revenue as we continue to make significant investments in developing new products and services and enhancing existing iFIT products and services.

General and Administrative. General and administrative expenses consist of personnel-related expenses, professional service costs, capitalized internal use software amortization expense, and other administrative expenses. Personnel-related expenses include salaries, bonuses, benefits, and stock-based compensation for our administrative, finance, legal, and human resources personnel.

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Following the completion of this offering, we expect to incur additional general and administrative expenses as a result of operating as a public company, including expenses related to compliance and reporting obligations of public companies and increased costs for insurance, investor relations expenses, professional services and stock-based compensation. As a result, we expect our general and administrative expenses to increase in absolute dollars and vary from period to period as a percentage of revenue.

In addition, we expect increased compensation expense in future periods to reflect the forgiveness of $53.2 million aggregate principal amount of executive loans (including a $44 million loan to our CEO) to comply with the Sarbanes-Oxley Act a $35 million payment to our CEO and a restricted grant to our CEO of $50.0 million of New Convertible Notes. We expect to incur share-based compensation expense of approximately $163.1 million in the first year subsequent to the initial public offering related to options and restricted shares, including modifications of existing awards and issuance of loans to non-executive employees, granted to members of management and employees in conjunction with this offering. See “Executive and Director Compensation—Additional Compensation in Fiscal Q1 or Q2 2022” and notes (O) and (Q) to our Unaudited Pro Forma Condensed Consolidated Balance Sheet. See “Unaudited Pro Forma Condensed Consolidated Financial Information.”

Other Expense (Income)

Other expense (income), net consists of interest expense, including amortization of debt issuance cost and amortization of debt discount, changes in the fair value of warrant liabilities and embedded derivative liabilities, gains and losses on mandatorily redeemable preferred stock and warrants, gain on the sale of a subsidiary, equity-method investment income, gains and losses on investment securities and other miscellaneous income and expense items.

Provision for Income Taxes

Provision for income taxes consists primarily of income taxes related to federal, foreign and state jurisdictions in which we conduct business. The foreign jurisdictions have statutory tax rates different from those in the United States. Accordingly, our effective tax rates will vary depending on the relative proportion of foreign to U.S. income, the utilization of foreign tax credits, and changes in tax laws. We maintain a full valuation allowance on our federal and state deferred tax assets as we have concluded that it is more likely than not that our U.S. deferred assets will not be utilized.

Results of Operations

The following tables set forth the components of our consolidated results of operations for each of the periods presented and as a percentage of our revenue for those periods. The period-to-period comparison of operating results is not necessarily indicative of results for future periods.

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Consolidated Statements of Operations Data:
Revenue:
Interactive fitness products	$	626,189	$	727,703	$	1,515,288
Subscription(1)		73,776		123,977		229,768
Total revenue		699,965		851,680		1,745,056
Cost of revenue:
Interactive fitness products(2)		444,908		503,353		989,873
Subscription(2)		13,226		19,362		28,980
Total cost of revenue		458,134		522,715		1,018,853
Gross profit		241,831		328,965		726,203

106

	Year Ended May 31,
	2019			2020			2021
	(in thousands)
Operating expenses:
Sales and marketing		193,173			278,492			619,431
Research and development (3)		20,898			23,122			36,274
General and administrative(2)		48,892			77,105			198,132
Total operating expenses		262,963			378,719			853,837
Loss from operations		(21,132	)		(49,754	)		(127,634	)
Other expense (income):
Gain on sale of subsidiary		(111,800	)		—			—
Other expense, net(4)		13,368			46,320			387,089
Total other expense (income)		(98,432	)		46,320			387,089
Income (loss) before provision for income taxes		77,300			(96,074	)		(514,723	)
Provision for income taxes		20,733			2,469			1,983
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)

(1) We use Billings as a key operating metric in evaluating the performance of our business because it enables an analysis of performance based on the timing of actual transactions with our customers and may be seen as an early indicator of trends in our operating results. See “Management’s Discussion and Analysis—Key Business Metrics and Non-GAAP Financial Measures” for how we calculate Billings.

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Billings	$	92,720	$	183,727	$	382,275

(2) Includes depreciation and amortization expense as follows:

	Year Ended May 31,
	2019		2020		2021
	(in thousands)
Cost of revenue
Interactive fitness products	$	1,933	$	1,466	$	1,852
Subscription		5,468		7,833		6,314
Total cost of revenue		7,401		9,299		8,166
General and administrative		9,319		8,732		8,183
Total	$	16,720	$	18,031	$	16,349

(3) In fiscal 2019, 2020 and 2021, we invested $35.8 million, $45.1 million and $91.7 million, respectively, which represents 5.1%, 5.3% and 5.3% of our total revenues, respectively, in research and development and to enhance our iFIT platform, develop new products, content and features, and improve our platform infrastructure, a portion of which was capitalized.

(4) Includes a loss in fiscal 2021 of $178.2 million related to the issuance of the Series A and B preferred stock and the 2020 Warrants. The loss is due to the excess of the fair value of the instruments issued over the proceeds received. In fiscal 2020 and 2021, we also incurred losses of $9.4 million and $142.2 million, respectively, related to the change in fair value of our warrant liabilities and $20.2 million and $39.3 million, respectively, related to the change in fair value of our embedded derivative liabilities. Total other expense (income) also includes interest expense (income) of $15.4 million, $15.5 million and $31.0 million for fiscal 2019, 2020 and 2021, respectively, and other expense (income) of $(2.0) million, $1.2 million, and $(3.6) million, for fiscal 2019, 2020 and 2021, respectively.

107

The following table sets forth our consolidated statements of operations data as a percentage of total revenue:

	Year Ended May 31,
	2019			2020			2021
	(as a percentage of total revenue)
Consolidated Statements of Operations Data:
Revenue:
Interactive fitness products		89.5	%		85.4	%		86.8	%
Subscription		10.5			14.6			13.2
Total revenue		100.0			100.0			100.0
Cost of revenue:
Interactive fitness products		63.6			59.1			56.7
Subscription		1.9			2.3			1.7
Total cost of revenue		65.5			61.4			58.4
Gross profit		34.5			38.6			41.6
Operating expenses:
Sales and marketing		27.6			32.7			35.5
Research and development		3.0			2.7			2.1
General and administrative		7.0			9.1			11.4
Total operating expenses		37.6			44.5			48.9
Loss from operations		(3.0	)		(5.8	)		(7.3	)
Other expense (income):
Gain on sale of subsidiary		(16.0	)		—			—
Other expense, net		1.9			5.4			22.2
Total other expense (income)		(14.1	)		5.4			22.2
Income (loss) before provision for income taxes		11.0			(11.3	)		(29.5	)
Provision for income taxes		3.0			0.3			0.1
Net income (loss)		8.1	%		(11.6	)%		(29.6	)%

Comparison of Fiscal 2020 and 2021

Revenue

	Year Ended May 31,				Change
(dollars in thousands)	2020		2021		$		%
Revenue:
Interactive fitness products	$	727,703	$	1,515,288	$	787,585		108.2	%
Subscription		123,977		229,768		105,791		85.3
Total revenue	$	851,680	$	1,745,056	$	893,376		104.9	%

The $787.6 million increase in fiscal 2021 Interactive Fitness Products revenue was primarily attributable to an increase in the number of Touchscreen product units sold. The Company’s investments in advertising and brand awareness in fiscal 2021, as well as a general shift in consumer behavior to health and fitness and increased demand driven by stay-at-home orders issued by governments in response to the global pandemic, contributed to the increase in the number of interactive fitness units sold. While we have experienced strong demand for our interactive fitness units during fiscal 2021, our growth across quarterly periods also reflects our typical seasonality patterns, with higher revenue during the second and third quarters. Our prospective growth rates may also be impacted by the re-openings of fitness center facilities, vaccine distribution and consumers spending less time at home.

108

The $105.8 million increase in fiscal 2021 subscription revenue was primarily attributable to an increase in demand for our Interactive Fitness Products with an iFIT bundled offering upon purchase of the product. In addition, $2.0 million of the $105.8 million increase was attributable to revenue related to extended warranties within subscription revenue, which increased from $20.2 million in fiscal 2020 to $22.2 million in fiscal 2021.

Cost of revenue

	Year Ended May 31,						Change
(dollars in thousands)	2020			2021			$		%
Cost of revenue:
Interactive fitness products	$	503,353		$	989,873		$	486,520		96.7	%
Subscription		19,362			28,980			9,618		49.7
Total cost of revenue	$	522,715		$	1,018,853		$	496,138		94.9	%
Gross profit:
Interactive fitness products	$	224,350		$	525,415		$	301,065		134.2	%
Subscription		104,615			200,788			96,173		91.9
Total gross profit	$	328,965		$	726,203		$	397,238		120.8	%
Gross margin:
Interactive fitness products		30.8	%		34.7	%
Subscription		84.4			87.4
Total gross margin		38.6	%		41.6	%

The $486.5 million increase in Interactive Fitness Products cost of revenue was primarily attributable to the increase in the number of Touchscreen product units sold. The increase in Interactive Fitness Products gross margin from 30.8% in fiscal 2020 to 34.7% in fiscal 2021 was primarily attributable to direct-to-consumer sales increasing (as a percentage of total Interactive Fitness Products sales), which is our higher margin channel.

The $9.6 million increase in subscription cost of revenue during fiscal 2021 was primarily attributable to the increase in the number of Total Fitness Subscribers and increases in iFIT software content costs. The increase in subscription gross margin from 84.4% in fiscal 2020 to 87.4% in fiscal 2021 was primarily attributable to greater growth in our subscribers than in our fixed cost base. Subscription cost of revenue is expected to continue to increase as we continue to invest in video and live fitness content for our Total Fitness Subscribers and updates to and development of our iFIT platform.

Operating Expenses

Sales and Marketing

	Year Ended May 31,						Change
(dollars in thousands)	2020			2021			$		%
Sales and marketing	$	278,492		$	619,431		$	340,939		122.4	%
As a percentage of total revenue		32.7	%		35.5	%

The $340.9 million increase in sales and marketing expense during fiscal 2021 was primarily due to a $254.9 million increase in expenses associated with advertising costs and other marketing programs, an increase of $51.4 million in shipping and handling fees and an increase of $23.8 million in labor costs. As a percentage of revenues, sales and marketing increased 2.8%, which was mainly due to increased advertising and marketing spend in fiscal 2021.

109

Research and Development

	Year Ended May 31,						Change
(dollars in thousands)	2020			2021			$		%
Research and development	$	23,122		$	36,274		$	13,152		56.9	%
As a percentage of total revenue		2.7	%		2.1	%

The $13.2 million increase in research and development expense during fiscal 2021 was primarily attributable to a $14.2 million increase in personnel-related expenses related to an increase in headcount to support product and software development for the iFIT platform. As a percentage of revenue, research and development expense was 0.6% lower year over year. In addition to our research and development expense, in fiscal 2020 and fiscal 2021, we invested $22.0 million and $55.4 million, respectively, to enhance our iFIT platform, develop new products, content and features and improve our platform infrastructure, which was capitalized in each of those years.

General and Administrative

	Year Ended May 31,						Change
(dollars in thousands)	2020			2021			$		%
General and administrative	$	77,105		$	198,132		$	121,027		157.0	%
As a percentage of total revenue		9.1	%		11.4	%

The $121.1 million increase in general and administrative expense during fiscal 2021 was primarily due to a $78.3 million increase in stock-based compensation expense, a $14.0 million increase in consulting and advisory fees, and a $19.4 million increase in personnel costs. As a percentage of revenue, general and administrative expense increased 2.3% which was mainly due to the increase in stock-based compensation expense in fiscal 2021.

Other Expense (Income)

	Year Ended May 31,					Change
(dollars in thousands)	2020		2021			$			%
Interest expense	$	15,496	$	31,016		$	15,520			100.2	%
Change in fair value of warrant liabilities		9,396		142,150			132,754			1,412.9
Change in fair value of embedded derivative liabilities		20,200		39,300			19,100			94.6
Loss on issuance of mandatorily redeemable preferred stock and warrants		—		178,200			178,200			—
Other expense (income), net		1,228		(3,577	)		(4,805	)		(391.3	)
Total other expense, net	$	46,320	$	387,089		$	340,769			735.7	%

The $340.8 million increase in total other expense, net in fiscal 2021 was primarily due to the $132.8 million and $19.1 million increase in losses due to the change in fair value of the warrant and embedded derivative liabilities, respectively, the $178.2 million loss on the issuance of the Series A and B preferred stock and 2020 Warrants and the $15.5 million increase in interest expense due to the interest incurred on the 2019 Note and the Series A preferred stock during fiscal 2021.

An initial public offering constitutes a mandatory prepayment event under the terms of the Series A and B preferred stock and the 2019 Note, at which time the Company will redeem the Series A preferred stock and the 2019 Note, including the underlying embedded derivative instruments. As such, after an initial public offering, we would not expect to recognize fair value changes in the embedded derivative liabilities. Additionally, the classification of the 2019 Warrant and 2020 Warrants will be reassessed and will no longer be required to be remeasured at fair value as the warrants will be net share settled in connection with the offering.

110

Provision for Income Taxes

	Year Ended May 31,						Change
(dollars in thousands)	2020			2021			$			%
Provision for income taxes	$	2,469		$	1,983		$	(486	)		(19.7	)%
As a percentage of total revenue		0.3	%		0.1	%

Our effective tax rate was (2.5)% and (0.5)% for fiscal 2020 and fiscal 2021, respectively.

Comparison of Fiscal 2019 and 2020

Revenue

	Year Ended May 31,				Change
	2019		2020		$		%
	(dollars in thousands)
Revenue:
Interactive fitness products	$	626,189	$	727,703	$	101,514		16.2	%
Subscription		73,776		123,977		50,201		68.0
Total revenue	$	699,965	$	851,680	$	151,715		21.7	%

The $101.5 million increase in fiscal 2020 Interactive Fitness Products revenue was primarily attributable to an increase in the number of Touchscreen product units sold. The Company’s investments in advertising and brand awareness in fiscal 2020, as well as a general shift in consumer behavior to health and fitness, contributed to the increase in the number of interactive fitness units sold.

The $50.2 million increase in fiscal 2020 subscription revenue was primarily attributable to the growth in our Total Fitness Subscribers, which increased from 262,181 as of May 31, 2019 to 530,490 as of May 31, 2020. Total Fitness Subscribers grew as consumers shifted to at-home workouts due to changes in consumer fitness trends. Included in the $50.2 million increase was a decrease of $1.3 million attributable to revenue related to extended warranties within subscription revenue, which decreased from $21.5 million in fiscal 2019 to $20.2 million in fiscal 2020.

111

Cost of revenue

	Year Ended May 31,						Change
	2019			2020			$		%
	(dollars in thousands)
Cost of revenue
Interactive fitness products	$	444,908		$	503,353		$	58,445		13.1	%
Subscription		13,226			19,362			6,136		46.4
Total cost of revenue	$	458,134		$	522,715		$	64,581		14.1	%
Gross profit
Interactive fitness products	$	181,281		$	224,350		$	43,069		23.8	%
Subscription		60,550			104,615			44,065		72.8
Total gross profit	$	241,831		$	328,965		$	87,134		36.0	%
Gross margin
Interactive fitness products		28.9	%		30.8	%
Subscription		82.1			84.4
Total gross margin		34.5	%		38.6	%

The $58.4 million increase in Interactive Fitness Products cost of revenue was primarily attributable to the increase in the number of Touchscreen product units sold. The increase in Interactive Fitness Products gross margin from 28.9% in fiscal 2019 to 30.8% in fiscal 2020 was primarily attributable to direct-to-consumer sales increasing (as a percentage of total Interactive Fitness Products sales) which is our higher margin channel.

The $6.1 million increase in subscription cost of revenue during fiscal 2020 was primarily attributable to the increase in the number of Total Fitness Subscribers and increases in amortization of capitalized iFIT software and content costs. The increase in subscription gross margin from 82.1% for fiscal 2019 to 84.4% for fiscal 2020 was primarily attributable to greater growth in our subscribers than in our fixed cost base. Subscription cost of revenue is expected to continue to increase as we continue to invest in video and live fitness content for our Total Fitness Subscribers and updates to and development of our iFIT platform.

Operating Expenses

Sales and Marketing

	Year Ended May 31,						Change
(dollars in thousands)	2019			2020			$		%
Sales and marketing	$	193,173		$	278,492		$	85,319		44.2	%
As a percentage of total revenue		27.6	%		32.7	%

The $85.3 million increase in sales and marketing expense during fiscal 2020 was primarily due to a $62.1 million increase in expenses associated with advertising costs and other marketing programs, an increase of $12.4 million in shipping and handling fees, and a $9.3 million increase in bad debt expense mainly due to the bankruptcy of a major retail partner. As a percentage of revenues, sales and marketing increased 5.1% which was mainly due to the increased advertising and marketing spend in fiscal 2020.

Research and Development

	Year Ended May 31,						Change
(dollars in thousands)	2019			2020			$		%
Research and development	$	20,898		$	23,122		$	2,224		10.6	%
As a percentage of total revenue		3.0	%		2.7	%

112

The $2.2 million increase in research and development expense during fiscal 2020 was primarily due to a $1.4 million increase in personnel-related expenses. As a percentage of revenue, research and development expense was slightly lower year over year. In addition to our research and development expense, in fiscal 2019 and fiscal 2020, we invested $14.9 million and $22.0 million, respectively, to enhance our iFIT platform, develop new products, content and features and improve our platform infrastructure which was capitalized in each of those years.

General and Administrative

	Year Ended May 31,						Change
(dollars in thousands)	2019			2020			$		%
General and administrative	$	48,892		$	77,105		$	28,213		57.7	%
As a percentage of total revenue		7.0	%		9.1	%

The $28.2 million increase in general and administrative expense during fiscal 2020 was primarily due to a $18.5 million increase in stock-based compensation and to a lesser extent increases in personnel costs and product liability insurance costs. As a percentage of revenue, general and administrative expense increased 2.1% which was mainly due to the increase in stock-based compensation expense in fiscal 2020.

Other Expense (Income)

	Year Ended May 31,					Change
(dollars in thousands)	2019			2020		$		%
Interest expense	$	15,368		$	15,496	$	128		0.8	%
Change in fair value of warrant liabilities		—			9,396		9,396		—
Change in fair value of embedded derivative liabilities		—			20,200		20,200		—
Gain on the sale of a subsidiary		(111,800	)		—		111,800		(100.0	)
Other expense (income), net		(2,000	)		1,228		3,228		(161.4	)
Total other expense (income), net	$	(98,432	)	$	46,320	$	144,752		(147.1	)%

The $144.8 million increase in total other expense (income), net in fiscal 2020 was primarily due to the $9.4 million and $20.2 million in losses on the changes in fair value of the warrant liability and embedded derivative liability, respectively, recognized in fiscal 2020 and the $111.8 million gain on the sale of subsidiary, which was completed during fiscal 2019.

After the initial public offering, we do not expect to recognize fair value changes in the embedded derivative liabilities. An initial public offering constitutes a mandatory prepayment event under the terms of the 2019 Note, at which time the Company will redeem the 2019 Note, including the underlying derivative instrument. Additionally, the classification of the 2019 Warrant will be reassessed and it will no longer be required to be remeasured at fair value as the 2019 Warrant will be net share settled in connection with the offering.

Provision for Income Taxes

	Year Ended May 31,						Change
(dollars in thousands)	2019			2020			$			%
Provision for income taxes	$	20,733		$	2,469		$	(18,264	)		(88.1	)%
As a percentage of total revenue		3.0	%		0.3	%

Our effective tax rate was 26.8% and (2.5)% for fiscal 2019 and 2020, respectively. The decrease was mainly due to the gain from the sale of our subsidiary that occurred during fiscal 2019.

113

Quarterly Results of Operations Data

The following table sets forth our unaudited quarterly consolidated statements of operations data for each of the eight quarters in the period ended May 31, 2021, as well as the percentage that each line item represents of our total revenue for each quarter presented. In the opinion of management, the consolidated statements of operations data set forth below has been prepared on a basis consistent with our audited consolidated financial statements included elsewhere in this prospectus and contain all adjustments, consisting only of normal and recurring adjustments, necessary for a fair statement of the results of operations for these periods. Our historical results are not necessarily indicative of the results that may be expected in the future, and results for any quarter are not necessarily indicative of results to be expected for a full year or any other period. The following quarterly results of operations data should be read in conjunction with our financial statements and the related notes included elsewhere in this prospectus.

	Three Months Ended
	August 31, 2019			November 30, 2019			February 29, 2020			May 31, 2020			August 31, 2020			November 30, 2020			February 28, 2021			May 31, 2021
	(in thousands)
Revenue:
Interactive fitness products	$	120,380		$	156,055		$	221,556		$	229,712		$	261,730		$	372,469		$	503,775		$	377,314
Subscription		23,927			26,375			26,164			47,511			44,593			53,152			64,688			67,335
Total revenue		144,307			182,430			247,720			277,223			306,323			425,621			568,463			444,649
Cost of revenue:
Interactive fitness products		91,578			116,550			146,148			149,077			157,381			241,918			321,965			268,609
Subscription		3,905			4,548			5,311			5,598			4,776			5,726			8,583			9,895
Total cost of revenue		95,483			121,098			151,459			154,675			162,157			247,644			330,548			278,504
Gross profit		48,824			61,332			96,261			122,548			144,166			177,977			237,915			166,145
Operating expenses:
Sales and marketing		37,887			54,235			102,129			84,241			98,856			117,038			221,571			181,966
Research and development		4,986			5,541			6,013			6,582			6,198			7,935			10,934			11,207
General and administrative		14,437			17,238			14,421			31,009			15,084			63,210			20,632			99,206
Total operating expenses		57,310			77,014			122,563			121,832			120,138			188,183			253,137			292,379
Income (loss) from operations		(8,486	)		(15,682	)		(26,302	)		716			24,028			(10,206	)		(15,222	)		(126,234	)
Other expense (income):
Total other expense (income), net		2,338			2,682			9,745			31,555			68,912			278,518			37,268			2,391
Loss before provision for income taxes		(10,824	)		(18,364	)		(36,047	)		(30,839	)		(44,884	)		(288,724	)		(52,490	)		(128,625	)
Provision (benefit) for income taxes		(115	)		236			41			2,307			(101	)		(2	)		346			1,740
Net loss	$	(10,709	)	$	(18,600	)	$	(36,088	)	$	(33,146	)	$	(44,783	)	$	(288,722	)	$	(52,836	)	$	(130,365	)

114

The following table sets forth our results of operations for each of the eight quarters in the period ended May 31, 2021 as a percentage of our total revenue for those periods:

	Three Months Ended
	August 31, 2019			November 30, 2019			February 29, 2020			May 31, 2020			August 31, 2020			November 30, 2020			February 28, 2021			May 31, 2021
	(as a percentage of total revenue)
Revenue:
Interactive fitness products		83.4	%		85.5	%		89.4	%		82.9	%		85.4	%		87.5	%		88.6	%		84.9	%
Subscription		16.6			14.5			10.6			17.1			14.6			12.5			11.4			15.1
Total revenue		100.0			100.0			100.0			100.0			100.0			100.0			100.0			100.0
Cost of revenue:
Interactive fitness equipment		63.5			63.9			59.0			53.8			51.4			56.8			56.6			60.4
Subscription		2.7			2.5			2.1			2.0			1.6			1.3			1.5			2.2
Total cost of revenue		66.2			66.4			61.1			55.8			52.9			58.2			58.1			62.6
Gross profit		33.8			33.6			38.9			44.2			47.1			41.8			41.9			37.4
Operating expenses:
Selling and marketing		26.3			29.7			41.2			30.4			32.3			27.5			39.0			40.9
Research and development		3.5			3.0			2.4			2.4			2.0			1.9			1.9			2.5
General and administrative		10.0			9.4			5.8			11.2			4.9			14.9			3.6			22.3
Total operating expenses		39.7			42.2			49.5			43.9			39.2			44.2			44.5			65.8
Loss from operations		(5.9	)		(8.6	)		(10.6	)		0.3			7.8			(2.4	)		(2.7	)		(28.4	)
Other expense (income):
Total other expense (income), net		1.6			1.5			3.9			11.4			22.5			65.4			6.6			0.5
Income (loss) before income taxes		(7.5	)		(10.1	)		(14.6	)		(11.1	)		(14.7	)		(67.8	)		(9.2	)		(28.9	)
Provision (benefit) for income taxes		(0.1	)		0.1			0.0			0.8			(0.0	)		(0.0	)		0.1			0.4
Net loss		(7.4	)%		(10.2	)%		(14.6	)%		(12.0	)%		(14.6	)%		(67.8	)%		(9.3	)%		(29.3	)%

Quarterly Trends

Revenue

Our quarterly revenue increased in each of the periods presented when compared to the results of the same quarter in the prior year primarily due to an increase in demand for our Interactive fitness products. However, due to seasonality of our business, we expect our Interactive fitness products revenues to generally decline in the fourth fiscal quarter, relative to the prior quarter, as seasonal demand has historically been strongest during our second and third fiscal quarters. In the fourth fiscal quarter of 2020, we did not experience the typical seasonality as we were partially impacted from the global pandemic.

Our Subscription revenue increased primarily due to the increase in Total Fitness Subscribers and to a lesser extent by the increase in revenue from extended warranties.

115

Cost of Revenue

Interactive Fitness Products cost of revenue has fluctuated in line with Interactive Fitness Products revenue for all periods presented primarily due to costs associated with sales of Interactive Fitness Products.

Subscription cost of revenue has constantly increased in each of the quarters presented with the exception of the first fiscal quarter of 2021 as a result of increased spending in developing iFIT content and features, as well as continued investments in the iFIT platform infrastructure.

Operating Expenses

Sales and marketing expense increased in the second and third quarter of each fiscal year due to an increase in advertising and other marketing programs for the holiday season. During the fourth quarters of fiscal 2020 and 2021, we continued to incur significant marketing expenses to drive brand awareness and to sustain revenue growth. Additionally, sales and marketing expenses have generally increased due to costs related to an increase in salaries and contract labor to support our growth.

Research and development expense has increased primarily due to personnel-related expenses as we have continued to increase our headcount to support product and platform innovation.

General and administrative expense generally increased primarily due to increases in personnel-related expenses and consulting fees. We saw significant increases in general and administrative expense in the fourth quarter of fiscal 2020 and the second and fourth quarters of fiscal 2021 related to stock-based compensation expense associated with loans to management and issuances of equity awards.

Other Expense (Income)

Total other expenses (income) increased and fluctuated starting in fiscal Q3 2020 and throughout fiscal 2021 primarily due to changes in the fair values of the warrants and embedded derivative liabilities associated with our 2019 Note and our Series A and B preferred stock. In fiscal Q2 2021, we recognized a loss of $173.4 million related to the issuance of our Series A preferred stock and 2020 Warrants which significantly increased total other expenses (income) for the period.

Liquidity and Capital Resources

Our operations have been financed primarily through cash flow from operating activities, borrowings under our credit facilities and issuances of the 2019 Notes and the Series A and B preferred stock. As of May 31, 2021, we had cash and cash equivalents of $146.5 million.

We believe our existing cash and cash equivalents and cash flow from operations, along with available borrowings, taking into account the outflows related to the acquisition of Sweat, will be sufficient to meet our working capital and capital expenditure needs for at least the next 12 months. Our future capital requirements may vary materially from those currently planned and will depend on many factors, including our rate of revenue growth, the timing and extent of spending on research and development efforts and other business initiatives, the expansion of sales and marketing activities, the timing of new product introductions, market acceptance of our products and overall economic conditions. We anticipate significant ongoing discretionary strategic investments in marketing and inventory to continue to fuel the business. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, or if we cannot expand our operations or otherwise capitalize on our business opportunities because we lack sufficient capital, our business, results of operations and financial condition would be adversely affected.

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Debt and Preferred Equity

2016 Credit Agreement

On August 3, 2016, our wholly owned subsidiary iFIT Inc. entered into a credit agreement with JP Morgan Chase Bank, N.A. an administrative agent, and a syndicate of financial institutions and institutional lenders (the “2016 Credit Agreement”), which provided for a $175.0 million term loan and a $125.0 million revolving line of credit (the “2016 Revolver”). The term loan and the 2016 Revolver mature on August 3, 2021.

On June 26, 2018, iFIT Inc. fully repaid the outstanding principal amount and accrued but unpaid interest of the term loan for $119.2 million and wrote-off unamortized debt issuance costs of $4.6 million related to the term loan.

As of May 31, 2019, the 2016 Revolver had outstanding borrowings of $102.5 million and an available borrowing capacity of $22.5 million.

2020 Credit Agreement

On April 27, 2020, iFIT Inc. entered into a credit agreement with JP Morgan Chase Bank, N.A. an administrative agent, and a syndicate of the existing lenders of the 2016 Credit Agreement (the “2020 Credit Agreement”), which provided for a $175.0 million revolving line of credit (the “2020 Revolver”) and a letter of credit. The 2020 Revolver matures on April 24, 2024.

As a condition to closing, the 2020 Credit Agreement required the termination of any security interests and guarantees under the 2016 Credit Agreement and thus iFIT Inc. repaid all outstanding borrowings under 2016 Revolver. Management determined the loan restructuring would not constitute a troubled debt restructuring. In addition, as the borrowing capacity for each of the continuing lenders increased under the 2020 Revolver compared to that under the 2016 Revolver, the loan restructuring for these lenders are deemed a debt modification. In connection with the execution of the 2020 Credit Agreement, certain lenders of the 2016 Revolver Loan exited the syndicate under the 2020 Credit Agreement. iFIT Inc. wrote off $1.3 million of unamortized deferred costs attributable to the exit lenders’ 2016 Revolver. iFIT Inc. capitalized $2.1 million new fees paid to the continuing lenders and third-party lenders as deferred financing fees which will be amortized along with the unamortized deferred costs attributable to these continuing lenders over the term of the 2020 Credit Agreement to interest expense on a straight-line basis.

The 2020 Credit Agreement permits the interest rate to be selected at our option at Adjusted LIBOR, Alternative Base (“CDOR”), plus their respective applicable margin. Adjusted LIBOR is the rate for deposits in U.S. Dollars with a maturity of one month. The Alternate Base Rate is the highest of (i) the administrative agent’s “Prime Rate”, (ii) the Federal Funds Effective Rate calculated by Federal Reserve Bank of New York plus 0.5%, and (iii) Adjusted LIBOR plus 1.0%. Canadian Prime Rate is the higher of (i) the PRIMCAN Index rate and (ii) the average rate for 30 day Canadian Dollar-denominated bankers’ acceptances. CDOR Rate is the rate offered on Canadian deposits for the relevant interest period plus 0.1% per annum. Each of the interest rates is subject to a floor. Additionally, the margin is determined based on total leverage ratio. Total leverage ratio is defined as our total indebtedness over consolidated EBITDA as defined under the 2020 Credit Agreement. As of May 31, 2020, the interest rate was 5.5% for borrowings on the 2020 Credit Agreement.

Under the 2020 Credit Agreement, the lenders have a perfected first priority lien on substantially all our tangible and intangible assets. The 2020 Credit Agreement contained financial covenants, including a minimum fixed charge coverage ratio when a triggering event occurs and limitations on additional indebtedness and dividends. As of May 31, 2020, iFIT Inc. was in compliance with all of the debt covenants.

As of May 31, 2020, the 2020 Revolver had no outstanding borrowings and an available borrowing capacity of $80.9 million.

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2021 Credit Agreement

On May 12, 2021, iFIT Inc. entered into a credit agreement with Bank of America, N.A. the administrative agent, and a syndicate of the existing lenders of the 2020 Credit Agreement (the “2021 Credit Agreement”), which provides for a $325.0 million revolving line of credit (the “2021 Revolver”) and a $9.4 million letter of credit. The 2021 Revolver matures on May 12, 2026.

As a condition to closing, the 2021 Credit Agreement required the termination of any security interests and guarantees and the repayment of all outstanding borrowings under the 2020 Credit Agreement.

The 2021 Credit Agreement permits the interest rate to be selected at Icon’s option at the LIBO Rate, Alternate Base Rate, Canadian Prime Rate, or Canadian Dollar Offered Rate (CDOR), plus their respective applicable margin. The LIBO Rate is the published LIBO Rate, as adjusted to reflect applicable statutory reserves prescribed by governmental authorities. The Alternate Base Rate is the higher of (i) the Federal Funds Rate plus 0.50%, (ii) the Published LIBO Rate plus 1.00% and (iii) the Prime Rate. The Canadian Prime Rate is the higher of (i) the variable interest rate of Bank of America, N.A. and (ii) the 1-month CDOR plus 1.00% per annum. The CDOR Rate is the rate of interest per annum equal to the arithmetic average of the rates applicable to Canadian Dollar bankers’ acceptance rate. As of May 31, 2021, the interest rate was 3.4% for borrowings under the 2021 Credit Agreement.

Under the 2021 Credit Agreement, the lenders have a perfected first priority lien on substantially all our tangible and liquid assets. The 2021 Credit Agreement contained financial covenants, including a minimum fixed charge coverage ratio when a triggering event occurs and limitations on additional indebtedness and dividends. As of May 31, 2021, the Company was in compliance with all of its debt covenants.

As of May 31, 2021, the 2021 Revolver had $0.3 million of outstanding borrowings and an available borrowing capacity of $261.3 million. The company used the outstanding borrowings for general business purposes.

2019 Note and 2019 Warrant

Pursuant to a securities purchase agreement, on November 29, 2019, we issued a note for an aggregate principal amount of $200.0 million and a warrant to purchase up to 25,853,840 shares of our common stock (the “2019 Warrant”) to Icon Preferred Holdings, L.P (“Pamplona”). The 2019 Note matures on November 29, 2029. In addition, we reimbursed Pamplona $1.5 million of transaction expenses which were accounted for as a discount on the 2019 Note.

Interest on the 2019 Note accrues at a rate of (i) 7.0% per annum prior to and on November 29, 2026, and (ii) thereafter, 10.0% per annum, payable quarterly in cash in arrears on March 31, June 30, September 30 and December 31 of each year commencing on December 31, 2019. At our election, any interest accrued can be paid in kind. If paid-in-kind (“PIK”) interest is elected, such accrued interest should be added to the unpaid principal amount of the 2019 Note outstanding at such time. The discretionary PIK interest should be recorded at the then fair value of the incremental 2019 Note issued when a PIK interest election is made at the applicable contractual interest payment dates. We elected the PIK interest on each of the interest payment dates since issuing the 2019 Notes and recorded the PIK interest at the fair value of the incremental 2019 Note issued on these dates. As described below, an effective interest rate of the 2019 Note was established at the issuance date and thus any resulting difference between the fair value and such assumed cash flows of the PIK interest is recognized through a corresponding adjustment to the amount of interest cost recognized.

We have the option to prepay, at a premium, all or a portion of the outstanding principal amount of the 2019 Note. Any prepayment must include the portion of the original principal amount being prepaid, plus all PIK interest previously added in respect of such portion of the original principal amount. Additionally, if such principal amount of the 2019 Note to be prepaid plus all cash interest paid in respect of the portion to be prepaid

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is less than 150% of the original principal amount to be prepaid (such difference, the “Make-whole”), then such prepayment shall also include an amount equal to the Make-whole. In connection with the closing of the offering, we expect to repay the 2019 Note with a combination of cash and New Convertible Notes as described herein.

Upon the occurrence of (a) our liquidation or the liquidation of our material subsidiaries, (b) an event of default, (c) a change in control, and (d) our initial public offering, we must redeem the 2019 Note at an amount equal to the principal amount to be prepaid plus the Make-whole if applicable. Such redemption features are determined to be accounted for as embedded derivatives pursuant to ASC 815, Derivatives and Hedging. The embedded derivatives were recognized at a fair value of $11.4 million at inception and are subsequently remeasured at fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivatives at inception created a discount on the 2019 Note. The fair value of the embedded derivative is $31.6 million and $67.2 million as of May 31, 2020 and May 31, 2021, respectively. The $20.2 million and $35.6 million changes in fair value during fiscal 2020 and 2021, respectively, were recorded in change in fair value of embedded derivative liabilities in the consolidated statements of operations and comprehensive income (loss).

The initial recognition of the 2019 Warrant also created a discount on the 2019 Note. The debt discount of $57.9 million (i.e., the sum of $1.5 million transaction costs reimbursed to the lender, the $11.4 million fair value of the embedded derivatives at inception, and the $45.0 million fair value of the 2019 Warrant at inception) and issuance costs of $7.3 million allocated to the 2019 Note are amortized to interest expense using the effective interest method over the term of the 2019 Note. Additionally, the redemption feature of the 2019 Warrant will not survive the initial public offering of the Company. The effective interest rate of the 2019 Note was established at the issuance date incorporating assumed cash flows from the PIK interest.

As of May 31, 2020 and May 31, 2021, the effective interest rate on the 2019 Note was 11.9%.

The Company issued the 2019 Warrant to purchase up to 25,853,840 shares of the Company’s common stock at an exercise price of $0.001 per share. In the event the 2019 Warrant is exercised on or prior to November 29, 2024, the warrant holder shall be entitled to receive 19,676,110 shares of the Company’s common stock. Otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six month thereafter at an amount equal to (i) 1,544,432 multiplied by (ii) the outstanding principal amount of the 2019 Note divided by $200.0 million, until the underlying shares of the warrant equal to 25,853,840. If the Company makes or declares a dividend or any other distribution to its common stockholders, the holder shall receive such dividend or distribution that it would have been entitled to had the warrant been exercised in full into shares on the date of such event. If, at any time prior to an initial public offering, the Company makes a dilutive issuance of common stock or options to certain members of management or holders of the Company’s common equity, Pamplona and L Catterton will receive grants of additional warrant shares to keep their percentage of ownership in the Company consistent with the ownership percentage prior to the dilutive issuance.

The 2019 Warrant grants the holder the right to require the Company to purchase the warrant and the shares issued pursuant to the exercise of the warrant for cash at fair market value from November 29, 2026 to January 28, 2027. Upon a liquidity event, including an initial public offering, the repurchase right will expire. The warrant represents an obligation that is indexed to an obligation to repurchase the shares of the Company’s common stock, and the Company is required to transfer cash. As such, the 2019 Warrant is classified as a liability. The warrant was recorded at fair value at inception and is subsequently remeasured at fair value, with changes in fair value recorded in earnings. The initial fair value of the warrant is estimated to be $45.0 million, which created a discount on the 2019 Note. The discount is amortized using the effective interest method as discussed above. The fair value of the warrant was $54.3 million and $183.8 million as of May 31, 2020 and May 31, 2021, respectively. The $9.4 million and $129.5 million change in fair value of the warrant liability during fiscal 2020 and 2021, respectively, was recorded in changes in fair value of warrant liabilities in the consolidated statements of operations and comprehensive income (loss).

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Upon completion of this offering, we will issue in aggregate approximately 19,861,454 shares of our Class A common stock to net settle on a cashless basis the 2019 Warrant (calculated based on the midpoint of the range; the actual number of shares will be calculated based on the net cashless settlement of warrants to purchase 20,022,245 shares, after giving effect to certain anti-dilution adjustments, using the public offering price of the Class A common stock).

Series A Preferred Stock and 2020 Warrants

On October 2, 2020, pursuant to its amended articles of incorporation, we authorized and issued 210 shares of preferred stock (the “Series A”) pursuant to a securities purchase agreement and warrants to purchase up to 18,899,244 shares of our common stock (the “2020 Warrants”) to LC9 Connected Holdings, LP, (together with its managing entities, “L Catterton”), a new investor in the Company, and Pamplona for gross proceeds of $210.0 million (the “2020 Transactions”). We paid Pamplona a $4.8 million advisory fee and reimbursed L Catterton and Pamplona $1.3 million and $0.2 million, respectively, of related transaction expenses, which were included in the loss on issuance (see below). As such, we received $203.8 million net proceeds from the 2020 Transactions.

In addition, we incurred $6.0 million in other transaction and legal fees, of which $3.9 million and $2.1 million were allocated to the Series A preferred stock and 2020 Warrants, respectively, based on their relative fair values. The amount allocated to the Series A preferred stock is presented as a direct deduction from its carrying value in the consolidated balance sheets. The amount allocated to the 2020 Warrants was expensed immediately as such warrants are liability-classified and recognized at fair value.

Prior to and in preference to any declaration or payment of any dividend on our common shares, on a pari passu basis, the holders of the Series A preferred stock are entitled to receive cumulative dividends per share at the rate per annum equal to (i) 7% from October 2, 2020 until November 29, 2026 and (ii) 10% thereafter.

Upon any liquidation, dissolution or winding up of the Company, each holder of the Series A preferred stock shall be entitled to be paid, before any distribution or payment is made upon any of our common stock, for each outstanding share of Series A preferred stock, an amount in cash equal to a mandatory payment price which is the greater of (i) $1.0 million plus all accrued but unpaid dividends and (ii) $1.5 million. As of May 31, 2021, the aggregate liquidation preference of the Series A preferred stock was $315.0 million.

The shares of the Series A preferred stock are not convertible into shares of our common stock and they do not have any voting rights.

On November 29, 2030, we are required to redeem the Series A preferred stock at the mandatory payment price, and thus, the Series A preferred stock is accounted for as a mandatorily redeemable financial instrument liability in the consolidated balance sheets. The Series A preferred stock was recorded at fair value at inception and subsequently measured at the present value of the redemption amount to be paid at the mandatory redemption date of November 29, 2030, accruing interest using the rate implicit at inception. The fair value of the Series A preferred stock at inception, including the value of the embedded redemption features, was determined to be $246.4 million.

Upon the occurrence of (a) any liquidation of the Company or its material subsidiaries, (b) an initial public offering of the Company, (c) a change in control, or (d) an event of default, we are required to redeem the Series A preferred stock at the mandatory payment price. However, in the event of the consummation of our initial public offering on or prior to September 30, 2021, we shall redeem the Series A preferred stock at a price equal to $1.25 million per share (the “Minimum IPO Return”) and the Minimum IPO Return shall increase gradually on October 1, 2021 and on each six months thereafter; provided further that in no event shall the Minimum IPO Return exceed $1.5 million per share. Upon our initial public offering, the Minimum IPO Return is to be paid as follows per share: (i) an amount equal to (A) at our option, $0.6 million to $1.0 million paid in cash (provided that, from and after January 1, 2022, we no longer have such option, and such amount shall be equal to $0.6 million) plus (B) at L Catterton’s option, up to 50% of any increase in the Minimum IPO Return

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above $1.25 million shall be paid in cash; and (ii) the remainder of the Minimum IPO Return shall be paid in a number of our common shares at an amount equal to (x) the amount of such remainder of the Minimum IPO Return, divided by (y) 85% of the price per share of our common stock sold in the initial public offering. In connection with this offering, we expect to repay the Series A preferred stock with New Convertible Notes as described herein. Such a redemption feature is accounted for as an embedded derivative pursuant to ASC 815, Derivatives and Hedging. The embedded derivative was separately recognized as a liability at an estimated fair value of $44.9 million at inception and is subsequently remeasured to fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivative at inception created a discount on the Series A preferred stock. The fair value of the embedded derivative is $48.6 million as of May 31, 2021.

As a consequence, the Series A preferred stock was recorded at its fair value of $246.4 million net of the bifurcated embedded derivative of $44.9 million and allocated issuance costs of $3.9 million, for a net carrying amount at issuance of $197.6 million. The 2020 Warrants were recorded at their fair value of $130.8 million. The aggregate fair value of the Series A preferred stock and 2020 Warrants was $377.2 million as of the issuance date, which is greater than the $203.8 million net cash proceeds. There were no other rights or privileges identified that require separate accounting as an asset. As a result, the Company recognized a loss for the excess of the aggregate fair value of the Series A preferred stock and the 2020 Warrants over the net cash proceeds, amounting to $173.4 million. One of the driving factors for the Company to enter into the 2020 Transactions was due to the extensive experience the investor has in the consumer health segment and depth of initial public offering experience and relationships. The Company believed that a relationship with L Catterton would greatly enhance the Company’s prospects for an effective exit, potentially via an initial public offering.

On or after October 2, 2023, we have the option to prepay all or any portion of the outstanding shares of Series A preferred stock at a price per share equal to the greater of (i) $1.0 million plus all accrued but unpaid dividends, and (ii) $1.5 million; provided, that we shall not consummate an initial public offering within nine months of any such optional payment.

The difference between the fair value and the initial carrying amount of the Series A preferred stock of $197.6 million, inclusive of the discount of $44.9 million and the issuance costs of $3.9 million allocated to the Series A preferred stock, is amortized through the mandatory redemption date and is recognized as interest expense in the consolidated statements of operations and comprehensive income (loss) using the effective interest method over the term of the Series A preferred stock. As of May 31, 2021, the effective interest rate on Series A preferred stock was 8.73%. For fiscal 2021, the interest expense is $11.7 million, which includes the accruing dividend and amortization of discount and debt issuance costs. As of May 31, 2021, the carrying amount of the Series A preferred stock is $209.3 million.

On October 2, 2020, as part of the 2020 Transaction, the Company issued to L Catterton and Pamplona the 2020 Warrant to purchase up to 17,639,219 and 1,260,026 shares, respectively, of the Company’s common stock at an exercise price of $0.001 per share. The 2020 Warrants are exercised at the holders’ discretion subject to the following vesting conditions. For the 2020 Warrant held by L Catterton, if the warrant is exercised on or prior to November 29, 2024, the number of the underlying shares shall be equal to 11,501,709 shares; otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six-months thereafter at an amount equal to (i) 1,534,378 shares plus (ii) 0.49% of any common stock of the Company issued after October 2, 2020, until the underlying shares of the warrant is equal to 5.88% of the sum of (i) 293,410,933 shares plus (ii) certain common stock of the Company issued after October 2, 2020. For the 2020 Warrant held by Pamplona, if the warrant is exercised prior to November 29, 2024, the number of the underlying shares shall be equal to 821,546 shares; otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six-months thereafter at an amount equal to (i) 109,620 shares plus (ii) 0.035% of any common stock of the Company issued after October 2, 2020, until the underlying shares of the warrant is equal to 0.42% of the sum of (i) 293,409,005 shares plus (ii) certain common stock of the Company issued after October 2, 2020.

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If the Company makes or declares a dividend or any other distribution to its common shareholders, holders of the 2020 Warrants shall receive such dividend or distribution that they would have been entitled to had the 2020 Warrants been exercised in full into shares on the date of such event. Management determined that the 2020 Warrants, which expire on November 29, 2034, are freestanding financial instruments and participating securities for EPS purposes. The 2020 Transaction agreement also contains anti-dilution provisions with regards to the 2020 Warrants. If, at any time prior to an initial public offering, the Company makes a dilutive issuance of common stock or options to certain members of management or holders of the Company’s common equity, Pamplona and L Catterton will receive grants of additional warrant shares to keep their percentage of ownership in the Company consistent with the ownership percentage prior to the dilutive issuance. These provisions include the Pamplona warrant shares included in the 2019 Warrant in addition to the warrant shares included in the 2020 Warrant.

The holders have the right to require the Company to purchase the 2020 Warrants (or the shares issued pursuant to the exercise of the 2020 Warrants) at their fair value for cash during the period from November 29, 2026 to January 28, 2027. As such, the 2020 Warrants are classified as liabilities in the consolidated balance sheet as of May 31, 2021. The 2020 Warrants were recorded at fair value at inception and are subsequently remeasured at fair value, with changes in fair value recorded in earnings. The initial fair value of the 2020 Warrants was estimated to be $130.8 million and the fair value of the 2020 Warrants was $143.5 million as of May 31, 2021. The $12.7 million change in fair value of the warrant liability during fiscal 2021 was recorded in changes in fair value of warrant liabilities in the consolidated statements of operations and comprehensive income (loss). In connection with this offering, the Company expects that this repurchase right under the 2020 Warrants will be extinguished.

Upon completion of this offering, we will issue in aggregate approximately 12,510,663 shares of our Class A common stock to net settle on a cashless basis the 2020 Warrants (calculated based on the midpoint of the range; the actual number of shares will be calculated based on the net cashless settlement of warrants to purchase 12,611,366 shares, after giving effect to certain anti-dilution adjustments, using the public offering price of the Class A common stock).

Series B Preferred Stock

On March 17, 2021, pursuant to a securities purchase agreement, we issued 25 shares of Series B preferred stock (the “Series B”) to Planet Fitness Holdings, LLC. (“Planet Fitness”) for an aggregate purchase price of $25.0 million.

Dividends shall accrue on the shares of Series B preferred stock at the rate per annum equal to 7.0% on the sum of (i) the liquidation value of each outstanding share of Series B preferred stock, plus (ii) all previously compounded accrued dividends, accruing from the date of issuance. Series B accrued dividends shall accrue daily, whether or not declared, and shall be cumulative, compounding each quarter.

Upon any liquidation, dissolution or winding up of the Company, each holder of Series B preferred stock shall be entitled to be paid, after the distribution or payment is made upon any Series A preferred stock and before any distribution or payment is made upon any common stock of the Company, an amount in cash per share of Series B preferred stock equal to the mandatory payment price, which is the sum of (i) $1 million plus (ii) all accrued but unpaid dividends. As of May 31, 2021, the aggregate liquidation preference of the Series B preferred stock was $25.4 million.

Following the distribution to the Series A and B preferred stock, all of the remaining proceeds available for distribution to stockholders of the Company shall be distributed among the holders of common stock on a pro rata basis.

The shares of Series B preferred stock are not convertible into shares of the Company’s common stock and they do not have any voting rights.

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On March 17, 2026, the Company must redeem the Series B preferred stock in cash at the mandatory payment price, and thus, the Series B preferred stock is accounted for as a mandatorily redeemable financial instrument liability in the consolidated balance sheets. The Series B preferred stock was recorded at fair value at inception and subsequently measured at the present value of the redemption amount to be paid at the mandatory redemption date of March 17, 2026, accruing interest using the rate implicit at inception. The fair value of the Series B preferred stock at inception, including the value of the embedded redemption feature, was determined to be $29.8 million.

Upon the occurrence of (a) any liquidation of the Company or its material subsidiaries, (b) an initial public offering of the Company, (c) a change in control, or (d) the sale of all or substantially all of the assets of the Company and its subsidiaries, the Company must redeem the Series B preferred stock at the mandatory payment price. However, in the event of the consummation of the Company’s initial public offering on or prior to January 1, 2022, the Company shall redeem all outstanding shares of Series B preferred stock at a price per share equal to $1.0 million. Upon the consummation of an IPO on or after January 1, 2022, the Company shall redeem all outstanding shares of Series B preferred stock at the Series B preferred stock mandatory payment price per share. The Company shall pay any amounts to be paid in a number of shares issued in such an IPO equal to (x) the dollar value of such applicable payment amount, divided by (y) the public offering price per share of these shares multiplied by 80%. Such a redemption feature is accounted for as an embedded derivative pursuant to ASC 815, Derivatives and Hedging. The embedded derivative was separately recognized as a liability at a fair value of $5.2 million at inception and is subsequently remeasured at fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivative at inception created a discount on the Series B preferred stock. The fair value of the embedded derivative is $5.2 million as of May 31, 2021.

The Series B preferred stock was recorded at its fair value of $29.8 million, net of the bifurcated derivative liability of $5.2 million and issuance costs of $0.2 million, for a net carrying amount at issuance of $24.4 million. The fair value of the series B preferred stock was greater than the cash proceeds. To date there has been immaterial revenue from Planet Fitness and there were no other rights or privileges identified that require separate accounting as an asset. As a result, the Company recognized a loss for the excess of the fair value of the Series B preferred stock of $29.8 million over the cash proceeds of $25.0 million, amounting to $4.8 million, which is included in loss on issuance of mandatorily redeemable preferred stock in the consolidated statements of operations and comprehensive income (loss). The Company issued the Series B preferred stock with the goal of expanding its collaborative arrangement with Planet Fitness, an established and recognizable brand within the fitness community with whom the Company has worked with in the past, as well as providing the Company with added liquidity in anticipation of growth prior to a potential initial public offering.

On or after March 17, 2024, the Company has the option to prepay all or any portion of the outstanding shares of Series B preferred stock at a price per share equal to the mandatory payment price.

The difference between the fair value and the initial carrying amount of the Series B preferred stock of $24.4 million, inclusive of the discount of $5.2 million and the issuance costs of $0.2 million of the Series B preferred stock, is amortized through the mandatory redemption date and is recognized as interest expense in the consolidated statements of operations and comprehensive income (loss) using the effective interest method over the term of the Series B preferred stock. As of May 31, 2021, the effective interest rate on Series B preferred stock was 7.45%. For fiscal 2021, the interest expense was $0.4 million, which includes the accruing dividend and amortization of discount and debt issuance costs. As of May 31, 2021, the carrying amount of the Series B preferred stock is $24.8 million.

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Cash Flows

	Year Ended May 31,
	2019			2020			2021
	(in thousands)
Cash and cash equivalents, beginning of period	$	18,948		$	23,771		$	100,321
Cash and cash equivalents, end of period		23,771			100,321			146,453
Net cash provided by (used in)
Operating activities		16,032			27,887			(13,883	)
Investing activities		113,178			(26,419	)		(82,181	)
Financing activities		(124,087	)		75,124			141,345
Effect of exchange rates on cash		(300	)		(42	)		851
Net change in cash and cash equivalents	$	4,823		$	76,550		$	46,132

Cash Flows from Operating Activities

Net cash used in operating activities of $13.9 million for fiscal 2021 was primarily due to the net loss of $516.7 million and a decrease in net change in operating assets and liabilities of $25.7 million, which was offset by non-cash adjustments of $528.5 million. The decrease in net change in operating assets and liabilities was primarily due to a $325.2 million increase in inventories, $108.3 million increase in accounts receivable, and $74.4 million increase in prepaid expenses and other assets offset by a $333.7 million increase in accounts payable, accrued expenses, and other current liabilities, and a $147.8 million increase in deferred revenue. Non-cash adjustments primarily consisted of changes in fair value of warrant and embedded derivative liabilities of $142.2 million and $39.3 million, respectively, as well as loss on issuance of the Series A and B preferred stock and 2020 Warrants of $178.2 million, stock-based compensation expense of $95.6 million, content amortization expense of $9.6 million, provision for doubtful accounts of $14.9 million, and depreciation and amortization expense of $16.3 million.

Net cash provided by operating activities of $27.9 million for fiscal 2020 was primarily due to the net loss of $98.5 million, which was offset by non-cash adjustments of $92.8 million and an increase in net change in operating assets and liabilities of $33.7 million. Non-cash adjustments primarily consisted of warrant and embedded derivative liabilities revaluations of $9.4 million and $20.2 million, respectively, as well as stock-based compensation expense of $18.1 million, content amortization expense of $5.1 million, provision for doubtful accounts of $10.6 million and depreciation and amortization expense of $18.0 million. The increase in net change in operating assets and liabilities was primarily due to a $20.9 million decrease in inventories, a $59.8 million increase in deferred revenue partially offset by a $24.8 million decrease in accounts payable and accrued expenses, a $11.2 million increase in accounts receivable and a $10.4 million increase in prepaid expenses.

Net cash provided by operating activities of $16.0 million for fiscal 2019 was primarily due to net income of $56.6 million and an increase in net change in operating assets and liabilities of $24.7 million, partially offset by non-cash adjustments of $65.3 million, mostly due to the $111.8 million gain on sale of subsidiary. Non-cash adjustments also included a $1.3 million gain on the disposal of fixed assets, partially offset by $16.7 million in depreciation and amortization expense, $18.5 million change in deferred income taxes, $5.6 million due to the amortization and write-off of deferred financing fees and debt discount, and $1.3 million due to the provision for doubtful accounts. The increase in net change in operating assets and liabilities was primarily due to a $40.5 million increase in accounts payable and accrued expenses and a $18.9 million increase in deferred revenue, partially offset by a $15.9 million increase in accounts receivable and a $11.8 million increase in inventories.

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Cash Flows from Investing Activities

Cash used in investing activities of $82.2 million for fiscal 2021 was primarily due to $56.2 million used for purchases of property and equipment driven by significant investment in iFIT software, $20.3 million used for purchases of investment securities, and $9.6 million used for the business acquisition completed on April 30, 2021. The cash outflows were partially offset by investment security sales of $5.6 million.

Cash used in investing activities of $26.4 million for fiscal 2020 was primarily due to $19.9 million used for purchases of property and equipment, $6.3 million for purchases of investment securities, and $0.5 million for intangible assets additions.

Cash provided by investing activities of $113.2 million for fiscal 2019 was primarily due to $128.9 million in proceeds from the sale of the subsidiary partially offset by $16.2 million used for purchases of property and equipment.

Cash Flows from Financing Activities

Cash provided by financing activities of $141.3 million for fiscal 2021 was primarily related to proceeds of $235.0 million from the issuance of the Series A preferred stock and 2020 Warrants. The proceeds were partially offset by $74.8 million for repurchases of common stock, which included loans to management of $68.6 million, and $13.7 million in payments of financing fees, primarily on the Series A preferred stock and 2020 Warrants.

Cash provided by financing activities of $75.1 million for fiscal 2020 was primarily related to proceeds of $164.6 million under our line of credit and $200.0 million from the issuance of the 2019 Note and 2019 Warrant. The proceeds were partially offset by $267.1 million in payments on the line of credit, as well as $13.0 million in payments of deferred financing fees, primarily on the 2019 Note and 2019 Warrant, and $9.3 million in payments on the 2020 Mandatorily Redeemable Preferred Stock.

Cash used in financing activities of $124.1 million for fiscal 2019 was primarily related to $141.5 million payments on the line of credit and $118.8 million in payments on long term debt. The payments were partially offset by borrowings of $136.3 million under the line of credit.

Critical Accounting Policies and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s estimates, assumptions, and judgments.

Revenue Recognition

Our primary sources of revenue are from interactive fitness product sales, subscriptions, and extended warranties.

We determine revenue recognition through the following steps:

• identify the contract, or contracts, with a customer;

• identify the performance obligations in the contract;

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• determine the transaction price;

• allocate the transaction price to the performance obligations in the contract; and

• recognize revenue when, or as, a performance obligation is satisfied.

Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration that we expect to be entitled to in exchange for those goods or services. Our revenue is reported net of sales returns, discounts, and customer sales incentives, which represent reductions of the transaction price. We estimate our liability for product returns based on historical return trends by product category, impact of seasonality, and an evaluation of current economic and market conditions, and record the expected customer refund liability as a reduction to revenue and the expected inventory right of recovery as a reduction of cost of revenue. If actual return costs differ from previous estimates, the amount of the liability and corresponding revenue are adjusted in the period in which such costs occur.

Some of our contracts with customers contain multiple promises, such as arrangements where we sell Interactive Fitness Products and an iFIT subscription together to the end customer. For customer contracts that include multiple performance obligations, we account for individual performance obligations if they are distinct. The transaction price is then allocated to each performance obligation (i.e. between the Interactive Fitness Products and iFIT subscription) based on their relative standalone selling price. The standalone selling price of each performance obligation is estimated based on an approach that maximizes the use of observable inputs and faithfully depicts the selling price of the promised goods or services if the Company sold those goods or services separately to a similar customer in similar circumstances. We determine the standalone selling price based on prices charged to customers for goods or services on a standalone basis, or a cost-plus margin approach for performance obligations where standalone selling price is not directly observable.

Deferred revenue is recorded for nonrefundable cash payments received for a performance obligation to transfer goods or services in the future. Deferred revenue consists of subscription fees billed and collected that have not been earned, as subscription revenue is recognized over the subscription term.

We account for payments to retailers for customer programs, such as cooperative advertising programs, as a selling expense if we receive a distinct identifiable benefit in exchange. Otherwise, we record such costs as a reduction to revenue.

Product Warranty

We provide a standard product warranty that our fitness products will operate under normal, non-commercial use for a period of time from the date of original delivery. At the time revenue is recognized, an estimate of future warranty costs is recorded as a component of cost of revenue. Factors that affect the warranty obligation include historical as well as current product failure rates, service delivery costs incurred in correcting product failures, and warranty policies and business practices.

In addition, we also offer the option for customers to purchase extended warranties for an additional fee. These warranty contracts provide coverage on labor and parts beyond the limited warranty period. Unearned warranty premiums represent premiums received from customers related to extended warranty contracts for which revenue has not been earned and are included within deferred revenue. We record premium revenues related to extended warranty contracts ratably over the policy period in subscription revenue in the consolidated statements of operations and comprehensive income (loss).

Inventories

Inventories consist primarily of raw materials (principally parts and supplies) and finished goods. Inventories are valued at the lower of cost or net realizable value, and cost is determined using standard costs which approximate actual cost using the first-in, first-out (FIFO) inventory method. We periodically review our inventories and

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make a provision as necessary to appropriately value inventories that are excess, slow-moving, obsolete, or damaged. The amount of the provision is equal to the difference between the inventory cost and its net realizable value based upon assumptions about the product, future demand, damages, quality, and market conditions. If changes in market conditions result in reductions in the estimated net realizable value of our inventory below our previous estimate, we would increase our reserve in the period in which we made such a determination.

Capitalized iFIT Content

Capitalized iFIT content costs include certain expenditures to develop video and live content offered to our customers. The company capitalizes production costs for live and recorded iFIT content in accordance with Accounting Standards Codification (ASC) 926-20, Entertainment-films—Other Assets—Film Costs. We recognize capitalized iFIT content, net of accumulated amortization, within other non-current assets in the consolidated balance sheets and recognize the related amortization expense as a component of cost of revenue for subscription in the consolidated statements of operations and comprehensive income (loss). Costs which qualify for capitalization include production costs, development costs, direct costs, labor costs, and production overhead. Capital expenditures for capitalized iFIT content are included within operating activities in the consolidated statements of cash flows.

Based on factors including historical and estimated viewing patterns, we amortize individual titles within the iFIT content library on a straight-line basis over a three-year useful life. We review factors impacting the amortization of the capitalized iFIT content on an ongoing basis. Estimates related to these factors require considerable management judgment.

Our business model is subscription based as opposed to generating revenues at a specific title level. Therefore, all content assets are monetized as part of a single asset group. The content is assessed at the group level when an event or change in circumstances indicates a change in the expected usefulness of the content or that fair value may be less than unamortized cost. We assess unamortized costs for impairment regardless of whether the produced content is completed. To date, we have not recognized an impairment with regards to the fair value of our content portfolio. If circumstances in the future suggest that an impairment may exist, these aggregated content assets will be stated at the lower of unamortized cost or fair value. In addition, unamortized costs for assets that have been, or are expected to be, abandoned are written off.

Stock-Based Compensation

Stock-based awards granted to employees are measured at fair value upon the grant date and the related expense is recognized over the requisite service period. Forfeitures are recognized as incurred. To the extent a stock-based award is subject to a performance condition, the amount of expense recorded in a given period, if any, reflects an assessment of the probability of achieving such performance condition, with compensation expense recognized once the event is deemed probable to occur.

The Company provided loans to certain members of management that in some instances were secured by shares and options of our common stock that the respective members of management owned which have been treated as the in-substance grant of a stock option to purchase our common stock. For some of the loans, the Company accepted the pledge of a mix of owned shares and unvested options exercisable into common shares of the Company. The Company accounted for the pledge of an option as a cancellation of the old option in exchange for a cash incentive and issuance of a replacement award whose strike price is the cumulative amount of the actual option exercise price and the attributable loan amount. See Note 20 to our annual consolidated financial statements “Stock-Based Compensation” for more information.

We calculate the fair value of stock options using the Black-Scholes option-pricing model. The determination of the grant date fair value of stock option awards is affected by a number of assumptions that require significant judgement, including the fair value of the shares of common stock underlying the stock options, the expected term of the award, our expected common stock price volatility over the term of the option award, the risk-free interest rate, and the expected dividend yield of our common stock.

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The estimated grant-date fair value of our equity-based awards was calculated using the Black-Scholes option-pricing model based on the following assumptions for awards granted during fiscal 2020 and 2021. There were no awards granted in fiscal 2019.

	Year Ended May 31,
	2020		2021
Expected term		5 - 10 years		0.25 -10 years
Volatility		75.0% - 80.0%		58.2% - 80.0%
Risk-free interest rate		0.4% - 2.0%		0.02 - 0.79%
Dividend yield		—		—

Fair Value of Common Stock. The fair value of our common stock has historically been established by our board of directors, which is responsible for these estimates, and has been based in part upon valuations provided by an independent third-party valuation firm. Because there is no public market for our common stock, the board of directors considered this independent valuation and other factors which are detailed further in “—Common Stock Valuations” below. The fair value of our common stock will be determined by the board of directors until such time as our common stock is listed on a stock exchange. See below for more information.

Expected Term. The expected term represents the period over which we anticipate our stock-based awards to be outstanding. We estimate the expected term based on prior award history and expectations regarding future exercises.

Volatility. Expected volatility is a measure of the amount by which our stock price is expected to fluctuate. We estimate the expected volatility by taking the average historical volatility of the common stock of a group of comparable publicly traded companies over a period equal to the expected life of the awards.

Risk-Free Interest Rate. The risk-free interest rate is the estimated average interest rate based on U.S. Treasury zero-coupon notes with terms consistent with the expected term of the awards.

Dividend Yield. We have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future. Consequently, we used an expected dividend yield of zero.

Common Stock Valuations

The fair value of our common stock has historically been established by our board of directors, who are responsible for these estimates. In the absence of a public trading market, the board of directors, with input from management, exercises significant judgment and considers numerous objective and subjective factors to determine the fair value of our common stock including:

• Relevant precedent transactions involving our capital stock;

• Our actual operating and financial performance;

• Current business conditions and projections;

• Any adjustment necessary to recognize a lack of marketability of the common stock;

• The market performance of comparable publicly traded companies;

• Likelihood of achieving a liquidity event, such as an initial public offering; and

• U.S. and global capital market conditions.

In addition, the board of directors considers the independent valuations completed by a third-party valuation firm. The valuations of our common stock are determined in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

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Income Taxes

We recognize income taxes under the asset and liability method. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

The provision for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and any estimated valuation allowances deemed necessary to recognize deferred tax assets at an amount that is more likely than not to be realized. Our tax filings, including the positions taken therein, are subject to audit by various taxing authorities. While we believe we have provided adequately for its income tax liabilities in the consolidated financial statements, adverse determinations by the taxing authorities could have a material adverse effect on our consolidated financial condition, results of operations or cash flows.

Fair Value of Financial Instruments

The Company’s primary financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, long-term debt, net, investment securities, deferred compensation assets, warrant liabilities, embedded derivative liabilities, mandatorily redeemable preferred stock, and foreign currency derivative contracts. The carrying amounts for cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short maturities. Financial assets and liabilities measured at fair value on a recurring basis consist primarily of investment securities, deferred compensation assets, warrant liabilities, embedded derivative liabilities, contingent consideration liability and foreign currency derivative contracts.

In determining fair value, we use various valuation approaches including market, income and cost approaches. FASB Topic 820, Fair Value Measurements, establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, developed based on market data obtained from independent sources. Unobservable inputs are those that reflect our expectation of the assumptions that market participants would use in pricing the asset or liability, developed based on the best information available under the circumstances. We estimated the fair value of the warrant liabilities using the discounted cash flow model and the guideline public company method and estimated the fair value of the embedded derivative liabilities using the with and without model. See Note 5 to our annual consolidated financial statements “Fair Value Measurements” for more information.

Emerging Growth Company Accounting Election

When we furnished the initial draft of this registration statement of which this prospectus forms a part of, we qualified as an “emerging growth company” as defined in the JOBS Act. As such we are able to take advantage of specified reduced disclosure requirements applicable to this offering, including the ability to adopt new or revised accounting pronouncements under private company transition timelines. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the filing of our first quarterly report on Form 10-Q following this offering. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Recent Accounting Pronouncements

See Note 2 to our annual consolidated financial statements “Significant Accounting Policies” for more information.

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Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risks in the ordinary course of our business. These risks primarily include interest rate and foreign currency risks as follows:

Interest Rate Risk

As of May 31, 2019, 2020 and 2021 we had cash and cash equivalents of $23.8 million, $100.3 million and $146.5 million, respectively, which consisted primarily of cash and short-term investments purchased with original maturities of three months or less. Such interest-earning instruments carry a degree of interest rate risk. However, historical fluctuations of interest income have not been significant.

A hypothetical 10% change in interest rates during any of the periods presented would not have had a material impact on our consolidated financial statements.

Foreign Currency Risk

We have foreign currency risks related to our revenue and operating expenses denominated in foreign currencies and any unfavorable movement in the exchange rate between the U.S. dollar and the currencies in which we conduct our sales and operations in foreign countries could have an adverse impact on our revenues and our operating results. Accordingly, our operating results and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. In addition, our suppliers incur many costs, including labor costs, in other currencies. To the extent that exchange rates move unfavorably for our suppliers, they may seek to pass these additional costs on to us, which could have a material impact on our gross margins. However, we believe that the exposure to foreign currency fluctuation from operating expenses is relatively small at this time as the related costs do not constitute a significant portion of our total expenses. We recognized net losses of $2.8 million and $0.6 million from foreign currency translation in fiscal 2019 and fiscal 2020, respectively, and we recognized a net gain from foreign currency translation of $7.5 million in fiscal 2021. As we grow our operations, our exposure to foreign currency risk could become more significant. To manage the effects of a foreign currency risk, we entered into foreign currency exchange contracts to hedge our foreign currency risk. It is difficult to predict the effect hedging activities will have on our operating results.

We analyzed our foreign currency exposure to identify assets and liabilities denominated in other currencies and a hypothetical 10% change in exchange rates between those currencies and the U.S. dollar would not materially affect our operating results for fiscal 2019, fiscal 2020 and fiscal 2021.

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BUSINESS

Our Mission and Vision

Our mission is to improve your fitness and well-being.

Our vision is to create the world’s most holistic health and fitness platform.

Who We Are

We are a health and fitness subscription technology company, fueled by our passion to innovate, grow and provide meaningful solutions for our members. iFIT is an integrated health and fitness platform, designed to connect our proprietary software, experiential content and interactive hardware to deliver an unmatched connected fitness experience.

We are a growing community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers with members in over 120 countries. We deliver our patented interactive experiences on the industry’s broadest range of fitness modalities including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories.

Driven by the adoption of our iFIT platform, we are the #1 provider of large fitness equipment in the United States, with approximately 40% market share based on units. In fiscal 2021, we sold approximately 10.1 million Interactive Fitness Products with a Gross Merchandise Value of $2.8 billion. Our brands, including iFIT, NordicTrack, ProForm and Freemotion, are leaders in the fitness equipment industry, and 83% of our total revenue was generated by sales of our connected fitness products and iFIT subscriptions.

Our iFIT operating system provides interactive experiences on all of our connected equipment brands, allowing members to gain access to our full library of iFIT live and on-demand content for $15/month for individuals or $39/month for families of up to five (or $396 when paid annually). We believe the combination of our proprietary software and experiential content connected with our interactive hardware creates a compelling value proposition for our rapidly growing member base and generates attractive recurring subscription revenue.

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Proprietary Software

Our innovative iFIT software is the common operating system that unites our experiential content and interactive hardware into one integrated platform. Our software is the connective tissue that provides members with a unique two-way experience with iFIT’s authentic trainers. Through iFIT’s patented software, biometric data is monitored and workout variables including speed, incline, resistance and digital weight are dynamically adjusted in real time. Our interactive software optimizes our members’ workout experience by removing the guesswork and providing personalized training. We further personalize workouts with our patent-pending SmartAdjust^TM and ActivePulse^TM technologies, which automatically adjust our equipment based on members’ real-time fitness levels and heart rates. Our distinctive leaderboard allows members to connect and interact with a global community of like-minded people.

Experiential Content

We strive to create the most compelling interactive content in the health and fitness industry. Our highly differentiated content seamlessly integrates with our proprietary software and interactive hardware, delivering a unique media form that we call “experiential content.” Our members enjoy patented live interactive studio and outdoor workouts. Further, our members can access iconic fitness experiences with workouts filmed in more than 50 countries across seven continents. Our experiential content creates multi-sensory experiences that allow our members to see, hear and feel interactive workouts. Our content is developed and led by a team of over 180 world-class trainers in more than 60 categories including running, cycling, high-intensity interval training (HIIT), strength, boot camp and yoga, as well as new categories including mindfulness, nutrition and active recovery. Our recent acquisition of Sweat also gives our members access to additional differentiated content with over 5,000 unique workouts led by instructors who are globally recognized as top female fitness icons.

During fiscal 2021, we (including Sweat) streamed 142 million live and on-demand interactive workouts across our fitness products. We have begun offering content in eight different languages including Mandarin Chinese, Spanish and French. Our expanding mindfulness, nutrition and recovery content provides a complete experience for our members. In fiscal 2021, our iFIT members participated in 112 million workouts, reflecting growth of 229% year over year. Our community has given our experiential iFIT content more than 4.1 million member reviews with an average rating of 4.7 stars out of 5.

Interactive Fitness Hardware

We generate recurring subscription revenue on the industry’s broadest range of connected fitness hardware, including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories. Our interactive hardware is intelligent—specifically designed and engineered to respond to our proprietary software and experiential content. This unique combination allows our members to have an immersive experience that can only be found on our hardware. For example, when our content streams the trail to the summit of Mt. Kilimanjaro, our interactive drive systems automatically adjust the speed and incline in sync with our content. Our hardware and technology are protected by over 400 issued and pending patents.

Our Brands

We market our iFIT platform with our industry-leading brands: NordicTrack, ProForm, Freemotion, Weider and Sweat. We intentionally segment our brands across a wide range of channels, products and price points to attract consumers from a variety of fitness and income levels. Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. The breadth of our product portfolio and multi-brand strategy provides us with the largest addressable market in the fitness industry, and creates a broad funnel to acquire interactive fitness members at scale.

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Our Direct-to-Consumer and Multi-Channel Distribution Model

Our global distribution model is unmatched in our industry, combining both domestic and international direct-to-consumer capabilities with wholesale distribution. In fiscal 2021, we generated 44% of our interactive hardware revenue through our own direct-to-consumer channels, 54% of our interactive hardware revenue through more than 50 select retailers globally and 2% of our interactive hardware revenue through our strategic partnerships in the commercial channel. Our multi-channel distribution mitigates our dependence on any single channel and allows us to meet consumers wherever they want to shop. We also have a first-mover advantage globally, with 16% of our fiscal 2021 revenue coming from international markets.

Our Growth, Revenue and Scale

Our ability to connect with our community of health and fitness members through our cutting-edge iFIT technology and immersive experiences has fueled our growth as one of the largest connected health and fitness platforms in the world.

Our strong financial performance is underpinned by the rapid growth in our member base and consistent increase in member engagement on our platform, as seen through:

• Total Fitness Subscribers growing from approximately 103 thousand to 1.1 million between May 31, 2017 and May 31, 2021, representing a CAGR of 81.3%; and

• Total number of workouts on our platform growing from 12.1 million during fiscal 2019 to 34.1 million during fiscal 2020, representing 181% growth. In fiscal 2021, our members participated in 112 million workouts, reflecting growth of 229% year over year.

• We generated total revenue of $700.0 million and $851.7 million during fiscal 2019 and fiscal 2020, respectively, representing an increase of 21.7%, and $1,745.1 million in fiscal 2021, representing an increase of 104.9%;

• We generated net income of $56.6 million during fiscal 2019, and incurred net losses of $98.5 million and $516.7 million during fiscal 2020 and 2021, respectively; and

• We generated Billings of $92.7 million and $183.7 million during fiscal 2019 and fiscal 2020, respectively, representing an increase of 98.2%, and $382.3 million in fiscal 2021, representing an increase of 108.7%.

The Global Wellness Economy

We operate in the global wellness industry which has demonstrated sustained, consistent growth through a range of economic cycles over many years. According to a Frost & Sullivan report, during 2021 the total global health and wellness market is projected to achieve estimated spend of $5.9 trillion.

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We believe the breadth of our equipment range across modalities, brands, price points and distribution channels gives us the largest SAM among our primary competitors in the fitness industry. We believe we are the only provider delivering a seamless solution of software, content and hardware with offerings across treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories in the global market. We have a growing international presence with distribution in over 120 countries.

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Our Competitive Differentiators

Seamlessly Integrated Health and Fitness Platform

iFIT is a global health and fitness platform which seamlessly integrates our proprietary software, experiential content and interactive hardware to deliver an unmatched connected fitness experience.

We design and develop our own software, content, and hardware to ensure these elements work in harmony across our portfolio of brands and products. Our software utilizes biometric inputs (including heart rate), adaptive fitness technology, artificial intelligence (AI) and scalable cloud-based infrastructure to create an unmatched user experience that is highly engaging and valued by our members. Our content is delivered by our patented streaming technology that connects our wide range of connected devices. This comprehensive technology stack allows our devices to seamlessly connect to our network of products and members. This network effect of interactive fitness devices drives high engagement, retention, and social interaction. We believe our member-centric platform is difficult to replicate and highly scalable into adjacent categories and verticals.

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Differentiated Experiential Content

We have invented experiential content, creating a new media form that is highly differentiated from passive streaming. We believe we create the best interactive content in the fitness industry, which includes live and on-demand studio classes and digital outdoor experiences. Our world-class production teams, including Emmy award-winning talent and cinematographers, film iFIT experiential content in more than 50 countries across seven continents, led by more than 180 iFIT trainers, including Olympians, top female fitness icons and other elite athletes. iFIT members can trek to Mt. Everest base camp or walk with elephants on safari in South Africa on their treadmills and ellipticals. They can join live studio cycle classes or ride the Swiss Alps on their bikes. iFIT members can row the River Thames on their rowers or join a studio boot camp class from their fitness mirrors. Our constantly growing library includes more than 17,000 interactive workouts in more than 60 categories including running, cycling, HIIT, strength, boot camp class and yoga, as well as new categories including mindfulness, nutrition and active recovery, allowing iFIT members to benefit from a complete content solution. Our proprietary LiveAdjust^TM streaming technology allows iFIT trainers to control members’ equipment variables including speed, incline, resistance and digital weight which creates an authentic interactive workout.

Innovation Pipeline That Drives Growth

We are innovators—and consider ourselves the original pioneers—of connected health and fitness technology. We have compiled a portfolio of more than 400 issued and pending patents in areas ranging from interactive streaming to adaptive fitness technology. These patents provide a competitive moat to our business. Our vertically integrated software, content and hardware teams launch new innovative products and services in multiple categories each year with industry-leading speed to market. This multidisciplinary team of over 2,500 employees includes more than 600 research and development professionals, with engineering teams across three continents, focusing on improving the user experience. Our robust innovation pipeline is unique in the fitness industry and positions us to stay at the forefront of health and fitness technology.

Advantaged Business Model

We believe our multi-brand, multi-product and multi-channel business model provides us with the largest addressable market in the fitness industry and creates a broad funnel to acquire subscribers, generating highly attractive recurring revenue. We believe our strategy is highly scalable and difficult to replicate. Our proven approach delivers a compelling financial model.

Our brands—We market our iFIT platform with our industry-leading brands: NordicTrack, ProForm, Freemotion, Weider and Sweat. We address the premium at-home market with NordicTrack, the mass market with ProForm, strength training with Weider and commercial verticals with Freemotion. With Sweat, we market our iFIT platform to the extensive global Sweat community of 450,000 paid subscribers as of May 31, 2021 and more than 50 million followers across its social media channels, the majority of which are women. We intentionally segment our brands across a wide range of channels, products and price points to attract members from a variety of fitness and income levels.

Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. ProForm is the number one unit volume brand at retail. Our portfolio of valuable brands enables us to bring our iFIT platform to as many members as possible, while also providing a flexible and sustainable model for long-term growth.

Our product portfolio—The fitness products in our portfolio are connected by the iFIT operating system, enabling our members to have a unified user experience on every product they purchase from us. We deliver our interactive experiences on the fitness industry’s broadest range of fitness modalities, including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories. During 2020,

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we ranked #1 in overall market share in the United States in total large exercise equipment units. The breadth of our product and technology portfolio helps insulate us from consumer trends, creating valuable opportunities for expansion and an unrivalled Serviceable Addressable Market.

Our distribution channels—We have an established presence across all major distribution channels to meet our consumers wherever they want to shop. In fiscal 2021, we generated 44% of our interactive hardware revenue through our direct-to-consumer channel via our owned websites. We generated 54% of our interactive hardware revenue through our retail partners including Amazon, Best Buy, Dick’s Sporting Goods, Costco, Canadian Tire, Rebel Sports and Decathlon. We generated 2% of our interactive hardware revenue through our key relationships in the commercial channel including Orangetheory Fitness and 24 Hour Fitness. We also have a first-mover advantage globally, with 16% of our fiscal 2021 revenue coming from international markets. We believe the breadth of our omnichannel distribution is unmatched in the fitness industry and provides multiple avenues for future growth.

Global Member Community with High Engagement

We have amassed a fast-growing, connected community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers in over 120 countries. Our business is characterized by high growth and strong engagement. Our growth is driven by our efficient customer acquisition and the core value proposition of our proprietary combination of software, content and hardware which have driven substantial expansion in the number of our Total Fitness Subscribers and total workouts participated in on our platform. We offset customer acquisition costs with the gross profit earned on our interactive fitness equipment, generating highly compelling unit economics. In fiscal 2020, total workouts participated in on our platform increased 181% over fiscal 2019. In fiscal 2021, our members participated in 112 million iFIT workouts, reflecting growth of 229% year over year, or 142 million workouts including Sweat.

Well-Established Global Supply Chain with Attractive Speed to Market

We have a robust and resilient supply chain with attractive speed-to-market capabilities. We manufacture both domestically and internationally in seven countries, and maintain 30+ year relationships with long-term strategic partners, with direct purchasing relationships down to the component level. Our in-house engineering expertise allows us to quickly create and adjust designs to streamline production and minimize supply bottlenecks. This network of partnerships combined with our experience, provides us with a considerable competitive advantage and allows us to flexibly respond to fluctuations in market demand. In fiscal 2021, the breadth of our scaled distribution network allowed us to ship 16,600 containers delivering approximately 10.1 million units of Interactive Fitness Products globally—more than anyone in our industry. This capability allowed us to respond quickly and grow during periods of surge demand since the onset of the outbreak of COVID-19 (the “global pandemic”).

Visionary Founder and Experienced Team

Our visionary co-founder and CEO Scott R. Watterson has combined his passions for fitness, technology, design and engineering to make interactive fitness products that positively affect people’s lives. His passion and leadership inspires our entire company, resulting in game-changing innovations. Our senior management team consists of industry veterans with an average of 23 years of experience in our company. Our entrepreneurial culture encourages our multidisciplinary team of over 2,500 employees to push for path-breaking developments across software, content and hardware. All of our efforts are guided by our core desire to provide the most immersive and interactive experiences to our members to guide them on their personal journeys for self-improvement.

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Our Growth Strategies

Our goal is to grow our recurring subscriber base globally through the sale of our digital services and Interactive Fitness Products. We will continue to drive member engagement and retention by providing immersive and interactive experiences through our integrated platform.

Scale Marketing to Accelerate Growth

We market our products through a unique combination of performance, brand marketing and retail partnerships, resulting in a best-in-class customer acquisition cost and highly efficient media campaigns. Our low customer acquisition cost allows us to invest more in brand marketing to acquire additional customers. As we significantly scale our marketing efforts in the United States and internationally, we believe we can drive sustainable growth across our subscriber base and product portfolio.

Accelerate Global Growth by Leveraging Our International Presence

By leveraging our established international presence, we see substantial opportunities to accelerate sales of our iFIT interactive products and services in global markets. With minimal marketing spend in fiscal 2021, our existing international direct-to-consumer business experienced high double digit growth in the UK, France and Australia. In addition to growing our international direct-to-consumer sales, we will enhance our worldwide network of strategic retail partners including Decathlon, Rebel Sports and others. We believe we have significant runway to expand market share, and grow iFIT memberships as we meet increasing global demand through our multi-channel distribution strategy.

Continuously Improve Members’ Experience

We are constantly improving and expanding our members’ experience, which ensures high subscriber engagement, retention and satisfaction. We will continue to enhance our members’ experience by developing new content, deploying new software and continually personalizing the ways our members engage with iFIT. Whether consumers are at home, outside or in commercial facilities, iFIT will provide experiential content on our expanding platform of interactive equipment, mobile apps and digital TV apps.

Continue to Launch New and Disruptive Products

We will continue to launch new products and disrupt existing product categories by innovating software, content and hardware. We invest considerable resources in our research and development, with more than 600 professionals and engineering teams across three continents. We maintain an extensive multi-year innovation pipeline driving advancements across our entire portfolio, as well as emerging verticals, allowing us to continually launch new products embraced by the market.

Leverage Installed Consumer Base to Increase Hardware Sales and Subscription Revenues

Since fiscal 2017 through fiscal 2021, we have sold over 48.3 million units of fitness products to consumers around the world. Our large and growing installed base of members, and our relationship with them, represents distinct opportunities to accelerate additional sales of hardware and conversion to Interactive Fitness Subscriptions. As we increase marketing efforts to our existing base and drive brand awareness of the iFIT platform, we anticipate meaningful adoption of our interactive fitness subscription and additional hardware purchases. Our data shows 16% of the subscribers that have been on the iFIT platform for more than three years have purchased multiple pieces of interactive hardware from us. We intend to leverage Sweat’s globally recognized fitness icons to cross sell iFIT products and memberships to its high-quality member database and over 50 million social media followers.

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Grow Commercial Sales and Expand Strategic Partnerships

By expanding our premium commercial brand of Freemotion, we see significant growth opportunities to bring more of our interactive hardware and membership offerings into all verticals in the commercial channel. We have established relationships with best-in-class commercial operators, including Planet Fitness and Orangetheory Fitness, elite training facilities for pro and collegiate teams and more. Orangetheory Fitness uses our patented technologies in their commercial fitness facilities nationwide. Through our exclusive partnership with Planet Fitness, we have made the iFIT experience available to their base of more than 15 million Planet Fitness members nationally by providing select iFIT content through the Planet Fitness app.

Expand the iFIT Platform into Adjacent Categories

We will expand our proven iFIT subscription services and hardware into categories naturally adjacent to fitness, such as mindfulness, nutrition and recovery. Recently we have brought innovation to mindfulness with iFIT Mind^™, creating multi-series workouts on our interactive hardware guided by experts in mental health. Our members responded quickly and positively, adding iFIT Mind^™ to their iFIT routine, further enhancing the retention of our platform and providing an excellent tool to attract new members. We recently acquired “29029,” a premier wellness tourism event and community, which will accelerate our expansion into wellness tourism and corporate wellness. As we expand into adjacent categories, which we believe are currently underserved, we believe we will enhance stickiness of current members and create more on-ramps into the iFIT ecosystem.

Our Brands and Product Offerings

Our Brands

We market Interactive Fitness Products and services through a portfolio of industry-leading brands. We intentionally segment our brands across a wide range of channels, products and price points to cater to consumers from a variety of fitness and income levels.

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Our brands include the following:

• iFIT. Our proprietary iFIT software is the common operating system that connects our experiential content and interactive hardware into one integrated platform to create an unmatched connected fitness experience for our members. iFIT powers our entire portfolio of brands.

• NordicTrack. NordicTrack addresses the at-home market by providing premium connected fitness technology with the majority of large exercise equipment marketed at price points ranging from $1,300 to $4,000. Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. NordicTrack ranked #1 in treadmills and ellipticals sold in 2020. NordicTrack is also a market leader for premium interactive bikes, rowers, strength equipment and fitness mirrors.

• ProForm. ProForm addresses the mass market by providing connected fitness technology to at-home consumers at attainable price points, with the majority of large exercise equipment marketed at price points ranging from $400 to $1,800. ProForm ranked #2 in treadmills and ellipticals sold in 2020. ProForm is also a market leader for interactive bikes, rowers, climbers, strength equipment and fitness mirrors at approachable price points.

• Freemotion. Our ultra-premium brand Freemotion provides leading-edge technology to pro sports training facilities, commercial gyms and high-end residential consumers at price points typically ranging from $4,000 to $13,000. Through our Freemotion brand, we deliver a range of professional-grade cardio and strength equipment which pair with our interactive live-streamed and on-demand content.

• Weider. Weider offers a full spectrum of weight-based strength training equipment, including home gyms, benches, weights and kettlebells, all complemented by iFIT training content. Weider is the fastest growing strength brand in retail from 2019 to 2020.

• Weslo. Weslo delivers iFIT interactive training equipment at value price points, on products including treadmills, bikes and ellipticals.

• UTS. Universal Technical Services (“UTS”) is our extended warranty offering for our at-home and commercial equipment.

• Sweat. On June 30, 2021, we acquired Sweat Group Pty Ltd, an Australian company. The Sweat app is one of the world’s largest digital fitness training platforms for women. The Sweat acquisition gives us direct access to Sweat’s community of 450,000 paid subscribers at May 31, 2021 and more than 50 million followers across its social media channels, the majority of which are women. The Sweat platform is powered by a team of industry-leading female personal trainers and fitness icons, led by renowned trainer Kayla Itsines, and offers over 5,000 unique workouts across 26 exercise programs. Sweat will remain a standalone brand as part of iFIT . The Sweat app is available in eight different languages and 155 countries.

• 29029. 29029 is a wellness tourism company focused on restorative endurance and ultra-distance events. Most events last three days with the ultimate goal of hiking the equivalent elevation of Mount Everest’s 29,029 feet. With an NPS score of 98, 29029 has built an incredible community ranging from endurance athletes to everyday individuals looking to find their best self through an intense physical and mental challenge.

iFIT Subscriptions

The iFIT platform is a connected community of over 6.4 million Total Members and more than 1.5 million Total Fitness Subscribers in more than 120 countries led by a team of over 180 world-class trainers. By delivering engaging interactive health and fitness experiences, we believe iFIT has become an essential component of many of our members’ lives. As we have added compelling content, features and functionality to the iFIT platform, we have seen a strong increase in member engagement and interaction. In fiscal 2020, total workouts participated in on our platform increased 181% over fiscal 2019. In fiscal 2021, our members participated in 112 million workouts, reflecting growth of 229% year over year.

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Individuals access the iFIT platform through a subscription plan, either directly through our Interactive Fitness Products, through the iFIT mobile app, or on a smart TV. We also have members that use iFIT on other fitness equipment or without having connected equipment. An iFIT subscription gives members access to our full library of live and on-demand content which includes a growing collection of global workouts, studio classes, cross training workouts and Google Map^® workouts.

We offer subscriptions for $15/month for individuals or $39/month for families of up to five (when paid annually $396). When an individual buys select interactive fitness equipment, their purchase may also include the purchase of an annual subscription to iFIT. After the conclusion of the initial subscription period, customers may enter into a monthly or annual subscription arrangement. Sweat offers an individual membership for either $19.99/month or $119.99/year. In fiscal Q2 2022, we expect to change our iFIT membership subscription for our Touchscreen products from an annual subscription and billing plan to a monthly subscription and billing plan. In addition, as a result of the Sweat acquisition, our subscription revenue will include revenue generated from Sweat app subscriptions.

Our Experiential Content

We strive to create the most compelling interactive content in the fitness industry. Our content seamlessly integrates with our proprietary software and interactive hardware, delivering a unique media form we call “experiential content.” This content is highly differentiated from passive streaming.

Our experiential content creates multi-sensory experiences that allow our members to see, hear and feel interactive workouts. Through our proprietary LiveAdjust^TM video technology, iFIT trainers control members’ equipment variables including speed, incline, resistance and digital weight which creates an authentic interactive workout in sync with our visual media. iFIT streams live bike and treadmill classes throughout the day from the world’s only LiveAdjust^TM fitness studios. Our content is developed and led by a team of over 180 iFIT trainers in more than 60 categories including running, cycling, HIIT, strength, boot camp, yoga and meditation. We produce interactive fitness series which use progression-based protocols to increase in intensity as a member’s fitness improves. Our multi-week programs are carefully crafted by our world-class trainers to allow individual progression, teach fitness fundamentals, and provide aspirational and achievable objectives.

Our vison of creating the world’s most complete health and fitness platform drives us to create experiential content filmed in more than 50 countries across seven continents by our industry-leading production teams which include Emmy award-winning talent and cinematographers. Our members can trek to Mt. Everest base camp or walk with elephants on safari in South Africa on their treadmills and ellipticals. They can join live studio cycle classes or ride the Swiss Alps on their bikes. They can row the River Thames on their rowers or join a studio boot camp from their fitness mirrors. Our members are guided on these journeys by our team of world-class trainers who include Olympic champions, elite athletes and PhDs. As we expand globally, we have begun to offer content in Mandarin Chinese, Spanish, Italian, French, Portuguese, Russian and German.

Our highly engaged community of iFIT members have created more than 2 million user-generated workouts, including workouts through our patented technology with Google Maps. We also create nutrition, mindfulness and recovery content to offer a complete health experience for our members. This diversity of experiential content ensures that we can cater to any individual member to keep them engaged and motivated to change their life for the better.

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Interactive Fitness Hardware

We deliver our patented interactive experiences on the broadest range of fitness modalities including treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories. Our interactive hardware is intelligent—it is specifically designed and engineered to respond to our proprietary software and experiential content. This unique combination allows our members to have an immersive experience that can only be found on our hardware. For example, when our content streams the trail to the summit of Mt. Kilimanjaro, our interactive drive systems automatically adjust the speed and incline in sync with our content. Our hardware is powered by our proprietary iFIT operating system which integrates seamlessly with our patented display technology and our proprietary dynamic lift and drive systems.

We offer some of the most technologically advanced interactive fitness hardware in the fitness industry. Our hardware and technology are protected by over 400 issued and pending patents. We continue to pioneer

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connected and interactive fitness technology across our major modalities including treadmills with a patented interface, bikes with motorized inclines, ellipticals with variable-length strides, rowers that fold for storage, strength with proprietary resistance mechanisms and fitness mirrors with proprietary display technologies.

This allows our members to access the iFIT platform and experiential content through the modality they most prefer, with experiential content that has been designed specifically for that modality. Workouts can be streamed to the member’s fitness equipment and their workout results are automatically uploaded to their iFIT profiles.

• Treadmills. We are the leading provider of interactive treadmills in the at-home and commercial fitness markets. We offer treadmills at a range of price points to make connected fitness accessible to a variety of consumers, from $999 to $13,000. Our treadmill line integrates our LiveAdjust^™ technology with our proprietary drive systems to deliver an immersive iFIT experience. Our treadmill range offers a variety of premium features, including 32-inch high-definition touchscreens, premium sound systems, incline to 40%, decline to 6%, Bluetooth connectivity and more. Treadmills are a leading category in the at-home fitness market, and we ranked #1 in 2020.

• Bikes. We are leaders in interactive bikes in the at-home and commercial fitness markets. Our interactive studio and recumbent bikes display iFIT experiential content on high-definition touchscreen up to 22 inches. We offer an immersive experience with proprietary LiveAdjust^™ technology that integrates iFIT software with the bike’s motorized resistance mechanisms. Our premium bikes are unique in the fitness industry with iFIT-controlled motorized 20% incline and 10% decline to deliver a unique cycling experience that syncs with our iFIT content. We ranked #2 in bikes in 2020. Our bikes range in price from $400 to $7,500.

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• Ellipticals. We are leaders in interactive ellipticals in the at-home and commercial fitness markets. Our range of elliptical trainers are all integrated with iFIT to control resistance in interactive workouts displayed on high-definition touchscreen while providing a low-impact, high-intensity exercise. On our premium ellipticals, iFIT adjusts incline and decline on a motorized incline ramp for variety and challenge. Many of our ellipticals also offer our patented SpaceSaver^™ folding design. We ranked #1 in ellipticals in 2020, with price ranges from $599 to $9,999.

• Climbers/Steppers. As leaders in the interactive climber/stepper category, our products bring the full iFIT experience to members, controlling both resistance and incline to deliver a short, intense workout. Our FreeStride^™ series offers dynamic-adjusting stride and floating suspension, all while providing a low-impact workout. Our members can enjoy experiential content on a range of high-definition touchscreen sizes. We ranked #2 in climbers/steppers in 2020. Our climbers/steppers range from $599 to $1,699.

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• Rowers. As leaders in the interactive rower category, our rowers provide immersive studio based and outdoor workout experiences, with iFIT-controlled Silent Magnetic Resistance. Our rowers have rotating high-definition touchscreens that allow members to seamlessly transition to floor-based workouts. We offer rowers featuring our unique SpaceSaver^™ folding design. We ranked #2 in rowers in 2020. Our rowers range in price from $999 to $1,699.

• Interactive Fitness Mirrors. In 2020, we introduced our interactive fitness mirrors to provide products with immediate visual feedback, allowing the member to match the form of their iFIT trainer for a better workout. Our Vault^™ offering combines iFIT strength training series through our integrated high-definition touchscreen and a fitness mirror with a compact home gym storage system. Our Vue^™ product offers an oversized reflective surface, ideal for iFIT yoga workouts and strength training. Our fitness mirrors range in price from $1,499 to $2,999.

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• Smart Home Gyms. We pioneered the smart home gym category with strength equipment such as the Fusion CST, which pairs iFIT interactive training with cabled resistance for functional fitness training. The interactive experience allows members to access strength and cross-training sessions, while iFIT digitally adjusts their resistance in real-time. We ranked #3 in multipurpose home gyms in 2020. Our smart home gyms range in price from $1,899 to $2,999.

• Adjustable Weights, Benches and Strength Racks. We offer a broad range of adjustable weights, kettle bells, hand weights, benches, strength racks and weight plates. We ranked #1 in benches in 2020.

• Yoga Products and Fitness Accessories. We offer a full line of fitness accessories, including yoga products, mats, foam rollers percussion massagers, kettlebells, weights, jump ropes and resistance bands.

• Related Product Categories. We will expand our proven iFIT subscription services into categories naturally adjacent to fitness. In addition to the variety of products discussed above, we are constantly focusing on new growth initiatives, and developing enhanced products and subscription services for

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our members. Current offerings include iFIT Nutrition, such as protein and hydration products, as well as branded iFIT apparel.

Our Vertically Integrated Business

At iFIT, idea generation, engineering, content creation, marketing, distribution, selling and customer care are vertically integrated to create a seamless customer experience that is extremely difficult to replicate. Our multidisciplinary team of over 2,500 employees is at the forefront of health and fitness innovation.

Idea Generation, Innovation and Engineering

We are pioneers in health and fitness technology. We have compiled a portfolio of more than 400 issued and pending patents, in areas ranging from streaming to adaptive fitness technology which provide a competitive moat to our business. We aim to provide premium, leading-edge technology in every fitness modality we offer, and continuously incorporate proprietary software and hardware features that enhance the user experience.

We have built a vertically integrated innovation engine to remain at the forefront of health and fitness technology. Our research and development team has more than 600 professionals, with engineering teams across three continents, continuously deploying new software, launching new hardware products, and introducing new content categories each year.

We have 111,000 square feet of space dedicated to research and development in our Logan, Utah headquarters. This facility includes our live iFIT studios, production and content development, industrial design and mechanical and electrical engineering capabilities used to create proprietary designs, features and products. Our rapid prototype lab allows us to create fully functioning prototypes that incorporate hardware, software and content. We conduct our industrial design in-house across all our brands and categories.

Our research and development organization consists of world-class teams for engineering, product development, design, prototype, product testing, software, UI/UX development, and content. We have an engineering team dedicated to supporting our manufacturing facilities, allowing us to effectively manage quality control and ensure all finished products meet our standards. Our teams have a diverse set of skills and industry experience, including expertise in highly scalable distributed systems and member-centric application engineering.

We evaluate new product concepts in response to consumer desires by frequently introducing new products and repositioning existing products. During fiscal 2021, we invested $91.7 million in research and development and to enhance our iFIT platform, develop new products, content and features, and improve our platform infrastructure, a portion of which was capitalized. These capabilities allow us to assess market interest to maximize efficiency of product rollouts and increase speed to market.

Content Creation

Our vision of creating the world’s most complete health and fitness platform drives us to create experiential content shot on seven continents and more than 50 countries. Our world-class production teams include Emmy award-winning talent and cinematographers. From our six LiveAdjust^TM fitness studios, we livestream more than 130 classes a week as well as specialized nutrition and wellness content. We stream using our proprietary LiveAdjust^TM video technology to make automatic adjustments to the speed, resistance and incline of interactive fitness equipment in sync with our visual media. We offer live-streamed and on-demand studio and outdoor interactive workouts in more than 60 categories including running, cycling, HIIT, strength, boot camp, yoga and meditation across our full range of fitness modalities. Our on-demand library includes more than 17,000 interactive workouts which pair seamlessly with our equipment.

We have made significant infrastructure investments in our content development capabilities and have six on-location studios, in-house video graphics and editing teams and the ability to distribute content in multiple

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languages. At our Logan, Utah headquarters, we have 48,000 square feet of facilities dedicated to content production and engineering.

Music and Music Technology

We license music from Feed Media Group, to access a large catalogue of curated music that iFIT members can enjoy during cardio, strength, and yoga workouts, as well as live workouts. We also create content in-house with music that we license separately. We provide the opportunity for our members to select from a list of ten curated playlists of popular music, including pop, hip-hop, rock and electronic dance music (EDM). Based on our extensive consumer research, allowing members to choose their own music from a variety of playlists results in more personalized workouts and higher engagement with our content.

Our Trainers

Our team of over 180 professional trainers include Olympic champions, elite athletes and experts with PhDs in exercise physiology, psychology, and nutrition science. Our trainers go through a rigorous selection process before they build comprehensive training plans for our members using dedicated training protocols to take our consumers from one fitness level to the next. Our platform allows our members to interact directly with trainers from all over the globe and to connect and learn from a variety of personality types and training styles. This unique approach allows for a more personalized workout experience for our members.

Multi-Channel Sales and Marketing

We have a highly efficient and scalable marketing model to increase brand awareness, and acquire and retain iFIT subscribers on their choice of fitness equipment. We have developed a proprietary marketing model that combines brand and product-specific performance marketing. We drive brand awareness through a combination

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of direct-to-consumer and retail partnerships. Our research indicates that NordicTrack enjoys market leading awareness among fitness equipment brands, with over 91% aided brand awareness in the United States. We have a robust direct-to-consumer marketing platform that provides a rich brand experience on iFIT.com, NordicTrack.com, ProForm.com and FreemotionFitness.com. We market to consumers through advertising campaigns on social media, digital media, cable and broadcast TV, and over-the-top providers such as Hulu, Roku, and Amazon Prime Video. Our marketing team creates specific messages for different target audiences that match their individual preferences. Our model allows for message testing and optimization, effective promotion and accelerated brand awareness that drives sales at direct-to-consumer and our retail partners.

We have developed a proprietary marketing mix model that is based on a random search algorithm to perform computations on aggregate data to determine and maximize contributions of media channels. This model allows us to efficiently and effectively allocate our marketing resources to drive future membership and revenue growth.

We strive to provide retail touchpoints where consumers can access and purchase our products wherever they shop. Our brands and products are marketed in every channel where fitness products can be purchased. This omni-channel marketing strategy resulted in approximately 10.1 million customer interactions and purchases of our interactive products during fiscal 2021.

Our marketing model is a highly efficient way to acquire customers across multiple channels of distribution. We believe we have significant opportunity to accelerate sustainable growth as we increase our marketing spend internationally and domestically.

We have multi-disciplinary marketing teams with expertise in performance and brand marketing across all our channels of distribution and geographies, ranging from web development, digital and social ad creation, photo and video marketing asset generation to video content. Our multichannel marketing strategy enables us to reach current and potential customers across a multitude of mediums.

Member Engagement and Support Services

We are focused on keeping our customers engaged from the moment they purchase one of our products. When a customer purchases our interactive fitness hardware, a dedicated team reaches out to onboard that customer into the iFIT platform. This team provides assistance for account sign ups, profile creation, and initial workout and program selection.

After initial onboarding, we have a dedicated member engagement team that stays connected with our members through email, SMS, push notifications and phone calls. Our team promotes engagement with our products and community through monthly, quarterly and flash challenges, incentivizing our members to continuously engage on the iFIT platform. We also host live events on location and in studio to enhance engagement among our member community.

Warranties

We offer a range of warranties for direct-to-consumer purchases, through our strategic retailers and for our commercial equipment sales. Products include a base warranty at no additional charge. With the purchase of our interactive exercise products, we offer consumers an option to purchase an extended warranty contract, which we provide through our wholly owned subsidiary UTS. These warranties are underwritten by a regulated third-party insurer. We offer multiple warranty and maintenance options for our products in the United States and have started pilot programs in Europe.

Financing

We partner with a third-party consumer finance company to offer 0% APR financing programs for certain products. These programs allow our qualified customers to pay in monthly payments. Our financing programs

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have successfully broadened our member base by attracting consumers from a wider spectrum of ages and income levels.

Manufacturing

To continue to provide our members with our interactive fitness technology, we manufacture both domestically and internationally in eight countries, almost exclusively through third parties, and maintain 40+ year relationships with long-term strategic partners, with direct purchasing relationships down to the component level. This network of partnerships combined with our experience, enables a robust and resilient supply chain with attractive speed-to-market capabilities.

Our in-house engineering expertise allows us to quickly create and adjust designs to streamline production and minimize supply bottlenecks. This provides us with a considerable competitive advantage and allows us to flexibly respond to fluctuations in market demand. This capability allowed us to respond quickly and grow during periods of surge demand since the onset of the current global pandemic.

Our products are primarily designed in-house. We send our designs to our long-standing contract manufacturing partners. This manufacturing model allows us to efficiently deploy our capital and focus on research and development and other areas important to our business. This also allows us to react quickly when making design changes, bring our products to market quickly and ensure we are working with manufacturing partners that are both cost-efficient and maintain the level of quality we require. Though the substantial majority of our manufacturing is outsourced to Asia, we also manufacture domestically in Smithfield, Utah.

We purchase from our primary contract manufacturers on a purchase order basis. Our contract manufacturers must follow our established product design specifications, quality assurance programs and manufacturing standards. Our team manages our supply chain from the initial design phase through to finished product assembly. We have over 40 dedicated production lines.

We source our critical components from over 30 suppliers. Additionally, we qualify alternative suppliers and manufacturers when possible, and develop contingency plans for responding to disruptions, including developing multiple sources of supply for critical components and products. We believe our scale, manufacturing experience and relationships have helped to mitigate the risks of material delays in obtaining our components or products. We have a quality assurance team that is involved throughout the entire development process. We also have an engineering team dedicated to supporting our factories, such that we can effectively manage quality control and ensure finished products meet our standards.

Logistics and Fulfillment

We distribute our products through a global logistics network that serves our multiple channels. We ship products direct-to-consumers, to retailers’ distribution centers and to gyms, universities and other commercial fitness customers. In fiscal 2021, the breadth of our scaled distribution network allowed us to import 16,600 containers of fitness equipment, equipment, which makes us the #1 importer of fitness equipment and #64 top importer in the U.S. We sell approximately 10.1 million units of Interactive Fitness Products – more than anyone in our industry. Our integrated distribution and inventory management system allows us to ensure that all necessary components are onsite for manufacturing production, and is also capable of tracking of finished goods through the distribution chain. Through the effective use of electronic data interchange, we are able to run manufacturing jobs to fill specific customer orders, arrange for shipping from many of our manufacturing facilities and make timely deliveries to our customer locations.

To support sales of our direct-to-consumer home products and commercial fitness products, we have built networks of last mile delivery service centers around the world, including a large network of third-party logistics partners. Our delivery and service team supports delivery, set up and installation of our products with

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professional high-touch service and ongoing care. Our field specialists are trained on our product and services, offer product education, assistance with account set up, and tips and recommendations for product care. We have relationships with 11 ports across the United States, which allows us to route shipments to the most efficient port depending on conditions. We operate three distribution centers and use flexible, regional third-party logistics centers. Additionally, we maintain relationships with more than 120 local third-party distribution hubs to enable scalable, high touch delivery and service.

Intellectual Property

We are pioneers in health and fitness technology. As of August 10, 2021, we own 207 issued U.S. patents and have 47 U.S. patent applications pending. We also own 150 issued foreign patents and have 56 foreign patent applications pending. Additionally, as of August 20, 2021, we own 47 registered U.S. trademarks, and have 30 U.S. trademark applications pending. We also own 742 registered foreign trademarks and have 97 foreign trademark applications pending. Of our issued patents, 27 expire within 24 months, 19 expire between two to five years, and the remainder expire at various dates thereafter.

We rely on a combination of patents, trademarks, service marks, trade secrets, know-how and expertise, registered domain names, license agreements, intellectual property assignment agreements, confidentiality procedures and non-disclosure agreements to establish and protect our intellectual property and proprietary rights. We seek to protect our intellectual property and proprietary rights, including our proprietary technology, software, know-how and brands, by relying on a combination of federal, state, and common law rights in the United States and other countries, as well as contractual measures.

We generally enter into confidentiality, non-disclosure and invention assignment agreements with our employees, consultants, independent contractors and other third parties to control access to, and clarify ownership of, our intellectual property and proprietary information. It is our practice to file applications for U.S. and foreign patents on inventions, designs and improvements and pursue other intellectual property protection that we deem valuable to our business to the extent we believe it would be beneficial and cost effective.

In addition to the intellectual property that we own, we also receive licenses to certain intellectual property from third parties, including third parties that manufacture or market fitness equipment. We strive to ensure that the quality, image and appeal of such licensed products are consistent with the high-quality brands of our products.

Although we seek to protect our intellectual property and proprietary rights, the steps we take and have taken may not be effective to prevent the unauthorized access, use, copying, reverse engineering, infringement, misappropriation or other violation of our intellectual property and proprietary technology and information, including by third parties who may use our intellectual property, proprietary technology or information to develop products and services that compete with ours. Policing the unauthorized use of our intellectual property and proprietary rights can be difficult. The enforcement of our intellectual property and proprietary rights also depends on any legal actions we may bring against any such parties being successful, but these actions are costly, time-consuming, and may not be successful. Additionally, third parties have in the past and may in the future assert claims of infringement, misappropriation and other violations of their intellectual property rights against us. Successful claims of infringement, misappropriation or other violations by a third party could prevent us from offering certain products or features, require us to develop alternate, non-infringing technology, which could require significant time, and during which, we could be unable to continue to offer our affected products or solutions, require us to obtain a license, which may not be available on reasonable terms or at all, or force us to pay substantial damages, royalties, or other fees. Important factors relating to risks associated with our intellectual property include, but are not limited to, those described under “Risk Factors—Risks Related to Information Technology and Intellectual Property” in this prospectus.

Competition

Our global health and fitness platform integrates proprietary software, experiential content and interactive hardware to provide what we believe is an unmatched form of connected fitness. This, in combination with the

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strength of our global supply chain, innovation pipeline, broad distribution model, leading brands, product diversity, market share and 40+ year history gives us a competitive advantage and is difficult to replicate.

We directly compete with other companies in the highly competitive markets for connected and traditional fitness equipment, health and wellness apps and additional adjacent categories. The fitness equipment market is characterized by frequent introduction of new products, often accompanied by major advertising and promotional programs.

• Content. We compete for consumers to join and remain in our community by providing compelling and personalized content.

• Products. We compete with a number of companies with regard to assortment of products, innovative features and competitive product costs in the following spaces: treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment and accessories.

• Talent. We compete for talent across the spectrum of our company, including across technology, design, engineering, manufacturing, logistics, media production, fitness trainers, marketing, sales, finance, legal and retail. As our platform is highly dependent on technology and software, we require a significant base of engineers and developers to continue innovating. We also rely on world-class trainers to help us create content, which includes creating personalized training plans.

We believe the principal competitive factors affecting our business include price, quality, brand name recognition, product innovation, original content and customer service. More broadly we compete for consumer interest within the larger market for wellness, entertainment, sporting and athletic related activities.

Employees and Human Capital

Our multidisciplinary team of employees are at the forefront of health and fitness innovation. As of May 31, 2021, we employed approximately 2,500 people in the US, more than 600 employees were engaged in research and development, 130 in sales and marketing, 300 in manufacturing and distribution, and 1,400 in other areas, primarily administrative and customer service. None of our U.S. or Canadian employees are unionized.

Our human capital resources objectives include identifying, recruiting, retaining and incentivizing our existing and new employees, including our fitness trainers. As we grow, we are focused on maintaining an entrepreneurial culture that encourages our team members to challenge the status quo and create cutting-edge developments in software, content and hardware. To help us achieve our human capital resources objectives, we maintain equity incentive plans, the principal purposes of which are to attract, retain and motivate selected employees, consultants and directors.

Facilities

Our headquarters are located in Logan, Utah, and we own office buildings, studios, warehouses, light manufacturing facilities and adjacent land for future growth. Additionally, we own office and warehouse space in St. Jerome, Canada. The total square footage of our owned buildings is approximately 560,000 square feet.

We lease additional manufacturing facilities, warehouses and offices in the United States and various foreign countries including the United Kingdom, Mexico, Brazil, China, France and Australia.

These facilities are well maintained, in good operating condition and are adequate for our current needs. We believe that suitable additional or substitute space will be available as needed to accommodate any expansion of our operations.

Cybersecurity and Data Privacy

We share, disclose, transfer, use and otherwise process personal information and other member data, which subjects us to a number of varying laws, rules, regulations, directives, policies and industry standards in the

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United States and throughout the world, as well as contractual obligations, related to data privacy, protection and security. These laws, rules, regulations, directives, policies and industry standards are constantly evolving and may be interpreted, applied, created or amended in a manner that could harm our current or future business and operations. We have appointed a Data Protection Officer (DPO) to facilitate compliance with these data privacy, protection and security laws as well as to stay abreast of additional regulations that may come into force. Although we take a variety of technical and organizational security measures and have implemented other procedures and protocols to comply with applicable data privacy, protection and security laws and regulations and to protect our data and information, including personal information and other data pertaining to members and employees, we, from time to time, may not be in technical compliance with all such laws and regulations and we may be unable to anticipate or prevent unauthorized access to personal or other confidential information, and we have in the past and may in the future experience cybersecurity incidents.

In the United States, the California Consumer Privacy Act, or CCPA, which went into effect on January 1, 2020, established a new privacy framework for covered businesses such as ours. Among other things, the CCPA requires companies covered by the legislation to provide new disclosures to California residents and afford such residents new rights, including the right to access and delete certain personal information, as well as the right to opt-out of certain sales of personal information. The CCPA provides for significant civil penalties and statutory damages for violations, as well as a private right of action for certain data breach incidents. This private right of action may increase the likelihood of, and risks associated with, data breach litigation. In November 2020, California voters passed the California Privacy Rights Act, or CPRA, which will become effective in most material respects beginning on January 1, 2023 (but with a lookback to January 1, 2022). The CPRA further expands the CCPA with additional data privacy compliance requirements and obligations and establishes a regulatory agency dedicated to enforcing the CCPA and CPRA. Certain other state laws impose similar privacy obligations and all 50 states have adopted data breach notification laws that impose, in varying degrees, an obligation to notify affected individuals in the event of a data or security breach or compromise, including when their personal information has or may have been accessed by an unauthorized person, and we have in the past and may in the future be subject to such notification obligations.

In the EU, the GDPR became effective on May 25, 2018 and has resulted in and will continue to result in significantly greater compliance burdens and costs for covered entities, which include all businesses established within the European Economic Area, or EEA, and any business located outside of the EEA that processes personal data of individuals located within the EEA. The GDPR created more stringent operational requirements for processors and controllers of personal data, including, for example, requiring enhanced disclosures to data subjects about how personal data is processed (including information about the profiling of individuals and automated individual decision-making), limiting retention periods of personal data, requiring mandatory data breach notification and requiring additional policies and procedures (including to comply with the accountability principle under the GDPR). In addition, data subjects have more robust rights with respect to their personal data. The GDPR also imposes significant fines and penalties for non-compliance and individuals are entitled to bring private rights of action. Following Brexit, as of January 2021, we are required to comply with the GDPR as well as the United Kingdom equivalent to the extent of our operations in the United Kingdom. The relationship between the United Kingdom and the EU in relation to certain aspects of data protection law remains unclear.

Many other jurisdictions are considering or have instituted data privacy, protection and security laws, rules and regulations, and their interpretations continue to develop and may be inconsistent from jurisdiction to jurisdiction, which could increase our risk and compliance costs.

Additionally, we are subject to laws, rules, and regulations (including the GDPR) regarding cross-border transfers of personal data, including laws relating to the transfer of personal data outside the EEA and the United Kingdom. We rely on transfer mechanisms permitted under these laws, including standard contractual clauses, which have been subject to regulatory and judicial scrutiny. If these existing mechanisms for transferring personal data from the EEA, the United Kingdom, or other jurisdictions are unavailable, we may be unable to transfer personal data of employees, members or others in those regions to the United States or elsewhere.

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For more information, see “Risk Factors—Risks Related to Legal and Government Regulation—We collect, store, share, disclose, transfer, use and otherwise process personal information and other member data, which subjects us to legal obligations and laws and regulations related to data security and privacy, and any actual or perceived failure by us or our third-party service providers to meet those obligations could harm our business” and “—We derive a portion of our revenue from international sales and are subject to the operational risks of doing business in foreign countries.”

Environmental, Health and Safety Regulations

We and our operations are subject to federal, state, local and foreign environmental, health and safety laws and regulations, including relating to climate change, that, among other matters, impose workplace standards and limitations on the discharge of pollutants into the environment and establish standards for the use, management, handling, generation, treatment, storage, disposal, and release of, and exposure to, hazardous substances and wastes. The nature of our manufacturing and assembly operations exposes us to the risk of regulatory compliance and claims with respect to environmental, health and safety matters. Although compliance with such laws and regulations has not had a material adverse effect on capital expenditures, earning and competitive position, there can be no assurance that material costs or liabilities will not be incurred in connection with environmental, health or safety matters in the future. Future events, such as new, or changes in existing laws and regulations or enforcement policies or the discovery of contamination on sites owned, leased or operated by us may give rise to additional compliance costs, liabilities or operational interruptions, which could have a material adverse effect on our results of operations or financial condition.

Our Environmental, Social and Governance (“ESG”) Efforts and Impact Framework

ESG is core to our business and our mission. As champions of healthy living and personalized fitness, we provide our members the tools to take ownership of their personal fitness and well-being. We are dedicated to delivering products and services that create a positive social impact and improve an individual’s quality of life. Our interactive fitness offerings increase accessibility to wellness, globally, across demographics, income levels, and physical abilities, and foster a growing global community of individuals who are connected and inspired by a shared fitness experience. Our goal is to improve lives and well-being across all our stakeholders - our customers, our employees, our partners, our investors, and our communities.

The Positive Impacts of Proper Exercise

It is widely accepted that more frequent, proper exercise can have a meaningfully positive impact on an individual’s overall well-being and, in the aggregate, can help reduce significant direct and indirect costs to society. It is well-documented that regular exercise improves overall physical health and reduces the risk of diseases such as heart disease, Type 2 diabetes, and many other chronic conditions. Recent research has demonstrated that physical activity is associated with positive physical health outcomes, and overall mental and emotional well-being. Research has also found a direct link between exercise and positive emotions, such as having a sense of purpose in life. Exercise improves mental health by reducing anxiety, depression and negative moods and by improving self-esteem and cognitive function. Exercise can also help reduce the negative effects of stress and improve an individual’s mood. Similarly, research has found evidence of improved social interactions and support for the achievement of personal and professional goals stemming from an increase in exercise.

iFIT’s Social Impact

We believe iFIT’s interactive fitness offerings and the iFIT platform can help drive outcomes that improve the lives of our members. The iFIT platform enables members to live a healthy and balanced life and, in combination with our nutrition, wellness, and recovery services, helps members improve their mental health. During fiscal 2021 our members performed approximately 140 million workouts across our platform. Many of our members

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have experienced the transformational impact of iFIT firsthand and attest to how it has revolutionized their physical and mental well-being. We believe iFIT provides a direct and meaningful social impact in the lives of our over 6.4 million members, allowing people in more than 120 countries to have positive fitness and health experiences.

Our ESG Priorities

We are committed to sustainable business practices, and have begun implementing ESG goals throughout our company and will continue to manage our commitment over time.

Environmental. We recognize the importance of managing the environmental footprint of our operation. We have engaged with a third party ESG expert firm to assist us in the development of our sustainability strategy including greenhouse gas (GHG) inventory, external reporting recommendations and support, vision, goals and KPIs.

We intend to conduct GHG inventory of our operations to understand our largest sources of emissions and provide reduction strategies. Our GHG inventory and measurements will align to third-party verification and are grounded in the methodologies from the World Resources Institute (WRI), a recognized authority on carbon inventories for business. Through our process, we will identify opportunities for improvement and goal setting.

Social. We seek to build a company culture that is consistent with our mission-oriented mindset. Our business impacts society through our relationships with our varied stakeholders, and it starts with our employees and local community.

We believe in the importance of fostering a diverse, inclusive and safe workplace. It is our goal at iFIT to have a workforce that is reflective of the community in which we operate, and we continue to work toward increasing the diversity of our team. As of May 31, 2021, 30% of our leadership identifies as female, a 6% increase compared to 24% in 2018. As of the same period in 2021, 19% of our workforce identifies as a racial or ethnic minority, a 3% increase compared to 2018. Moreover, as of May 31, 2021, 11% of our 180 iFIT trainers identify as Black or African-American, 6% identify as Asian and 6% identify as Hispanic or Latino. We also support and develop female talent through membership and participation in the Utah-based Women Tech Council group. We are committed to increasing diversity and representation through our diversity, inclusion, equity and belonging initiatives and to disclosing our diversity on an annual basis.

Employee wellbeing is also a top priority for us. As such, we have implemented multiple initiatives including our Spring / Fall Wellness Programs, Summer Camps, Sports Tournaments, FallFest, Employee Appreciation Week, Sponsored Mentorship Lunches as well as an Employee Assistance Program focused on Mental Health. Our employees are highly engaged, and this is demonstrated by a high participation rate in these programs.

Through the iFIT Foundation, which we established in 2009, we are able to have a more positive impact on the broader community as well. The mission of the foundation is to provide year-round relief for members of our communities in critical need by aiding iFIT employees, their families and other local individuals in temporary hardships, contributing to local organizations, assisting schools, providing essentials for children in need, and supporting community non-profits. This foundation is non-profit and completely employee-volunteer run.

Our commitment to employee wellbeing and safety extends to our suppliers as well. iFIT is a proud member of the Business Social Compliance Initiative (BSCI), a program designed to ensure ethical working conditions for suppliers. As of May 2021, 85% of iFIT’s finished goods suppliers participate in the program, which includes a social compliance audit intended to protect the health, safety and rights of our suppliers’ employees, the communities with which they engage and the environment.

Data security and privacy is essential and critical to our operations and members. We have implemented security practices to ensure appropriate physical, technical and administrative safeguards to protect customer and employee data. We also have engaged a third party data protection officer as an additional measure.

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Governance. ESG matters are critically important to our executive team and board of directors. We have established a board that we believe values diversity and will continue to do so going forward. Currently, 23% of our board identifies as female and 15% of our board identifies as a racial or ethnic minority. Our nominating, governance and corporate responsibility committee will be charged with developing recommendations and overseeing our Sustainability and ESG programs.

Legal Proceedings

We are and, from time to time, we may become involved in legal or regulatory proceedings, inquiries or investigations, arising in the ordinary course of our business, including, but not limited to, actions relating to intellectual property and patent infringement, misappropriation or other violation, product liability lawsuits, non-product liability commercial suits involving contract claims, and various product reviews and recalls with the Consumer Product Safety Commission. We vigorously defend any and all claims and lawsuits brought against us and believe that the ultimate outcome of any currently pending claim, series of claims or lawsuits, review or recalls will not have a material adverse effect on our results of operations, financial position or liquidity. See Note 18 of the notes to our audited consolidated financial statements included elsewhere in this prospectus for additional information.

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MANAGEMENT

Executive Officers, Directors and Director Nominees

The following table sets forth the names and ages, as of the date of this prospectus, and titles of the individuals who will serve as our executive officers and members of our board of directors at the time of the offering.

Name	Age		Position
Scott R. Watterson		66	Co-Founder, Chief Executive Officer and Director
David J. Watterson		62	Executive Vice President, Chief Strategy Officer and Director
Steven J. Barr		56	Executive Vice President, Chief Financial Officer
Everett Smith		66	Senior Vice President, General Counsel, Secretary
Greg Benson		67	Director
Erica Berchtold		45	Director Nominee
Karen Boykin-Towns		56	Director
Scott Dahnke		56	Director
Robert C. Gay		70	Director, Lead Independent Director
Alexander Hawkinson		48	Director
Wen-Chung Ko		77	Director
Charles Robins		82	Director
Andrew Singer		32	Director
Gary E. Stevenson		66	Director
Abigail Taylor		41	Director Nominee

Scott R. Watterson

Mr. Watterson is responsible for setting the overall direction and strategy for iFIT Health & Fitness as the company’s Chairman of the board of directors and Chief Executive Officer. Mr. Watterson has served in both roles from 1988 to 2004, and since 2007, growing iFIT, formerly known as ICON Health & Fitness, Inc., to a global leader in connected fitness technology. Having co-founded iFIT’s predecessor company, Weslo, Inc., in 1977, Mr. Watterson has over 40 years’ experience in helping people from every demographic, fitness level, and ambition pursue and achieve their health and fitness goals. Mr. Watterson is currently serving on the board of directors for The Employers Council, which serves five western states. Previously, he served on the Board of Trustees at Utah State University, Utah State University Foundation, the Board of Trustees for the Make-A-Wish Foundation of Utah and the Utah Foundation. Mr. Watterson graduated from Utah State University College of Business, in 1979. We believe Mr. S. Watterson is qualified to serve on our board of directors because of his extensive knowledge of the Company and our industry, his operational expertise, leadership and vision, and the continuity that he brings to our board of directors as our Co-Founder and Chief Executive Officer.

David J. Watterson

Mr. D. Watterson has served as our Executive Vice President and Chief Strategy Officer from 1992 to 2004, and since 2007, and as a director since 2007, overseeing all product and merchandise strategy, planning, and development for the Company. He served as our Chairman of the board of directors and Chief Executive Officer from 2004 to 2007. Mr. D. Watterson has also previously served in key roles at our Company including President of North America and Senior Vice President of Marketing, Research and Development. Mr. D. Watterson graduated from Utah State University with a B.S. in Marketing. We believe Mr. D. Watterson is qualified to serve on our board of directors due to his operational and historical expertise gained from serving in various roles at our Company and his vast knowledge of the fitness industry.

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Steven J. Barr

Mr. Barr has served as our Chief Financial Officer since 2020, leading the Company’s financial operations and strategy. Prior to joining iFIT, Mr. Barr was a Partner at PricewaterhouseCoopers for 22 years from 1998 to 2020, serving in numerous global and US leadership roles including serving as the Global and U.S. Consumer Markets leader and as the senior partner leading firm relationships for Fortune 100 and Fortune 500 companies. Prior to his admission as a partner at PricewaterhouseCoopers in 1998 Mr. Barr served on the professional staff from 1992 until 1998. From 1988 until 1992 Mr. Barr began his career at KPMG. Mr. Barr currently serves on the board of directors of Biome Capital Partners and University of Mount Union. Mr. Barr is a certified public accountant in the states of Ohio, California and New York and holds a B.S. in Accounting from University of Mount Union.

Everett Smith

Mr. Smith has served as our Senior Vice President and General Counsel since 2006, managing and overseeing the Company’s legal affairs and compliance. Mr. Smith served as our Corporate Controller from 1999 to 2006 and the Director of Tax and SEC Reporting from 1996 to 1999. From 1990 until 1996, Mr. Smith was an attorney with the Securities and Exchange Commission in Washington, D.C. Mr. Smith holds a Juris Doctor degree from the University of Idaho College of Law and a L.L.M. from Georgetown University Law Center. Mr. Smith is also a certified public accountant and holds a Master of Accountancy from Brigham Young University. He is a member of the Utah and Idaho State Bar Associations.

Greg Benson

Mr. Benson has served as a Director since 1999. In 2008, Mr. Benson co-founded Huntsman Gay Capital Partners (“HGGC”) and is an Executive Director. Mr. Benson has served as a member of the board of directors for the firm’s Fund II investment in Pearl Holding Group and for the firm’s Fund I investments in iQor and Sandbox. Prior to the inception of HGGC, Mr. Benson joined Bain Capital (“Bain”) in 1996 and was an Executive Vice President and senior member of the London-based team starting up Bain’s European private equity business. At Bain, Mr. Benson worked with a number of Bain’s portfolio companies in various capacities. Prior to joining Bain, he served as the Chief Financial Officer of American Pad and Paper Company. Mr. Benson began his business career with General Electric where he served in senior management positions with a wide variety of responsibilities including Head of Merchant Banking for GE Financial Services. Mr. Benson graduated from the University of Minnesota with a B.S. in Business Administration. We believe that Mr. Benson is qualified to serve on our board of directors due to his experience in the private equity industry and experience serving in executive and senior management roles.

Erica Berchtold

Erica Berchtold will serve as a Director upon the effective date of the registration statement of which this prospectus forms a part. Ms. Berchtold is currently the Chief Executive Officer of THE ICONIC, an online fashion and sports retailer based in Sydney, Australia, and has held that position since 2019. Prior to joining THE ICONIC, Ms. Berchtold held the position of Managing Director of the Sports Division (Rebel, AMART Sports, Infinite Retail and Goldcross Cycles) at Super Retail Group for over seven years from 2011 to 2019. Ms. Berchtold holds a diploma in Journalism from Macleay College. We believe that Ms. Berchtold is qualified to serve on our board of directors due to her significant international experience and business experience in the retail and consumer industry in an executive role.

Karen Boykin-Towns

Karen Boykin-Towns has served as a Director since 2021. Ms. Boykin-Towns is the founder of Encore Strategies, a boutique consultancy established in 2019, focused on providing strategic counsel for businesses with complex challenges. She also joined Sard Verbinnen & Company a leading communications firm as Senior Counselor in 2019. Prior to founding Encore Strategies, Ms. Boykin-Towns served as the Vice President of

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Corporate Affairs for Pfizer Inc’s $34 billion innovative medicines business from 2015 until 2019. Earlier in her 22-year tenure at Pfizer, she served as the company’s first Chief Diversity Officer. Ms. Boykin-Towns serves on several boards including as Vice Chair of the National Association for the Advancement of Colored People (NAACP) National Board of Directors, Visiting Nurse Services of New York (VNSNY), Brewster Academy, American Airlines Community Council, and L’Oréal USA Diversity & Inclusion Advisory Board. Ms. Boykin-Towns holds an MBA from the Zicklin School of Business at Baruch College of the City University of New York (CUNY), and earned a B.A. from The College of Mount Saint Vincent. Ms. Boykin-Towns’ awards include Savoy Magazine’s “Top Influential Women in Corporate America” and “Woman of the Year” by Seeds of Fortune. We believe Ms. Boykin-Towns is qualified to serve on our board of directors due to her experience in executive and advisory roles and her experience on the boards of directors of other organizations.

Scott Dahnke

Mr. Dahnke has served as a Director since 2020. Mr. Dahnke currently serves as the Global co-Chief Executive Officer of L Catterton, the world’s largest consumer-focused private equity firm, a firm which he has co-led since 2003. L Catterton has approximately $30 billion under management across seven fund strategies in 17 offices globally. He has a broad range of business experience in private equity, consulting, management, and finance. At L Catterton, Mr. Dahnke has completed more than 35 investments in companies, including: Peloton, Restoration Hardware, The Honest Company, Zarbee’s Naturals, Kettle Chips, Equinox, Wellness Pet Food, Heartland RV, YoCrunch, Nature’s Variety, Edible Arrangements, Ferrara Candy, Rachael Ray Nutrish, Vroom, Leslie’s Pool Supplies, and Noodles & Company. Mr. Dahnke serves as the Chair of the Board of Directors of Williams-Sonoma, Inc. (NYSE:WSM) and also serves on the Board of Directors of Vroom (NASDAQ:VRM) and the Honest Company (NASDAQ: HNST). Prior to joining L Catterton in 2003, Mr. Dahnke was a Managing Director at Deutsche Bank Capital Partners and at AEA Investors, where he led AEA’s consumer products investing effort. Earlier in his career, he served consumer-focused clients on a wide array of strategic and operational matters as a Partner at McKinsey & Company, and worked in the Merger Department of Goldman, Sachs & Co. and with General Motors. He received a B.S. in Mechanical Engineering from the University of Notre Dame and earned an MBA from the Harvard Business School. We believe that Mr. Dahnke is qualified to serve on our board of directors due to his experience in building brand equity, in leading consumer brands, and his expertise in the global retail and consumer industry.

Robert C. Gay

Mr. Gay has served as a Director since 1994, and will serve as our Lead Independent Director. He is Co-Founder, past Chairman and CEO of HGGC where, since 2012, he has served as an Executive Director. He is also Founder of Kensington Capital Holdings, a private family office and investment firm. Previously he served as a Managing Director of Bain Capital from 1989 to 2004, where he was one of the firm’s senior partners and Chairman of the firm’s Management Committee. Prior to Bain Capital, Mr. Gay served as a Principal in the Merchant Banking division at Kidder Peabody, Executive Vice President of the GE Capital Corporation’s Capital Markets Group, and as Engagement Manager at McKinsey & Co. He is also a past advisory board member and co-founder of Sorenson Capital and co-founder of the investment firm, KSV Global. Mr. Gay received a PhD in Business Economics from Harvard University where he also taught economics. He has served as a member of the board on multiple private and public companies, most recently as a director of Clene Inc. from 2015 to 2020. Over the course of his career, Mr. Gay has been actively engaged in several humanitarian efforts he helped launch including Engage Now Africa, Ending Modern Slavery, Ensign College of Public Health and Unitus Labs. We believe that Mr. Gay is qualified to serve on our board of directors due to his educational qualifications and his broad industry experience in business management, financing and development, as well as the unique perspective he brings from the range of executive positions and directorships that he has held and currently holds.

Alexander Hawkinson

Mr. Hawkinson has served as a Director since 2019. From 2012 to 2018, he served as founder and Chief Executive Officer of SmartThings, a consumer IoT platform. Mr. Hawkinson is currently and has been

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since 2019 a co-founder and operator of Bright.AI and One Tap Away, and has previously founded and operated other companies. Mr. Hawkinson is the founder and operator of multiple companies, including Bright.AI and One Tap Away. Mr. Hawkinson serves on the boards of directors of CSC ServiceWorks, Latham Pools, Mural Advisors (for which he also currently serves as General Partner since 2020), Mural 365, OPTcorp, and the Advisory Council of the College of Electrical and Computer Engineering at Carnegie Mellon University. His deep expertise spans artificial intelligence, IoT, AI, cloud-based software, and mobile applications in both consumer and enterprise technologies. He graduated from Carnegie Mellon University with a B.S. in Cognitive Science in 1994. We believe Mr. Hawkinson is qualified to serve on our board of directors due to his experience in executive roles and his experience on the boards of directors of other companies.

Wen-Chung Ko

Mr. Ko has served as a Director since 2015. Mr. Ko founded Chang Chen Instrument Co., LTD. and Gentech Instrument Electronic LTD in 1975 and 2000, respectively. He has served as the President of Chang Chen Instrument Co., LTD. and Gentech Instrument Electronic LTD since 1975 and 2000, respectively. Mr. Ko is also a board member of Chang Qun Development Co., LTD., a land development corporation in Taiwan. Mr. Ko was named to The New Millennium’s Prominent Figures in Taiwan (Finance and Economics) list published in 1999 by the International Trade Association of Taiwan Republic of China. We believe Mr. Ko is qualified to serve on our board of directors due to his prior experience on the boards of directors of other companies.

Charles Robins

Charles W. Robins has served as a Director since 2009. Mr. Robins was most recently a Partner at Weil, Gotshal & Manges in their Private Equity Group before he retired in 2008, and served as senior counsel from 2008 to 2017. Prior to joining Weil, Mr. Robins spent more than 30 years with the Boston firm of Hutchins & Wheeler (later Hutchins, Wheeler & Dittmar), where he established and built that firm’s private equity practice. Mr. Robins began his career with the office of the Chief Counsel, Internal Revenue Service in Washington, D.C., where he analyzed and developed policy issues regarding redemptive buyouts, the precursor of the modern leveraged buyout. He is a member of the American, Massachusetts and Boston Bar Associations and an overseer at the Beth Israel Deaconess Hospital in Boston. Mr. Robins graduated from Bates College with a B.A., and from Columbia Law School with an LLB. We believe Mr. Robins is qualified to serve on our board of directors due to the continuity he brings due to his extensive prior service on our board of directors and his significant legal, corporate and advisory experience.

Andrew Singer

Andrew Singer has served as a Director since 2021. Mr. Singer is a principal at Pamplona, having joined the firm in 2013. Prior to this role, Mr. Singer worked in the mergers and acquisitions practice at Merrill Lynch with a focus on branded consumer products. During his time at Pamplona, he served on the board of several companies, including Latham Pool, a leading consumer-focused manufacturer and marketer of in-ground swimming pools, Calyx, a tech-enabled clinical development business, Parexel, a global clinical research organization (“CRO”) and Spreemo, a radiology intelligence platform. Mr. Singer holds a Bachelor of Science degree in business and enterprise management from the Calloway School of Business and Accountancy at Wake Forest University. We believe Mr. Singer is qualified to serve as a member of our board of directors because of his extensive financial services experience and consumer products knowledge.

Gary E. Stevenson

Gary E. Stevenson co-founded iFIT’s predecessor company, Weslo, Inc., in 1977, with Scott R. Watterson and has served as a Director since 1988. Mr. Stevenson previously served as President and Chief Operating Officer of iFIT from 1988 to 2008. In 2008, Mr. Stevenson resigned as an employee and officer of the Company after accepting a full-time assignment from The Church of Jesus Christ of Latter-day Saints, and between 2012 and

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2015, served as the Presiding Bishop. Mr. Stevenson currently serves as a member of the Quorum of the Twelve of The Church of Jesus Christ of Latter-day Saints. Mr. Stevenson’s current and past affiliations include Utah State University President’s National Advisory Council, Utah State University College of Business and Engineering Advisory Board, Marriott School, Brigham Young University National Advisory Council, among others. Mr. Stevenson graduated from Utah State University College of Business in 1979 with a B.S. in Business Administration and a minor in Japanese. We believe Mr. Stevenson is qualified to serve as a member of our board of directors because of his extensive knowledge of the Company and our industry, his leadership in global organizations, and the continuity that he brings to our board of directors as a co-founder of our Company.

Abigail Taylor

Abigail Taylor will serve as a Director upon the effective date of the registration statement of which this prospectus forms a part. Ms. Taylor is the General Manager of Asurion’s Retail business segment, overseeing 25 clients, as well as the Chief Operations Leader for the company’s Strategic Portfolio, which includes select North and South American wireless carriers and cable providers in seven countries. In this role, Ms. Taylor has led the business in winning key new accounts, serving 130 million customers, and transforming operations to a digital-first service model. Previously, Ms. Taylor built Asurion’s Customer Experience & Brand organization where she had responsibility for leading the company’s end-to-end customer experience efforts across both the Wireless Carrier and Retail businesses. Ms. Taylor joined Asurion in 2013 after spending her early career at Bain & Co, PepsiCo and The Parthenon Group in Strategy and Finance roles. Ms. Taylor holds a B.A., in Economics from Duke University and an MBA from Harvard Business School. We believe that Ms. Taylor is qualified to serve on our board of directors due to her extensive leadership experience in the retail and consumer industries.

Family Relationships

Scott R. Watterson, who is our Co-Founder, Chief Executive Officer and one of our directors, and David J. Watterson, who is our Chief Strategy Officer and one of our directors, are brothers. There are no other family relationships among any of our executive officers or directors named herein.

Board of Directors

Our business and affairs are managed under the direction of our board of directors. Our amended and restated certificate of incorporation will provide that the total number of directors on our board of directors shall be fixed from time to time, exclusively by resolution adopted by a majority of the board of directors.

Contemporaneously with this offering, our board will be composed of 13 directors divided into three classes, with terms staggered according to class. Class I will initially consist of five directors, Class II will initially consist of four directors and Class III will initially consist of five directors. The Class I directors, whose terms will expire at the first annual meeting of our stockholders following the filing of our amended and restated certificate of incorporation, will be Erica Berchtold, Alexander Hawkinson, Wen-Chung Ko, and Abigail Taylor. The Class II directors, whose terms will expire at the second annual meeting of our stockholders following the filing of our amended and restated certificate of incorporation, will be Greg Benson, Karen Boykin-Towns, Charles Robins and David Watterson. The Class III directors, whose terms will expire at the third annual meeting of our stockholders following the filing of our amended and restated certificate of incorporation, will be Scott Dahnke, Robert C. Gay, Andrew Singer, Gary E. Stevenson and Scott R. Watterson. See “Description of Capital Stock — Antitakeover Provisions” for more information. In uncontested elections, our directors will be elected by a majority of the votes cast. A plurality vote standard applies to contested elections where the number of nominees exceeds the number of directors to be elected.

Right of Pamplona and L Catterton to Appoint Directors

Pamplona and L Catteron shall each have the right to nominate one director to our board of directors and to appoint one board observer, until such time as they have received a cash return equal to the New Convertible

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Notes issued to them. The board observer right survives until there is no longer any amount payable under the applicable New Convertible Note. Andrew Singer is the Pamplona director appointee, and Scott Dahnke is the L Catterton director appointee. See also “Certain Relationships and Related Party Transactions — Omnibus Investor Agreement.”

Director Independence and Controlled Company Exemption

Following the offering, we will be eligible to avail ourselves of the “controlled company” exemption under the corporate governance rules of NASDAQ. Accordingly, we will not be required to have a majority of “independent directors” on our board of directors as defined under the rules of NASDAQ nor will we have a compensation committee and a nominating, governance and corporate responsibility committee composed entirely of independent directors. However, we anticipate that our Board will be composed of a majority of independent directors and that our compensation committee and our nominating, governance and corporate responsibility committee will be comprised of independent directors. The “controlled company” exemption does not modify the independence requirements for the audit committee, and we intend to comply with the requirements of Sarbanes-Oxley and NASDAQ, which require that our audit committee be composed of at least three members, one of whom will be independent upon the listing of our Class A common stock, a majority of whom will be independent within 90 days of listing and each of whom will be independent within one year of listing.

If at any time we cease to be a “controlled company” under the rules of NASDAQ, our board of directors will take all action necessary to comply with NASDAQ corporate governance rules, including appointing a majority of independent directors to the board of directors and establishing certain committees composed entirely of independent directors, subject to a permitted “phase-in” period.

Lead Independent Director

Our board of directors will adopt, effective prior to the completion of this offering, corporate governance guidelines that provide that one of our independent directors will serve as our lead independent director. Our board of directors has appointed Mr. Gay to serve as our lead independent director. As lead independent director, Mr. Gay will preside over periodic meetings of our independent directors, serve as a liaison between the Chairperson of our board of directors and the independent directors, and perform such additional duties as our board of directors may otherwise determine and delegate.

Board Committees

Prior to the completion of this offering, our board of directors will establish an audit committee, a compensation committee and nominating, governance and corporate responsibility committee. Each committee will operate under a charter that has been approved by our board of directors and will have the composition and responsibilities described below. Members serve on these committees until their resignations or until otherwise determined by our board of directors. The charter of each committee will be available on our website.

Audit Committee

The primary purposes of our audit committee are to assist the board of directors’ oversight of:

• audits of our financial statements;

• the integrity of our financial statements;

• our process relating to risk management and the conduct and systems of internal control over financial reporting and disclosure controls and procedures;

• the qualifications, engagement, compensation, independence and performance of our independent auditor;

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• the performance of our internal audit function; and

• certain conflicts and related person transactions.

Upon the consummation of this offering, and prior to the listing of our Class A common stock, our audit committee will be composed of Greg Benson, Charles Robins and Abigail Taylor. Greg Benson will serve as chair of the audit committee. Each of Messrs. Benson and Robins and Ms. Taylor qualifies as an “audit committee financial expert” as such term has been defined by the Securities and Exchange Commission in Item 407(d) of Regulation S-K. Our Board has affirmatively determined that each of Messrs. Benson and Robins and Ms. Taylor meets the definition of an “independent director” for the purposes of serving on the audit committee under applicable NASDAQ rules and Rule 10A-3 under the Exchange Act. We intend to comply with these independence requirements for all members of the audit committee within the time periods specified under such rules. The audit committee will be governed by a charter that complies with the rules of NASDAQ.

Compensation Committee

The primary purposes of our compensation committee are to assist the board of directors in overseeing our management compensation policies and practices, including:

• determining and approving the compensation of our executive officers; and

• reviewing and approving incentive compensation and equity compensation policies and programs.

Upon the consummation of this offering, and prior to the listing of our Class A common stock, our compensation committee will be composed of Erica Berchtold, Charles Robins and Andrew Singer, each of whom qualifies as an independent director for the purpose of serving on the compensation committee. Charles Robins will serve as chair of the compensation committee. Although we intend to avail ourselves of the “controlled company” exemption under the rules of NASDAQ, we anticipate that our compensation committee will be composed entirely of independent directors. The compensation committee will be governed by a charter that complies with the rules of NASDAQ.

Nominating, Governance and Corporate Responsibility Committee

The primary purposes of our nominating, governance and corporate responsibility committee are to recommend candidates for appointment to the board of directors and to review the corporate governance guidelines of the Company, including:

• identifying and screening individuals qualified to serve as directors;

• developing, recommending to the board of directors and reviewing the Company’s corporate governance guidelines;

• coordinating and overseeing the annual self-evaluation of the board of directors and its committees; and

• reviewing on a regular basis the overall corporate governance of the Company and recommending improvements to the board of directors where appropriate.

• develop, recommend and oversee a program relating to corporate responsibility and sustainability, including environmental, social and governance matters.

Upon the consummation of this offering, and prior to the listing of our Class A common stock, our nominating, governance and corporate responsibility committee will be composed of Karen Boykin-Towns, Scott Dahnke and Robert C. Gay. Scott Dahnke will serve as the chair of the nominating, governance and corporate responsibility committee. Although we intend to avail ourselves of the “controlled company” exemption under the rules of NASDAQ, we anticipate that our nominating, governance and corporate responsibility committee will be composed entirely of independent directors. Upon the consummation of this offering, and prior to the listing of our Class A common stock, we will be governed by a charter that complies with the rules of NASDAQ.

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Compensation Committee Interlocks and Insider Participation

None of the members of our compensation committee is or has been an officer or employee of our company. None of our executive officers has served as a member of the board of directors, or as a member of the compensation or similar committee, of any entity that has one or more executive officers who served on our board of directors or compensation committee during fiscal 2020.

Indemnification of Directors and Officers

Our amended and restated certificate of incorporation will provide that we will indemnify our directors and officers to the fullest extent permitted by the DGCL.

We intend to enter into indemnification agreements with each of our directors prior to the completion of this offering. The indemnification agreements will provide the directors with contractual rights to indemnification, expense advancement and reimbursement, to the fullest extent permitted under the DGCL, subject to certain exceptions contained in those agreements

Code of Business Conduct

Prior to the completion of this offering, we will amend our code of business conduct that applies to our employees, officers and directors. The full text of our code will be available on our website located at www.ifit.com. Any amendments or waivers from our code for our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, to our code will be disclosed on our Internet website promptly following the date of such amendment or waiver.

Corporate Governance Guidelines

Our Board will adopt corporate governance guidelines in accordance with the corporate governance rules of NASDAQ that serve as a flexible framework within which our board of directors and its committees operate. These guidelines will cover a number of areas including the duties and responsibilities of the board of directors, director independence, Board leadership structure, executive sessions, CEO evaluations, management development and succession planning, director nomination, qualification and election, director orientation and continuing education, Board agenda, materials, information and presentations, director access to company employees and independent advisers, Board communication with stockholders and others, director compensation and annual board and committee performance evaluations. A copy of our corporate governance guidelines will be posted on our website.

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EXECUTIVE AND DIRECTOR COMPENSATION

The following tables and accompanying narrative disclosure set forth information about the compensation provided to certain of our executive officers during fiscal years end May 31, 2021 and May 31, 2020. These executive officers, who consist of our principal executive officer and the two most highly compensated executive officers (other than our principal executive officer) who were serving as executive officers as of May 31, 2021, the end of our last completed fiscal year, were:

• Scott R. Watterson, Co-Founder, Chief Executive Officer

• David J. Watterson, Executive Vice President, Chief Strategy Officer

• Steven J. Barr, Executive Vice President, Chief Financial Officer

We refer to these individuals in this section as our “NEOs” or “named executive officers.”

Summary Compensation Table

The following table sets forth certain information regarding the total compensation awarded to, earned by or paid to our named executive officers for services rendered in all capacities in respect of fiscal 2020 and 2021.

Name and Principal Position	Year Ended May 31,		Salary ($)(1)		Bonus ($)(2)		Stock Awards ($)		Option Awards ($)(3)		Nonequity Incentive Plan Compensation ($)		Nonqualified deferred compensation earnings ($)		All Other Compensation ($)(4)		Total ($)
Scott R. Watterson     Co-Founder, Chief Executive Officer		2021		853,635		1,440,000		—		50,076,161		—		—		1,396,770		53,766,566
		2020		744,540		2,190,000		—		—		—		—		115,320		3,013,541
David J. Watterson     Executive Vice President, Chief Strategy Officer		2021		669,250		600,000		—		—		—		—		78,099		1,347,349
		2020		577,407		862,500		—		17,269,093		—		—		74,958		18,757,460
Steven J. Barr     Executive Vice President, Chief Financial Officer(5)		2021		270,833		1,000,000		—		4,793,166		—		—		133,562		6,197,561

(1) Base salary amounts represent the amount earned during the applicable fiscal year.

(2) These amounts represent bonuses paid for fiscal 2021 and 2020. Cash bonus payments are generally paid in two tranches at mid-year and year-end. Bonuses are based on a percentage of the annual Adjusted EBITDA. For fiscal 2021, represents the first tranche (mid-year) of the annual bonus paid based on a percentage of an anticipated Adjusted EBITDA for fiscal year 2021 with the second tranche to be paid once results are determined in fiscal 2022. For Mr. S. Watterson, fiscal 2021 includes $1,440,000 cash bonus paid on December 11, 2020. For Mr. D. Watterson, fiscal 2021 includes $600,000 cash bonus paid on December 11, 2020. For Mr. Barr, fiscal 2021 includes $1,000,000 cash bonus paid on April 17, 2021. For fiscal 2020, also includes bonus payments made to Messrs. S. Watterson and D. Watterson on January 22, 2020 in connection with the successful completion of the 2019 Financing Transaction. For Mr. S. Watterson, fiscal 2020 includes $300,000 cash bonus paid on January 3, 2020, $690,000 cash bonus paid on September 9, 2020, and $1,200,000 cash bonus earned in connection with the 2019 Financing Transaction. For Mr. D. Watterson, fiscal 2020 includes $126,000 cash bonus paid on January 3, 2020, $286,500 cash bonus paid on September 9, 2020, and $450,000 cash bonus earned in connection with the 2019 Financing Transaction.

(3) The amounts reported in the Option Awards column represent the grant date fair value of the stock options granted to our NEOs during fiscal 2021 and 2020 as computed in accordance with FASB Accounting Standards Codification Topic 718. The assumptions used in calculating the grant date fair value of the stock options reported in the Option Awards column are set forth in Note 20 of the notes to our consolidated financial statements included elsewhere in this

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prospectus. Note that the amounts reported in this column reflect the accounting cost for these stock options and do not correspond to the actual economic value that may be received by our NEOs from the stock options. For Mr. D. Watterson, includes (1) the grant date fair value of an aggregate of 2,904,741 options in three stock option grants made on May 4, 2020, all of which were immediately exercisable and (2) the incremental fair value of an aggregate of 3,494,119 options previously granted to Mr. D. Watterson in 2014, which were modified in May 2020 to eliminate a performance condition related to a liquidity event, which resulted in all of such options being immediately exercisable. On June 10, 2020 after the end of the fiscal 2020, Mr. D. Watterson exercised all of his outstanding options. For Mr. S. Watterson includes a grant date fair value of an aggregate of 10,662,624 stock options award on May 28, 2021, which are immediately exercisable. For Mr. Barr includes a grant date fair value of an aggregate of 1,020,600 stock options awarded on May 28, 2021, which vest in equal monthly installments over a two-year vesting period, with the vesting period commencing on November 1, 2020. 50% of any stock options granted to Mr. Barr that are outstanding but not yet vested and exercisable at any given time shall vest and become exercisable upon a liquidity event.

(4) For Mr. S. Watterson, reflects $31,368 and $36,794, respectively, for fiscal 2021 and 2020 for the personal use of a Company-provided vehicle and $10,812 and $40,432, respectively, for fiscal 2021 and 2020 as the aggregate cost of premiums for life, welfare, and health insurance plans for senior executives and other medical expenses.

For Mr. D. Watterson, reflects $35,587 and $30,751, respectively, for fiscal 2021 and 2020 for the personal use of a Company-provided vehicle and $16,262 and $21,954, respectively, for fiscal 2021 and 2020 as the aggregate cost of premiums for insurance plans for senior executives and other medical expenses.

For Mr. Barr, reflects $104,170 as reimbursement for automobile purchase and $28,495 for moving expense and as the aggregate cost of premiums for insurance plans for senior executives and other medical expenses.

For Mr. S. Watterson, reflects $145,250 and $38,094, respectively, for fiscal 2021 and 2020 of below market-loan interest based on the federal funds rate for loans that the Company extended to Mr. S. Watterson. For Mr. S. Watterson, includes $1,209,340 loan from the Company that was forgiven in fiscal 2021. See “Certain Relationships and Related Party Transactions – Executive Loans” for a further description of the loans.

For Mr. D. Watterson, reflects $26,250 and $22,253, respectively, for fiscal 2021 and 2020 of below market-loan interest based on the federal funds rate for loans that the Company extended to Mr. D. Watterson. See “Certain Relationships and Related Party Transactions – Executive Loans” for a further description of the loans.

The cost of the Company-provided vehicle was determined based on the personal use of the vehicle as a percentage of total usage compared to the lease value of the vehicle.

(5) Mr. Barr commenced service as our Chief Financial Officer on November 1, 2020.

Cash Compensation

In fiscal 2021 and 2020, cash compensation for our NEOs was a combination of base salary and cash bonuses. Base salaries pair or earned by each of Messrs. S. Watterson, D. Watterson, and Barr are set forth in the Summary Compensation Table above in the “Salary” column. Annual cash bonuses were paid to our NEOs in two tranches at mid-year and year-end. Bonuses are based on a percentage of the annual Adjusted EBITDA. For fiscal 2021, the first tranche of the annual bonus was paid based on a percentage of an anticipated Adjusted EBITDA for fiscal 2021 with the second tranche to be paid once results are determined. For 2021, Mr. Barr received a discretionary cash bonus of $1 million for service provided to the Company.

Equity Compensation

From time to time, we have granted equity awards in the form of qualified and nonqualified stock options to our NEOs, which may vest on the grant date or in equal installments over a three year-period and in some cases subject to a performance condition subject to a liquidity event. As described in the footnote to the Summary Compensation Table above, in May 2021, Messrs. S. Watterson and Barr were granted options to purchase an aggregate of 10,662,624 and 1,020,600 shares of our common stock, respectively. Stock options granted to Mr. Watterson were immediately vested. Stock option granted to Mr. Barr vest in equal monthly installments over a two-year vesting period, with the vesting period commencing on November 1, 2020. 50% of any stock options granted to Mr. Barr that are outstanding but not yet vested and exercisable at any given time shall vest

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and become exercisable upon a liquidity event. Our NEOs currently hold outstanding stock options to purchase shares of our Class A common stock that were granted under our 2014 Stock Option Plan, as set forth in the “Outstanding Equity Awards at Fiscal Year-End Table” below.

Deferred Compensation Plan

Our named executive officers are eligible to participate in the Deferred Compensation Plan for ICON Health & Fitness, Inc., which we sometimes refer to as the Deferred Compensation Plan, which permits eligible participants to make elective deferrals of up to 100% of the participant’s annual base salary, up to 100% of the participant’s annual short-term cash incentive compensation or other discretionary bonuses and up to 100% of the participant’s commissions. Deferred amounts credited to a participant’s account are generally distributed following the participant’s retirement or disability, in a lump sum or up to five annual installments, as elected by the participant. In addition, participants have the option of electing to receive in-service distributions on such date specified by the participant. Further under the Deferred Compensation Plan, a participant’s Deferred Compensation Plan account is deemed to be invested in one or more alternate investment options, such as a mutual fund, for purposes of tracking the deemed investment gain or loss on the participant’s account. The Deferred Compensation Plan is non-funded and unsecured in that it represents only a contractual promise by us to make benefit payments in the future and participants in the Deferred Compensation Plan have the status of general unsecured creditors of our Company. The Deferred Compensation Plan will continue to operate following this offering.

Employment Agreements

We are currently party to employment agreements with Scott R. Watterson and Steven J. Barr, as described below.

Scott R. Watterson

We entered into the Second Amended and Restated Employment Agreement with Scott R. Watterson for his services as our Chief Executive Officer and Chairman in July 2008, as amended from time to time and last amended in May 2020 (the “Watterson Employment Agreement”). The Watterson Employment Agreement provides for a two-year term beginning on May 31, 2020. The Watterson Employment Agreement provides that Mr. Watterson will receive an annualized base salary of $625,000 and is eligible to receive an annual bonus equal to 1.5% of the consolidated EBITDA (as defined therein) subject to the terms and conditions described in the Watterson Employment Agreement. Under the Watterson Employment Agreement, our Board may, in its discretion, increase the amount of Mr. Watterson’s annualized base salary to such greater amount as it may deem appropriate. In addition to the above, Mr. Watterson participates in the employee benefits program offered by us to our similarly-situated employees and is reimbursed for reasonable expenses in connection with the performance of his duties. Mr. Watterson is also entitled to a new automobile of his choice, every three years. The Watterson Employment Agreement also includes certain restrictive covenants, including a one year non-compete and eighteen month non-solicitation provisions.

Mr. Watterson may terminate the agreement any time with six months prior written notice, provided, however, we may accelerate Mr. Watterson’s last day of employment to any date within the six month notice period without converting the resignation into anything other than a voluntary resignation. Subject to the opportunity to cure, we may terminate Mr. Watterson’s employment for (i) willful misconduct or gross negligence, (ii) the commission of a criminal act against the corporation involving material harm, (iii) the commission of a criminal act of moral turpitude bringing the corporation into disrepute, (iv) willful insubordination to any directive of the Board provided reasonable prior notice of such directive is given by written notice to Mr. Watterson, and (v) violation of certain enumerated employment obligations by Mr. Watterson causing the company material harm. Mr. Watterson may resign with prior written notice for any reason.

If we terminate Mr. Watterson’s employment without cause or Mr. Watterson terminates his employment following any material diminution of his responsibilities, for being asked by the Board to perform any act which a reasonable person would consider illegal or unethical or following a “Change of Control” as defined in the Watterson Employment Agreement, then we must provide Mr. Watterson with (i) Mr. Watterson’s annual base salary then in effect and (ii) the annual bonus as defined in the Watterson Employment Agreement. These payments (other than the Accrued Obligations) are subject to Mr. Watterson’s execution and non-revocation of a waiver and release of claims.

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In the event that Mr. Watterson’s employment is terminated due to his disability, we must provide Mr. Watterson a disability severance payment equal to one month’s base salary in effect at termination multiplied by the number of each calendar year, or part thereof, of Mr. Watterson’s employment with the corporation, any subsidiary, IHF Capital, Inc. or IHF Holdings, Inc. (or any predecessor companies) after January 1, 1988.

Steven J. Barr

In connection with our offering, we entered into the Offer Letter with Steven J. Barr for his services as our Executive Vice President and Chief Financial Officer (the “Barr Offer Letter”). The Barr Offer Letter provides that Mr. Barr will receive an annualized base salary of $750,000 and is eligible to receive an annual bonus equal to $1.5 million subject to the terms and conditions described in the Barr Offer Letter. Under the Barr Offer Letter, our Board may, in its discretion, increase the amount of Mr. Barr’s annualized base salary to such greater amount as it may deem appropriate. In addition to the above, Mr. Barr participates in the employee benefits program offered by us to our similarly-situated employees and is reimbursed for reasonable expenses in connection with the performance of his duties. The Barr Offer Letter also provides for a grant of 18,800 stock options in connection with our offering (the “IPO Grant”). The IPO Grant is subject to time-based vesting and accelerated vesting in connection with certain terminations of employment, as described in further detail below.

The Barr Offer Letter also includes certain restrictive covenants, including an eighteen month non-compete and confidentiality provisions.

Subject to the opportunity to cure, we may terminate Mr. Barr’s employment for (i) any act or omission by Mr. Barr that constitutes a material breach of the Barr Offer Letter or any other material agreement with the Company, (ii) Mr. Barr’s willful failure or willful refusal to perform the lawful duties required of Mr. Barr as an employee of the Company, (iii) any material violation by Mr. Barr of any material Company written policy, rule or regulation or any law or regulation applicable to the Company’s business of which Mr. Barr has knowledge or should have knowledge as Chief Financial Officer, (iv) Mr. Barr’s act or omission constituting fraud, material dishonesty, breach of fiduciary duty, gross negligence, willful misconduct or intentional misrepresentation in relation to Mr. Barr’s duties to the Company or (v) Mr. Barr’s conviction or, or plea of guilty or nolo contendere to, any felony or crime of moral turpitude. Mr. Barr may resign with prior written notice with or without “good reason”, defined to include any of the following actions by the Company without Mr. Barr’s consent: (i) a relocation of Mr. Barr’s position to a location outside the state of Utah, (ii) a significant diminution of job function, reporting relationship or scope or (iii) a decrease in base salary compensation (other than a general reduction in base salary affecting all similarly situated executives in substantially the same proportions, up to a maximum reduction of 10%) or target bonus opportunity.

If we terminate Mr. Barr’s employment without cause or Mr. Barr terminates his employment for good reason (a “Qualifying Termination”), then we must provide Mr. Barr with (i) continuation of Mr. Barr’s annual base salary then in effect for twelve months, (ii) COBRA reimbursement for 12 months, and (iii) continued or accelerated vesting into the next vesting period following termination. These payments (other than the Accrued Obligations) are subject to Mr. Barr’s execution and non-revocation of a waiver and release of claims. The Barr Offer Letter further provides that if such Qualifying Termination occurs within 12 months of a Change in Control (as defined in the Barr Offer Letter), Mr. Barr’s IPO Grant will accelerate and vest in full.

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Outstanding Equity Awards at Fiscal Year-End

The following table sets forth certain information with respect to outstanding equity awards held by our named executive officers as of May 31, 2021.

				Option Awards
Name	Grant Date			Number of securities underlying unexercised options (#) exercisable		Number of securities underlying unexercised options (#) unexercisable		Equity incentive plan awards: Number of securities underlying unexercised unearned options (#)		Option exercise price ($)		Option expiration date
Scott R. Watterson		5/28/2021	(1)		10,662,624		—		—		9.06		5/28/2031
David J. Watterson		—			—		—		—		—		—
Steven J. Barr		5/28/2021	(2)		255,150		765,450		—		9.06		5/28/2031

(1) Represents stock options exercisable for shares of Class B common stock granted to Mr. S. Watterson. Options granted in fiscal 2021 were immediately vested and exercisable.

(2) Represents stock options exercisable for shares of Class A common stock granted to Mr. Barr. Options granted in fiscal 2021 vest in equal monthly installments over a two-year vesting period, with the vesting period commencing on November 1, 2020. 50% of any stock options granted to Mr. Barr that are outstanding but not yet vested and exercisable at any given time shall vest and become exercisable upon a liquidity event, including upon the consummation of this offering.

Employment Benefit Plans

2014 Stock Option Plan

In fiscal 2014, the Company established a stock option plan (“2014 Plan”). The 2014 Plan included a total reserved amount of 27,594,000 shares subject to options, stock appreciation rights, restricted stock, and other stock-based awards. On May 28, 2021, our Board of Directors approved an amendment to the 2014 Plan to increase the maximum shares available for issuance from 27,594,000 to 40,401,774. The Company has granted options in fiscal years 2014, 2017, 2020, 2021 and fiscal Q1 2022 under the 2014 Plan. Options generally have a contractual term of 10 years from the grant date.

2021 Equity Incentive Plan

In connection with the offering, our board of directors will adopt an omnibus equity incentive plan (the “2021 Plan”). The 2021 Plan is intended to provide flexibility to motivate, attract and retain the service providers who are expected to make significant contributions to our success and allow participants to share in such success. The principal features of the 2021 Plan are summarized below.

Purpose. The purposes of the 2021 Plan are to align the interests of eligible participants with our stockholders by providing incentive compensation tied to the Company’s performance and to advance the Company’s interests and increase stockholder value by attracting, retaining and motivating key personnel.

Shares Available. Subject to adjustment as provided in Section 4 of the 2021 Plan, the total number of shares of common stock that may be issued under the 2021 Plan will not exceed 45,000,000 (the “Share Reserve”). Each share of common stock subject to an award shall reduce the Share Reserve by one share; provided, however, that awards that are required to be paid in cash pursuant to their terms shall not reduce the Share Reserve. Any shares of common stock delivered under the 2021 Plan shall consist of authorized and unissued shares or treasury shares. The shares of common stock that are withheld from an award in payment or net settlement of the exercise, base or purchase price or taxes relating to such an award will be deemed not to have been delivered under the 2021 Plan and will continue to be available for further awards.

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Administration. The 2021 Plan may be administered by our board of directors, the Compensation Committee of our board of directors, or such other committee of our board of directors appointed by our board of directors to administer the 2021 Plan (as applicable, the “Committee”). The Committee has the power and discretion necessary to administer the 2021 Plan, with such powers including, but not limited to, the authority to select persons to participate in the 2021 Plan, determine the form and substance of awards under the 2021 Plan, determine the conditions and restrictions, if any, subject to which such awards will be made, modify the terms of awards, accelerate the vesting of awards, and make determinations regarding a participant’s termination of employment or service for purposes of an award.

Eligibility. Any employee, officer, non-employee director, consultant or other personal service provider to the Company or any of its subsidiaries are eligible to participate in the 2021 Plan, at the Committee’s discretion. In its determination of eligible participants, the Committee may consider any and all factors it considers relevant or appropriate, and designation of a participant in any year does not require the Committee to designate that person to receive an award in any other year.

Award Limit for Directors. No non-employee director may be granted during any calendar year, awards that have a fair value that when added to all other cash compensation received in respect of service as a member of our board of directors for such calendar year, would exceed $500,000. The independent members of our board of directors may make exceptions to this limit for a non-executive chair of our board of directors, provided that the non-employee director receiving such additional compensation may not participate in the decision to award such compensation.

Awards. The types of awards available under the 2021 Plan include stock options (both incentive and non-qualified), stock appreciation rights, restricted stock awards, restricted stock units, and stock awards. All awards granted to participants under the 2021 Plan will be represented by an award agreement.

Stock Options. A stock option granted under the 2021 Plan entitles a participant to purchase a specified number of shares of our common stock during a specified term (with a maximum term of ten years at an exercise price), at an exercise price that will be not be less than the fair market value of one share of our common stock as of the date of grant.

The Committee will determine the requirements for vesting and exercisability of the stock options, which may be based on the continued employment or service of the participant with the Company for a specified time period, upon the attainment of performance goals or both. The maximum term of a stock option is 10 years, subject to earlier termination upon termination of employment or service of the participant, as determined by the Committee. Unless approved by the Company’s stockholders, the Committee may not take any action with respect to a stock option that would be treated as a “repricing” under the then applicable requirements of the stock exchange on which shares of our common stock are listed, or that would result in the cancellation of “underwater” stock options in exchange for cash or other awards. Stock options are nontransferable except in limited circumstances.

Stock Appreciation Rights. A stock appreciation right (“SAR”) granted under the 2021 Plan entitles a participant to the right to receive, upon exercise or other payment of the SAR, an amount in cash, shares of our common stock or a combination of both, equal to the product of (a) the excess of (i) the fair market value of one share of our common stock on the date of exercise or payment of the SAR, over (ii) the base price of such SAR, and (b) the number of shares of our common stock as to which such SAR is exercised or paid. The base price of a SAR will be not less than the fair market value of one share of our common stock as of the date of grant. SARs are nontransferable, except in limited circumstances.

The Committee will determine the requirements for vesting and exercisability of the SARs, which may be based on the continued employment or service of the participant with the Company for a specified time period or upon the attainment of specific performance goals, or both. The maximum term of a SAR is 10 years, subject to earlier termination upon termination of employment or service of the participant, as determined by the Committee. Unless approved by the Company’s stockholders, the Committee may not take any action with respect to a SAR that would be treated as a “repricing” under the then applicable requirements of the stock exchange on which shares of our common stock are listed, or that would result in the cancellation of “underwater” SARs in exchange for cash or other awards.

Restricted Stock Awards. A restricted stock award granted under the 2021 Plan is a grant of a specified number of shares of our common stock to a participant, subject to vesting restrictions as specified in the award. The Committee will determine the requirements for the lapse of the vesting restrictions for the restricted stock awards, which may be based on the continued employment or service of the participant with the Company over a specified time period, upon the attainment of performance goals, or both.

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The participant will have the rights of a stockholder with respect to the shares of our common stock granted under a restricted stock award, including the right to vote the shares and receive all dividends and other distributions with respect thereto, unless the Committee determines otherwise. If a participant has the right to receive dividends paid with respect to a restricted stock award, such dividends shall not be paid to the participant until the underlying award vests. Any shares granted under a restricted stock award are nontransferable, except in limited circumstances. A participant may make an election under Section 83(b) of the Code for tax planning purposes.

Restricted Stock Units. A restricted stock unit (“RSU”) granted under the 2021 Plan provides a participant to the right to receive, upon vesting and settlement of the restricted stock unit, one share of our common stock per vested unit, or an amount in cash equal to the fair market value of one share, as determined by the Committee. The Committee may grant RSUs together with dividend equivalent rights (which will not be paid until the award vests), and the holder of any RSUs will not have any voting or other rights as a stockholder until the shares of our common stock underlying the RSUs are delivered. The Committee will determine the requirements for vesting and payment of the RSUs, which may be based on the continued employment or service of the participant with the Company for a specified time period, or upon the attainment of specific performance goals, or both. RSUs will be forfeited if the vesting requirements are not satisfied. RSUs are nontransferable, except in limited circumstances.

Stock Awards. Stock awards may be granted to eligible participants under the 2021 Plan and consist of an award of shares of our common stock. A stock award may be granted for past employment or service, in lieu of bonus or other cash compensation, as director’s compensation or any other purpose as determined by the Committee. The Committee will determine the requirements for the vesting and payment of the stock award, with the possibility that awards may be made with no vesting requirements. Upon receipt of the stock award, the participant will have all rights of a stockholder with respect to the shares of our common stock, including the right to vote and receive dividends (which will not be paid until the award vests).

Vesting of Awards. Awards granted under the 2021 Plan shall vest no earlier than the first anniversary of the date of grant; provided, that the following awards shall not be subject to the foregoing minimum vesting requirement: any (i) awards substituted or assumed in connection with corporate transactions, (ii) awards to non-employee directors that vest on the earlier of the first anniversary of the date of grant and the next annual meeting of stockholders, (iii) shares of our common stock delivered in lieu of fully vested cash obligations, and (iv) any additional awards the Committee may grant, up to a maximum of five percent (5%) of the Share Reserve, as adjusted in connection with corporate events or transactions.

Performance-Based Compensation. All types of awards granted under the 2021 Plan may be granted with vesting, payment, lapse of restrictions and/or exercisability requirements that are subject to the attainment of specific performance goals. The Committee may adjust performance goals, or the manner of measurement thereof, as it deems appropriate. Performance goals to which an award is subject may include the performance goals specified in the 2021 Plan, or any other performance goal determined by the Committee.

Plan Amendments or Termination. Our board of directors may amend, modify, suspend or terminate the 2021 Plan, provided that if such amendment, modification, suspension or termination materially and adversely affects any award, the Company must obtain the affected participant’s consent. Certain amendments or modifications of the 2021 Plan may also be subject to the approval of our stockholders as required by SEC and NYSE rules or applicable law.

Termination of Service. Awards under the 2021 Plan may be subject to reduction, cancellation or forfeiture upon termination of service or failure to meet applicable performance conditions or other vesting terms.

Under the 2021 Plan, unless an award agreement provides otherwise, if a participant’s employment or service is terminated for cause, or if after termination the Committee determines that the participant engaged in an act that falls within the definition of cause, or if after termination the participant engages in conduct that violates any continuing obligation of the participant with respect to the Company, the Company may cancel, forfeit and/or recoup any or all of that participant’s outstanding awards. In addition, if the Committee makes the determination above, the Company may suspend the participant’s right to exercise any stock option or stock appreciation right,

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receive any payment or vest in any award pending a determination of whether the act falls within the definition of cause (as defined in the 2021 Plan). If a participant voluntarily terminates employment or service in anticipation of an involuntary termination for cause, that shall be deemed a termination for cause.

The Company has the right to recoup any gain realized by the participant from the exercise, vesting or payment of any award if, within one year after such exercise, vesting or payment, the participant is terminated for cause, the Committee determines the participant is subject to recoupment due to a clawback policy or if after the participant’s termination the Committee determines that the participant engaged in an act that falls within the definition of cause or materially violated any continuing obligation of the participant with respect to the Company.

Change in Control. Under the 2021 Plan, in the event of a change in control of the Company, as defined in the 2021 Plan, all outstanding awards shall either be (a) continued or assumed by the surviving company or its parent, or (b) substituted by the surviving company or its parent for awards, with substantially similar terms (with appropriate adjustments to the type of consideration payable upon settlement, including conversion into the right to receive securities, cash or a combination of both, and with appropriate adjustment of performance conditions or deemed achievement of such conditions).

Only to the extent that outstanding awards are not continued, assumed or substituted upon or following a change in control, the Committee may, but is not obligated to, make adjustments to the terms and conditions of outstanding awards, including without limitation (i) acceleration of exercisability, vesting and/or payment immediately prior to, upon or following such event, (ii) upon written notice, provided that any outstanding stock option and stock appreciation right must be exercised during a period of time immediately prior to such event or other period (contingent upon the consummation of such event), and at the end of such period, such stock options and stock appreciation rights shall terminate to the extent not so exercised, and (iii) cancellation of all or any portion of outstanding awards for fair value (in the form of cash, shares, other property or any combination of such consideration) as determined in the sole discretion of the Committee.

Adjustments. In the event of any recapitalization, reclassification, share dividend, extraordinary cash dividend, stock split, reverse stock split, merger, reorganization, consolidation, combination, spin-off or other similar corporate event or transaction affecting the shares of our common stock of the Company, the Committee will make equitable adjustments to (i) the number and kind of shares or other securities available for awards and covered by outstanding awards, (ii) the exercise, base or purchase price, or other value determinations of outstanding awards, and/or (iii) any other terms of an award affected by the corporate event.

IPO Awards. In connection with the offering, we intend to grant 332,980 restricted shares and options under

the 2021 Plan to certain directors, executive officers and employees at the time of this offering for approximately 6,210,729 shares of common stock, with the public offering price as the exercise price, including (i) 678,208 shares of Class A common stock issuable upon exercise of options granted to Scott R. Watterson, (ii) 1,241,957 shares of Class A common stock issuable upon exercise of options granted to David J. Watterson, and (iii) 784,161shares of Class A common stock issuable upon exercise of options granted to Steven J. Barr. We also intend to grant options for approximately 12,701 shares of Class A common stock, with the public offering price as the exercise price, to certain of our non-employee directors (Greg Benson, Erica Berchtold, Karen Boykin-Towns, Robert C. Gay, Alexander Hawkinson, Charles Robins and Abigail Taylor).

Potential Payments Upon Termination or Change-In-Control

We do not have any termination or change in control payment arrangements, except as described above in “—Employment Agreements.”

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Additional Compensation in Fiscal Q1 or Q2 2022

On May 28, 2021, the board of directors approved a cash payment to Scott R. Watterson in the amount of $35.0 million contingent upon liquidity events, including an initial public offering.

In addition, to comply with the Sarbanes-Oxley Act, a loan in a principal amount of $44.0 million extended by the Company to Scott R. Watterson was forgiven, and $9 million in aggregate principal amount of loans to David J. Watterson were forgiven. See “Certain Relationships and Related Party Transactions — Executive Loans.”

In addition, upon the closing of this offering, the Company intends to enter into a Restricted Property Award Agreement with Scott R. Watterson, pursuant to which it intends to grant to Scott R. Watterson a restricted interest in $50.0 million of New Convertible Notes (the “restricted property”), subject to certain conditions. Under the Restricted Property Award Agreement, Mr. Watterson’s right to retain the restricted property is subject to forfeiture in the event his employment or service with the Company or a subsidiary is terminated for any reason prior to the lapse of the forfeiture restrictions. The forfeiture restrictions will lapse on the earlier of (i) the date of certain liquidity events, such as the conversion or sale by the other initial holders of all the New Convertible Notes, or upon death or a termination without cause, and (ii) the six year anniversary of agreement. During the period of applicability of the forfeiture restrictions, Mr. Watterson shall not have any rights of a holder under the New Convertible Notes including conversion rights, and any interest thereon (which must be paid in the form of Class A shares during such period) and any other payments thereon will form part of the restricted property that is subject to the same forfeiture restrictions.

Fiscal Q2 2022 compensation will also include compensation expense related to the IPO Awards described above, to be made in connection with the offering, to certain directors, executive officers and employees, with the public offering price as the exercise price, including (i) 678,208 shares of Class A common stock issuable upon exercise of options granted to Scott R. Watterson, (ii) 1,241,957 shares of Class A common stock issuable upon exercise of options granted to David J. Watterson, and (iii) 784,161 shares of Class A common stock issuable upon exercise of options granted to Steven J. Barr, as described above. See “—Employment and Benefit Plans —2021 Equity Incentive Plan—IPO Awards.”

In addition, we intend to modify and reprice certain grants made under the 2014 Plan and enter into loans and other compensation arrangements with non-executive employees, which we describe in notes (O) and (Q) to our Unaudited Pro Forma Condensed Consolidated Balance Sheet. See “Unaudited Pro Forma Condensed Consolidated Financial Information.”

Non-Employee Director Compensation

The following table sets forth information concerning the compensation of our non-employee directors for fiscal 2021. Compensation information for Messrs. S. Watterson and D. Watterson is included in the “Summary Compensation Table” above. In fiscal 2021, the non-employee directors as indicated below received an annual cash retainer of $40,000, payable in equal quarterly installments. Other than as set forth in the table and described herein, during fiscal 2021, we did not pay any fees to, make any equity awards or non-equity awards to, or pay any other compensation to the non-employee members of our board of directors. We also reimburse each of our directors for all reasonable out-of-pocket expenses incurred in connection with attendance at board and committee meetings.

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Name	Fees Earned or Paid in Cash ($)		All Other Compensation ($)			Total ($)
Greg Benson		40,000		—			40,000
Karen Boykin-Towns		—		—			—
Scott Dahnke		—		—			—
Robert C. Gay		—		—			—
Alexander Hawkinson		—		—			—
Wen-Chung Ko		40,000		—			40,000
Marc Magliacano		—		—			—
Charles Robins		40,000		—			40,000
Andrew Singer		—		—			—
Gary E. Stevenson		40,000		1,793,891	(1)		1,833,891

(1) Includes a loan initially extended in 1999 to Mr. Stevenson in the principal amount of $990,660 and related payments of $803,231 in connection with the forgiveness of such loan in fiscal 2021.

In connection with this offering, we intend to grant options for approximately 12,701 shares of Class A common stock, with the public offering price as the exercise price, to certain of our non-employee directors (Greg Benson, Erica Berchtold, Karen Boykin-Towns, Alexander Hawkinson, Robert C. Gay, Charles Robins and Abigail Taylor).

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PRINCIPAL STOCKHOLDERS

The following table shows information as of August 31, 2021 regarding the beneficial ownership of our common stock as adjusted to give effect to this offering, assuming no exercise of the underwriters’ option to purchase additional shares of our Class A common stock, by:

• each person or group who is known by us to own beneficially more than 5% of our Class A or Class B common stock;

• each member of our board of directors and each of our named executive officers; and

• all members of our board of directors and our executive officers as a group.

Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as noted by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole voting and investment power with respect to all shares of our common stock shown as beneficially owned by them. Percentage of beneficial ownership is based on 239,211,835 shares of common stock outstanding as of August 31, 2021 (after giving effect to the stock-split), and 200,488,123 shares of Class A common stock and 114,402,561 shares of Class B common stock outstanding after giving effect to this offering and the Concurrent Transactions, assuming no exercise of the underwriters’ option to purchase additional shares, or 205,103,507 shares of Class A common stock, assuming the underwriters exercise their option to purchase additional shares in full. Shares of Class A or Class B common stock subject to options or other convertible securities currently exercisable or exercisable within 60 days of the date of this prospectus are deemed to be outstanding and beneficially owned by the person holding the options for the purposes of computing the percentage of beneficial ownership of that person and any group of which that person is a member, but are not deemed outstanding for the purpose of computing the percentage of beneficial ownership for any other person. Except as otherwise indicated, the persons named in the table below have sole voting and investment power with respect to all shares of capital stock held by them. Unless otherwise indicated, the address for each holder listed below is 1500 South West 1000, Logan, Utah, 84321.

	Shares Beneficially Owned Before this Offering					Percentage of Total Voting Power Before this Offering			Shares Beneficially Owned After this Offering and Concurrent Transactions										Percentage of Total Shares After this Offering			Percentage of Total Voting Power After this Offering
	Common Stock								Class A					Class B
Name and address of beneficial owner	Number of shares		Percentage of shares						Number of shares		Percentage of shares			Number of shares		Percentage of shares
5% stockholders:
Scott R. Watterson (1)		218,231,665		83.7	%		83.7	%		–		–			125,065,185		100	%		38.4	%		86.2	%
Gary E. Stevenson (2)		43,424,608		16.7	%		16.7	%		43,424,608		21.7	%		–		–			13.8	%		3.2	%
Wen-Chung Ko (3)		34,424,465		13.2	%		13.2	%		34,424,465		17.2	%		–		–			10.9	%		2.6	%
Robert C. Gay (4)		18,375,318		7.0	%		7.0	%		18,375,318		9.2	%		–		–			5.8	%		1.4	%
Pamplona (5)		20,862,992		8.0	%		8.0	%		36,393,836		18.2	%		–		–			11.6	%		2.7	%
L. Catterton (6)		11,770,618		4.5	%		4.5	%		26,457,921		13.2	%		–		–			8.4	%		2.0	%
Named executive officers and directors:
Scott R. Watterson (1)		218,231,665		83.7	%		83.7	%		–		–			125,065,185		100	%		38.4	%		86.2	%
David J. Watterson		9,492,790		3.6	%		3.6	%		9,492,790		4.7	%		–		–			3.0	%		*
Steven J. Barr (7)		–		–			–			1,020,600		*			–		–			*			*
Everett Smith (8)		160,348		*			*			548,099		*			–		–			*			*
Greg Benson		–		–			–			–		–			–		–			–			–
Erica Berchtold		–		–			–			–		–			–		–			–			–
Karen Boykin-Towns		–		–			–			–		–			–		–			–			–
Scott Dahnke (6)		11,770,618		4.5	%		4.5	%		26,457,921		13.2	%		–		–			8.4	%		2.0	%
Robert C. Gay (4)		18,375,318		7.0	%		7.0	%		18,375,318		9.2	%		–		–			5.8	%		1.4	%
Alexander Hawkinson		–		–			–			–		–			–		–			–			–
Wen-Chung Ko		34,424,465		13.2	%		13.2	%		34,424,465		17.2	%		–		–			10.9			2.6
Charles Robins		–		–			–			–		–			–		–			–			–

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	Shares Beneficially Owned Before this Offering					Percentage of Total Voting Power Before this Offering			Shares Beneficially Owned After this Offering and Concurrent Transactions										Percentage of Total Shares After this Offering			Percentage of Total Voting Power After this Offering
	Common Stock								Class A					Class B
Name and address of beneficial owner	Number of shares		Percentage of shares						Number of shares		Percentage of shares			Number of shares		Percentage of shares
Andrew Singer		–		–			–			–		–			–		–			–			–
Gary E. Stevenson (2)		43,424,608		16.7	%		16.7	%		43,424,608		21.7	%		–		–			13.8	%		3.2	%
Abigail Taylor		–		–			–			–		–			–		–			–			–
All directors, director nominees and executive officers as a group (persons)		247,958,305		95.1	%		95.1	%		132,175,102		65.9	%		125,065,185		100	%		78.3	%		94.4	%

* Represents beneficial ownership of less than 1% of our outstanding common stock.

(1) Represents, before this offering all 207,551,041 shares of common stock currently held by HF Investment Holdings, LLC, an entity controlled by Scott R. Watterson, and options in 10,662,624 shares of Class A common stock. In connection with the offering, the interests of Mr. Watterson and an affiliate SW ICON LLC in HF Investment Holdings in 114,402,561 shares will be exchanged for shares of Class B common stock and distributed to Mr. Watterson and SW ICON LLC. After this offering, represents 114,402,561 shares of Class B common stock and options in 10,662,624 shares of Class B common stock. These figures do not include the restricted grant in $50.0 million of New Convertible Notes, the rights in which are subject to forfeiture restrictions and are not currently convertible into Class A common stock. These figures do not include Class A common stock issuable upon conversion of Class B common stock.

(2) Represents shares held directly as well as the indirect interests of Mr. Stevenson and an affiliate GS ICON LLC in HF Investment Holdings, which will be distributed in connection with the completion of the offering.

(3) Represents the indirect interests of Mr. Ko in HF Investment Holdings, which will be distributed in connection with the completion of the offering.

(4) Represents the indirect interests of Mr. Gay and affiliates BG ICON LLC and BG ICON II LLC in HF Investment Holdings, which will be distributed in connection with the completion of the offering.

(5) Represents (a) before this offering, 20,862,992 shares issuable upon exercise by Icon Preferred Holdings, L.P. of warrants (including anti-dilution), and (b) after this offering, 20,695,494 shares to be issued upon net settlement of warrants held by it, 527,904 shares issued as partial repayment of the Series A preferred stock and 15,170,438 shares issuable upon conversion of New Convertible Notes issued in the Concurrent Transactions, based on the assumptions described herein.

(6) Represents (a) before this offering, 11,770,618 shares issuable upon exercise by LC9 Connected Holdings, LP of warrants (including anti-dilution), and (b) after this offering, 11,676,623 shares to be issued upon net settlement of warrants held by it, 7,390,649 shares issued as partial repayment of the Series A preferred stock and 7,390,649 shares issuable upon conversion of New Convertible Notes issued in the Concurrent Transactions, based on the assumptions described herein. All of the shares of common stock are held by LC9 Connected Holdings, LP. LC9 Management, L.L.C. is the general partner of LC9 Connected Holdings, LP, and the management of LC9 Management, L.L.C. is controlled by its managing members. Scott A. Dahnke and J. Michael Chu are the managing members of LC9 Management, L.L.C. and as such could be deemed to share voting control and investment power over such shares that are held by LC9 Connected Holdings, LP, but each disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. The business address of the entities and individuals mentioned in this footnote is 599 West Putnam Avenue, Greenwich, CT 06830.

(7) Represents 1,020,600 stock options that may be settled with shares of Class A common stock within 60 days of the date of this prospectus.

(8) Represents (a) before this offering, 160,348 shares held directly, and (b) after this offering, includes 387,751 stock options that may be settled with shares of Class A common stock within 60 days of the date of this prospectus.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Set forth below is a description of certain relationships and related person transactions between us or our subsidiaries and our directors, executive officers or holders of more than 5% of our voting securities.

2019 Financing Transaction

On November 18, 2019, we entered into a securities purchase agreement with Icon Preferred Holdings, L.P., an entity managed by Pamplona (a beneficial holder of more than 5% of our Class A common stock), pursuant to which Pamplona purchased a subordinated promissory note of the Company, with an initial $200,000,000 principal amount, and a warrant for 19,676,110 shares of Class A common stock of the Company (subject to vesting and adjustment), for an aggregate purchase price of $200,000,000 in cash.

The 2019 Note bears interest that accrues at a rate per annum equal to 7.0% to and including November 29, 2026, and thereafter at a rate of 10.0%. The 2019 Note must be repaid upon an initial public offering at a price equal to 150% of the principal amount thereof. In the event that Pamplona does not exercise the 2019 Warrant on or before November 29, 2024, then Pamplona’s shares under the 2019 Warrant increase on each successive six month anniversary thereof, until the maximum amount of shares available is 25,853,840 shares of common stock of the Company; however, because the 2019 Note is expected to be repaid in full upon closing of the initial public offering, these increases will not vest. The number of shares issuable upon exercise of the 2019 Warrant is subject to certain anti-dilution rights. Upon completion of the offering, we will issue new shares of Class A common stock to the warrant holder to net settle on a non-cash basis the 2019 Warrant as described herein, including adjustments resulting from the holder’s anti-dilution rights. We have made no payments pursuant to the 2019 Note, and we expect to pay approximately $300,000,000 in a combination of cash and New Convertible Notes as described herein in connection with repayment of the 2019 Note upon closing of the initial public offering. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt and Preferred Stock—2019 Note and 2019 Warrant.”

2020 Financing Transactions

On October 2, 2020, we entered into a securities purchase agreement with LC9 Connected Holdings, L.P., an entity managed by L Catterton (a beneficial holder of more than 5% of our Class A common stock) and Pamplona, pursuant to which L Catterton purchased 196 shares of Series A preferred stock of the Company and a warrant for 11,501,709 shares of common stock of the Company (“2020 Warrant No. 1”), for an aggregate purchase price of $196,000,000, and Pamplona purchased 14 shares of Series A preferred stock of the Company and a warrant for 821,546 shares of common stock of the Company (“2020 Warrant No. 2”), for an aggregate purchase price of $14,000,000.

Upon an initial public offering, the Company must pay in full all outstanding shares of Series A preferred stock at a price per share equal to the greater of (i) the sum of (a) the liquidation value of each outstanding share of Series A preferred stock, plus (b) all accrued but unpaid dividends and (ii) 150% of the liquidation value of such outstanding share of Series A preferred stock. We are required to pay the Company’s Series A preferred stockholders a price equal to 125% of the liquidation value of such Series A preferred stock, if an initial public offering occurs prior to September 30, 2021. Therefore, in connection with the closing of this offering, this mandatory payment will be required to be made at a price equal to 125% of the liquidation value, and at the Company’s option 50% to 80% of the 125% purchase price must be paid in a combination of cash and New Convertible Notes as described herein, and the remainder of the payment is required to be made with a number of shares of Class A common stock equal to the amount of the remainder divided by 85% of the public offering price of the Class A common stock.

In the event that L Catterton does not exercise 2020 Warrant No. 1 on or before November 29, 2024, then L Catterton’s shares under 2020 Warrant No. 1 increase on each successive six month anniversary thereof, until the

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maximum amount of shares available is 17,639,219 shares of common stock of the Company. Similarly, if Pamplona does not exercise 2020 Warrant No. 2 on or before November 29, 2024, then Pamplona’s shares under 2020 Warrant No. 2 increase on each successive six month anniversary thereof, until the maximum amount of shares available is 1,260,026 shares of common stock of the Company. The number of shares issuable upon exercise of 2020 Warrant No. 1 and 2020 Warrant No. 2 is subject to certain anti-dilution rights. Upon completion of the offering, we will issue new shares of Class A common stock to the warrant holder to net settle on a non-cash basis the 2020 Warrants as described herein, including adjustments resulting from the holders’ anti-dilution rights. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt and Preferred Stock—Series A Preferred Stock and 2020 Warrants.”

Stock Redemption

During November 2020 through January 2021, the Company offered to redeem from its existing stockholders common stock, subject to certain limitations. The offer was extended to all stockholders on the same terms. Certain of the Company’s existing stockholders, including 5% stockholders and directors, agreed to participate in respect of all or a portion of their outstanding shares. In aggregate, the Company redeemed 12,515,154 shares of common stock for aggregate consideration of $13,786,534. The following directors and/or beneficial holders of more than 5% of our Class A common stock received the following payments for their corresponding portion of that redemption: Gary E. Stevenson ($3,000,037), Wen-Chung Ko ($3,000,358) and Robert C. Gay ($2,000,011).

Executive Loans

In October 2020, the Company extended a loan to Scott R. Watterson, our Co-Founder and Chief Executive Officer and a director, in a principal amount of $44 million. This loan matures on October 2, 2030 and bears interest at a rate of 1.12% per annum. The Company has also extended loans to David J. Watterson, our Chief Strategy Officer and a director, consisting of a loan extended in October 2020 in a principal amount of $8 million, maturing on October 2, 2030 and bearing interest at a rate of 1.12% per annum, a loan extended in June 2019 in a principal amount of $250,000, maturing on June 19, 2029 and bearing interest at a rate of 2.73%, a loan extended in August 2017 in an aggregate principal amount of $750,000, maturing on August 20, 2027 and bearing interest at a rate of 2.55%, and a loan extended in May 2021 in a principal amount of $9,329,756, maturing on May 17, 2023 and bearing interest at a rate of 0.13%. Immediately prior to the public filing of this registration statement, these loans were forgiven or repaid to comply with the Sarbanes-Oxley Act. The $44 million loan to Scott R. Watterson was forgiven and $9 million in aggregate principal amount of loans to David J. Watterson were forgiven. The loan to David J. Watterson in the principal amount of $9,329,756 was repaid by the surrender of the equivalent of 963,673 shares of common stock pledged to secure such loan. For additional information see Notes 20 and 23 to the notes to our consolidated financial statements.

Employment Arrangements with Immediate Family Members of Our Executive Officers

The Company employs seven immediate family members of Scott R. Watterson (other than David J. Watterson): Blake A. Watterson (son), our Chief Operating Officer; Eric Watterson (son), our Chief Marketing Officer; Mark D. Watterson (son), our Chief Experience Officer; Nick T. Watterson (son), a product manager; Tony L. Ritchie (brother in law), our Director of Member Care; Lisa D. Bybee (sister-in-law), a Supervisor of Direct Sales; and Brian N. Green (son-in-law), a National Account Manager. The aggregate compensation paid to these immediate family members of Scott R. Watterson was $2,312,065 in fiscal 2021, $1,620,765 in fiscal 2020, $991,596 in fiscal 2019 and $1,013,184 in fiscal 2018. In addition, the Company has granted stock options to these immediate family members over 2,001,623 shares of stock, with a weighted average exercise price of $0.10 per share. In connection with the offering, the Company intends to grant restricted shares and options under the 2021 Plan to immediate family members for approximately 396,068 shares of common stock, with the public offering price as the exercise price.

The Company employs three immediate family members of David J. Watterson: Tony Smith (brother-in-law) our Chief Development Officer; David C. Watterson (son), a VP of Member Experience; and Cade C. Watterson

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(son), a marketing manager of CRM. The aggregate compensation paid to these immediate family members of David J. Watterson was $1,461,279.81 in fiscal 2021, $927,406 in fiscal 2020, $545,808 in fiscal 2019 and $640,938 in fiscal 2018. In addition, the Company has granted stock options to these immediate family members over 1,212,170 shares of stock, with a weighted average exercise price of $0.01 per share. In connection with the offering, the Company intends to grant restricted shares and options under the 2021 Plan to immediate family members for approximately 201,285 shares of common stock, with the public offering price as the exercise price.

Manufacturing Services Provided by Affiliates of Wen-Chung Ko

The Company obtains certain manufacturing services from affiliates of Wen-Chung Ko, a director and beneficial holder of more than 5% of our Class A common stock. The aggregate purchases of these services were $31.2 million in fiscal 2021, $18.3 million in fiscal 2020, $17.8 million in fiscal 2019 and $18.9 million in fiscal 2018.

Development Services Provided by Affiliates of Alexander Hawkinson

The Company obtains certain development services from a media company affiliated with Alexander Hawkinson, a director. The aggregate payments for these services were $3.4 million in fiscal 2021.

Omnibus Investor Agreement

The Company and certain of our shareholders, including shareholders affiliated with Gary E. Stevenson, Scott R. Watterson, Robert C. Gay, Wen-Chung Ko, Pamplona and L Catterton are expected to enter into an omnibus investor agreement in connection with this offering. The omnibus investor agreement provides for entry into a registration rights agreement and the issuance of New Convertible Notes.

Registration Rights Agreement

Pursuant to the omnibus investors agreement, the Company is expected to enter into a registration rights agreement which provides Pamplona and L Catterton and the other investors party thereto certain demand and piggyback registration rights, including certain priority demand rights for Pamplona and L Catterton. In addition, the registration rights agreement will provide for a lock up that will restrict Scott R. Watterson and certain investors owning more than 5% of our common stock from selling our common stock until the earlier of (a) 18 months and (b) the receipt by Pamplona and L Catterton of proceeds equal to the principal amount of New Convertible Notes received by them, subject to certain limitations, including a $2.5 million carveout for each of Robert C. Gay and Gary E. Stevenson.

The New Convertible Notes will provide that so long as Pamplona, L Catterton and/or their permitted transferees that comprise the required holder or holders, they will retain a consent right over certain indebtedness and any cash dividends and will be entitled to certain information rights. In addition, we have agreed that until they receive a cash return equal to the principal amount of the New Convertible Notes issued to them, Pamplona and L Catterton shall each have the right to nominate one director to our board of directors and to appoint one board observer.

Restrictions on Transfer and Voting

The omnibus investor agreement provides that shares of common stock received by Pamplona and L Catterton pursuant to the omnibus investor agreement shall be transferable only if transferred together with a proportionate principal amount of the 2021 IPO Convertible Note B (as defined in the omnibus investor agreement) issued to Pamplona and L Catterton and a proportionate amount of any shares of common stock into which such 2021 Convertible Note B has been converted. Any attempted transfer of such shares of common stock without a transfer of the proportional portion of the 2021 IPO Convertible Note B and a proportionate amount of any shares of common stock into which such 2021 IPO Convertible Note B has been converted shall be void ab initio and of no effect. The omnibus investor agreement also includes certain provisions that would cap the voting percentage by the Pamplona board designees if the board has fewer than eleven (11) members.

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Restricted Grant in New Convertible Notes to Scott R. Watterson

In addition, upon the closing of this offering, the Company intends to enter into a Restricted Property Award Agreement with Scott R. Watterson, pursuant to which it intends to grant to Scott R. Watterson a restricted interest in $50.0 million of New Convertible Notes (the “restricted property”), subject to certain conditions. Under the Restricted Property Award Agreement, Mr. Watterson’s right to retain the restricted property is subject to forfeiture in the event his employment or service with the Company or a subsidiary is terminated for any reason prior to the lapse of the forfeiture restrictions. The forfeiture restrictions will lapse on the earlier of (i) the date of certain liquidity events, such as the conversion or sale by the other initial holders of all the New Convertible Notes, or upon death or a termination without cause, and (ii) the six year anniversary of agreement. During the period of applicability of the forfeiture restrictions, Mr. Watterson shall not have any rights of a holder under the New Convertible Notes including conversion rights, and any interest thereon (which must be paid in the form of Class A shares during such period) and any other payments thereon will form part of the restricted property that is subject to the same forfeiture restrictions.

Policies for Approval of Related Person Transactions

In connection with this offering, our board of directors will adopt a written related person transaction policy setting forth the policies and procedures for the review and approval or ratification by the audit committee of related person transactions. This policy will cover, with certain exceptions set forth in Item 404 of Regulation S-K under the Securities Act, any transaction, arrangement or series of transactions or arrangements in which we participate (whether or not we are a party) and a related person has or will have a direct or indirect material interest in such transaction. A related person includes (i) our directors, director nominees or executive officers, (ii) any 5% record or beneficial owner of our common stock or (iii) any immediate family member of the foregoing. In reviewing and approving any related party transaction, the audit committee is tasked to consider all of the relevant facts and circumstances, and consideration of various factors enumerated in the policy.

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DESCRIPTION OF MATERIAL INDEBTEDNESS

2021 Credit Agreement

We entered into the Credit Agreement, dated as of May 12, 2021 (the “2021 Credit Agreement” or the “Senior ABL Credit Agreement”), providing for an asset-based revolving credit facility (the “2021 Revolver” or the “Senior ABL Revolving Credit Facility”) with Bank of America, N.A., as administrative agent and collateral agent (in such capacities, the “Administrative Agent”), and the other financial institutions and lenders from time to time party thereto.

General

The Company is and, at the option of the Company, (i) any of the Company’s wholly-owned domestic subsidiaries (subject to certain exclusions for excluded subsidiaries including immaterial subsidiaries and captive insurance subsidiaries) (collectively with the Company, the “U.S. ABL Borrowers”), (ii) any of the Company’s wholly-owned Canadian subsidiaries (collectively, the “Canadian ABL Borrowers”) and (iii) in the sole discretion of the Administrative Agent and each of the lenders, any of the Company’s other wholly-owned foreign subsidiaries (collectively, the “Foreign ABL Borrowers” and, together with the U.S. ABL Borrowers and the Canadian ABL Borrowers, the “ABL Borrowers”) may be, a borrower under the Senior ABL Revolving Credit Facility. The Senior ABL Revolving Credit Facility provides for an asset-based revolving credit facility in the amount of up to $325.0 million, available in U.S. dollars to the U.S. ABL Borrowers and the Canadian ABL Borrowers (the “U.S. Facility”) and Canadian Dollars to the Canadian ABL Borrowers (the “Multicurrency Facility”), subject to (i) U.S. borrowing base availability (the “U.S. Borrowing Base”) and (ii) Canadian borrowing base availability (the “Canadian Borrowing Base” and, together with the U.S. Borrowing Base, the “Borrowing Base”), and includes letter of credit and swingline sub-facilities.

The Senior ABL Revolving Credit Facility matures on May 12, 2026.

Subject to certain conditions, without consent of the existing lenders (but subject to receipt of commitments), the ABL Borrowers are entitled to request additional revolving credit commitments under the Senior ABL Revolving Credit Facility up to an amount not to exceed (i)(x) the greater of $100.0 million and the amount by which the Borrowing Base exceeds the total amount of commitments at such time plus (ii) an unlimited amount with respect to incremental term facilities, (x) if incurred for purposes of a term loan facility, as long as the secured leverage ratio does not exceed 3.00 to 1.00 and (y) if unsecured, as long as the total leverage ratio does not exceed 4.00 to 1.00.

The “U.S. Borrowing Base” is defined in the Senior ABL Credit Agreement as, at any time, the sum of: (i) 100% of eligible cash of each U.S. ABL Borrower, (ii)(a) 90% of the value of all eligible accounts receivable of each U.S. ABL Borrower, (iii) 90% of the value of the eligible credit card accounts receivable of each U.S. ABL Borrower, plus (iv)(a) from June 1 through September 30 of each calendar year, the lesser of (1) 75% of the U.S. ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), at such time, valued at the lower of cost or market value, determined on a first-in-first-out basis and (2) the product of 95% multiplied by the net orderly liquidation value (“NOLV”) percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the U.S. ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), valued at the lower of the cost or market value, determined on a first-in-first-out basis and (b) at all other times, the lesser of (1) 75% of the U.S. ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), at such time, valued at the lower the cost or market value, determined on a first-in-first-out basis and (2) the product of 90% multiplied by the NOLV percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the U.S. ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), valued at the lower of the cost or market value, determined on a first-in-first-out basis, (v) the least of (a) 70% of the U.S. ABL Borrowers’ eligible in-transit inventory, at such time, valued at the lower of the cost or market value, determined on a first-in-first-out basis, (b) the product of 85% multiplied

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by the NOLV percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the U.S. ABL Borrower’s eligible in-transit inventory, valued at the lower of the cost or market value, determined on a first-in-first-out basis and (c) $80,000,000 or 25% of the Borrowing Base, (vi) the amount of the Canadian Borrowing Base that any U.S. ABL Borrower elects to allocate to the U.S. Borrowing Base minus (vii) the reserves on the U.S. Borrowing Base.

The “Canadian Borrowing Base” is defined in the Senior ABL Credit Agreement as, at any time, the sum of: (i) 100% of the U.S. dollar equivalent of eligible cash of each Canadian ABL Borrower, (ii)(a) 90% of the U.S. dollar value of all eligible accounts receivable of each Canadian ABL Borrower, (iii) 90% of the U.S. dollar value of the eligible credit card accounts receivable of each Canadian ABL Borrower, plus (iv)(a) from June 1 through September 30 of each calendar year, the lesser of (1) 75% of the Canadian ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), at such time, valued at the lower of the U.S. dollar cost or market value, determined on a first-in-first-out basis and (2) the product of 95% multiplied by the U.S. dollar NOLV percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the Canadian ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), valued at the lower of the U.S. dollar cost or market value, determined on a first-in-first-out basis and (b) at all other times, the lesser of (1) 75% of the Canadian ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), at such time, valued at the lower the U.S. dollar of cost or market value, determined on a first-in-first-out basis and (2) the product of 90% multiplied by the U.S. dollar NOLV percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the Canadian ABL Borrowers’ eligible inventory (other than eligible in-transit inventory), valued at the lower of the U.S. dollar cost or market value, determined on a first-in-first-out basis, (v) the least of (a) 70% of the Canadian ABL Borrowers’ eligible in-transit inventory, at such time, valued at the lower of the U.S. dollar cost or market value, determined on a first-in-first-out basis, (b) the product of 85% multiplied by the U.S. dollar NOLV percentage identified in the most recent inventory appraisal ordered by the Administrative Agent multiplied by the Canadian ABL Borrower’s eligible in-transit inventory, valued at the lower of the U.S. dollar cost or market value, determined on a first-in-first-out basis and (c) $80,000,000 or 25% of the Borrowing Base minus (vi) the reserves on the Canadian Borrowing Base and (vii) the amount of the Canadian Borrowing Base that any U.S. ABL Borrower elects to allocate to the U.S. Borrowing Base.

Interest Rates and Fees

The revolving credit loans under the Senior ABL Credit Agreement bear interest at the ABL Borrower’s election at a rate equal to (a) in the case of U.S. dollar denominated loans borrowed by any U.S. ABL Borrower or Canadian ABL Borrower, (i) the rate for deposits in U.S. dollars in the London interbank market (adjusted for statutory reserve requirements) for the applicable interest period (“LIBO Rate”), plus an applicable margin based on the average daily excess availability as set forth below, or (ii) the base rate, which will be the highest of (x)(1) except as provided in clause (2), the rate of interest publicly announced by Bank of America, N.A. as its “Prime Rate” in the US in effect at its principal office in New York City and (2) for the purpose of U.S. dollar denominated revolving credit loans to a Canadian ABL Borrower, the rate of interest per annum publicly announced from time to time Bank of America, N.A. (acting through its Canadian branch), as its U.S. “base rate” for U.S. dollar denominated commercial loans), (y) the greater of (1) the federal funds effective rate in effect on such day plus 0.50% per annum and (z) one-month LIBOR plus 1.00% per annum, and (b) in the case of Canadian dollar denominated loans borrowed by any Canadian ABL Borrower, (i) the sum of (x) the arithmetic average of the rates offered for Canadian dollar bankers’ acceptances for the interest period or comparable or successor rates approved by Bank of America, N.A., determined by it at or about 10:00 a.m. (Toronto time) on such day (“CDOR Rate”) and (y) an applicable margin based on the average daily excess availability as set forth below, or (ii) the higher of (x) the variable per annum rate of interest designated by Bank of America, N.A. (acting through its Canadian branch) as its prime rate for commercial loans, as in effect from time to time for Canadian Dollar loans in Canada and (y) one month CDOR Rate plus 1.00% per annum. As used below, “LIBO Rate Loans” are the loans referred to in clause (a)(i) above, “CDOR Rate Loans” are the loans referred to in clause (b)(i) above, “Alternate Base Rate Loans” are the loans referred to in clauses (a)(ii) above, and “Canadian

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Prime Rate Loans” are the loans referred to in clause (b)(ii) above. Alternate Base Rate Loans and Canadian Prime Rate Loans are subject to a “floor” of 0.00%, and LIBO Rate Loans and CDOR Loans are subject to a “floor” of 0.00%. The applicable margin as described herein is as follows:

Level	Excess Availability	Applicable Rate for LIBO Rate Loans or CDOR Rate Revolving Loans			Applicable Rate for Alternate Base Rate Loans or Canadian Prime Rate Loans
I	Greater than or equal to 50%		1.15	%		0.15	%
II	Less than 50%		1.20	%		0.20	%

The Senior ABL Revolving Credit Facility bears a commitment fee of 0.15% per annum on the average daily undrawn portion of the initial commitments under the Senior ABL Revolving Credit Facility, payable quarterly in arrears. The Senior ABL Revolving Credit Facility bears customary letter of credit fees.

Prepayments

If, at any time, the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit under the Senior ABL Revolving Credit Facility exceeds the lesser of (x) the then total effective commitments under the Senior ABL Revolving Credit Facility and (y) the then applicable Borrowing Base, prepayments of the revolving credit loans and/or swingline borrowings (and after giving effect to such prepayment, the cash collateralization of letters of credit) will be required in an amount equal to such excess. If, at any time, the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit under the U.S. Facility exceeds the then total effective commitments under the U.S. Facility, prepayments of the revolving credit loans and/or swingline borrowings (and after giving effect to such prepayment, the cash collateralization of letters of credit) under the U.S. Facility will be required in an amount equal to such excess. If at any time, the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit of the U.S. ABL Borrowers exceeds the U.S. Borrowing Base minus the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit of the Canadian ABL Borrowers made in reliance on the U.S. Borrowing Base, prepayments of the revolving credit loans and/or swingline borrowings (and after giving effect to such prepayment, the cash collateralization of letters of credit) of the U.S. ABL Borrowers will be required in an amount equal to such excess. If, at any time, the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit under the Multicurrency Facility exceeds the then total effective commitments under the Multicurrency Facility, prepayments of the revolving credit loans and/or swingline borrowings (and after giving effect to such prepayment, the cash collateralization of letters of credit) under the Multicurrency Facility will be required in an amount equal to such excess. If at any time, the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit of the Canadian ABL Borrowers exceeds the Borrowing Base minus the aggregate amount of outstanding revolving loans, swingline borrowings, unreimbursed drawings under letters of credit and the undrawn amount of outstanding letters of credit of the U.S. ABL Borrowers, prepayments of the revolving credit loans and/or swingline borrowings (and after giving effect to such prepayment, the cash collateralization of letters of credit) of the Canadian ABL Borrowers will be required in an amount equal to such excess. The application of proceeds from mandatory prepayments shall not reduce the aggregate amount of loan commitments under the Senior ABL Revolving Credit Facility and amounts prepaid may be reborrowed, subject to availability and then effective commitments under the Senior ABL Revolving Credit Facility.

After the occurrence and during the continuance of a Cash Dominion Period (defined in the Senior ABL Credit Agreement as (a) specified availability being less than the greater of (i) 10.0% of Line Cap and (ii) $20.0 million

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or (b) the occurrence of one or more specified events of default, in the case of clause (a) for a period of five consecutive business days and for which the Administrative Agent has delivered notice that such period is in effect), to the date that specified availability shall have been in excess of such thresholds in the definition of Cash Dominion Period for 20 consecutive business days and no specified event of default has existed or been continuing, all amounts deposited in the core concentration account controlled by the administrative agent will be applied on a daily basis to the outstanding loan balances under the Senior ABL Revolving Credit Facility and certain other secured obligations then due and owing.

Voluntary reductions of the unutilized portion of the Senior ABL Revolving Credit Facility commitments and prepayments of borrowings under the Senior ABL Revolving Credit Facility are permitted at any time, in minimum principal amounts in increments of $100,000 or CA$100,000 with respect to borrowings of LIBO Rate Loans and/or CDOR Rate Loans, respectively, without premium or penalty, subject to reimbursement of the lenders’ redeployment costs actually incurred in the case of a prepayment of adjusted LIBOR borrowings other than on the last day of the relevant interest period.

Guarantee; Security

All obligations under the Senior ABL Revolving Credit Facility are guaranteed by (i) iFIT Health & Fitness Inc (“Holdings”), (ii) each U.S. ABL Borrower (other than with respect to its own primary obligations) and (iii) each direct and indirect wholly-owned U.S. restricted subsidiary of the Company, other than certain excluded subsidiaries.

All obligations of each ABL Borrower and each guarantor are secured by first-priority security interests in substantially all of the tangible and intangible assets of the U.S. ABL Borrowers and the U.S. subsidiary guarantors, subject to permitted liens and other exceptions.

In addition to the guarantees set forth above, obligations of each Canadian ABL Borrower are also guaranteed by (i) each Canadian ABL Borrower (other than with respect to its own primary obligations) and (ii) each direct and indirect wholly-owned Canadian restricted subsidiary of any Canadian ABL Borrower, other than certain excluded subsidiaries.

All obligations of each Canadian ABL Borrower and each Canadian subsidiary guarantor are secured by a first priority lien on substantially all of the tangible and intangible assets of the Canadian ABL Borrowers and the Canadian subsidiary guarantors, subject to permitted liens and other exceptions.

The Senior ABL Revolving Credit Facility generally requires the security interest in deposit accounts owned by the ABL Borrowers and its subsidiaries to be perfected by control, except for certain immaterial accounts and other exceptions.

Covenants, Representations and Warranties

The Senior ABL Revolving Credit Facility contains customary representations and warranties and customary affirmative and negative covenants. The negative covenants are limited to the following: limitations on indebtedness, liens, mergers, consolidations, liquidations and dissolutions, dispositions, sale and leasebacks, swap agreements, dividends, distributions, redemptions, repurchases and other restricted payments, loans, advances, guarantees acquisitions and other investments, prepayments, redemptions and repurchases of specified indebtedness, burdensome agreements and negative pledge clauses, amendments of material documents, Canadian pension plans, passive holding company and transactions with affiliates. The negative covenants are subject to customary exceptions and permit the payment of dividends and distributions, investments, permitted acquisitions and payments or redemptions of specified junior indebtedness upon satisfaction of certain dollar baskets and a “payment condition.” The payment condition is deemed satisfied upon 30-day specified excess availability exceeding agreed upon thresholds and the absence of specified events of default and, in certain cases, pro forma compliance with a fixed charge coverage ratio of 1.00 to 1.00.

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There are not any financial covenants included in the Senior ABL Credit Agreement, other than a springing minimum fixed charge coverage ratio of at least 1.00 to 1.00, which will be tested only when specified excess availability is less than the greater of (i) 10.0% of Line Cap and (ii) $20.0 million for five consecutive business days, and continuing until such time as specified availability has been in excess of such threshold for a period of 20 consecutive calendar days.

Events of Default

Events of default under the Senior ABL Credit Agreement are limited to nonpayment of principal when due, nonpayment of interest or other amounts, inaccuracy of representations or warranties in any material respect, violation of covenants, cross-default and cross-acceleration to other material debt, certain bankruptcy or insolvency events, certain ERISA and Canadian pension events, certain material judgments, actual or asserted invalidity of guarantees and certain other loan documents or security interests, failure to deliver a monthly borrowing base certificate, failure to comply with certain cash management provisions and a change of control, in each case subject to customary threshold, notice and grace period provisions.

The New Convertible Notes

In connection with the offering, and as full or partial consideration for the repayment of the 2019 Note and the Series A preferred stock, we intend to issue convertible senior notes (the “New Convertible Notes”) in an aggregate principal amount of up to $374.0 million, less the amount of cash applied to repayment of the 2019 Note and the Series A preferred stock. The New Convertible Notes will bear interest at a rate of 7.00% per annum, payable quarterly at the election of the Company in cash, by adding accrued amounts to the unpaid principal amounts of the New Convertible Notes outstanding or in additional Class A common stock (based on 85% of the 10-day volume weighted average price (“VWAP”)). The New Convertible Notes will mature on the sixth anniversary of issuance of the closing of the offering. The New Convertible Notes are pari passu in right of payment to any existing and future senior indebtedness, including indebtedness under the Senior ABL Revolving Credit Facility. The New Convertible Notes will rank senior in right of payment to any future subordinated borrowings.

Holders of the New Convertible Notes may convert all or any portion of the New Convertible Notes at their option at any time. The New Convertible Notes will be convertible, at the holder’s option, at an initial conversion price equal to 85% of the public offering price of our Class A common shares in the offering.

The Company may redeem the New Convertible Notes at any time, upon an agreed notice period, at par plus any accrued and unpaid interest. In addition, at any time following the second anniversary of issuance, the Company may require all holders to convert if the share price exceeds 150% of the public offering price based on a 60-day VWAP.

At maturity, the Company is required to repay the New Convertible Notes in cash at par plus any accrued but unpaid interest.

The New Convertible Notes will be held initially by Pamplona and L Catterton and will be subject to certain transfer restrictions. Each of Pamplona and L Catterton, until they have received a cash return equal to the principal amount of New Convertible Notes issued to them, shall be entitled to nominate one director to our board of directors and, subject to certain transfer rights, to appoint one board observer. The board observer right survives until there is no longer any amount payable under the applicable New Convertible Note.

In addition, upon the closing of this offering, the Company intends to enter into a Restricted Property Award Agreement with Scott R. Watterson, pursuant to which it intends to grant to Scott R. Watterson a restricted interest in $50.0 million of New Convertible Notes (the “restricted property”), subject to certain conditions. Under the Restricted Property Award Agreement, Mr. Watterson’s right to retain the restricted property is subject to forfeiture in the event his employment or service with the Company or a subsidiary is terminated for any reason prior to the lapse of the forfeiture restrictions. The forfeiture restrictions will lapse on the earlier of (i) the

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date of certain liquidity events, such as the conversion or sale by the other initial holders of all the New Convertible Notes, or upon death or a termination without cause, and (ii) the six year anniversary of agreement. During the period of applicability of the forfeiture restrictions, Mr. Watterson shall not have any rights of a holder under the New Convertible Notes, including conversion rights, and any interest thereon (which must be paid in the form of Class A shares during such period) and any other payments thereon will form part of the restricted property that is subject to the same forfeiture restrictions.

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DESCRIPTION OF CAPITAL STOCK

The following description summarizes the most important terms of our capital stock, as they will be in effect following this offering. Because it is only a summary, it does not contain all the information that may be important to you. We expect to adopt an amended and restated certificate of incorporation and amended and restated bylaws that will become effective upon the completion of this offering, and this description summarizes provisions that are expected to be included in these documents. For a complete description, you should refer to our amended and restated certificate of incorporation and amended and restated bylaws, which are included as exhibits to the registration statement of which this prospectus forms a part, and to the applicable provisions of Delaware law.

Upon the completion of this offering, our authorized capital stock will consist of 3,000,000,000 shares of our Class A common stock, $0.001 par value per share, 3,000,000,000 shares of our Class B common stock, $0.001 par value per share, and 50,000,000 shares of preferred stock, par value $0.001 issued and outstanding.

Assuming (a) the reclassification of all outstanding shares of our common stock into Class A common stock and the subsequent exchange or conversion of certain shares of Class A common stock for Class B common stock, which will occur in connection with the completion of this offering, (b) repayment of the Series A preferred stock with 7,918,553 shares of our Class A common stock and cash and New Convertible Notes, and repayment of the Series B preferred stock with 1,602,565 shares of our Class A common stock, which will occur in connection with the completion of the offering, (c) the issuance of 737,180 shares of our Class A common stock as deferred consideration for the 29029 acquisition and the issuance of 2,279,203 shares of our Class A common stock as deferred consideration for the Sweat acquisition, which will occur in connection with the completion of this offering, and (d) the issuance of 32,372,117 shares of our Class A common stock to settle outstanding warrants, which will occur in connection with the completion of this offering, as of August 31, 2021, there were outstanding:

• 169,718,892 shares of our Class A common stock outstanding, held by approximately 25 stockholders of record;

• 10,865,601 shares of our Class A common stock issuable upon exercise of outstanding stock options, with a weighted-average exercise price of $2.21 per share;

• 114,402,561 shares of our Class B common stock outstanding, held by the Scott R. Watterson holders; and

• 10,662,624 shares of our Class B common stock issuable upon exercise of outstanding stock options, held by the Scott R. Watterson holders, with a weighted-average exercise price of $9.06 per share; and

• shares of Class A common stock issuable upon conversion of the New Convertible Notes to be issued as described herein, which have an initial conversion price equal to 85% of the public offering price of our Class A common stock in this offering; based on the midpoint of the price range, we would have $374.0 million of outstanding New Convertible Notes, which would be immediately convertible into 22,561,086 shares of Class A common stock, and a restricted grant to our CEO in $50.0 million principal amount of New Convertible Notes which would, upon vesting, be convertible into 3,016,591 shares of Class A common stock.

In connection with this offering, we will adopt the 2021 Plan providing for the issuance of up to 45,000,000 shares of Class A common stock, including 332,980 restricted shares and options issued for 6,210,729 shares of Class A common stock to be granted in connection with the offering with an exercise price of the public offering price.

Class A Common Stock and Class B Common Stock

Dividend Rights

Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of our common stock are entitled to receive dividends out of funds legally available if our board of directors, in its discretion, determines to issue dividends and then only at the times and in the amounts that our board of directors may determine. See the section titled “Dividend Policy” for additional information.

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Any dividend or distributions paid or payable to the holders of shares of Class A common stock and Class B common stock shall be paid pro rata, on an equal priority, pari passu basis, unless different treatment of the shares of each such class is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A common stock and Class B common stock, each voting separately as a class; provided, however, that if a dividend or distribution is paid in the form of Class A common stock or Class B common stock (or rights to acquire shares of Class A common stock or Class B common stock), then the holders of the Class A common stock shall receive Class A common stock (or rights to acquire shares of Class A common stock) and holders of Class B common stock shall receive Class B common stock (or rights to acquire shares of Class B common stock).

Voting Rights

Holders of our Class A common stock are entitled to one vote for each share of Class A common stock held on all matters submitted to a vote of stockholders and holders of our Class B common stock are entitled to ten votes for each share of Class B common stock held on all matters submitted to a vote of stockholders. Except as otherwise provided in our amended and restated certificate of incorporation or as required by law, all matters to be voted on by our stockholders must be approved by the affirmative vote of the holders of a majority in voting power of the shares of stock of the Company which are present in person or by proxy and entitled to vote thereon. Following this offering, Scott R. Watterson, our Co-Founder and Chief Executive Officer, together with certain affiliated stockholders, also referred to as the Scott R. Watterson holders, will hold outstanding Class B common stock, which will represent 85.1% of the voting power of our outstanding capital stock. Holders of shares of our Class A common stock and Class B common stock vote together as a single class on all matters (including the election of directors) submitted to a vote of stockholders, unless otherwise required by Delaware law or our amended and restated certificate of incorporation. Delaware law could require either holders of our Class A common stock or Class B common stock to vote separately as a single class in the following circumstances:

• if we were to seek to amend our amended and restated certificate of incorporation to increase or decrease the par value of a class of our capital stock, then that class would be required to vote separately to approve the proposed amendment; and

• if we were to seek to amend our amended and restated certificate of incorporation in a manner that alters or changes the powers, preferences, or special rights of a class of our capital stock in a manner that affected its holders adversely, then that class would be required to vote separately to approve the proposed amendment.

Our amended and restated certificate of incorporation does not provide for cumulative voting for the election of directors. As a result, the holders of a majority of our voting shares can elect all of the directors then standing for election. Our amended and restated certificate of incorporation will provide for the annual election of our board of directors by our stockholders.

No Preemptive or Similar Rights

Our common stock is not entitled to preemptive rights and is not subject to redemption or sinking fund provisions.

Right to Receive Liquidation Distributions

Upon our liquidation, dissolution, or winding up, the assets legally available for distribution to our stockholders would be distributable ratably among the holders of our common stock and any participating preferred stock outstanding at that time, subject to the prior satisfaction of all outstanding debt and liabilities and the preferential rights of and the payment of liquidation preferences, if any, on any shares of preferred stock outstanding at that time.

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Change of Control Transactions

In the case of any distribution or payment in respect of the shares of our Class A common stock or Class B common stock upon a merger or consolidation with or into any other entity, or other substantially similar transaction, the holders of our Class A common stock and Class B common stock will be treated equally and identically with respect to shares of Class A common stock or Class B common stock owned by them, unless the only difference in the per share distribution to the holders of the Class A common stock and Class B common stock is that any securities distributed to the holder of a share Class B common stock have ten times the voting power of any securities distributed to the holder of a share of Class A common stock (or another difference that corresponds to the differences in rights between Class A and Class B common stock as set forth in the amended and restated certificate of incorporation), or such merger, consolidation, or other transaction is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A common stock and Class B common stock, each voting as a separate class.

Subdivisions and Combinations

If we subdivide or combine in any manner outstanding shares of Class A common stock or Class B common stock, the outstanding shares of the other class will be subdivided or combined in the same manner, unless different treatment of the shares of each class is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A common stock and Class B common stock, each voting as a separate class.

Conversion

Each outstanding share of Class B common stock is convertible at any time at the option of the holder into one share of Class A common stock. In addition, each share of Class B common stock will convert automatically into one share of Class A common stock upon any transfer, whether or not for value, which occurs after the closing of this offering, except for certain permitted transfers described in our amended and restated certificate of incorporation, including transfers and subsequent transfer to family members of the holders, trusts for the benefit of the holders or their family members, and partnerships, corporations, and other entities owned or controlled by the holders or their family members. Once converted or transferred and converted into Class A common stock, the Class B common stock may not be reissued.

All the outstanding shares of our Class B common stock will convert automatically into shares of our Class A common stock upon the date that is the earlier of (i) the date specified by a vote of the holders of not less than two-thirds of the voting power of the then outstanding shares of Class B common stock and (ii) the date the shares of Class B common stock cease to represent at least 15% of all outstanding shares of our common stock. Following such conversion, each share of Class A common stock will have one vote per share and the rights of the holders of all outstanding common stock will be identical. Once converted into Class A common stock, the Class B common stock may not be reissued.

Preferred Stock

Pursuant to the provisions of our amended and restated certificate of incorporation, each currently outstanding share of preferred stock will automatically be converted into shares of Class A common stock or otherwise be repaid with a combination of cash and/or New Convertible Notes, effective upon the completion of this offering. Following this offering, no shares of preferred stock will be outstanding.

Following the completion of this offering, our board of directors will be authorized, subject to limitations prescribed by Delaware law, to issue preferred stock in one or more series, to establish from time to time the number of shares to be included in each series, and to fix the designation, powers, preferences, and rights of the shares of each series and any of its qualifications, limitations, or restrictions, in each case without further vote or action by our stockholders. Our board of directors can also increase or decrease the number of shares of any

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series of preferred stock, but not below the number of shares of that series then outstanding, without any further vote or action by our stockholders. Our board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of our common stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring, or preventing a change in control of our company and might adversely affect the market price of our Class A common stock and the voting and other rights of the holders of our Class A common stock and Class B common stock. We have no current plans to issue any shares of preferred stock.

Stock Options

As of May 31, 2021, we had outstanding options to purchase an aggregate of 9,741,051 shares of our Class A common stock, with a weighted-average exercise price of $1.41 per share, and outstanding options to purchase an aggregate of 10,662,624 shares of our Class B common stock, with a weighted-average exercise price of $9.06 per share. Since May 31, 2021, we have granted options to purchase an aggregate of 6,657,071 shares of our Class A common stock, with a weighted-average exercise price of $17.74 per share, and options to purchase an aggregate of 678,208 shares of our Class A common stock, with a weighted-average exercise price of $19.50 to our chief executive officer.

Warrants

As of May 31, 2021, we had outstanding warrants to purchase up to 32,633,610 shares of our Class A common stock at an exercise price of $0.001. These warrants, after giving effect to certain anti-dilution adjustments, are expected to be settled in connection with the completion of this offering. See “Certain Relationships and Related Party Transactions—2019 Financing Transaction” and “—2020 Financing Transactions.”

Anti-Takeover Provisions

The provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws, as we expect they will be in effect upon the completion of this offering, could have the effect of delaying, deferring, or discouraging another person from acquiring control of our company. These provisions, which are summarized below, may have the effect of discouraging takeover bids. They are also designed, in part, to encourage persons seeking to acquire control of us to negotiate first with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with an unfriendly or unsolicited acquirer outweigh the disadvantages of discouraging a proposal to acquire us because negotiation of these proposals could result in an improvement of their terms.

Section 203 of the DGCL

In general, DGCL Section 203 prohibits a publicly held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years following the date on which the person became an interested stockholder unless:

• prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

• the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, but not the outstanding voting stock owned by the interested stockholder, (1) shares owned by persons who are directors and also officers and (2) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

• at or subsequent to the date of the transaction, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of stockholders, and not by

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written consent, by the affirmative vote of at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder.

Generally, a “business combination” includes a merger, asset or stock sale, or other transaction or series of transactions together resulting in a financial benefit to the interested stockholder. An “interested stockholder” is a person who, together with affiliates and associates, owns or, within three years prior to the determination of interested stockholder status, did own 15% or more of a corporation’s outstanding voting stock. We expect the existence of this provision to have an anti-takeover effect with respect to transactions our board of directors does not approve in advance. We also anticipate that DGCL Section 203 may also discourage attempts that might result in a premium over the market price for the shares of common stock held by stockholders.

The Company will be governed by Section 203 of the DGCL at such time that all the outstanding shares of our Class B common stock convert automatically into shares of our Class A common. Until such time, the Company will not be governed by Section 203 of the DGCL (or any successor provision thereto), and the restrictions contained in Section 203 shall not apply.

Amended and Restated Certificate of Incorporation and Amended and Restated Bylaw Provisions

Our amended and restated certificate of incorporation and our amended and restated bylaws will include a number of provisions that could deter hostile takeovers or delay or prevent changes in control of our management team, including the following:

• Dual Class Common Stock. As described above in the section titled “—Class A Common Stock and Class B Common Stock—Voting Rights,” our amended and restated certificate of incorporation will provide for a dual class common stock structure pursuant to which holders of our Class B common stock will have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the shares of our outstanding Class A and Class B common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.

• Classified Board of Directors. Our amended and restated certificate of incorporation will provide that our board will be divided into three classes, with one class being elected at each annual meeting of stockholders with termination staggered according to class.

• Board of Directors Vacancies; Removal. Our amended and restated certificate of incorporation and amended and restated bylaws will authorize a majority of the members of the board of directors then in office, even if less than a quorum, or by a sole remaining director, or by the stockholders to fill vacant directorships, including newly created seats. In addition, the number of directors constituting our board of directors is permitted to be set only by a resolution adopted by a majority vote of our entire board of directors. These provisions would prevent a stockholder from increasing the size of our board of directors and then gaining control of our board of directors by filling the resulting vacancies with its own nominees. This makes it more difficult to change the composition of our board of directors but promotes continuity of management. Our amended and restated certificate of incorporation will provide that, subject to any rights of any preferred stock then outstanding, any director may be removed from office at any time with or without cause and only by the affirmative vote of the holders of a majority of the voting power of then outstanding shares of capital stock of the Corporation entitled to vote thereon voting together as a single class.

• Requirements for Amendments of Our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws. Our amended and restated certificate of incorporation and amended and restated bylaws will provide that the vote of holders of a majority of the then outstanding shares of Class B common stock, voting as a separate class, will be required to amend provisions of our amended and restated certificate of incorporation and amended and amended and restated bylaws affecting the

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rights of holders of Class B common stock. Our amended and restated certificate of incorporation will provide that any other amendments to our amended and restated certificate of incorporation will require the approval of the majority of the combined vote of our then-outstanding shares of Class A and Class B common stock. Our amended and amended and restated bylaws will provide that any other amendments to our amended and restated bylaws will require the approval of the board of directors or the majority of the combined vote of our then-outstanding shares of Class A and Class B common stock.

• Stockholder Action; Special Meeting of Stockholders. Our amended and restated certificate of incorporation and amended and restated bylaws will provide that special meetings of our stockholders may be called only by a majority of our board of directors or our chief executive officer. Our amended and restated certificate of incorporation will provide that our stockholders may take action by written consent only for so long as the outstanding shares of Class B common stock represent at least 40% of the combined voting power of our common stock after which stockholders will only be able to take action at annual or special meetings of our stockholders. These provisions might delay the ability of our stockholders to force consideration of a proposal or for stockholders to take any action, including the removal of directors.

• Advance Notice Requirements for Stockholder Proposals and Director Nominations. Our amended and amended and restated bylaws will provide advance notice procedures for stockholders seeking to bring business before our annual meeting of stockholders or to nominate candidates for election as directors at our annual meeting of stockholders. Our amended and amended and restated bylaws also specify certain requirements regarding the form and content of a stockholder’s notice. These provisions might preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders if the proper procedures are not followed. We expect that these provisions might also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

• No Cumulative Voting. The DGCL provides that stockholders are not entitled to the right to cumulate votes in the election of directors unless a corporation’s certificate of incorporation provides otherwise. Our amended and restated certificate of incorporation and amended and restated bylaws will not provide for cumulative voting.

• Issuance of Undesignated Preferred Stock. After the filing of our amended and restated certificate of incorporation, our board of directors will have the authority, without further action by the stockholders, to issue up to 50,000,000 shares of undesignated preferred stock with rights and preferences, including voting rights, designated from time to time by our board of directors. The existence of authorized but unissued shares of preferred stock enables our board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest, or other means.

Exclusive Forum

Our amended and restated certificate of incorporation will provide that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (i) derivative action or proceeding brought on our behalf, (ii) action asserting a claim of breach of a fiduciary duty owed or other wrongdoing by any current or former director, officer, employee, agent or stockholder to us or our stockholders, (iii) action asserting a claim arising pursuant to any provision of the DGCL, our amended and restated certificate of incorporation, or our amended and restated bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware.

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Our amended and restated certificate of incorporation will also provide that the foregoing exclusive forum provision does not apply to actions brought to enforce any liability or duty created by the Securities Act or Exchange Act, or any other claim or cause of action for which the federal courts have exclusive jurisdiction.

Additionally, our amended and restated certificate of incorporation will also provide that, unless we consent in writing to an alternative forum, the federal district courts of the United States of America shall be the sole and exclusive forum for the resolution of any action asserting a claim arising under the Securities Act, or the rules and regulations promulgated thereunder. Pursuant to the Exchange Act, claims arising thereunder must be brought in federal district courts of the United States of America.

To the fullest extent permitted by law, any person or entity purchasing or otherwise acquiring or holding any interest in any shares of our capital stock shall be deemed to have notice of and consented to the forum provision in our amended and restated certificate of incorporation. In any case, stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable. Our amended and restated certificate of incorporation will also provide that any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of and consented to this choice of forum provision. These exclusive forum provisions may have the effect of discouraging lawsuits against our directors and officers.

Listing

We intend to apply to have our Class A common stock listed on NASDAQ under the symbol “IFIT.”

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for shares of our Class A common stock, and we cannot predict the effect, if any, that market sales of shares of our Class A common stock or the availability of shares of our Class A common stock for sale will have on the market price of our Class A common stock prevailing from time to time. Nevertheless, sales of substantial amounts of our Class A common stock, including shares issued upon exercise of outstanding stock options in the public market following this offering could materially adversely affect the prevailing market price of our common stock at such time and our ability to raise equity capital in the future.

Sale of Restricted Securities

Upon consummation of this offering, we will have 200,488,123 shares of our Class A common stock outstanding (or 205,103,507 shares, if the underwriters exercise their option to purchase additional shares in full) and 114,402,561 shares of our Class B common stock outstanding. We will also have 22,561,086 shares of our Class A common stock issuable upon exercise of the New Convertible Notes. Of these shares, all shares sold in this offering will be freely tradable without further restriction or registration under the Securities Act, except that any shares purchased by our affiliates may generally only be sold in compliance with Rule 144, which is described below. The remaining outstanding shares will be deemed “restricted securities” under the Securities Act.

Lock-Up Arrangements and Registration Rights

We, each of our directors and executive officers and other shareholders and option holders owning substantially all of our common stock, New Convertible Notes and options or warrants to acquire common stock, have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and BofA Securities, Inc. on behalf of the underwriters, we and they will not, subject to limited exceptions, directly or indirectly sell or dispose of any shares of common stock or any securities convertible into or exchangeable or exercisable for shares of common stock for a period of 180 days after the date of this prospectus.

In addition, the registration rights agreement will provide for a lock up that will restrict Scott R. Watterson and certain investors owning more than 5% of our common stock from selling our common stock until the earlier of (a) 18 months and (b) the receipt by Pamplona and L Catterton of proceeds equal to the principal amount of New Convertible Notes received by them, subject to certain limitations, including a $2.5 million carveout for each of Robert C. Gay and Gary E. Stevenson.

Prior to the consummation of the offering, certain of our employees, including our executive officers, and/or directors may enter into written trading plans that are intended to comply with Rule 10b5-1 under the Exchange Act. Sales under these trading plans would not be permitted until the expiration of the lock-up agreements relating to the offering described above.

Following the lock-up periods set forth in the agreements described above, and assuming that the representatives of the underwriters do not release any parties from these agreements, all of the shares of our common stock that are restricted securities or are held by our affiliates as of the date of this prospectus will be eligible for sale in the public market in compliance with Rule 144 under the Securities Act.

In addition, following the expiration of the lock-up period, certain stockholders will have the right, subject to certain conditions, to require us to register the sale of their shares of our common stock under federal securities laws. See “Certain Relationships and Related Party Transactions—Omnibus Investor Agreement.” If these stockholders exercise this right, our other existing stockholders may require us to register their registrable securities.

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Rule 144

The shares of our common stock sold in this offering will generally be freely transferable without restriction or further registration under the Securities Act, except that any shares of our common stock held by an “affiliate” of ours may not be resold publicly except in compliance with the registration requirements of the Securities Act or under an exemption under Rule 144 or otherwise. Rule 144 permits our common stock that has been acquired by a person who is an affiliate of ours, or has been an affiliate of ours within the past three months, to be sold into the market in an amount that does not exceed, during any three-month period, the greater of:

• one percent of the total number of shares of our Class A common stock outstanding; or

• the average weekly reported trading volume of our Class A common stock for the four calendar weeks prior to the sale.

Such sales are also subject to specific manner of sale provisions, a six-month holding period requirement, notice requirements and the availability of current public information about us.

Approximately 5.4 million shares of our common stock that are not subject to lock-up arrangements will be eligible for sale under Rule 144 immediately upon the closing.

Rule 144 also provides that a person who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has for at least six months beneficially owned shares of our common stock that are restricted securities, will be entitled to freely sell such shares of our common stock subject only to the availability of current public information regarding us. A person who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has beneficially owned for at least one year shares of our common stock that are restricted securities, will be entitled to freely sell such shares of our common stock under Rule 144 without regard to the current public information requirements of Rule 144.

Rule 701

Rule 701 generally allows a stockholder who purchased shares of our capital stock pursuant to a written compensatory plan or contract and who is not deemed to have been an affiliate of our Company during the immediately preceding 90 days to sell these shares in reliance upon Rule 144, but without being required to comply with the public information, holding period, volume limitation or notice provisions of Rule 144. Rule 701 also permits affiliates of our Company to sell their Rule 701 shares under Rule 144 without complying with the holding period requirements of Rule 144. All holders of Rule 701 shares, however, are required to wait until 90 days after the date of this prospectus before selling those shares pursuant to Rule 701.

Additional Registration Statements

We intend to file a registration statement on Form S-8 under the Securities Act to register 66,528,225 shares of our Class A common stock to be issued or reserved for issuance under our equity incentive plans. Such registration statement is expected to be filed soon after the date of this prospectus and will automatically become effective upon filing with the SEC. Accordingly, shares registered under such registration statement will be available for sale in the open market, unless such shares are subject to vesting restrictions with us or the lock-up restrictions described above.

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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS OF OUR CLASS A COMMON STOCK

The following summary describes the material U.S. federal income tax consequences to Non-U.S. Holders (as defined below) with respect to the ownership and disposition of our Class A common stock. This summary applies only to Non-U.S. Holders that purchase our Class A common stock in this offering and hold our Class A common stock as a capital asset within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the “Code”) (generally, property held for investment purposes). This discussion does not address all aspects of U.S. federal income taxes that may be relevant to a Non-U.S. Holder in light of its particular circumstances or to Non-U.S. Holders that that are subject to special treatment under the Code, such as:

• insurance companies, banks, and other financial institutions;

• tax-exempt organizations (including private foundations) and tax-qualified retirement plans;

• “qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds;

• persons subject to special tax accounting rules as a result of any item of gross income with respect to our Class A common stock being taken into account in an applicable financial statement;

• non-U.S. governments and international organizations;

• Non-U.S. Holders who acquire our common stock pursuant to the exercise of employee stock options or otherwise as compensation for their services;

• dealers and traders in securities and persons that elect mark-to-mark treatment;

• U.S. expatriates and certain former citizens or long-term residents of the United States;

• persons that own, or are deemed to own, more than five percent of our Class A common stock;

• “controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;

• persons that hold our Class A common stock as part of a “straddle,” “hedge,” “conversion transaction,” “synthetic security,” or integrated investment or other risk reduction strategy; and

• partnerships and other pass-through entities, and investors in such pass-through entities (regardless of their places of organization or formation).

Furthermore, the discussion below is based upon the provisions of the Code, and U.S. Treasury regulations, rulings, and judicial decisions thereunder as of the date hereof, and such authorities may be repealed, revoked, or modified, possibly with retroactive effect, and are subject to differing interpretations which could result in U.S. federal income tax consequences different from those discussed below. We have not requested a ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and there can be no assurance that the IRS will agree with such statements and conclusions or will not take a contrary position regarding the tax consequences described herein, or that any such contrary position would not be sustained by a court. This summary does not address the potential application of the alternative minimum tax or the Medicare contribution tax on certain “net investment income” within the meaning of Section 1411 of the Code and does not discuss state or local taxes, U.S. federal gift, and estate tax laws or any non-U.S. tax consequences that may be relevant to Non-U.S. Holders in light of their particular circumstances.

For the purposes of this discussion, a “Non-U.S. Holder” is a beneficial owner of Class A common stock that is not a U.S. Holder or a partnership for U.S. federal income tax purposes. A “U.S. Holder” means a beneficial owner of our Class A common stock that is, for U.S. federal income tax purposes,

• an individual who is a citizen or resident of the United States,

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• a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes), created or organized in or under the laws of the United States, any state thereof, or the District of Columbia,

• an estate, the income of which is subject to U.S. federal income taxation regardless of its source, or

• a trust, if it (i) is subject to the primary supervision of a court within the United States and one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) have the authority to control all substantial decisions of the trust or (ii) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person.

If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds shares of our Class A common stock, the tax treatment of a person treated as a partner of such partnership generally will depend on the status of the partner and the activities of the partnership. Persons that, for U.S. federal income tax purposes, are treated as partners in a partnership holding shares of our Class A common stock are urged to consult their own tax advisors.

PERSONS CONSIDERING THE PURCHASE OF OUR CLASS A COMMON STOCK PURSUANT TO THIS OFFERING SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF ACQUIRING, OWNING, AND DISPOSING OF OUR CLASS A COMMON STOCK IN LIGHT OF THEIR PARTICULAR SITUATIONS AS WELL AS ANY CONSEQUENCES ARISING UNDER THE LAWS OF ANY OTHER TAXING JURISDICTION, INCLUDING ANY STATE, LOCAL, OR NON-U.S. TAX CONSEQUENCES OR ANY U.S. FEDERAL NON-INCOME TAX CONSEQUENCES, AND THE POSSIBLE APPLICATION OF TAX TREATIES.

If you are an individual non-U.S. citizen, you may, in some cases, be deemed to be a resident alien (as opposed to a nonresident alien) by virtue of being present in the United States for at least 31 days in the calendar year and for an aggregate of at least 183 days during a three-year period ending in the current calendar year. Generally, for this purpose, all the days present in the current year, one-third of the days present in the immediately preceding year, and one-sixth of the days present in the second immediately preceding year, are counted.

Resident aliens generally are subject to U.S. federal income taxation as if they were U.S. citizens. Individuals who are uncertain of their status as resident or nonresident aliens for U.S. federal income tax purposes are urged to consult their own tax advisors regarding the U.S. federal income tax consequences of the ownership or disposition of our Class A common stock.

Distributions

We do not expect to make any regular cash distributions on our Class A common stock in the foreseeable future. If we do make distributions on our Class A common stock, however, distributions made to a Non-U.S. Holder of our Class A common stock generally will be treated as dividends in respect of our Class A common stock for U.S. federal income tax purposes to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). If a distribution exceeds our current and accumulated earnings and profits, the excess amount will be treated first as a tax-free return of capital to the extent of a Non-U.S. Holder’s adjusted tax basis in our Class A common stock and thereafter as gain realized on the sale or exchange of our Class A common stock as described below under “Gain on Disposition of Our Class A Common Stock.”

Any distribution on our Class A common stock that is treated as a dividend paid to a Non-U.S. Holder that is not effectively connected with such Non-U.S. Holder’s conduct of a trade or business in the United States generally will be subject to withholding tax at a rate of 30% of the gross amount of the dividends or such lower rate as may be specified by an applicable income tax treaty between the United States and the Non-U.S. Holder’s country of residence. To obtain a reduced rate of withholding under an income tax treaty, a Non-U.S. Holder generally will be required to provide the applicable withholding agent with a properly executed IRS Form W-8BEN, IRS Form

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W-8BEN-E, or other appropriate or successor form, certifying under penalty of perjury the Non-U.S. Holder’s entitlement to benefits under that income tax treaty. Such form must be provided prior to the payment of dividends and must be updated periodically. If you are eligible for a reduced rate of U.S. withholding tax under an income tax treaty, you should consult with your own tax advisor regarding your entitlement to benefits under any applicable income tax treaty.

Withholding agents generally are not required to withhold tax on dividends paid to a Non-U.S. Holder that are effectively connected with the holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base that the holder maintains in the United States) if certification and disclosure requirements are satisfied and a properly executed IRS Form W-8ECI (or successor form), stating that the dividends are so connected is furnished to the applicable withholding agent. In general, such effectively connected dividends will be subject to U.S. federal income tax on a net income basis substantially in the same manner as if the Non-U.S. Holder was a United States person. A Non-U.S. Holder that is a corporation for U.S. tax purposes receiving effectively connected dividends may also be subject to an additional “branch profits tax,” which is imposed, under certain circumstances, at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on its Non-U.S. Holder’s effectively connected earnings and profits, subject to certain adjustments.

See also the sections below titled “—Backup Withholding and Information Reporting” and “—Foreign Accounts” for additional withholding rules that may apply to any dividends paid.

Gain on Disposition of Our Class A Common Stock

Subject to the discussions below under the section titled “Backup Withholding and Information Reporting,” a Non-U.S. Holder generally will not be subject to U.S. federal income or withholding tax with respect to gain realized on a sale or other disposition of our Class A common stock unless (1) the gain is effectively connected with a trade or business of the holder in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that the holder maintains in the United States), (2) the Non-U.S. Holder is a nonresident alien individual and is present in the United States for 183 or more days in the taxable year of the disposition and certain other conditions are met, or (3) we are or have been a “United States real property holding corporation” within the meaning of Section 897(c)(2) of the Code at any time within the shorter of (A) the five-year period preceding such disposition or (B) the holder’s holding period in the Class A common stock.

If you are a Non-U.S. Holder described in (1) above, you will be subject to U.S. federal income tax on the net gain derived from the sale on a net income basis substantially in the same manner applicable to United States persons. Non-U.S. Holders that are corporations for U.S. federal income tax purposes described in (1) above may also be subject to the additional branch profits tax at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty). If you are an individual Non-U.S. Holder described in (2) above, you will be subject to tax at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on the gain derived from the sale, which gain may be offset by U.S. source capital losses (even though you are not considered a resident of the United States), provided you have timely filed U.S. federal income tax returns with respect to such losses. With respect to (3) above, in general, we would be a United States real property holding corporation if the fair market value of our “United States real property interests” (as defined in the Code and applicable U.S. Treasury regulations) equals or exceeds 50% of the sum of the fair market value of our worldwide real property interests and other assets used or held for use in a trade or business (as determined for U.S. federal income tax purposes). We believe that we are not, and do not anticipate becoming, a United States real property holding corporation. However, because the determination of whether we are a United States real property holding corporation depends on the fair market value of our United States real property interests and other business assets, there can be no assurance that we will not become a United States real property holding corporation in the future. Even if we are treated as a United States real property holding corporation, gain realized by a Non-U.S. Holder on a disposition of our Class A common stock will not be subject to U.S. federal

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income tax so long as (1) the Non-U.S. Holder owned, directly, indirectly, or constructively, no more than five percent of our Class A common stock at all times within the shorter of (i) the five-year period preceding the disposition or (ii) the holder’s holding period and (2) our Class A common stock is “regularly traded” on an established securities market within the meaning of applicable Treasury regulations during such period. There can be no assurance that our Class A common stock will qualify as regularly traded on an established securities market.

Backup Withholding and Information Reporting

Generally, the applicable withholding agent must report information to the IRS with respect to any distributions made to a Non-U.S. Holder on our Class A common stock, including the amount of any dividends, the name and address of the Non-U.S. Holder, and the amount, if any, of tax withheld. A similar report is sent to the Non-U.S. Holder to whom any distributions are paid. Pursuant to tax treaties or certain other agreements, the IRS may make its reports available to tax authorities in a country in which a Non-U.S. Holder resides or is established.

Dividends paid to a Non-U.S. Holder may also be subject to U.S. backup withholding. U.S. backup withholding generally will not apply to a Non-U.S. Holder who provides a properly executed IRS Form W-8BEN or IRS Form W-8BEN-E (or successor form), as applicable, or otherwise establishes an exemption, provided that the applicable withholding agent does not have actual knowledge, or reason to know, the recipient is a United States person or that the conditions of such other exemption are not, in fact, satisfied.

Under current U.S. federal income tax law, U.S. information reporting and backup withholding requirements generally will apply to the proceeds of a Non-U.S. Holder’s disposition of our Class A common stock effected by or through a U.S. office of any broker, U.S. or non-U.S., unless the Non-U.S. Holder provides a properly executed IRS Form W-8BEN or IRS Form W-8BEN-E (or successor form), as applicable, or otherwise meets documentary evidence requirements for establishing non-U.S. person status or establishes an exemption. Generally, U.S. information reporting and backup withholding requirements will not apply to a payment of disposition proceeds to a Non-U.S. Holder where the transaction is effected outside the United States through a non-U.S. office of a non-U.S. broker. However, for information reporting purposes, and, depending on the circumstances, backup withholding purposes, certain U.S. related brokers may be treated in a manner similar to U.S. brokers. Additionally, information reporting and backup withholding requirements may apply to a payment of disposition proceeds if the broker has actual knowledge, or reason to know, that the recipient is, in fact, a United States person or that the conditions of such other exemption are not, in fact, satisfied.

Backup withholding is not an additional tax. If backup withholding is applied to you, you should consult with your own tax advisor to determine whether you have overpaid your U.S. federal income tax, and whether you are able to obtain a tax refund or credit of the overpaid amount.

Foreign Accounts

In addition, U.S. federal withholding taxes may apply under Sections 1471 through 1474 of the Code, commonly referred to as the Foreign Account Tax Compliance Act (“FATCA”), on certain types of payments, including dividends on our Class A common stock, made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on our Class A common stock paid to a “foreign financial institution” or a “non-financial foreign entity” (each as defined in the Code), unless (1) the foreign financial institution agrees to undertake certain diligence and reporting obligations, (2) the non-financial foreign entity either certifies it does not have any “substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. The 30% federal withholding tax described in this paragraph is generally not reduced under income tax treaties with the United States. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (1) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other

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things, that it undertake to identify accounts held by certain “specified United States persons” or “United States owned foreign entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the U.S. governing FATCA may be subject to different rules. While withholding under FATCA would have also applied to payments of gross proceeds from the sale or other disposition of Class A common stock on or after January 1, 2019, recently proposed U.S. Treasury regulations (the preamble to which specifies that taxpayers are permitted to rely on such proposed regulations pending finalization), eliminate FATCA withholding on payments of gross proceeds from the sale or other disposition of stock entirely.

Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our Class A common stock.

EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING THE TAX CONSEQUENCES OF PURCHASING, HOLDING, AND DISPOSING OF OUR CLASS A COMMON STOCK, INCLUDING THE CONSEQUENCES OF ANY PROPOSED CHANGE IN APPLICABLE LAW, AS WELL AS TAX CONSEQUENCES ARISING UNDER ANY STATE, LOCAL, NON-U.S. OR U.S. FEDERAL NON-INCOME TAX LAWS SUCH AS ESTATE AND GIFT TAX.

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UNDERWRITING

Under the terms and subject to the conditions in an underwriting agreement dated the date of this prospectus, the underwriters named below, for whom Morgan Stanley & Co. LLC, BofA Securities, Inc. and Barclays Capital Inc. are acting as representatives, have severally agreed to purchase, and we have agreed to sell to them, the number of shares indicated below:

Name	Number of Shares
Morgan Stanley & Co. LLC
BofA Securities, Inc.
Barclays Capital Inc.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Jefferies LLC
Robert W. Baird & Co. Incorporated
Cowen and Company, LLC
JMP Securities LLC
Raymond James & Associates, Inc.
Truist Securities, Inc.
William Blair & Company, L.L.C.
Telsey Advisory Group LLC
AmeriVet Securities, Inc.
Blaylock Van, LLC
Loop Capital Markets LLC
Siebert Williams Shank & Co., LLC
Total:	30,769,231

The underwriters and the representatives are collectively referred to as the “underwriters” and the “representatives,” respectively. The underwriters are offering the shares of Class A common stock subject to their acceptance of the shares from us and subject to prior sale. The underwriting agreement provides that the obligations of the several underwriters to pay for and accept delivery of the shares of Class A common stock offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriters are obligated to take and pay for all of the shares of common stock offered by this prospectus if any such shares are taken. However, the underwriters are not required to take or pay for the shares covered by the underwriters’ over-allotment option described below.

The underwriters initially propose to offer part of the shares of Class A common stock directly to the public at the offering price listed on the cover page of this prospectus and part to certain dealers at a price that represents a concession not in excess of $                per share under the public offering price. After the initial offering of the shares of Class A common stock, the offering price and other selling terms may from time to time be varied by the representative.

We have granted the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase up to 4,615,384 additional shares of Class A common stock at the public offering price listed on the cover page of this prospectus, less underwriting discounts and commissions. The underwriters may exercise this option solely for the purpose of covering over-allotments, if any, made in connection with the offering of the shares of common stock offered by this prospectus. To the extent the option is exercised, each underwriter will become obligated, subject to certain conditions, to purchase about the same percentage of the additional shares of Class A common stock as the number listed next to the underwriter’s name in the preceding table bears to the total number of shares of Class A common stock listed next to the names of all underwriters in the preceding table.

At our request, the DSP Underwriters have reserved up to 5% of the shares offered by this prospectus, for sale through a directed share program at the initial public offering price to individuals, including certain of our senior management and employees, as well as friends and family members of our executive officers, founders and certain members of senior management, and persons with whom we have a business relationship, including certain customers and partners. If purchased by persons who are not directors, officers, existing equityholders or

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employees, the shares will not be subject to a lock-up restriction. If purchased by any directors, officers, employee or existing equityholder, the shares will be subject to a 180-day lock-up restriction. The number of shares of common stock available for sale to the general public will be reduced by the number of reserved shares sold to these individuals. Any reserved shares of our common stock that are not so purchased will be offered by the DSP Underwriters to the general public on the same terms as the other shares of our Class A common stock offered by this prospectus. We have agreed to indemnify the DSP Underwriters against certain liabilities and expenses, including liabilities under the Securities Act, in connection with sales of the reserved shares.

The following table shows the per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase up to an additional 4,615,384 shares of Class A common stock.

	Total
	Per Share	No Exercise	Full Exercise
Public offering price	$	$	$
Underwriting discounts and commissions	$	$	$
Proceeds, before expenses	$	$	$

The estimated offering expenses paid or payable by us, exclusive of the underwriting discounts and commissions, are approximately $15.8 million. We have agreed to reimburse the underwriters for expense relating to clearance of this offering with the Financial Industry Regulatory Authority up to $40,000.

The underwriters have informed us that they do not intend sales to discretionary accounts to exceed 5% of the total number of shares of common stock offered by them.

We intend to apply to have our common stock listed on NASDAQ under the symbol “IFIT.”

We and all directors and executive officers and other shareholders, and option holders owning substantially all of our common stock and options or warrants to acquire common stock have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and BofA Securities, Inc. on behalf of the underwriters, we and they will not, and will not publicly disclose an intention to, during the period ending 180 days after the date of this prospectus (the “restricted period”):

• offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for shares of common stock;

• file any registration statement with the Securities and Exchange Commission relating to the offering of any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock; or

• enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock;

whether any such transaction described above is to be settled by delivery of common stock or such other securities, in cash or otherwise. In addition, we and each such person agrees that, without the prior written consent of Morgan Stanley & Co. LLC and BofA Securities, Inc. on behalf of the underwriters, we or such other person will not, during the restricted period, make any demand for, or exercise any right with respect to, the registration of any shares of common stock or any security convertible into or exercisable or exchangeable for common stock.

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The restrictions described in the immediately preceding paragraph do not apply to us with respect to, among other things:

(a) the issuance by us of shares of Class A common stock upon the exercise (including net exercise) of an option or warrant or the conversion of a security outstanding on the date hereof;

(b) grants of stock options, stock awards, restricted stock or other equity awards and the issuance of Class A common stock or securities convertible into or exercisable for Class A common stock (whether upon the exercise of stock options or otherwise) to our employees, officers, directors, advisors, or consultants pursuant to the terms of a plan in effect on the date hereof, provided all recipients of any such securities shall enter into a “lock-up” agreement covering the remainder of the 180-day period;

(c) the issuance of or entry into an agreement providing for the issuance of Class A common stock or securities convertible into, exercisable for or which are otherwise exchangeable for or represent the right to receive Class A common stock in connection with (x) the acquisition by us or any of our subsidiaries of the securities, business, technology, property or other assets of another person or entity or pursuant to an employee benefit plan assumed by us in connection with such acquisition or (y) our joint ventures, commercial relationships and other strategic transactions, provided that the aggregate number of shares of Class A common stock (including shares of Class A common stock issuable in respect of securities convertible into, exercisable for or which are otherwise exchangeable for or represent the right to receive Class A common stock) that we may issue or agree to issue pursuant to this exception shall not exceed 10% of the total number of shares of Class A common stock outstanding as of the closing date of this offering immediately following the completion of the transactions to be completed as of such date and all recipients of any such securities shall enter into a “lock-up” agreement covering the remainder of the 180-day period; or

(d) the filing of any registration statement on Form S-8 relating to securities granted or to be granted pursuant to any equity compensation plan in effect on the date hereof or any assumed employee benefit plan.

The restrictions described above with respect to our directors, executive officers, shareholders and option holders do not apply to:

(a) transactions relating to shares of Class A common stock or other securities acquired in open market transactions after the completion of this offering; provided that no filing under Section 16(a) of the Exchange Act shall be required or shall be voluntarily made in connection with subsequent sales of Class A common stock or other securities acquired in such open market transactions;

(b) transfers of shares of Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock (i) as a bona fide gift, (ii) by will or intestate succession to an immediate family member or (iii) to a trust whose beneficiaries consist of exclusive of one or more of such person and/or an immediate family member;

(c) transfers of shares Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock to (i) any trust, partnership, limited liability company or other entity for the direct or indirect benefit of such person or an immediate family member of such person and (ii) any wholly owned subsidiary of such person;

(d) transfers to such person’s affiliates or to any investment fund or other entity controlled or managed by such person or any of such person’s affiliates;

(e) transfers to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (b) through (d) above;

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(f) transfers or distributions of shares of Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock to any partner, member or stockholder of such person;

(g) transfers as a result of the operation of law, or pursuant to an order of a court (including a domestic order, divorce settlement, divorce decree or separation agreement) or regulatory agency, provided that in the case of any transfer or distribution pursuant to clauses (b) through (g), (i) each donee, distributee, transferee, nominee or custodian, as applicable, shall sign and deliver a lock up agreement substantially in the form of this agreement and (ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Class A common stock, shall be required or shall be voluntarily made during the restricted period (other than a filing on a Form 5 that shall clearly indicate in the footnotes thereto the nature and conditions of such transfer, that such transfer is not for value and that the shares of Class A common stock, or any security convertible into Class A common stock, subject to such transfer remain subject to the restrictions set forth herein);

(h) the repurchase of shares of Class A common stock or any security convertible into Class A common stock by the Company pursuant to equity award agreements or other contractual arrangements providing for the right of said repurchase in connection with the termination of such person’s employment or service with the Company, provided that no filing by such person under the Section 16(a) of the Exchange Act, or other public announcement, shall be voluntarily made in connection with any such transfer, and if such person is required to file a report under the Exchange Act related thereto during the restricted period, such report shall disclose that such transfer was a result of the repurchase of the shares of Class A common stock or any security convertible into Class A common stock or such other securities by the Company pursuant to equity award agreements or other contractual arrangements in connection with the termination of such person’s employment or service with the Company;

(i) pursuant to the exercise of an option to purchase shares of Class A common stock or any security convertible into Class A common stock in connection with the termination or expiration of such option pursuant to its terms, provided that (1) such option was granted pursuant to a Company stock option plan or other equity incentive plan described in the Time of Sale Prospectus (as defined in the underwriting agreement) and the Prospectus, (2) any shares of Class A common stock or any security convertible into Class A common stock received upon such exercise shall be subject to the terms of the lock-up agreement and (3) no filing by such person or any party (transferor or transferee) under the Exchange Act, or other public announcement shall be voluntarily made in connection with any such exercise, and if the holder is required to file a report under the Exchange Act related thereto during the restricted period, such report shall disclose that such transfer was a result of the exercise of an option or security convertible into Class A common stock expiring or terminating in accordance with its terms, does not result in any aggregate reduction in beneficial ownership and remains subject to the restrictions set forth in the lock-up agreement;

(j) to the Company (x) pursuant to the exercise, on a “cashless” or “net exercise” basis, of any option to purchase shares of Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, or (y) for the purpose of satisfying any withholding taxes (including estimated taxes) due as a result of the exercise of any option to purchase shares of Class A common stock or any security convertible into or exercisable or exchangeable for Class A common stock or the vesting of any equity awards granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, provided that no filing by such person or any party (transferor or transferee) under the Exchange Act, or other public announcement, shall be voluntarily made in connection with any such transfer, and if such person is required to file a

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report under the Exchange Act related thereto during the restricted period, such report shall disclose that such transfer was to the Company and was a result of the exercise, on a “cashless” or “net exercise” basis, of any option to purchase shares of Class A common stock or any security convertible into Class A common stock granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, or for the purpose of satisfying any withholding taxes (including estimated taxes) due as a result of the exercise of any option to purchase shares of Class A common stock or any security convertible into Class A common stock or the vesting of any equity awards granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus;

(k) transfers to the Company upon death, disability or termination of employment, in each case, of such person;

(l) transfers of shares of Class A common stock or any security convertible into Class A common stock as a bona fide gift or gifts, or for bona fide estate planning purposes, including a bona fide gift to a charitable organization, as such term is described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended; provided that no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Class A common stock, shall be required or shall be voluntarily made during the restricted period (other than a filing on a Form 5 that shall clearly indicate in the footnotes thereto the nature and conditions of such transfer, that such transfer is not for value and that the shares of Class A common stock, or any security convertible into Class A common stock, subject to such transfer remain subject to the restrictions of the lock-up agreement);

(m) transfers (i) pursuant to a bona fide third-party tender offer, merger, purchase, consolidation or other similar transaction made to all holders of the Company’s Class A common stock involving a change of control (as defined below) of the Company (and nothing in the lock-up agreement shall prohibit such person from voting in favor of any such transaction or taking any other action in connection with such transaction) that is approved by the Company’s board of directors, provided that, in the event that such tender offer, merger, purchase, consolidation or other such transaction is not completed, all of such person’s shares of Class A common stock subject to the lock-up agreement shall remain subject to the lock-up agreement or (ii) to the Company for the payment of the exercise price upon the automatic “cashless” or “net” exercise of an option to purchase shares of Class A common stock in connection with the termination of such option pursuant to its terms upon a change of control of the Company, provided that such option was granted by the Company pursuant to a stock option or equity incentive plans described in the Prospectus;

(n) the exercise, conversion or repayment of warrants or preferred stock as described in the Time of Sale Prospectus (as defined in the underwriting agreement) and the Prospectus, provided that the restrictions contained in the lock-up agreement shall apply to shares of Class A common stock issued upon such exercise, conversion or repayment; or

(o) facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Class A common stock, provided that (i) such plan does not provide for the transfer of Class A common stock during the restricted period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of such person or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Class A common stock may be made under such plan during the restricted period.

Morgan Stanley & Co. LLC and BofA Securities, Inc., in their sole discretion, may release the common stock and other securities subject to the lock-up agreements described above in whole or in part at any time.

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In order to facilitate the offering of the Class A common stock, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the Class A common stock. Specifically, the underwriters may sell more shares than they are obligated to purchase under the underwriting agreement, creating a short position. A short sale is covered if the short position is no greater than the number of shares available for purchase by the underwriters under the over-allotment option. The underwriters can close out a covered short sale by exercising the over-allotment option or purchasing shares in the open market. In determining the source of shares to close out a covered short sale, the underwriters will consider, among other things, the open market price of shares compared to the price available under the over-allotment option. The underwriters may also sell shares in excess of the over-allotment option, creating a naked short position. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the Class A common stock in the open market after pricing that could adversely affect investors who purchase in this offering. As an additional means of facilitating this offering, the underwriters may bid for, and purchase, shares of Class A common stock in the open market to stabilize the price of the common stock. These activities may raise or maintain the market price of the Class A common stock above independent market levels or prevent or retard a decline in the market price of the Class A common stock. The underwriters are not required to engage in these activities and may end any of these activities at any time.

We and the underwriters have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act.

A prospectus in electronic format may be made available on websites maintained by one or more underwriters, or selling group members, if any, participating in this offering. The representative may agree to allocate a number of shares of Class A common stock to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the representative to underwriters that may make Internet distributions on the same basis as other allocations.

The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for us, for which they received or will receive customary fees and expenses.

In addition, in the ordinary course of their various business activities, the underwriters and their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve our securities and instruments. The underwriters and their respective affiliates may also make investment recommendations or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long or short positions in such securities and instruments.

Pricing of the Offering

Prior to this offering, there has been no public market for our common stock. The initial public offering price was determined by negotiations between us and the representative. Among the factors considered in determining the initial public offering price were our future prospects and those of our industry in general, our sales, earnings and certain other financial and operating information in recent periods, and the price-earnings ratios, price-sales ratios, market prices of securities, and certain financial and operating information of companies engaged in activities similar to ours.

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Selling Restrictions

European Economic Area

In relation to each Member State of the European Economic Area (each, a “Member State”), no securities have been offered or will be offered pursuant to the offering to the public in that Member State prior to the publication of a prospectus in relation to the securities which has been approved by the competent authority in that Member State or, where appropriate, approved in another Member State and notified to the competent authority in that Member State, all in accordance with the Prospectus Regulation, except that offers of securities may be made to the public in that Member State at any time under the following exemptions under the Prospectus Regulation:

(a) to any legal entity which is a qualified investor as defined in the Prospectus Regulation;

(b) to fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Regulation), subject to obtaining the prior consent of the representatives; or

(c) in any other circumstances falling within Article 1(4) of the Prospectus Regulation,

provided that no such offer of shares shall require us or any of our representatives to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus pursuant to Article 23 of the Prospectus Regulation and each person who initially acquires any shares or to whom any offer is made will be deemed to have represented, acknowledged and agreed to and with each of the representatives and us that it is a “qualified investor” as defined in the Prospectus Regulation.

In the case of any shares being offered to a financial intermediary as that term is used in Article 5 of the Prospectus Regulation, each such financial intermediary will be deemed to have represented, acknowledged and agreed that the shares acquired by it in the offer have not been acquired on a nondiscretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any shares to the public other than their offer or resale in a Member State to qualified investors as so defined or in circumstances in which the prior consent of the representatives has been obtained to each such proposed offer or resale.

For the purposes of this provision, the expression an “offer of shares to the public” in relation to any shares in any Member State means the communication in any form and by means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase shares, the expression “Prospectus Regulation” means Regulation (EU) 2017/1129 (as amended).

United Kingdom

In relation to the United Kingdom, no shares of Class A common stock have been offered or will be offered pursuant to this offering to the public in the United Kingdom prior to the publication of a prospectus in relation to the shares that either (i) has been approved by the Financial Conduct Authority, or (ii) is to be treated as if it had been approved by the Financial Conduct Authority in accordance with the transitional provision in Regulation 74 of the Prospectus (Amendment etc.) (EU Exit) Regulations 2019, except that offers of shares may be made to the public in the United Kingdom at any time under the following exemptions under the UK Prospectus Regulation:

(a) to any legal entity which is a qualified investor as defined in Article 2 of the UK Prospectus Regulation;

(b) to fewer than 150 natural or legal persons (other than qualified investors as defined in Article 2 of the UK Prospectus Regulation); or

(c) in any other circumstances falling within section 86 of the Financial Services and Markets Act 2000 (“FSMA”),

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provided that no such offer of shares shall require the Company or any representative to publish a prospectus pursuant to section 85 of the FSMA or supplement a prospectus pursuant to Article 23 of the UK Prospectus Regulation.

For the purposes of this provision, the expression an ‘‘offer to the public’’ in relation to any shares in any relevant state means the communication in any form and by any means of sufficient information on the terms of the offer and any shares to be offered so as to enable an investor to decide to purchase or subscribe for any shares, and the expression ‘‘UK Prospectus Regulation’’ means Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018.

We have not authorized and do not authorize the making of any offer of shares through any financial intermediary on their behalf, other than offers made by the underwriters with a view to the final placement of the shares as contemplated in this prospectus. Accordingly, no purchaser of the shares, other than the underwriters, is authorized to make any further offer of the shares on behalf of us or the underwriters.

In addition, in the United Kingdom, this document is being distributed only to, and is directed only at, and any offer subsequently made may only be directed at persons who are ‘‘qualified investors’’ (as defined in Article 2 of the UK Prospectus Regulation) (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, or the Order, and/or (ii) who are high net worth companies (or persons to whom it may otherwise be lawfully communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as ‘‘relevant persons’’) or otherwise in circumstances which have not resulted and will not result in an offer to the public of the shares in the United Kingdom within the meaning of the FSMA.

Any person in the United Kingdom that is not a relevant person should not act or rely on the information included in this document or use it as basis for taking any action. In the United Kingdom, any investment or investment activity that this document relates to may be made or taken exclusively by relevant persons.

Canada

The securities may be sold in Canada only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions, and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption form, or in a transaction not subject to, the prospectus requirements of applicable securities laws.

Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment hereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory of these rights or consult with a legal advisor.

Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.

Hong Kong

The shares may not be offered or sold in Hong Kong by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies (Winding Up and

208

Miscellaneous Provisions) Ordinance (Cap. 32 of the Laws of Hong Kong) (‘‘Companies (Winding Up and Miscellaneous Provisions) Ordinance’’) or which do not constitute an invitation to the public within the meaning of the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (‘‘Securities and Futures Ordinance’’), or (ii) to ‘‘professional investors’’ as defined in the Securities and Futures Ordinance and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a ‘‘prospectus’’ as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance, and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to ‘‘professional investors’’ in Hong Kong as defined in the Securities and Futures Ordinance and any rules made thereunder.

Singapore

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor (as defined under Section 4A of the Securities and Futures Act, Chapter 289 of Singapore (the ‘‘SFA’’)) under Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA, in each case subject to conditions set forth in the SFA.

Where the shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor, the securities (as defined in Section 239(1) of the SFA) of that corporation shall not be transferable for 6 months after that corporation has acquired the shares under Section 275 of the SFA except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person (as defined in Section 275(2) of the SFA), (2) where such transfer arises from an offer in that corporation’s securities pursuant to Section 275(1A) of the SFA, (3) where no consideration is or will be given for the transfer, (4) where the transfer is by operation of law, (5) as specified in Section 276(7) of the SFA, or (6) as specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005 of Singapore (‘‘Regulation 32’’).

Where the shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is a trust (where the trustee is not an accredited investor (as defined in Section 4A of the SFA)) whose sole purpose is to hold investments and each beneficiary of the trust is an accredited investor, the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferable for 6 months after that trust has acquired the shares under Section 275 of the SFA except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person (as defined in Section 275(2) of the SFA), (2) where such transfer arises from an offer that is made on terms that such rights or interest are acquired at a consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction (whether such amount is to be paid for in cash or by exchange of securities or other assets), (3) where no consideration is or will be given for the transfer, (4) where the transfer is by operation of law, (5) as specified in Section 276(7) of the SFA, or (6) as specified in Regulation 32.

Solely for the purposes of our obligations pursuant to Section 309B of the SFA, we have determined, and hereby notify all relevant persons (as defined in the Securities and Futures (Capital Markets Products) Regulations 2018

209

(‘‘CMP Regulations’’)) that the shares of Class A common stock are ‘‘prescribed capital markets products’’ (as defined in the CMP Regulations) and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).

Japan

No registration pursuant to Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended) (the “FIEL”) has been made or will be made with respect to the solicitation of the application for the acquisition of the shares of Class A common stock.

Accordingly, the shares of Class A common stock have not been, directly or indirectly, offered or sold and will not be, directly or indirectly, offered or sold in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for re-offering or re-sale, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan except pursuant to an exemption from the registration requirements, and otherwise in compliance with, the FIEL and the other applicable laws and regulations of Japan.

For Qualified Institutional Investors (“QII”)

Please note that the solicitation for newly-issued or secondary securities (each as described in Paragraph 2, Article 4 of the FIEL) in relation to the shares of Class A common stock constitutes either a “QII only private placement” or a “QII only secondary distribution” (each as described in Paragraph 1, Article 23-13 of the FIEL). Disclosure regarding any such solicitation, as is otherwise prescribed in Paragraph 1, Article 4 of the FIEL, has not been made in relation to the shares of Class A common stock. The shares of Class A common stock may only be transferred to QIIs.

For Non-QII Investors

Please note that the solicitation for newly-issued or secondary securities (each as described in Paragraph 2, Article 4 of the FIEL) in relation to the shares of Class A common stock constitutes either a “small number private placement” or a “small number private secondary distribution” (each as is described in Paragraph 4, Article 23-13 of the FIEL). Disclosure regarding any such solicitation, as is otherwise prescribed in Paragraph 1, Article 4 of the FIEL, has not been made in relation to the shares of common stock. The shares of Class A common stock may only be transferred en bloc without subdivision to a single investor.

Australia

This prospectus:

• does not constitute a disclosure document or a prospectus under Chapter 6D.2 of the Corporations Act 2001 (Cth) (the ‘‘Corporations Act’’);

• has not been, and will not be, lodged with the Australian Securities and Investments Commission (‘‘ASIC’’), as a disclosure document for the purposes of the Corporations Act and does not purport to include the information required of a disclosure document for the purposes of the Corporations Act; and

• may only be provided in Australia to select investors who are able to demonstrate that they fall within one or more of the categories of investors, available under section 708 of the Corporations Act (‘‘Exempt Investors’’).

The shares may not be directly or indirectly offered for subscription or purchased or sold, and no invitations to subscribe for or buy the shares may be issued, and no draft or definitive offering memorandum, advertisement or

210

other offering material relating to any shares may be distributed in Australia, except where disclosure to investors is not required under Chapter 6D of the Corporations Act or is otherwise in compliance with all applicable Australian laws and regulations. By submitting an application for the shares, you represent and warrant to us that you are an Exempt Investor.

As any offer of shares under this document will be made without disclosure in Australia under Chapter 6D.2 of the Corporations Act, the offer of those securities for resale in Australia within twelve months may, under section 707 of the Corporations Act, require disclosure to investors under Chapter 6D.2 if none of the exemptions in section 708 applies to that resale. By applying for the shares you undertake to us that you will not, for a period of twelve months from the date of issuance and sale of the shares, offer, transfer, assign or otherwise alienate those shares to investors in Australia except in circumstances where disclosure to investors is not required under Chapter 6D.2 of the Corporations Act or where a compliant disclosure document is prepared and lodged with ASIC.

Dubai International Financial Centre (‘‘DIFC’’)

This document relates to an Exempt Offer in accordance with the Markets Rules 2012 of the Dubai Financial Services Authority (‘‘DFSA’’). This document is intended for distribution only to persons of a type specified in the Markets Rules 2012 of the DFSA. It must not be delivered to, or relied on by, any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus supplement nor taken steps to verify the information set forth herein and has no responsibility for this document. The securities to which this document relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the securities offered should conduct their own due diligence on the securities. If you do not understand the contents of this document you should consult an authorized financial advisor.

In relation to its use in the DIFC, this document is strictly private and confidential and is being distributed to a limited number of investors and must not be provided to any person other than the original recipient, and may not be reproduced or used for any other purpose. The interests in the securities may not be offered or sold directly or indirectly to the public in the DIFC.

Switzerland

The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (‘‘SIX’’) or on any other stock exchange or regulated trading facility in Switzerland. This document does not constitute a prospectus within the meaning of, and has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the shares or the offering may be publicly distributed or otherwise made publicly available in Switzerland.

Neither this document nor any other offering or marketing material relating to the offering, the Company, the shares have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of shares will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA (‘‘FINMA’’), and the offer of shares has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes (‘‘CISA’’). The investor protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to acquirers of shares.

211

LEGAL MATTERS

Weil, Gotshal & Manges LLP, New York, New York, has passed upon the validity of the Class A common stock offered hereby on behalf of us. Certain legal matters will be passed upon on behalf of the underwriters by Davis Polk & Wardwell LLP, New York, New York.

212

EXPERTS

The financial statements as of May 31, 2020 and 2021, and for each of the three years in the period ended May 31, 2021, included in this registration statement, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such financial statements have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

213

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the shares of our Class A common stock offered by this prospectus. For purposes of this section, the term registration statement means the original registration statement and any and all amendments including the schedules and exhibits to the original registration statement or any amendment. This prospectus, filed as part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules thereto as permitted by the rules and regulations of the SEC. For further information about us and our Class A common stock, you should refer to the registration statement, including the exhibits. This prospectus summarizes provisions that we consider material of certain contracts and other documents to which we refer you. Because the summaries may not contain all of the information that you may find important, you should review the full text of those documents.

This registration statement, including its exhibits and schedules, will be filed with the SEC. The SEC maintains a website at (http://www.sec.gov) from which interested persons can electronically access the registration statement, including the exhibits and schedules to the registration statement. We intend to furnish our stockholders with annual reports containing financial statements audited by our independent auditors.

We have not authorized anyone to give you any information or to make any representations about us or the transactions we discuss in this prospectus other than those contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We do not take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is not an offer to sell or a solicitation of an offer to buy securities anywhere or to anyone where or to whom we are not permitted to offer or sell securities under applicable law.

214

Index

	PAGE
Report of Independent Registered Public Accounting Firm		F-2
Consolidated Financial Statements
Consolidated balance sheets		F-3
Consolidated statements of operations and comprehensive income (loss)		F-4
Consolidated statements of stockholders’ deficit		F-5
Consolidated statements of cash flows		F-6
Notes to consolidated financial statements		F-8

F-1

The accompanying consolidated financial statements give effect to a 37.8-for-1 stock split of the common stock of iFIT Health & Fitness Inc that will be effected immediately prior to the effective date of the registration statement. The following report is in the form which will be furnished by Deloitte & Touche LLP, an independent registered public accounting firm, upon the effective date of the 37.8-for-1 stock split of the common stock of iFIT Health & Fitness Inc as described in the last paragraph of Note 25 to the consolidated financial statements and assuming that from August 18, 2021, to the date of such effective date no other material events have occurred that would affect the consolidated financial statements or the required disclosures therein.

/s/ Deloitte & Touche LLP

Salt Lake City, Utah

September 27, 2021

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of iFIT Health & Fitness Inc

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of iFIT Health & Fitness Inc and subsidiaries (the “Company”) as of May 31, 2020 and 2021, the related consolidated statements of operations and comprehensive income (loss), stockholders’ deficit, and cash flows, for each of the three years in the period ended May 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of May 31, 2020 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended May 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Salt Lake City, Utah

August 18, 2021 (September            , 2021 as to the effects of the stock split described in Note 25)

We have served as the Company’s auditor since 2021.

F-2

iFIT Health & Fitness Inc

Consolidated Balance Sheets

(expressed in thousands, except share and per share amounts)

	May 31, 2020			May 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	100,321		$	146,453
Accounts receivable, net		73,828			167,297
Inventories		81,581			403,437
Prepaid expenses		4,258			8,881
Other current assets		17,573			50,885
Total current assets		277,561			776,953
Property and equipment, net		37,560			79,002
Goodwill		5,220			29,639
Intangible assets, net		2,979			5,336
Other non-current assets		48,809			101,636
Total assets	$	372,129		$	992,566
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable		113,178			425,967
Accrued expenses and other current liabilities		42,134			56,144
Current portion of deferred revenue		106,052			223,898
Total current liabilities		261,364			706,009
Long-term debt, net		139,842			157,133
Mandatorily redeemable preferred stock		—			234,041
Deferred income tax liabilities		837			1,269
Deferred revenue		55,687			90,348
Warrant liabilities		54,349			327,313
Embedded derivative liabilities		31,600			121,000
Other non-current liabilities		9,606			25,612
Total liabilities	$	553,285		$	1,662,725
Commitments and contingencies (see Note 18)
Stockholders’ deficit:
Common stock, $0.001 par value; 1,000,000,000 authorized shares; 246,291,797 shares issued and outstanding as of May 31, 2020 and 240,175,493 shares issued and outstanding as of May 31, 2021, inclusive of treasury stock below		246			240
Additional paid-in capital		223,015			324,368
Accumulated deficit		(380,443	)		(909,011	)
Accumulated other comprehensive loss		(11,816	)		(4,996	)
Treasury stock, at cost; 8,008,686 and 16,352,923 shares as of May 31, 2020 and May 31, 2021, respectively		(12,158	)		(80,760	)
Total stockholders’ deficit		(181,156	)		(670,159	)
Total liabilities and stockholders’ deficit	$	372,129		$	992,566

The accompanying notes are an integral part of the consolidated financial statements.

F-3

iFIT Health & Fitness Inc

Consolidated Statements of Operations and Comprehensive Income (Loss)

(expressed in thousands, except share and per share amounts)

	Year Ended May 31,
	2019			2020			2021
Revenue:
Interactive fitness products	$	626,189		$	727,703		$	1,515,288
Subscription		73,776			123,977			229,768
Total revenue		699,965			851,680			1,745,056
Cost of revenue:
Interactive fitness products		444,908			503,353			989,873
Subscription		13,226			19,362			28,980
Total cost of revenue		458,134			522,715			1,018,853
Gross profit		241,831			328,965			726,203
Operating expenses:
Sales and marketing		193,173			278,492			619,431
Research and development		20,898			23,122			36,274
General and administrative		48,892			77,105			198,132
Total operating expenses		262,963			378,719			853,837
Loss from operations		(21,132	)		(49,754	)		(127,634	)
Other expense (income):
Interest expense		15,368			15,496			31,016
Change in fair value of warrant liabilities		—			9,396			142,150
Change in fair value of embedded derivative liabilities		—			20,200			39,300
Loss on issuance of mandatorily redeemable preferred stock and warrants		—			—			178,200
Gain on the sale of subsidiary		(111,800	)		—			—
Other expense (income), net		(2,000	)		1,228			(3,577	)
Total other expense (income), net		(98,432	)		46,320			387,089
Income (loss) before provision for income taxes		77,300			(96,074	)		(514,723	)
Provision for income taxes		20,733			2,469			1,983
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Undistributed earnings allocated to participating securities		(7,496	)		—			—
Net income (loss) available to common stockholders	$	49,071		$	(98,543	)	$	(516,706	)
Net income (loss) per share attributable to common stockholders:
Basic	$	0.23		$	(0.46	)	$	(2.32	)
Diluted	$	0.23		$	(0.46	)	$	(2.32	)
Shares used to compute net income (loss) per share attributable to common stockholders:
Basic		213,654,521			213,111,562			222,511,893
Diluted		213,654,521			213,111,562			222,511,893
Other comprehensive income (loss):
Unrealized gain (loss) on foreign currency contract hedges, net of income taxes of $0, $0 and $0 in fiscal 2019, 2020 and 2021, respectively.		253			(343	)		(683	)
Foreign currency translation adjustment, net of income taxes of $(406), $(15) and $0 in fiscal 2019, 2020 and 2021, respectively.		(2,763	)		(633	)		7,503
Comprehensive income (loss)	$	54,057		$	(99,519	)	$	(509,886	)

The accompanying notes are an integral part of the consolidated financial statements.

F-4

iFIT Health & Fitness Inc

Consolidated Statements of Stockholders’ Deficit

(expressed in thousands, except share amounts)

	Common Stock									Treasury Stock
	Shares			Amount			Additional Paid-in Capital			Shares		Amount			Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Stockholders’ Deficit
Balance as of June 1, 2018		246,291,797		$	246		$	203,736			7,436,016	$	(10,936	)	$	(342,716	)	$	(8,330	)	$	(158,000	)
Adoption of ASC 606		—			—			—			—		—			4,249			—			4,249
Net income		—			—			—			—		—			56,567			—			56,567
Other comprehensive loss		—			—			—			—		—			—			(2,510	)		(2,510	)
Balance as of May 31, 2019		246,291,797			246			203,736			7,436,016		(10,936	)	$	(281,900	)	$	(10,840	)	$	(99,694	)
Stock-based compensation		—			—			18,057			—		—			—			—			18,057
Loans to management		—			—			1,222			572,670		(1,222	)		—			—			—
Net loss		—			—			—			—		—			(98,543	)		—			(98,543	)
Other comprehensive loss		—			—			—			—		—			—			(976	)		(976	)
Balance as of May 31, 2020		246,291,797			246			223,015			8,008,686		(12,158	)		(380,443	)		(11,816	)		(181,156	)
Stock-based compensation		—			—			95,583			—		—			—			—			95,583
Loans to management		—			—			7,601			8,344,237		(68,602	)		—			—			(61,001	)
Common stock redemption		(12,515,164	)		(12	)		(1,913	)		—		—			(11,862	)		—			(13,787	)
Exercise of common stock options		6,398,860			6			82			—		—			—			—			88
Net loss		—			—			—			—		—			(516,706	)		—			(516,706	)
Other comprehensive income		—			—			—			—		—			—			6,820			6,820
Balance as of May 31,2021		240,175,493		$	240		$	324,368			16,352,923	$	(80,760	)	$	(909,011	)	$	(4,996	)	$	(670,159	)

The accompanying notes are an integral part of the consolidated financial statements.

F-5

iFIT Health & Fitness Inc

Consolidated Statements of Cash Flows

(expressed in thousands)

	Year Ended May 31,
	2019			2020			2021
Operating Activities:
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities
Amortization of debt discount and issuance costs and write-off of deferred financing fees		5,573			2,698			6,994
Provision for doubtful accounts		1,278			10,562			14,903
Gain on disposal of property and equipment		(1,257	)		(77	)		(31	)
Gain on sale of subsidiary		(111,800	)		—			—
Deferred income taxes		18,496			901			(1,140	)
Stock-based compensation expense		—			18,059			95,583
Depreciation and amortization		16,720			18,031			16,349
Amortization of content costs		2,567			5,065			9,596
Unrealized loss (gain) on investment securities		43			1,428			(2,903	)
Change in fair value of warrant liabilities		—			9,396			142,150
Change in fair value of embedded derivative liabilities		—			20,200			39,300
Warrants issuance costs		—			2,105			2,070
Paid-in-kind interest		841			3,815			24,127
Loss on issuance of mandatorily redeemable preferred stock and warrants		—			—			178,200
Gain on extinguishment of mandatorily redeemable preferred stock		—			(2,232	)		—
Other non-cash items		2,268			2,829			3,318
Changes in operating assets and liabilities
Accounts receivable		(15,891	)		(11,231	)		(108,323	)
Inventories		(11,766	)		20,905			(325,210	)
Prepaid expenses and other assets		(6,689	)		(10,426	)		(74,393	)
Accounts payable, accrued expenses and other current liabilities		40,492			(24,762	)		333,662
Deferred revenue		18,945			59,750			147,807
Other liabilities		(355	)		(586	)		764
Net cash provided by (used in) operating activities	$	16,032		$	27,887		$	(13,883	)
Investing Activities:
Purchase of property and equipment		(16,190	)		(19,884	)		(56,224	)
Proceeds from disposal of property and equipment		1,237			77			31
Additions to intangible assets		(795	)		(511	)		(1,634	)
Purchase of investment securities		(3,973	)		(6,259	)		(20,273	)
Sale of investment securities		3,965			158			5,561
Cash paid for business acquisition, net of cash acquired		—			—			(9,642	)
Proceeds from sale of subsidiary		128,934			—			—
Net cash provided by (used in) investing activities	$	113,178		$	(26,419	)	$	(82,181	)
Financing Activities:
Proceeds from line of credit		136,252			164,638			271
Payments on line of credit		(141,502	)		(267,138	)		—
Proceeds from issuance of note and warrant		—			200,000			—

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	Year Ended May 31,
	2019			2020			2021
Proceeds from issuance of mandatorily redeemable preferred stock and warrants		—			—			235,000
Payments on long-term debt		(118,750	)		—			—
Payments on mandatorily redeemable preferred stock		—			(9,300	)		—
Payments on capital leases		(87	)		(87	)		(15	)
Payments of financing fees		—			(12,989	)		(13,667	)
Redemption of common stock and issuance of loans to management		—			—			(74,787	)
Payments for offering costs		—			—			(5,545	)
Proceeds from the exercise of stock options		—			—			88
Net cash provided by (used in) financing activities	$	(124,087	)	$	75,124		$	141,345
Effect of exchange rates on cash		(300	)		(42	)		851
Net increase in cash and cash equivalents		4,823			76,550			46,132
Cash and cash equivalents, beginning of period		18,948			23,771			100,321
Cash and cash equivalents, end of period	$	23,771		$	100,321		$	146,453
Supplemental disclosures of operating cash flow:
Cash paid for interest	$	7,660		$	6,322		$	780
Cash paid for income taxes		1,948			1,694			7,981
Non-cash investing and financing activities:
Non-cash treasury stock	$	—		$	1,222		$	7,601
Capital expenditures included in accounts payable		—			—			2,279
Non-cash sellers’ financing		—			—			8,719
Deferred unpaid offering costs		—			—			2,971
Contingent consideration - acquisitions		—			—			2,400

The accompanying notes are an integral part of the consolidated financial statements.

F-7

iFIT Health & Fitness Inc

Notes to Consolidated Financial Statements

1. Description of Business

iFIT Health & Fitness Inc and subsidiaries (“iFIT” or the “Company”) is a vertically integrated business in health, fitness, and wellness technology. The Company provides a platform which delivers interactive, personalized training to its users through immersive experiences using a broad array of equipment and products. The Company is principally involved in the development, manufacturing and distribution of home fitness equipment. At the core of the Company’s integrated platform is the patented iFIT^® technology which allows users to access a full ecosystem of online workouts, health and wellness content, and digital tracking features from any smart device and location. The Company, through its subsidiaries Universal Technical Services (“UTS”) and FG Assurance, Inc. (“FG Assurance”), also provides extended warranty coverages.

Liquidity and Capital Resources

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company has incurred losses from operations of $21.1 million, $49.8 million, and $127.6 million for fiscal 2019, 2020 and 2021, respectively. As of May 31, 2020 and 2021, the Company had accumulated deficits of $380.4 million and $909.0 million, respectively. However, as of May 31, 2020 and 2021, the Company had cash and cash equivalents of $100.3 million and $146.5 million, respectively. The Company also had operating cash inflows of $16.0 million and $27.9 million for fiscal 2019 and 2020, respectively, and operating cash outflows of $13.9 million for fiscal 2021. Further, the Company had an additional $80.9 million and $261.3 million of available cash under its line of credit as of May 31, 2020 and 2021, respectively (see Note 14). Management believes that the Company’s currently available cash and cash equivalents, along with available borrowings, taking into account the outflows related to the acquisition of Sweat (see Note 25), are sufficient to meet the Company’s anticipated cash needs for at least the next 12 months. Management considers that there are no conditions or events, in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern for a period of at least the next 12 months from the date the financial statements are issued.

2. Significant Accounting Policies

Basis of Presentation

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). References to “fiscal 2019”, “fiscal 2020” and “fiscal 2021” are intended to mean the Company’s fiscal years ended May 31, 2019, 2020 and 2021, respectively.

Use of Estimates

In preparing its consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, the Company makes assumptions, estimates, and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of net sales and expenses during the reported periods. On an ongoing basis, the Company evaluates its estimates, including, among others, those related to the realizability of inventory, sales returns, allowance for doubtful accounts, reserves for advertising discounts, fair value measurements including common stock, embedded derivative and warrant liabilities, product warranty, useful lives of property and equipment including internal use software, capitalized iFIT content, and finite-lived intangible assets, accounting for income taxes, impairment analyses of goodwill and other long-lived assets, fair value of assets acquired and liabilities assumed in business combinations, stock-based compensation expense,

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standalone selling price for contracts with multiple performance obligations and timing of revenue recognition, and commitments and contingencies. The Company’s estimates are based on historical experience and on its future expectations that are believed to be reasonable. Actual results may differ from its current estimates and those differences may be material.

During the first quarter of fiscal 2021, the Company reevaluated the estimated useful life of its capitalized software. As a result, the Company determined that the estimated useful life of its capitalized software should be increased from two years as originally estimated to three years. The Company accounted for the change in accounting estimate beginning June 1, 2020. For fiscal 2021, the impact of the change in estimate resulted in a reduction of net loss of $5.8 million.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, which include entities in the United States, Canada, Europe and China. All intercompany accounts and transactions have been eliminated in the consolidated financial statements.

The Company’s subsidiary, FG Assurance, has a fiscal year end of December 31 due to stand-alone statutory reporting requirements. As the fiscal year end for this subsidiary differs from the Company’s fiscal year end by more than three months, the Company has included the financial position as of March 31, 2020 and 2021 and the results of operations for the twelve months ended March 31, 2019, 2020 and 2021 for this entity in the consolidated financial statements. This represents the dates through which the most recent information for FG Assurance is available when the Company prepares its consolidated financial statements. No events or transactions occurred subsequent to March 31, 2021 that would have materially affected the consolidated financial statements, results of operations, or cash flows.

On March 28, 2019, the Company entered into a joint-venture agreement with Xiamen Cowell Industrial Ltd. (“Cowell”) to jointly establish ICON (Hangzhou) Fitness Equipment Co., Ltd. (the “Joint Venture”). The Joint Venture was formed to sell and distribute certain products as well as to provide after-sale services, technology services, and maintenance services within China, Hong Kong, Macau, and Taiwan. The Company owns 49% of the Joint Venture and does not have the power to make any decision unilaterally in the Joint Venture. The Company also holds a call option for the remaining 51% of the Joint Venture from Cowell that may be exercised any time after April 30, 2023. The day-to-day operations of the Joint Venture are managed by a related party to Cowell.

The Joint Venture is classified as a variable interest entity (“VIE”) as the Joint Venture does not have sufficient equity investment at risk to finance its operating activities without additional financial support. Other than an initial equity contribution, the Company has no further financial obligation to fund the Joint Venture. Cowell is solely obligated for providing all operating capital needs of the Joint Venture. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation, a VIE is consolidated in the financial statements if the Company has the power to direct activities that most significantly impact the economic performance of the VIE and has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company has determined the exercise of the call option to be impractical, and combined with the other facts previously described, has concluded the Company does not have the power to direct activities that most significantly impact the economic performance of the VIE. As a result, the Company is not the primary beneficiary of the Joint Venture and does not consolidate the Joint Venture. The investment in the Joint Venture is accounted for using the equity method of accounting and is included within other non-current assets.

Deferred Offering Costs

Deferred offering costs consist primarily of accounting, legal and other fees related to the Company’s proposed initial public offering. Upon consummation of the initial public offering, the deferred offering costs will be reclassified to stockholders’ deficit and recorded against the proceeds from the offering. In the event the offering

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is abandoned, deferred offering costs will be expensed. The Company has capitalized $9.1 million of deferred offering costs within other non-current assets in the consolidated balance sheet as of May 31, 2021. There were no offering costs capitalized as of May 31, 2020.

Segments

Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by its chief operating decision maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The CODM of the Company is the chief executive officer. The Company operates in the health and fitness industry and provides a platform which delivers an interactive, personalized, training to its users and determined that it has two reportable segments: Interactive Fitness Products and Subscription. See Note 22 for further discussion of the Company’s segment reporting structure.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, accounts receivable, and derivative instruments. Cash and cash equivalents are deposited with high quality financial institutions and may, at times, exceed federally insured limits. Management believes that the financial institutions that hold the Company’s deposits are financially credit worthy and, accordingly, minimal credit risk exists with respect to those balances. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal interest rate risk.

The Company’s cash flow hedges, which are accounted for as derivative instruments, expose it to credit risk to the extent that its counterparties may be unable to meet the terms of the agreements. The Company seeks to mitigate this risk by limiting counterparties to major financial institutions. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored on an ongoing basis.

Supplier Concentration

The Company relies on third parties for the supply and manufacture of its products, as well as third-party logistics providers both domestically and internationally. A significant disruption in the operations of these manufacturers would impact the production of the Company’s products for a substantial period of time, which could have a material effect on the Company’s business, financial condition and results of operations. The Company had certain suppliers whose purchases individually represented 10% or more of the Company’s total purchases. Purchases of finished goods from these suppliers amounted to the following percentages of total purchases in the periods presented:

	Year Ended May 31,
	2019			2020			2021
Supplier A		27	%		28	%		23	%
Supplier B		11			16			24

Customer Concentration

The Company has no customers whose revenue individually represented greater than 10% of total revenues for fiscal 2019, 2020 and 2021. As of May 31, 2020, there were no customers representing greater than 10% of the Company’s receivables. As of May 31, 2021, there were two customers that individually represented 20% and 14% of the Company’s receivables, respectively.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and short-term investments purchased with original maturities of three months or less and money market accounts.

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Accounts Receivable, Net

Accounts receivable consist of receivables from retail and commercial customers as well as amounts due from third-party sales processors. Accounts receivable are recorded net of an allowance for doubtful accounts estimated using an analysis of overall receivables aging, specific receivables at risk of not being paid, past collection experience, and current economic trends.

Accounts receivable are also recorded net of a reserve for advertising discounts and a refund liability, which represent a reduction to revenue from retail customers (i.e. credit memos). The credit memos represent the Company’s refund liability for returns from retail customers. The Company estimates its credit memos based on historical sales returns, other known factors, and the Company’s return policy. Estimated sales returns are recorded on a gross basis, as a reduction to revenue, with the expected return recorded as a reduction to accounts receivable. If future sales returns differ from the historical data the Company uses to calculate these estimates, the amount of the credit memos and corresponding revenue are adjusted in the period in which such costs occur. The refund liability for returns from non-retail customers is included within accrued expenses in the consolidated balance sheets.

Inventories

Inventories consist primarily of raw materials (principally parts and supplies) and finished goods. Inventories are valued at the lower of cost or net realizable value, and cost is determined using standard costs which approximate actual cost using the first-in, first-out (FIFO) inventory method. The Company maintains inventory in various distribution centers, manufacturing locations and third-party warehouses. The Company reviews inventories on hand and records allowances for estimated excess, slow moving and obsolete inventory. Inventories are written down that have a carrying value in excess of net realizable value.

Investment Securities at Fair Value

The Company records certain investment securities at fair value and records the related gains and losses through other expense (income) in the consolidated statements of operations and comprehensive income (loss). The investment securities have maturities of less than one year and are classified within other current assets in the consolidated balance sheets.

Investment Securities at Cost

On March 19, 2021, the Company invested $9.0 million in a health technology company focused on wearable health products. The Company received 90,331 shares of the investee’s Series C preferred shares. Upon an initial public offering by the investee, the Series C preferred shares of the investee owned by the Company will be converted into shares of the investee’s common stock. The Company is entitled to a portion of any dividends declared by the investee and has voting rights. The Company applied ASC 321, Investments – Equity Securities, and elected the measurement alternative for equity investments that do not have readily determinable fair values and do not qualify for the practical expedient in ASC 820, Fair Value Measurements, to estimate fair value using the net asset value per share. Under the alternative, the investment is measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. There has been no indication of impairment or changes in observable prices via transactions of similar securities, so the investment is still carried at cost. The investment is classified within other non-current assets in the consolidated balance sheets.

Property and Equipment, Net

Property and equipment is stated at cost less accumulated depreciation. Management periodically evaluates the recoverability of property and equipment, based on estimated future cash flows, and makes provisions, where

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appropriate, for amounts that will not be recovered. Depreciation expense of property and equipment is calculated using the straight-line method over the estimated useful lives of the respective assets. The Company capitalizes property and equipment costs related to tooling used in the manufacturing of products sold to its customers. Expenditures for upgrades and improvements are capitalized and expenditures for maintenance and repairs are expensed as incurred. For leasehold improvements, the useful life is the lesser of the applicable lease term or the expected asset life. Capital lease assets are included in property and equipment in the Company’s consolidated balance sheets.

The Company capitalizes certain eligible software development costs incurred in connection with its internal use software in accordance with ASC 350-40, Internal-use Software. These capitalized costs also relate to the Company’s iFIT software that is accessed by its customers on a subscription basis as well as certain costs associated with its information systems. Capitalized software costs are amortized over the estimated useful life, which beginning on June 1, 2020, is three years. Capitalization begins once the application development stage begins, management has authorized and committed to funding the project, it is probable the project will be completed, and the software will be used to perform the function intended. Internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. The Company expenses all costs incurred that relate to planning and post-implementation phases of development.

During fiscal 2019, 2020 and 2021, the Company capitalized $11.6 million, $14.1 million, and $34.4 million, respectively, of software development costs. Such costs are included in property and equipment in the consolidated balance sheets. Amortization expense of software developed for internal use is included within general and administrative expense, except amortization expense related to iFIT software which is included in cost of revenue for subscription in the consolidated statements of operations and comprehensive income (loss). As of May 31, 2020 and 2021, unamortized internal use software and iFIT development costs totaled $14.4 million and $33.2 million, respectively, and are included in property and equipment, net.

Capitalized iFIT Content

Capitalized iFIT content costs include certain expenditures to develop video and live content for the Company’s customers. The Company capitalizes production costs for live and recorded iFIT content in accordance with ASC 926-20, Entertainment-Films - Other Assets - Film Costs. The Company recognizes capitalized iFIT content, net of accumulated amortization, within other non-current assets in the consolidated balance sheets and recognizes the related amortization expense as a component of cost of revenue for subscription in the consolidated statements of operations and comprehensive income (loss). Costs which qualify for capitalization include production costs, development costs, direct costs, labor costs, and production overhead. Expenditures for capitalized iFIT content are included within operating activities in the consolidated statements of cash flows.

Based on certain factors, including historical and estimated user viewing patterns, the Company amortizes individual titles within the iFIT content library on a straight-line basis over a three-year useful life. The Company reviews factors impacting the amortization of the capitalized iFIT content on an ongoing basis. Estimates related to these factors require considerable management judgment.

The Company’s business model is subscription based as opposed to generating revenues at a specific title level. Therefore, all content assets are monetized as part of a single asset group. The content is assessed at the group level when an event or change in circumstances indicates a change in the expected usefulness of the content or that fair value may be less than unamortized cost. Unamortized costs are assessed for impairment regardless of whether the produced content is completed. To date, the Company has not recognized an impairment with regards to the carrying value of its content portfolio. If circumstances in the future suggest that an impairment may exist, these aggregated content assets will be stated at the lower of unamortized cost or fair value. In addition, unamortized costs for assets that have been, or are expected to be, abandoned are written off.

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Business Combinations

The Company accounts for business combinations using the acquisition method. Under this method, the purchase price, which is measured as the aggregate of the fair value of the consideration transferred, is allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values on the date of acquisition. To the extent the purchase price exceeds the fair value of the net identifiable tangible and intangible assets acquired and liabilities assumed, such excess is allocated to goodwill. The determination of fair value requires judgment and may involve the use of significant estimates and assumptions. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain.

During the measurement period, not to exceed one year from the date of acquisition, the Company may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill, if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the consolidated statements of operations and comprehensive income (loss). Acquisition-related costs, such as legal and consulting fees, are recognized separately from the acquisition and are expensed as incurred.

Goodwill

Goodwill represents the excess of cost over the fair value of net assets acquired in a business combination. Goodwill is tested for impairment annually at the beginning of the fourth quarter or more frequently when a triggering event occurs that indicates that the fair value of the reporting unit to which it is assigned may be below its carrying amount. The Company first performs a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If factors indicate that the fair value of the reporting unit is less than its carrying amount, the Company performs a quantitative assessment and the fair value of the reporting unit is determined by analyzing the expected present value of future cash flows. If the carrying amount of the reporting unit is greater than its fair value, the reporting unit’s goodwill is impaired. The goodwill impairment is equal to the difference between the carrying amount of the reporting unit and its fair value, not to exceed the carrying amount of the goodwill.

The Company performed a qualitative assessment at the beginning of the fourth quarter for fiscal 2019, 2020 and 2021, and based on this assessment, the Company determined that it was not more-likely-than-not that goodwill was impaired.

Intangible Assets

Intangible assets consist of patents, trademarks and brand names. Intangible assets are recorded at cost and are amortized on a straight-line basis over their estimated useful lives. The Company assesses the impairment of intangible assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or circumstances indicate that the carrying amount of long-lived assets may not be recoverable. The carrying value of a long-lived asset is considered impaired when the anticipated cumulative undiscounted cash flows from that asset are less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset, which is generally based on discounted cash flows. There were no impairments of long-lived assets recorded during fiscal 2019, 2020 and 2021.

Reinsurance Deposit

Funds are held on deposit with an unrelated insurance company (ceding insurer) in accordance with the reinsurance agreement between the insurer and FG Assurance in order to provide security for and convenient

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payment of the Company’s future insurance contract obligations. As of May 31, 2020 and 2021, other non-current assets include $15.0 million and $21.2 million, respectively, in funds held on deposit with the ceding insurer.

Equity Method Investment

The Company uses the equity method of accounting for the Joint Venture as the Company is able to exercise significant influence, but not control, over the investee. Judgment regarding the level of influence over the Joint Venture is required and includes considering key factors such as our ownership interest, representation on the board of directors, organizational structure, participation in policy-making decisions and material intra-entity transactions.

Under the equity method, the original investment is recorded at cost and subsequently adjusted by the Company’s share of equity in income or losses after the date of acquisition as well as capital contributions to and distributions by the Joint Venture. The proportionate share of the net income of the Joint Venture was immaterial for fiscal 2019, 2020 and 2021, and is included in other expense (income) in the consolidated statements of operations and comprehensive income (loss).

The Company evaluates its equity method investment for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable. Factors considered when reviewing an equity method investment for impairment include the length of time (duration) and the extent (severity) to which the fair value of the equity method investment has been less than carrying value, the investee’s financial condition and near-term prospects and the intent and ability to hold the investment for a period of time sufficient to allow for anticipated recovery.

Advertising Costs

The Company expenses advertising communication costs as incurred. Production costs of advertising content are recorded in prepaids until the initial run of the ad, at which time such costs are expensed. Advertising and production costs are included in selling and marketing expenses in the consolidated statements of operations and comprehensive income (loss) and totaled $67.2 million, $123.7 million and $378.7 million for fiscal 2019, 2020 and 2021, respectively. As of May 31, 2020 and 2021, the Company recorded $0.0 million and $0.4 million, respectively, of prepaid advertising costs within prepaid expenses in the consolidated balance sheets.

Revenue Recognition

On June 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC 606”) and all subsequent amendments using the modified retrospective approach. The adoption of the new standard did not have a material impact on the measurement or timing of revenue recognition. See Note 3 for additional disclosures regarding Revenue. The Company presents the reserve for returns and the right to recover inventory on a gross basis.

Cost of Revenue

Interactive Fitness Products

Cost of revenue for interactive fitness products consists primarily of inventory and manufacturing costs, tooling costs, royalties, duties and import costs, realized cash flow hedge gains and losses, depreciation and amortization, inbound freight, packaging, warranty replacement and servicing costs associated with the manufacturer’s warranty, and certain allocated costs related to management, facilities, and personnel.

Subscription

Cost of revenue for subscription consists primarily of costs associated with the creation of iFIT content, including associated payroll, filming and production costs, other iFIT content specific costs, hosting fees, music

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royalties, amortization of iFIT capitalized software development costs, and warranty replacement and servicing costs associated with extended warranty contracts.

Shipping and Handling Fees

Shipping and handling fees billed to customers are recorded gross and included in revenue with the associated costs reported in sales and marketing. Shipping and handling fees recorded in sales and marketing expense were $54.1 million, $66.5 million, and $117.9 million for fiscal 2019, 2020 and 2021, respectively.

Presentation of Certain Taxes

Taxes collected from customers and remitted to governmental authorities are recorded on a net basis and excluded from revenue.

Research and Development Costs Research and development expenses are related primarily to personnel focused on developing new products and services and improving existing products and services. Research and development also include facilities-related expenses and consulting and contractor expenses. Research and product development costs are generally expensed as incurred. The Company capitalizes certain qualified costs incurred in connection with the development of internal-use and iFIT software.

Stock-Based Compensation

Stock-based compensation expense associated with the Company’s equity awards is measured at fair value at the grant date and the related expense is recognized over the requisite service period. To the extent a stock-based award is subject to a performance condition, the amount of expense recorded in a given period, if any, reflects an assessment of the probability of achieving such performance condition, with compensation expense recognized once the event is deemed probable to occur. The fair value of equity awards is estimated using the Black-Scholes valuation model. Forfeitures are recognized as incurred.

Common Stock Valuations

The fair value of the shares of common stock has historically been established by the Company’s board of directors, which is responsible for these estimates. In the absence of a public trading market, the board of directors, with input from management, exercises significant judgment and considers numerous objective and subjective factors to determine the fair value of the Company’s common stock, including:

• Relevant precedent transactions involving the Company’s capital stock;

• The Company’s actual operating and financial performance;

• Current business conditions and projections;

• Any adjustment necessary to recognize a lack of marketability of the common stock;

• The market performance of comparable publicly traded companies;

• Likelihood of achieving a liquidity event, such as an initial public offering; and

• U.S. and global capital market conditions.

In addition, the board of directors considers the independent valuations completed by a third-party valuation firm. The valuations of the Company’s common stock are determined in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

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Foreign Currency Translation

The functional currency of the Company is the United States dollar (“US dollar”). Assets and liabilities of the Company’s European, Canadian and Chinese subsidiaries are translated from their functional currencies (Euro, Canadian dollar and Renminbi, respectively) into U.S. dollars at the applicable rates of exchange at each period end. The Company’s foreign transactions are primarily denominated in Euro, Canadian dollars and Renminbi. Revenues and expenses for these subsidiaries are translated into U. S. dollars at the weighted-average rate of exchange during the period. Gains and losses resulting from foreign currency transactions are recognized in other expense (income) in the consolidated statements of operations and comprehensive income (loss). Assets and liabilities are remeasured into U.S. dollars at exchange rates in effect at the balance sheet date, and equity is translated using historical rates. The impact of changes in exchange rates on the translation of the consolidated balance sheets is reflected in accumulated other comprehensive loss.

Warranty Reserves

The Company’s products carry defined warranties for defects in materials workmanship. The Company provides a standard (limited) product warranty for its fitness equipment. The standard (limited) product warranties generally obligate the Company to pay for the cost of replacement parts and service labor costs for a stated period of time from the date of delivery. The Company also offers additional extended warranties on average for one to five-year terms, which can be purchased separately within the limited warranty period. At the time of sale, the Company records a liability for the estimated costs of fulfilling future limited warranty claims. The estimated warranty expenses are included in cost of revenue, based on historical warranty claim experience and available product quality data. If necessary, the Company adjusts its liability for specific warranty matters when they become known and are reasonably estimable. Warranty expenses are affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates and variances in expected repair costs. The following table provides a reconciliation of the changes in the Company’s product warranty reserve, which is included in accrued expenses (in thousands):

	Year Ended May 31,
	2020		2021
Beginning balance	$	3,959	$	6,248
Additions:
Charges to costs and expenses		16,818		20,650
Deductions:
Warranty claims		14,529		18,637
Ending balance	$	6,248	$	8,261

Fair Value of Financial Instruments

Fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date. The Company’s assessment of the significance of a particular input to fair value requires judgment and may affect the fair value of assets and liabilities and their placement within the fair value hierarchy.

Financial assets and liabilities recorded on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

Level 1. Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company has the ability to access.

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Level 2. Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 2 inputs include the following:

(a) quoted prices for similar assets in active markets;

(b) quoted prices for identical or similar assets in non-active markets;

(c) pricing models whose inputs are observable for substantially the full term of the asset; and

(d) pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability.

Level 3. Financial assets and liabilities whose values are based on prices or valuation techniques that require unobservable inputs. These inputs reflect management’s own estimates about the assumptions a market participant would use in pricing the asset or liability.

The Company’s primary financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, long-term debt, mandatorily redeemable preferred stock, investment securities, warrant liabilities, embedded derivative liabilities, and foreign currency derivative contracts. The carrying amounts for cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short maturities. See Note 5 for further information.

Retirement Plans

The Company has a nonqualified deferred compensation plan that permits certain employees to annually elect to defer a portion of their compensation for their retirement. The amount of deferred compensation and related investment earnings have been placed in an irrevocable rabbi trust and recorded within other non-current assets with the associated liabilities within other non-current liabilities, in the Company’s consolidated balance sheets, as this trust will be available to the Company’s general creditors in the event of insolvency. These assets are measured at fair value with the associated gains and losses included within other expense (income) in the consolidated statements of operations and comprehensive loss. The deferred compensation investments consist primarily of company-owned life insurance policies and mutual funds. The value of the Company’s deferred compensation trust was $9.4 million and $13.7 million as of May 31, 2020 and 2021, respectively. See Note 5 for disclosures regarding fair value measurements.

An offsetting deferred compensation liability, which equals the total value of the trust at May 31, 2020 and 2021 of $9.4 million and $13.7 million, respectively, reflects amounts due to employees who contributed to the plan. The Company’s contributions to the deferred compensation plan were immaterial for fiscal 2019, 2020 and 2021. The Company also has a 401(k) savings plan. All employees who have met minimum age and service requirements are eligible to participate in the 401(k) savings plan. After three years of service, employees are 100% vested in all employer contributions. The Company matches 30% of the first 8% of gross earnings contributed. Company contributions to the plan for fiscal 2019, 2020 and 2021 were $0.8 million, $1.0 million and $1.2 million, respectively.

Derivative Financial Instruments

The Company uses foreign currency purchase contracts to manage its risk associated with operations in foreign jurisdictions and/or transactions denominated in foreign currencies. These derivatives are recognized as either assets or liabilities in the consolidated balance sheets at fair value and the accounting for changes in their fair value depends on their intended use and resulting hedge designation. For derivative instruments designated as hedges, the changes in fair value are recorded in the consolidated balance sheets as a component of accumulated other comprehensive loss. Changes in the fair value of derivative instruments not designated as hedges are recorded in the consolidated statements of operations and comprehensive income (loss), generally as a

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component of other expense (income). The Company has various foreign currency purchase contracts outstanding to manage its risk associated with operations in foreign jurisdictions and/or transactions denominated in foreign currencies.

As of May 31, 2019, the Company had 30 outstanding U.S. dollar forward purchase contracts denominated in euros with a notional amount of $7.2 million. Each contract varies between $0.1 million and $0.5 million. These contracts mature between June 10, 2019 and May 14, 2020 with exchange rates varying between 1.15 and 1.25 U.S. dollars per euro.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates 1.115 U.S. dollars per euro had an immaterial unrealized foreign exchange gain as of May 31, 2019, which has been recorded in other comprehensive income. Any gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2020.

For fiscal 2019, the Company realized a loss of $0.1 million as outstanding U.S. dollar forward purchase contracts matured. Realized gains and losses are recorded as a part of cost of revenue. As of May 31, 2019, all realized net derivative gains and losses were reclassified from accumulated other comprehensive loss to cost of revenue within the consolidated statements of operations and comprehensive income (loss).

As of May 31, 2020, the Company had 8 outstanding U.S. dollar forward purchase contracts denominated in GBP with a notional amount of $2.3 million. Each contract is $0.3 million. These contracts mature between June 30, 2020 and February 28, 2021 with exchange rates varying between 1.15 and 1.29 U.S. dollars per GBP.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates 1.234 U.S. dollars per GBP had an immaterial unrealized foreign exchange loss as of May 31, 2020, which has been recorded in other comprehensive income (loss). Any gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2021.

As of May 31, 2020, the Company had 16 outstanding U.S. dollar forward purchase contracts denominated in euros with a notional amount of $3.8 million. Each contract varies between $0.1 million and $0.3 million. These contracts mature between June 30, 2020 and September 30, 2021 with exchange rates varying between 1.11 and 1.19 U.S. dollars per euro.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates 1.11 U.S. dollars per euro had an immaterial unrealized foreign exchange loss as of May 31, 2020, which has been recorded in other comprehensive income (loss). Any gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2021.

For fiscal 2020, the Company realized a gain of $0.2 million as outstanding U.S. dollar forward purchase contracts matured. Realized gains and losses are recorded as a part of cost of revenue. As of May 31, 2020, all realized net derivative gains and losses were reclassified from accumulated other comprehensive loss to cost of revenue within the consolidated statements of operations and comprehensive income (loss).

As of May 31, 2021, the Company had 5 outstanding U.S. dollar forward purchase contracts denominated in GBP with a notional amount of $2.5 million. Each contract varies between $0.3 million and $0.6 million. These contracts mature between September 30, 2021 and February 28, 2022 with exchange rates varying between $1.22 and $1.25 U.S. dollars per GBP.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates $1.42 U.S. dollars per GBP had an unrealized foreign exchange loss of $0.3 million as of May 31, 2021, which has been recorded in other comprehensive income (loss). Any gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2022.

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As of May 31, 2021, the Company had 32 outstanding U.S. dollar forward purchase contracts denominated in euros with a notional amount of $17.5 million. Each contract varies between $0.3 million and $0.5 million, with one contract having a notional amount of $4.0 million. These contracts mature between June 15, 2021 and April 3, 2023 with exchange rates varying between $1.14 and $1.26 U.S. dollars per euro.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates $1.22 U.S. dollars per euro had an unrealized foreign exchange loss of $0.4 million as of May 31, 2021, which has been recorded in other comprehensive income (loss). The majority of gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2022.

As of May 31, 2021, the Company had 6 outstanding U.S. dollar forward purchase contracts denominated in Australian dollars with a notional amount of $7.9 million. Each contract varies between $1.1 million and $1.5 million. These contracts mature between June 30, 2021 and November 30, 2021 with exchange rates of $0.76 U.S. dollars per Australian dollar.

These outstanding contracts, which were designated as cash flow hedges, using the exchange rates $0.77 U.S. dollars per Australian dollar had an unrealized foreign exchange gain of $0.1 million as of May 31, 2021, which has been recorded in other comprehensive income (loss). Any gains or losses under these contracts are expected to be reclassified into earnings in fiscal 2022.

For fiscal 2021, the Company realized a loss of $0.9 million as outstanding U.S. dollar forward purchase contracts matured. Realized gains and losses are recorded as part of cost of revenue. As of May 31, 2021, all realized net derivative gains and losses were reclassified from accumulated other comprehensive loss to cost of revenue in the consolidated statements of operations and comprehensive income (loss).

Dispositions

During fiscal 2018, the Company entered into an agreement to sell a subsidiary for $135.0 million, net of working capital and other adjustments. The sale, which closed on June 1, 2019, resulted in a gain of $111.8 million and cash inflow of $128.9 million.

Income Taxes

The Company recognizes income taxes under the asset and liability method. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

The provision (benefit) for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and any estimated valuation allowances deemed necessary to recognize deferred tax assets at an amount that is more likely than not to be realized. The Company’s filings, including the positions taken therein, are subject to audit by various taxing authorities. While the Company believes it has provided adequately for its income tax liabilities in the consolidated financial statements, adverse determinations by these taxing authorities could have a material effect on the consolidated financial condition, results of operations or cash flows.

Earnings (Loss) Per Share

Basic and diluted net income (loss) per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. The Company considers its stock options issued in exchange for non-recourse notes to officers and warrants to be participating securities as the holders of such options and warrants have the right to receive nonforfeitable dividends on a pari passu basis in the event that a

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dividend is paid on common stock. Under the two-class method, in periods where the Company incurs a net loss, net losses attributable to common stockholders are not allocated to these options or warrants as the holders do not have a contractual obligation to share in the Company’s losses. In periods where the Company earns net income, participative securities participate in undistributed earnings on an equal basis with common shares. See Note 21 for the amount of undistributed earnings allocated to the participating securities.

Basic earnings (loss) per share is computed using net income (loss) available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) per share reflects the dilutive effects of stock options and warrants outstanding during the period, to the extent such securities would not be anti-dilutive. Certain stock options granted by the Company vest upon meeting certain performance conditions. If such performance conditions are not met, then the options are excluded from the basic and dilutive earnings (loss) per share calculations.

Treasury Stock

The Company records its purchases of treasury stock at cost as a separate component in the consolidated statements of stockholders’ deficit. See Note 19 for further detail on the Company’s accounting for share repurchases, including those related to loans to certain members of management which have been reflected as treasury stock transactions.

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss), foreign currency translation adjustments and unrealized gains (losses) on foreign currency contract hedges, net of tax, and is presented in the consolidated statements of operations and comprehensive income (loss).

Recent Accounting Pronouncements

Emerging Growth Company

Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

The Company ceased to be an emerging growth company (“EGC”) on May 31, 2021 as it no longer met the requirements under the JOBS Act. However, as the Company qualified as an EGC at the time it submitted a confidential draft registration statement with the Securities and Exchange Commission, the Company will continue to be treated as an EGC until the earlier of (1) the date on which the Company becomes a public enterprise or (2) May 31, 2022. As such, the Company has elected to take advantage of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act.

Accounting Pronouncements Recently Adopted

Revenue Recognition. In May 2014, the FASB issued ASC 606, which outlines a single comprehensive model for entities to use in accounting for revenue from contracts with customers. It supersedes prior revenue recognition guidance, including industry-specific guidance, and requires significantly expanded disclosures about revenue recognition. The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be

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entitled in exchange for those goods and services. Effective June 1, 2018, the Company adopted ASC 606 using the modified retrospective transition method. The adoption of ASC 606 had a $4.2 million impact on the Company’s revenue recognition policies. As such, a cumulative effect adjustment was made for that amount upon adoption. See Note 3 - Revenue for additional detail on revenue.

Goodwill Impairment. In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment, to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. The standard is effective for public entities for annual or any interim goodwill impairment tests in annual reporting years beginning after December 15, 2019. For all other entities, including emerging growth companies, the standard is effective for annual or any interim goodwill impairment tests in annual reporting years beginning after December 15, 2021. Early adoption of this standard is permitted. The Company adopted this ASU on June 1, 2019. The adoption of ASU 2017-04 had no impact on the Company’s consolidated financial statements.

Capitalized Content Costs. In March 2019, the FASB issued ASU 2019-02, Entertainment-Films-Other Assets-Film Costs (Subtopic 926-20), which requires production costs of content that is episodic in nature to be capitalized as incurred, which aligns the guidance with the accounting for production of film costs. The new guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. Early adoption is permitted. The Company adopted this ASU on June 1, 2019. The adoption of ASU 2019-02 did not have a material impact on the Company’s consolidated financial statements.

Fair Value Measurement. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). This new standard improves the effectiveness of the disclosure requirements of fair value measurements by removing, modifying, or adding certain disclosures. The new guidance is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. Early adoption is permitted. The Company adopted this ASU on June 1, 2020. The adoption of ASU 2018-13 did not have a material impact on the Company’s consolidated financial statements.

LIBOR. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. In response to concerns about structural risks related to interbank exchange rates, the FASB took the initiative to identify alternative reference rates, such as the Secured Overnight Financing Rate (SOFR), that are more observable or transaction based and that are less susceptible to manipulation. The amendments in this update apply to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. This ASU is effective for all entities as of March 12, 2020 through December 31, 2022. The Company adopted this ASU on June 1, 2020. The adoption of ASU 2020-04 did not have a material impact on the Company’s consolidated financial statements.

Income Taxes. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). The amendments in this ASU 2019-12 simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The update is effective for all entities for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. This ASU will be effective for the Company beginning June 1, 2022. Early adoption is permitted. The Company adopted this ASU on June 1, 2020. The adoption of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements.

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Accounting Pronouncements Not Yet Adopted

Leases. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This new standard requires lessees to recognize assets and liabilities on the balance sheet, initially measured at the present value of the lease payments, for the rights and obligations created by all leases with terms of more than 12 months. This guidance will be effective for the Company beginning the earliest of (1) the date on which the Company becomes a public enterprise or (2) June 1, 2022. Early application is permitted. The new guidance will result in the recording of a lease liability and corresponding asset on the statements of financial position. The Company is currently evaluating the effect of this ASU on the Company’s consolidated financial statements.

Credit Losses. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments - Credit Losses (Topic 326) (“ASU 2019-05”). ASU 2019-05 provides relief to certain entities adopting ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). The amendments accomplish those objectives by providing entities with an option to irrevocably elect the fair value option in Subtopic 825-10, applied on an instrument-by-instrument basis for eligible instruments, that are within the scope of Subtopic 326-20, upon adoption of Topic 326. The fair value option election does not apply to held-to-maturity debt securities. ASU 2019-05 has the same transition as ASU 2016-13 and is effective for public companies for the periods beginning after December 15, 2019, with adoption permitted after this update. Early adoption is permitted. This ASU will be effective for the Company beginning the earliest of (1) the date on which the Company becomes a public enterprise or (2) June 1, 2024. The Company is currently evaluating the effect of this guidance on its consolidated financial statements.

Internal-use Software. In August 2018, the FASB issued ASU No. 2018-15, Intangible – Goodwill and Others – Internal-use Software (Subtopic 350) – Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU 2018-15 is effective for public entities for fiscal years beginning after December 15, 2020, including interim periods within that fiscal year, and can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. This ASU will be effective for the Company beginning June 1, 2021. Early adoption is permitted. The adoption of ASU 2018-15 is not expected to have a material impact on the Company’s consolidated financial statements.

3. Revenue

The Company determines revenue recognition through the following steps:

• identify the contract, or contracts, with a customer;

• identify the performance obligations in the contract;

• determine the transaction price;

• allocate the transaction price to the performance obligations in the contract; and

• recognize revenue when, or as, a performance obligation is satisfied.

The Company receives revenue from three primary sources including fitness equipment, subscriptions, and extended warranties. Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

The Company records sales returns, discounts and third-party financing fees as a reduction of the transaction price. The Company estimates its refund liability for product returns based on historical sales returns, other known factors, and the Company’s return policy. Estimated sales returns are recorded as a reduction to revenue,

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with the expected inventory right of recovery recorded as a reduction to cost of revenue. If future sales returns differ from the historical data the Company uses to calculate these estimates, the amount of the refund liability and corresponding revenue are adjusted in the period in which such costs occur.

Some of the Company’s contracts with customers contain multiple promises. For these contracts, the Company accounts for individual performance obligations if they are distinct. The transaction price is then allocated to each performance obligation based on its relative standalone selling price. The standalone selling price of each performance obligation is estimated based on an approach that maximizes the use of observable inputs and faithfully depicts the selling price of the promised goods or services if the Company sold those goods or services separately to a similar customer in similar circumstances. We determine standalone selling price based on prices charged to customers for goods or services sold on a standalone basis, or a cost-plus margin approach for performance obligations where standalone selling price is not directly observable.

Deferred revenue is recorded for nonrefundable cash payments received for the Company’s performance obligation to transfer goods or services in the future. Deferred revenue consists of subscription fees billed and collected that have not been earned, as subscription revenue is recognized over the subscription term.

The Company accounts for payments to retailers for customer programs, such as cooperative advertising programs, as a selling expense if it receives a distinct identifiable benefit in exchange. Otherwise, such costs are recorded as a reduction to sales.

Interactive Fitness Products

The Company recognizes revenue from the sale of fitness products, net of sales returns, discounts and customer sales incentives, at the point in time when the Company transfers control of the product to the customer, based on the Company’s shipping terms within the contract. The majority of the Company’s shipping terms are FOB destination, in which title is transferred upon delivery to the customer. Generally, the Company’s return policy for sales to end users sold through retailers is to accept returns for defective products up to 30-days after the date of the retailer’s sale to the end user. If defective products are returned, the Company has agreed with customers to cure the defect and reship the product. With respect to direct-to-consumer sales, the Company offers a “no questions asked, money back guarantee” 30-day return policy, as stated in its return policy.

Payment terms with retail customers are typically 30 to 120 days. Direct customers have the option to pay at order placement by credit card or to finance the order with a third-party financing partner. The Company records fees paid to third-party financing partners in connection with its consumer financing program as a reduction of revenue, as it considers such costs to be a customer sales incentive.

Extended Warranty

The Company provides a standard (limited) product warranty for its fitness equipment. The standard (limited) product warranties generally obligate the Company to pay for the cost of replacement parts and service labor costs for a stated period of time from the date of delivery. At the time revenue is recognized, an estimate of future warranty costs is recorded as a component of cost of revenue within interactive fitness products.

In addition, the Company offers the option to purchase extended warranties for an additional fee. These warranty contracts offer additional product warranty coverage on average for one to five-year terms. Unearned warranty premiums represent premiums received from customers related to extended warranty contracts for which revenue has not been earned and are included within deferred revenue. The Company records subscription revenues related to extended warranty contracts ratably over the policy period. For fiscal 2019, 2020 and 2021, the Company recognized $21.5 million, $20.2 million, and $22.2 million, respectively, of revenue related to extended warranties within subscription revenue. As of May 31, 2020 and 2021, the Company had deferred revenues from warranty premiums of $55.1 million and $75.3 million, respectively, of which $16.7 million and

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$22.5 million, respectively, is included in current portion of deferred revenue and $38.4 million and $52.8 million, respectively, is included in long-term deferred revenue. The Company will recognize the balance of long-term deferred revenue into revenue as warranty services are provided, with substantially all of the May 31, 2021 long-term deferred revenue expected to be recognized between fiscal 2023 and fiscal 2026. For fiscal 2019, 2020 and 2021, the Company recognized warranty revenue of $11.8 million, $12.0 million, and $12.4 million that was included in the deferred revenue balance as of May 31, 2018, 2019 and 2020, respectively.

iFIT Subscriptions

The Company sells iFIT subscriptions to customers on either a month-to-month or annual basis. In addition, certain fitness equipment sales include a one-year iFIT subscription. After the initial one-year period, subscriptions are offered on a month-to-month or annual basis. Revenues associated with the Company’s subscriptions are deferred at the time of sale and recognized ratably over the subscription period. For fiscal 2019, 2020 and 2021, the Company recognized $52.3 million, $103.8 million and $207.6 million, respectively, of revenue related to iFIT subscriptions within subscription revenue. As of May 31, 2020 and 2021, the Company had deferred revenues from subscriptions totaling $106.6 million and $239.0 million, respectively, of which $89.3 million and $201.4 million, respectively, is included in current portion of deferred revenue and $17.3 million and $37.6 million, respectively, is included in long-term deferred revenue. The Company will recognize the balance of long-term deferred revenue into revenue as iFIT subscriptions are provided, with a majority of the May 31, 2021 long-term deferred revenue expected to be recognized in fiscal 2023 and substantially all recognized by the end of fiscal 2024. For fiscal 2019, 2020 and 2021, the Company recognized subscription revenue of $23.5 million, $44.2 million, and $86.8 million that was included in the deferred revenue balance as of May 31, 2018, 2019, and 2020, respectively.

Contract Costs

The Company incurs incremental costs of obtaining a contract, which primarily consist of commissions paid on sales of extended warranties. The Company capitalizes sales commissions that are direct and incremental to the contract and are expected to be recovered through revenue generated under the contract. Costs are amortized in sales and marketing ratably over the policy period.

As of May 31, 2020 and 2021, the Company had capitalized costs of obtaining contracts totaling $5.1 million and $6.3 million, respectively, of which $1.1 million and $1.4 million, respectively, is included in other current assets and $4.0 million and $4.9 million, respectively is included in other non-current assets. For fiscal 2019, 2020 and 2021, the Company recognized commission expense of $1.0 million, $1.0 million and $1.2 million, respectively, related to the amortization of capitalized commissions.

Exemptions and Elections

The Company has elected the practical expedient to not disclose information related to transaction price allocated to remaining performance obligations for contracts one year or less in duration.

The Company capitalizes and amortizes sales commissions over the customer life when the expected customer life is greater than one year. The Company has elected to use the practical expedient to expense incremental costs of obtaining a contract when the expected customer life is less than one year.

The Company has made an accounting policy election to present sales tax collected from customers and remitted to governmental authorities on a net basis. As such, these taxes are not included in revenue and are reflected as a liability on the consolidated balance sheets.

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Disaggregation of Revenue

Our revenues disaggregated by geographic region, based on ship-to address, were as follows (in thousands):

	Year Ended May 31,
	2019		2020		2021
United States	$	541,330	$	689,953	$	1,471,531
Rest of the World		158,635		161,727		273,525
Total revenue	$	699,965	$	851,680	$	1,745,056

4. Acquisition

On April 30, 2021, pursuant to a membership interest purchase agreement, the Company acquired all of the outstanding interests of Be Boundless, LLC (“29029”), an outdoor endurance event company. The acquisition is expected to expand the Company’s offerings for its subscribers and provide opportunities to interact with instructors from the iFIT platform at live events. The purchase price consisted of $9.6 million of cash paid at closing of the transaction, $8.6 million as a discounted liability and $2.4 million as contingent consideration, which are included in other non-current liabilities in the consolidated balance sheet as of May 31, 2021. The discounted liability and contingent consideration are settleable in shares upon an initial public offering.

As part of the purchase agreement, in the event that the Company does not undergo an initial public offering by the third anniversary of the closing date, the Company will instead pay $11.5 million in cash, plus interest accruing from the date of closing at the applicable federal rate, in lieu of the share consideration. The Company determined that because the former owners of 29029 are entitled to a minimum amount of future consideration of $11.5 million, whether in share consideration or cash in the event that the Company does not undergo an initial public offering within three years, the obligation is a guaranteed amount and is accounted for as a sellers’ financing liability (i.e. discounted liability) and is included in total purchase consideration at its acquisition date fair value. The acquisition date fair value of the financing liability, discounted to its present value, is $8.6 million.

In the event that the Company does undergo an initial public offering within three years of the closing date, the former owners of 29029 are entitled to a number of shares of the Company’s common stock equal to $14.4 million. This $14.4 million is equal to a number of shares of the Company’s common stock equal to $11.5 million at the time of an initial public offering issued at a 20% discount. The fair value of the common stock was determined by discounting the consideration to its present value and the incorporation of an additional discount for lack of marketability. The fair value of the 20% discount on the share consideration, which is in excess of the $11.5 million minimum amount of future consideration, was determined to be $2.4 million. This excess amount is accounted for as contingent consideration based on the fact that the arrangement obligates the Company to transfer equity interest to the sellers in excess of the minimum amount if an initial public offering takes place within three years of the acquisition date. Therefore, the Company has included the fair value of the contingent consideration liability as of the acquisition date as part of the total purchase consideration. The contingent consideration liability is subsequently remeasured to fair value at each reporting date until the contingency is resolved, with changes in fair value being recognized in earnings. The range of the undiscounted amounts the Company could pay under the contingent consideration agreement is between zero and $2.9 million, which is equal to the 20% discount on the $11.5 million of share consideration.

The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805, Business Combinations. The purchase price was allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition. The fair value of assets acquired included a brand name intangible asset of $1.5 million, with an estimated useful life of five years, and other assets totaling $0.4 million. The fair value of liabilities assumed included deferred revenue of $4.7 million and other current liabilities of $0.2 million. The excess of the purchase price over the fair value of the net assets

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acquired was allocated to goodwill. Goodwill is primarily attributed to synergies from future expected economic benefits, including enhanced membership growth from expanded capabilities, brand recognition and the expansion of the existing 29029 operations. The Company recognized $23.7 million of goodwill related to the acquisition, all of which is allocated to the Subscription segment. All of the goodwill related to the 29029 acquisition is deductible for tax purposes.

The financial results of 29029 are included in the consolidated results of the Company from April 30, 2021, the date of acquisition. For fiscal 2021, the results of operations for 29029 were not material. The Company did not incur material transaction expenses. Supplemental pro forma financial information has not been provided as the historical results of 29029 were not material to the Company.

5. Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s financial instruments that were measured at fair value by level within the fair value hierarchy (in thousands):

	May 31, 2020
	Level 1		Level 2		Level 3		Total
Assets:
Cash flow hedges	$	—	$	144	$	—	$	144
Investment securities		9,923		—		—		9,923
Deferred compensation assets		—		9,365		—		9,365
Total	$	9,923	$	9,509	$	—	$	19,432
Liabilities:
Warrant liability	$	—	$	—	$	54,349	$	54,349
Embedded derivative liability		—		—		31,600		31,600
Total	$	—	$	—	$	85,949	$	85,949
	May 31, 2021
	Level 1		Level 2		Level 3		Total
Assets:
Money market account	$	39,988	$	—	$	—	$	39,988
Investment securities		21,193		—		—		21,193
Deferred compensation assets		5,182		—		—		5,182
Total	$	66,363	$	—	$	—	$	66,363
Liabilities:
Cash flow hedges	$	—	$	656	$	—	$	656
Warrant liabilities1		—		—		327,313		327,313
Embedded derivative liabilities2		—		—		121,000		121,000
Contingent consideration liability		—		—		2,400		2,400
Total	$	—	$	656	$	450,713	$	451,369

^1.  The warrant liabilities balance includes the fair value of the warrants issued to both Pamplona and L Catterton. See Note 13 for additional information

² The embedded derivative liabilities balance includes the fair value of the embedded derivatives issued to Pamplona, L Catterton and Planet Fitness. See Note 13 for additional information

Level 1 assets measured and recorded on a recurring basis as of May 31, 2020 and 2021 consist of the money market account and investment securities. The Company records the related gains and losses through other

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expense (income) on the consolidated statements of operations and comprehensive income (loss). The fair value of the investment securities is obtained from real-time quotes for transactions in active exchange markets involving identical assets.

Level 2 assets and liabilities include derivative financial instruments associated with cash flow hedging activity and deferred compensation assets, which are further discussed in Note 2. Derivative financial instruments are initially measured at fair value on the contract date and are subsequently remeasured to fair value at each reporting date using inputs such as spot rates, forward rates, and discount rates. There is not an active market for each hedge contract, but the inputs used to calculate the value of the instruments are tied to active markets. The deferred compensation assets consist primarily of company-owned life insurance policies and mutual funds. In fiscal 2021, the Company concluded that as company-owned life insurance policies are measured and recorded at cash surrender value, not fair value, these assets should be excluded from the fair value hierarchy table above, and the mutual funds should be classified as a Level 1 asset. As of May 31, 2020, deferred compensation assets consisted of company-owned life insurance of $6.8 million and mutual funds of $2.5 million. The Company has not restated the prior period presentation as such amounts are not considered material.

The Company’s Level 3 liabilities measured and recorded on a recurring basis as of May 31, 2020 and 2021 consist of the warrant liabilities and the embedded derivative liabilities, as well as the contingent consideration liability associated with the Company’s acquisition of 29029. Changes in the fair value of these instruments are recorded in the consolidated statements of operations and comprehensive income (loss). The Company estimated the fair value of the warrant liabilities using the discounted cash flow model and the guideline public company method and estimated the fair value of the embedded derivative liabilities using the with and without model. The Company estimated the fair value of the contingent consideration liability by considering the weighted-average probability that the Company would undergo an initial public offering, discounted for present value and a lack of marketability at a discount rate that appropriately captures a market participant’s view of the risk with the obligation. As the fair value measure is based on significant inputs that are not observable in the market, they are categorized as Level 3. There have been no transfers between fair value measurement levels during fiscal 2020 or 2021.

Financial Instruments Not Reported at Fair Value

The Company has certain financial instruments that are not carried at fair value. The estimated fair value of the 2019 Note was $207.9 million and $289.5 million as of May 31, 2020 and May 31, 2021, respectively. The estimated fair value of the Series A and B preferred stock was $266.6 million and $30.3 million, respectively, as of May 31, 2021. The estimated fair value of the sellers’ financing liability was $8.7 million as of May 31, 2021.

The Company estimates the fair value of its 2019 Note and mandatorily redeemable preferred stock by using discounted cash flow method based on current market inputs for similar types of arrangements. The Company estimates the fair value of the sellers’ financing liability by discounting the estimated future cash flows using a debt rate based on current market conditions. Fluctuations in these input assumptions will result in different estimates of fair value.

6. Accounts Receivable - Allowance for Doubtful Accounts

Allowance for doubtful accounts consists of the following (in thousands):

	May 31, 2020			May 31, 2021
Allowance for doubtful accounts, beginning balance	$	2,581		$	8,265
Provision for doubtful accounts		10,562			14,903
Write-offs, net of recoveries		(4,878	)		(15,419	)
Allowance for doubtful accounts, ending balance	$	8,265		$	7,749

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Accounts receivable are also recorded net of a reserve for advertising discounts and a refund liability for retail customer returns (i.e. credit memos). As of May 31, 2020 and 2021, the reserve for advertising discounts was $2.5 million and $9.8 million, respectively, and credit memos were $4.2 million and $8.4 million, respectively.

7. Inventories

Inventories consist of the following (in thousands):

	May 31, 2020		May 31, 2021
Raw materials (parts and supplies)	$	26,031	$	118,181
Finished goods		55,550		285,256
Total inventories	$	81,581	$	403,437

8. Property and Equipment, Net

Property and equipment, net, consist of the following (in thousands):

	Estimated Useful Lives (Years)		May 31, 2020			May 31, 2021
Land		—	$	2,573		$	2,617
Buildings		up to 39		19,840			29,002
Building and leasehold improvements		15*		5,916			6,360
Equipment		3-10		40,225			43,104
Tooling		3-10		8,573			10,869
Capitalized software		3		83,902			118,255
				161,029			210,207
Less:
Accumulated depreciation and amortization				(123,469	)		(131,205	)
Property and equipment, net			$	37,560		$	79,002

^* Leasehold improvements are depreciated over the lesser of the life of the asset or remaining lease term.

For fiscal 2019, 2020 and 2021, the Company recorded depreciation and amortization from property and equipment of $15.0 million, $16.9 million, and $15.6 million, respectively. Depreciation and amortization expense is recorded in cost of revenue and general and administrative expenses in the consolidated statements of operations and comprehensive income (loss).

9. Goodwill and Intangible Assets

Intangible assets consist of the following (in thousands):

	Estimated Useful Lives (Years)	Balance as of May 31, 2020		Accumulated Amortization as of May 31, 2020			Net Book Value as of May 31, 2020
Patents	5 -10	$	40,035	$	(37,056	)	$	2,979
Trademarks	20		22,284		(22,284	)		—
Total		$	62,319	$	(59,340	)	$	2,979

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	Estimated Useful Lives (Years)		Balance as of May 31, 2021		Accumulated Amortization as of May 31, 2021			Net Book Value as of May 31, 2021
Patents		5 -10	$	41,682	$	(37,821	)	$	3,861
Trademarks		20		22,284		(22,284	)		—
Brand names		5		1,500		(25	)		1,475
Total			$	65,466	$	(60,130	)	$	5,336

The Company capitalizes legal costs that are incurred to acquire and defend patents when the costs and related patents are specifically identifiable. The weighted-average amortization period for patents as presented above are five years. Amortization expense related to intangible assets for fiscal 2019, 2020 and 2021 was $1.7 million, $1.1 million and $0.8 million, respectively. Amortization expense is recorded in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss).

Estimated amortization expense after May 31, 2021 is as follows (in thousands):

Year Ending May 31,
2022	$	1,467
2023		1,219
2024		988
2025		678
2026		417
Thereafter		567
Total	$	5,336

The changes in the carrying value of goodwill are as follows (in thousands):

	May 31, 2020			May 31, 2021
Goodwill, beginning balance	$	5,322		$	5,220
Acquisitions		—			23,686
Foreign currency translation		(102	)		733
Goodwill, ending balance	$	5,220		$	29,639

All of the Company’s goodwill was allocated to the Interactive Fitness Products segment as of May 31, 2020. On April 30, 2021, the Company acquired 29029 (see Note 4) and subsequently recognized $23.7 million of goodwill. The goodwill related to the 29029 acquisition is allocated entirely to the Subscription segment. Goodwill and intangible assets may be denominated in a foreign currency. Specifically, goodwill not related to the 29029 acquisition is denominated in Canadian dollars.

10. Other Current Assets

Other current assets consist of the following (in thousands):

	May 31, 2020		May 31, 2021
Investment securities	$	9,923	$	21,193
Right to recover inventory from sales returns		4,789		6,721
Deposits on inventory		—		12,714
Other		2,861		10,257
Total other current assets	$	17,573	$	50,885

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11. Other Non-Current Assets

Other non-current assets consist of the following (in thousands):

	May 31, 2020		May 31, 2021
Capitalized iFIT content, net	$	16,135	$	40,832
Deferred financing fees, net		2,959		2,517
Reinsurance deposit		14,981		20,853
Deferred compensation		9,365		13,718
Investment in securities at cost		—		9,000
Other		5,369		14,716
Total other non-current assets	$	48,809	$	101,636

For fiscal 2019, 2020 and 2021, capitalized iFIT content costs totaled $7.2 million, $12.2 million, and $34.3 million, respectively. Amortization expense related to capitalized iFIT content costs totaled $2.6 million, $5.1 million, and $9.6 million for fiscal 2019, 2020 and 2021, respectively. As of May 31, 2020 and 2021, capitalized iFIT content is net of accumulated amortization of $8.2 million and $17.8 million, respectively.

As of May 31, 2020 and 2021, deferred financing fees are net of accumulated amortization of $0.3 million and $0.8 million, respectively. Amortization expense related to deferred financing fees for fiscal 2019, 2020 and 2021 was $5.6 million, $1.6 million, and $2.1 million, respectively. See Note 14 for the deferred financing fees amortization associated with the Company’s long-term debt.

12. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (in thousands):

	May 31, 2020		May 31, 2021
Freight charges	$	7,569	$	4,815
Refund liabilities		4,933		5,559
Warranty reserves		6,248		8,261
Product liability reserves		3,061		2,834
Employee-related liabilities		6,483		17,337
Accrued sales taxes		5,635		5,509
Other		8,205		11,829
Total accrued expenses	$	42,134	$	56,144

13. Mandatorily Redeemable Preferred Stock

2020 Mandatorily Redeemable Preferred Stock

The Company had outstanding 930 shares of mandatorily redeemable preferred stock, par value $0.001 per share, outstanding as of May 31, 2019 (the “2020 Mandatorily Redeemable Preferred Stock”).

The 2020 Mandatorily Redeemable Preferred Stock is senior to the Company’s common stock with respect to dissolution, liquidation or winding up of the Company. Each outstanding share of the 2020 Mandatorily Redeemable Preferred Stock accrues cumulative dividends at a rate of 7% of the $10,000 per share liquidation value (the “Accrued Dividends”). The 2020 Mandatorily Redeemable Preferred Stock has an aggregate liquidation preference of $9.3 million, plus all attributable Accrued Dividends. As of May 31, 2019, the aggregate liquidation preference of the 2020 Mandatorily Redeemable Preferred Stock was $11.5 million.

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The 2020 Mandatorily Redeemable Preferred Stock has no voting rights and is not convertible into the Company’s common stock. The 2020 Mandatorily Redeemable Preferred Stock is mandatorily redeemable at the earlier of (i) the Company’s initial public offering and (ii) December 31, 2020 (the “Mandatory Redemption Date”). The Company also has the option to prepay all or any portion of the outstanding shares of the 2020 Mandatorily Redeemable Preferred Stock at a price per share equal to $10,000 plus all attributable Accrued Dividends.

The Company accounts for the 2020 Mandatorily Redeemable Preferred Stock as a liability in the consolidated balance sheets as it must be mandatorily redeemed. Therefore, the 2020 Mandatorily Redeemable Preferred Stock was recorded at fair value at inception and subsequently measured at the present value of the redemption amount to be paid at the Mandatory Redemption Date of December 31, 2020, accruing interest using the rate implicit at inception. The periodic accretions (including the cumulative Accrued Dividends) were recognized as interest expense in the consolidated statements of operations and comprehensive income (loss).

In 2019, in anticipation of an investment in the Company made by Icon Preferred Holdings, L.P. (“Pamplona”), the Company and the holder negotiated the redemption of the 2020 Mandatorily Redeemable Preferred Stock. As part of the negotiations, the holder agreed to forgive the Accrued Dividends owed on the 2020 Mandatorily Redeemable Preferred Stock. On November 29, 2019, the Company redeemed all 930 shares of the 2020 Mandatorily Redeemable Preferred Stock for $9.3 million in cash and recognized an extinguishment gain of $2.2 million in other expense (income), net in the consolidated statements of operations and comprehensive income (loss) for fiscal 2020. There was no 2020 Mandatorily Redeemable Preferred Stock authorized or outstanding as of May 31, 2020.

Series A Preferred Stock

On October 2, 2020, pursuant to its amended articles of incorporation, the Company authorized and issued 210 shares of preferred stock (which on March 17, 2021 were designated as Series A preferred stock) (the “Series A”) pursuant to a securities purchase agreement and warrants to purchase up to 18,899,244 shares of the Company’s common stock (the “2020 Warrants”) to LC9 Connected Holdings, LP, (“L Catterton”), a new investor in the Company, and Pamplona for gross proceeds of $210.0 million (the “2020 Transactions”). The Company paid Pamplona a $4.8 million advisory fee and reimbursed L Catterton and Pamplona $1.3 million and $0.2 million, respectively, of related transaction expenses, which were included in the loss on issuance (see below). As such, the Company received $203.8 million net proceeds from the 2020 Transactions.

In addition, the Company incurred $6.0 million in other transaction and legal fees, of which $3.9 million and $2.1 million were allocated to the Series A preferred stock and 2020 Warrants, respectively, based on their relative fair values. The amount allocated to the Series A preferred stock is presented as a direct deduction from its carrying value in the consolidated balance sheets. The amount allocated to the 2020 Warrants was expensed immediately as such warrants are liability-classified and recognized at fair value.

Prior and in preference to any declaration or payment of any dividend on the Company’s common shares, on a pari passu basis, the holders of the Series A preferred stock are entitled to receive cumulative dividends per share at the rate per annum equal to (i) 7% from October 2, 2020 until November 29, 2026 and (ii) 10% thereafter.

Upon any liquidation, dissolution or winding up of the Company, each holder of Series A preferred stock shall be entitled to be paid, before any distribution or payment is made upon any common stock of the Company, for each outstanding share of Series A preferred stock, an amount in cash equal to a mandatory payment price which is the greater of (i) $1.0 million plus all accrued but unpaid dividends and (ii) $1.5 million. As of May 31, 2021, the aggregate liquidation preference of the Series A preferred stock was $315.0 million.

The shares of the Series A preferred stock are not convertible into shares of the Company’s common stock and they do not have any voting rights.

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On November 29, 2030, the Company must redeem the Series A preferred stock at the mandatory payment price, and thus, the Series A preferred stock is accounted for as a mandatorily redeemable financial instrument liability in the consolidated balance sheets. The Series A preferred stock was recorded at fair value at inception and subsequently measured at the present value of the redemption amount to be paid at the mandatory redemption date of November 29, 2030, accruing interest using the rate implicit at inception. The fair value of the Series A preferred stock at inception, including the value of the embedded redemption features, was determined to be $246.4 million.

Upon the occurrence of (a) any liquidation of the Company or its material subsidiaries, (b) an initial public offering of the Company, (c) a change in control, or (d) an event of default, the Company must redeem the Series A preferred stock at the mandatory payment price. However, in the event of the consummation of the Company’s initial public offering on or prior to September 30, 2021, the Company shall redeem the Series A preferred stock a price equal to $1.25 million per share (the “Minimum IPO Return”) and the Minimum IPO Return shall increase gradually on October 1, 2021 and on each six months thereafter; provided further that in no event shall the Minimum IPO Return exceed $1.5 million per share. Upon the Company’s initial public offering, the Minimum IPO Return is to be paid as follows per share: (i) an amount equal to (A) at the Company’s option, $0.6 million to $1.0 million paid in cash (provided that, from and after January 1, 2022, the Company no longer has such option, and such amount shall be equal to $0.6 million) plus (B) at L Catterton’s option, up to 50% of any increase in the Minimum IPO Return above $1.25 million shall be paid in cash; and (ii) the remainder of the Minimum IPO Return shall be paid in a number of the Company’s common shares at an amount equal to (x) the amount of such remainder of the Minimum IPO Return, divided by (y) 85% of the price per share of the Company’s common stock sold in the initial public offering. Such a redemption feature is accounted for as an embedded derivative pursuant to ASC 815, Derivatives and Hedging. The embedded derivative was separately recognized as a liability at a fair value of $44.9 million at inception and is subsequently remeasured at fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivative at inception created a discount on the Series A preferred stock. The fair value of the embedded derivative is $48.6 million as of May 31, 2021. The $3.7 million change in fair value during fiscal 2021 was recorded in change in fair value of embedded derivative liabilities in the consolidated statements of operations and comprehensive income (loss).The following significant unobservable inputs were used to develop the fair value of the embedded derivative liability:

	As of May 31,
	2021
Probability of exit		100	%
Discount rate		9	%

As a consequence, the Series A preferred stock was recorded at its fair value of $246.4 million, net of the bifurcated embedded derivative of $44.9 million and allocated issuance costs of $3.9 million, for a net carrying amount at issuance of $197.6 million. The 2020 Warrants were recorded at their fair value of $130.8 million. The aggregate fair value of the Series A preferred stock and 2020 Warrants was $377.2 million as of the issuance date, which is greater than the $203.8 million net cash proceeds. There were no other rights or privileges identified that require separate accounting as an asset. As a result, the Company recognized a loss for the excess of the aggregate fair value of the Series A preferred stock and the 2020 Warrants over the net cash proceeds, amounting to $173.4 million. One of the driving factors for the Company to enter into the 2020 Transactions was due to the extensive experience the investor has in the consumer health segment and depth of initial public offering experience and relationships. The Company believed that a relationship with L Catterton would greatly enhance the Company’s prospects for an effective exit, potentially via an initial public offering.

On or after October 2, 2023, the Company has the option to prepay all or any portion of the outstanding shares of Series A preferred stock at a price per share equal to the mandatory payment price; provided, that the Company shall not consummate an initial public offering within nine months of any such optional payment.

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The difference between the fair value and the initial carrying amount of the Series A preferred stock of $197.6 million, inclusive of the discount of $44.9 million and the issuance costs of $3.9 million allocated to the Series A preferred stock, is amortized through the mandatory redemption date and is recognized as interest expense in the consolidated statements of operations and comprehensive income (loss) using the effective interest method over the term of the Series A preferred stock. As of May 31, 2021, the effective interest rate on Series A preferred stock was 8.73%. For fiscal 2021, the interest expense is $11.7 million, which includes the accruing dividend and amortization of discount and debt issuance costs. As of May 31, 2021, the carrying amount of the Series A preferred stock is $209.3 million.

Series B Preferred Stock

On March 17, 2021, pursuant to a securities purchase agreement, the Company amended its articles of incorporation to authorize 25 additional shares of preferred stock that were subsequently issued as Series B preferred stock (the “Series B”) to Planet Fitness Holdings, LLC. (“Planet Fitness”) for an aggregate purchase price of $25.0 million. The Company incurred $0.2 million in other transaction and legal fees, which is presented as a direct deduction from the carrying value of the Series B preferred stock in the consolidated balance sheets.

Dividends shall accrue on the shares of Series B preferred stock at the rate per annum equal to 7.0% on the sum of (i) the liquidation value of each outstanding share of Series B preferred stock, plus (ii) all previously compounded accrued dividends, accruing from the date of issuance. Series B preferred stock accrued dividends shall accrue daily, whether or not declared, and shall be cumulative, compounding each quarter.

Upon any liquidation, dissolution or winding up of the Company, each holder of Series B preferred stock shall be entitled to be paid, after the distribution or payment is made upon any Series A preferred stock and before any distribution or payment is made upon any common stock of the Company, an amount in cash per share of Series B preferred stock equal to the mandatory payment price, which is the sum of (i) $1 million plus (ii) all accrued but unpaid dividends. As of May 31, 2021, the aggregate liquidation preference of the Series B preferred stock was $25.4 million.

Following the distribution to the Series A and B preferred stock, all of the remaining proceeds available for distribution to stockholders of the Company shall be distributed among the holders of common stock on a pro rata basis.

The shares of Series B preferred stock are not convertible into shares of the Company’s common stock and

they do not have any voting rights.

On March 17, 2026, the Company must redeem the Series B preferred stock in cash at the mandatory payment price, and thus, the Series B preferred stock is accounted for as a mandatorily redeemable financial instrument liability in the consolidated balance sheets. The Series B preferred stock was recorded at fair value at inception and subsequently measured at the present value of the redemption amount to be paid at the mandatory redemption date of March 17, 2026, accruing interest using the rate implicit at inception. The fair value of the Series B preferred stock at inception, including the value of the embedded redemption feature, was determined to be $29.8 million.

Upon the occurrence of (a) any liquidation of the Company or its material subsidiaries, (b) an initial public offering of the Company, (c) a change in control, or (d) the sale of all or substantially all of the assets of the Company and its subsidiaries, the Company must redeem the Series B preferred stock at the mandatory payment price. However, in the event of the consummation of the Company’s initial public offering on or prior to January 1, 2022, the Company shall redeem all outstanding shares of Series B preferred stock at a price per share equal to $1.0 million. Upon the consummation of an IPO on or after January 1, 2022, the Company shall redeem all outstanding shares of Series B preferred stock at the Series B preferred stock mandatory payment price per

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share. The Company shall pay any amounts to be paid in a number of shares issued in such an IPO equal to (x) the dollar value of such applicable payment amount, divided by (y) the public offering price per share of these shares multiplied by 80%. Such a redemption feature is accounted for as an embedded derivative pursuant to ASC 815, Derivatives and Hedging. The embedded derivative was separately recognized as a liability at a fair value of $5.2 million at inception and is subsequently remeasured at fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivative at inception created a discount on the Series B preferred stock. The fair value of the embedded derivative is $5.2 million as of May 31, 2021, and the following significant unobservable inputs were used to develop the fair value of the embedded derivative liability:

	As of May 31,
	2021
Probability of exit		100	%
Discount rate		10	%

The Series B preferred stock was recorded at its fair value of $29.8, net of the bifurcated derivative liability of $5.2 million and issuance costs of $0.2 million, for a net carrying amount at issuance of $24.4 million. The fair value of the series B preferred stock was greater than the cash proceeds. To date there has been immaterial revenue from Planet Fitness and there were no other rights or privileges identified that require separate accounting as an asset. As a result, the Company recognized a loss for the excess of the fair value of the Series B preferred stock of $29.8 million over the cash proceeds of $25.0 million, amounting to $4.8 million, which is included in loss on issuance of mandatorily redeemable preferred stock in the consolidated statements of operations and comprehensive income (loss). The Company issued the Series B preferred stock with the goal of expanding its collaborative arrangement with Planet Fitness, an established and recognizable brand within the fitness community with whom the Company has worked with in the past, as well as providing the Company with added liquidity in anticipation of growth prior to a potential initial public offering.

On or after March 17, 2024, the Company has the option to prepay all or any portion of the outstanding shares of

Series B preferred stock at a price per share equal to the mandatory payment price.

The difference between the fair value and the initial carrying amount of the Series B preferred stock of $24.4 million, inclusive of the discount of $5.2 million and the issuance costs of $0.2 million of the Series B preferred stock, is amortized through the mandatory redemption date and is recognized as interest expense in the consolidated statements of operations and comprehensive income (loss) using the effective interest method over the term of the Series B preferred stock. As of May 31, 2021, the effective interest rate on Series B preferred stock was 7.45%. For fiscal 2021, the interest expense was $0.4 million, which includes the accruing dividend and amortization of discount and debt issuance costs. As of May 31, 2021, the carrying amount of the Series B preferred stock is $24.8 million.

14. Long-term Debt, Net

2016 Credit Agreement

On August 3, 2016, the Company’s wholly owned subsidiary ICON Health and Fitness, Inc. (“Icon”) entered into a credit agreement with JP Morgan Chase Bank, N.A. an administrative agent, and a syndicate of financial institutions and institutional lenders (the “2016 Credit Agreement”), which provided for a $175 million term loan and a $125 million revolving line of credit (the “2016 Revolver”). The term loan and the 2016 Revolver matures on August 3, 2021.

The 2016 Credit Agreement permits the interest rate to be selected at Icon’s option at either Adjusted LIBOR or Alternative Base Rate plus their respective applicable margin. Adjusted LIBOR is the rate for deposits in U.S. Dollars with a maturity of one month while the Alternate Base Rate is the highest of (i) the administrative agent’s

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“Prime Rate”, (ii) the Federal Funds Effective Rate calculated by Federal Reserve Bank of New York plus 0.5%, and (iii) Adjusted LIBOR plus 1.0%. Additionally, the margin applied to both the term loan and the revolving line of credit is determined based on total leverage ratio. Total leverage ratio is defined as Icon’s total indebtedness over consolidated EBITDA as defined under the 2016 Credit Agreement. As of May 31, 2019, the interest rate was 5.0% for borrowings under the 2016 Revolver.

Under the 2016 Credit Agreement, the lenders had a perfected first priority lien on substantially all tangible and intangible assets of Icon. The 2016 Credit Agreement contained financial covenants, including a maximum total leverage ratio, minimum fixed charge coverage ratio and limitation on capital expenditures. As of May 31, 2019, the maximum total leverage ratio was 5.00 and the minimum fixed charge coverage ratio was 1.25. As of May 31, 2019, Icon was in compliance with all of the debt covenants.

On June 26, 2018, Icon fully repaid the outstanding principal amount and accrued but unpaid interest on the term loan of $119.2 million and wrote-off unamortized debt issuance costs of $4.6 million related to the term loan.

As of May 31, 2019, the 2016 Revolver had outstanding borrowings of $102.5 million and an available borrowing capacity of $22.5 million.

2020 Credit Agreement

On April 28, 2020, Icon entered into a credit agreement with JP Morgan Chase Bank, N.A. an administrative agent, and a syndicate of the existing lenders of the 2016 Credit Agreement (the “2020 Credit Agreement”), which provided for a $175.0 million revolving line of credit (the “2020 Revolver”) and a letter of credit. The 2020 Revolver matures on April 24, 2024.

As a condition to closing, the 2020 Credit Agreement required the termination of any security interests and guarantees under the 2016 Credit Agreement and thus Icon repaid all outstanding borrowings under 2016 Revolver. Management determined the loan restructuring would not constitute a troubled debt restructuring. In addition, as the borrowing capacity for each of the continuing lenders increased under the 2020 Revolver compared to that under the 2016 Revolver, the loan restructuring for these lenders is deemed a debt modification. In connection with the execution of the 2020 Credit Agreement, certain lenders of the 2016 Revolver Loan exited the syndicate under the 2020 Credit Agreement. Icon wrote off $1.3 million of unamortized deferred costs attributable to the exit lenders’ 2016 Revolver. Icon capitalized $2.1 million in new fees paid to the continuing and third-party lenders as deferred financing fees which will be amortized along with the unamortized deferred costs attributable to these continuing lenders over the term of the 2020 Credit Agreement to interest expense on a straight-line basis.

The 2020 Credit Agreement permits the interest rate to be selected at Icon’s option at Adjusted LIBOR, Alternative Base Rate, Canadian Prime Rate, or Canadian Dollar Offered Rate (CDOR) Rate, plus their respective applicable margin. Adjusted LIBOR is the rate for deposits in U.S. Dollars with a maturity of one month. The Alternate Base Rate is the highest of (i) the administrative agent’s “Prime Rate”, (ii) the Federal Funds Effective Rate calculated by Federal Reserve Bank of New York plus 0.5%, and (iii) Adjusted LIBOR plus 1.0%. Canadian Prime Rate is the higher of (i) the PRIMCAN Index rate and (ii) the average rate for 30 day Canadian Dollar-denominated bankers’ acceptances. CDOR Rate is the rate offered on Canadian deposits for the relevant interest period plus 0.1% per annum. Each of the interest rates is subject to a floor. Additionally, the margin is determined based on total leverage ratio. Total leverage ratio is defined as Icon’s total indebtedness over consolidated EBITDA as defined under the 2020 Credit Agreement. As of May 31, 2020, the interest rate was 5.5% for borrowings under the 2020 Credit Agreement.

Under the 2020 Credit Agreement, the lenders have a perfected first priority lien on substantially all tangible and intangible assets of Icon. The 2020 Credit Agreement contains financial covenants, including a minimum fixed charge coverage ratio when a triggering event occurs and limitations on additional indebtedness and dividends. As of May 31, 2020, Icon was in compliance with all of the debt covenants.

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As of May 31, 2020, the 2020 Revolver had no outstanding borrowings and an available borrowing capacity of $80.9 million.

2021 Credit Agreement

On May 12, 2021, Icon entered into a credit agreement with Bank of America, N.A. an administrative agent, and a syndicate of the existing lenders of the 2020 Credit Agreement (the “2021 Credit Agreement”), which provided for a $325.0 million revolving line of credit (the “2021 Revolver”) and a $9.4 million letter of credit. The 2021 Revolver matures on May 12, 2026. As a condition to closing, the 2021 Credit Agreement required the termination of any security interests and guarantees under the 2020 Credit Agreement.

The 2021 Credit Agreement permits the interest rate to be selected at Icon’s option at the LIBO Rate, Alternate Base Rate, Canadian Prime Rate, or Canadian Dollar Offered Rate (CDOR), plus their respective applicable margin. The LIBO Rate is the published LIBO Rate, as adjusted to reflect applicable statutory reserves prescribed by governmental authorities. The Alternate Base Rate is the higher of (i) the Federal Funds Rate plus 0.50%, (ii) the Published LIBO Rate plus 1.00% and (iii) the Prime Rate. The Canadian Prime Rate is the higher of (i) the variable interest rate of Bank of America, N.A. and (ii) the 1-month CDOR plus 1.00% per annum. The CDOR Rate is the rate of interest per annum equal to the arithmetic average of the rates applicable to Canadian Dollar bankers’ acceptance rate. As of May 31, 2021, the interest rate was 3.4% for borrowings under the 2021 Credit Agreement.

Under the 2021 Credit Agreement, the lenders have a perfected first priority lien on substantially all tangible and liquid assets of Icon. The 2021 Credit Agreement contains financial covenants, including a minimum fixed charge coverage ratio when a triggering event occurs and limitations on additional indebtedness and dividends. As of May 31, 2021, the Company was in compliance with all of its debt covenants.

As of May 31, 2021, the 2021 Revolver had $0.3 million of outstanding borrowings and an available borrowing capacity of $261.3 million.

2019 Note and 2019 Warrant

Pursuant to a securities purchase agreement, on November 29, 2019, the Company issued a note for an aggregate principal amount of $200.0 million (the “2019 Note”) and a warrant to purchase up to 25,853,840 shares of the Company’s common stock (the “2019 Warrant”) to Pamplona. The 2019 Note matures on November 29, 2029. In addition, the Company reimbursed Pamplona for $1.5 million of transaction expenses which were accounted for as a discount on the 2019 Note.

The Company incurred $9.4 million in other transaction, legal and accounting fees in connection with the 2019 Note and 2019 Warrant issuance. At time of the transaction, $7.3 million and $2.1 million in transaction costs were allocated to the 2019 Note and 2019 Warrant, respectively, based on the relative proceeds allocated to both instruments. Deferred financing cost amortization related to the 2019 Note was $0.4 million and $0.7 million for fiscal 2020 and 2021, respectively.

Interest on the 2019 Note accrues at a rate of (i) 7.0% per annum prior to and on November 29, 2026, and (ii) thereafter, 10.0% per annum, payable quarterly in cash in arrears on March 31, June 30, September 30 and December 31 of each year commencing on December 31, 2019. At the election of the Company, any interest accrued can be paid in kind. If paid-in-kind (“PIK”) interest is elected, such accrued interest should be added to the unpaid principal amount of the 2019 Note outstanding at such time. The discretionary PIK interest should be recorded at the then fair value of the incremental 2019 Note issued when a PIK interest election is made at the applicable contractual interest payment dates. The Company elected the PIK interest on each of the interest payment dates since it entered into the 2019 Note and recorded the PIK interest at the fair value of the incremental 2019 Note issued on these dates. As described below, an effective interest rate of the 2019 Note was established at the issuance date and thus any resulting difference between the fair value and such assumed cash

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flows of the PIK interest is recognized through a corresponding adjustment to the amount of interest cost recognized.

The Company has the option to prepay, at a premium, all or a portion of the outstanding principal amount of the 2019 Note. Any prepayment must include the portion of the original principal amount being prepaid, plus all PIK interest previously added in respect of such portion of the original principal amount. Additionally, if such principal amount of the 2019 Note to be prepaid plus all cash interest paid in respect of the portion to be prepaid is less than 150% of the original principal amount to be prepaid (such difference, the “Make-whole”), then such prepayment shall also include an amount equal to the Make-whole.

Upon the occurrence of (a) any liquidation of the Company or its material subsidiaries, (b) an event of default, (c) a change in control, or (d) an initial public offering of the Company, the Company must redeem the 2019 Note at an amount equal to the principal amount to be prepaid plus the Make-whole if applicable. Such redemption feature is determined to be accounted for as embedded derivative pursuant to ASC 815, Derivatives and Hedging. The embedded derivative was recognized at a fair value of $11.4 million at inception and is subsequently remeasured at fair value with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss). The recognition of the embedded derivative at inception created a discount on the 2019 Note. The fair value of the embedded derivative is $31.6 million and $67.2 million as of May 31, 2020 and May 31, 2021, respectively. The $20.2 million and $35.6 million change in fair value during fiscal 2020 and 2021, respectively, were recorded in change in fair value of embedded derivative liability in the consolidated statements of operations and comprehensive income (loss). The following significant unobservable inputs were used to develop the fair value of the embedded derivative liability:

	As of May 31,
	2020			2021
Probability of exit		100	%		100	%
Discount rate		13	%		7	%

As discussed in Note 15, the initial recognition of the 2019 Warrant created a discount on the 2019 Note. The debt discount of $57.9 million (i.e., the sum of $1.5 million transaction costs reimbursed, the $11.4 million fair value of the embedded derivative at inception, and the $45.0 million fair value of the 2019 Warrant at inception) and issuance costs of $7.3 million allocated to the 2019 Note are amortized to interest expense using the effective interest method over the term of the 2019 Note. In addition, the effective interest rate of the 2019 Note was established at the issuance date incorporating assumed cash flows from the PIK interest.

As of May 31, 2020 and 2021 the effective interest rate on the 2019 Note was 11.9%.

For fiscal 2020 and 2021, interest expense recorded using the effective interest method is $7.3 million and $17.2 million, respectively, which includes the amortized debt discount costs of the 2019 Note of $0.8 million and $2.2 million, respectively, and debt issuance costs of the 2019 Note of $0.4 million and $0.7 million, respectively.

Long-term debt, net consists of the following (in thousands):

	May 31, 2020			May 31, 2021
2021 Credit Agreement	$	—		$	271
2019 Note		204,733			219,414
Discount on the 2019 Note		(57,994	)		(56,381	)
Debt issuance costs		(6,897	)		(6,171	)
Long-term debt, net	$	139,842		$	157,133

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As of May 31, 2021, scheduled maturities of principal on the Company’s long-term debt, net for future years ending May 31, are as follows (in thousands):

Year Ending May 31,	Principal Maturities
2022	$	—
2023		—
2024		—
2025		—
2026		271
Thereafter		219,414
Total long-term debt, net	$	219,685

15. Warrant Liabilities

2019 Warrant Liability

On November 29, 2019, concurrent with the 2019 Note issuance, the Company issued the 2019 Warrant to purchase up to 25,853,840 shares of the Company’s common stock at an exercise price of $0.001 per share. In the event the 2019 Warrant is exercised on or prior to November 29, 2024, the warrant holder shall be entitled to receive 19,676,110 shares of the Company’s common stock. Otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six months thereafter at an amount equal to (i) 1,544,433 multiplied by (ii) the outstanding principal amount of the 2019 Note divided by $200.0 million, until the underlying shares of the warrant equal to 25,853,840. If the Company makes or declares a dividend or any other distribution to its common stockholders, the holder shall receive such dividend or distribution that it would have been entitled to had the warrant been exercised in full into shares on the date of such event. Management determined that the warrant, which expires on November 29, 2034, is a freestanding financial instrument and participating security for EPS purposes.

The 2019 Warrant grants the holder the right to require the Company to purchase the warrant and the shares issued pursuant to the exercise of the warrant for cash at fair market value from November 29, 2026 to January 28, 2027. Upon a liquidity event, including an initial public offering, the repurchase right of the holder will expire. The warrant represents an obligation that is indexed to an obligation to repurchase the shares of the Company’s common stock, and the Company is required to transfer cash. As such, the 2019 Warrant is classified as a liability in the consolidated balance sheet as of May 31, 2020 and 2021. The warrant was recorded at fair value at inception and is subsequently remeasured at fair value, with changes in fair value recorded in earnings. The initial fair value of the warrant was estimated to be $45.0 million, which created a discount on the 2019 Note. The discount is amortized using the effective interest method as discussed above. The fair value of the 2019 Warrant was $54.3 million and $183.8 million as of May 31, 2020 and 2021, respectively. The $9.4 million and $129.5 million change in fair value of the warrant liability during fiscal 2020 and 2021, respectively, was recorded in changes in fair value of warrant liabilities in the consolidated statements of operations and comprehensive income (loss). The following significant unobservable inputs were used to develop the fair value of the 2019 Warrant:

	As of May 31,
	2020			2021
Fair value of common stock per share	$	3.59		$	10.26
Discount for lack of marketability		23.0	%		9.0	%
Warrant exercisable shares		19,676,110			19,676,110

The $2.1 million in transaction, legal and accounting fees in connection with the 2019 Note and 2019 Warrant issuance allocated to the warrant were expensed immediately within other expense (income) in the consolidated statements of operations and comprehensive income (loss).

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2020 Warrant Liability

On October 2, 2020, as part of the 2020 Transaction, the Company issued to L Catterton and Pamplona the 2020 Warrant to purchase up to 17,639,219 and 1,260,026 shares, respectively, of the Company’s common stock at an exercise price of $0.001 per share. The 2020 Warrants are exercised at the holders’ discretion subject to the following vesting conditions. For the 2020 Warrant held by L Catterton, if the warrant is exercised on or prior to November 29, 2024, the number of the underlying shares shall be equal to 11,501,709; otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six-months thereafter at an amount equal to (i) 1,534,378 plus (ii) 0.49% of any common stock of the Company issued after October 2, 2020, until the underlying shares of the warrant is equal to 5.88% of the sum of (i) 293,410,933 plus (ii) certain common stock of the Company issued after October 2, 2020. For the 2020 Warrant held by Pamplona, if the warrant is exercised prior to November 29, 2024, the number of the underlying shares shall be equal to 821,546; otherwise, the underlying shares of the warrant shall increase on November 30, 2024 and each six-months thereafter at an amount equal to (i) 109,620 plus (ii) 0.035% of any common stock of the Company issued after October 2, 2020, until the underlying shares of the warrant is equal to 0.42% of the sum of (i) 293,409,005 plus (ii) certain common stock of the Company issued after October 2, 2020.

If the Company makes or declares a dividend or any other distribution to its common stockholders, holders of the 2020 Warrants shall receive such dividend or distribution that they would have been entitled to had the 2020 Warrants been exercised in full into shares on the date of such event. Management determined that the 2020 Warrants, which expire on November 29, 2034, are freestanding financial instruments and participating securities for EPS purposes. The 2020 Transaction agreement also contains anti-dilution provisions with regards to the 2020 Warrants. If, at any time prior to an initial public offering, the Company makes a dilutive issuance of common stock or options to certain members of management or holders of the Company’s common equity, Pamplona and L Catterton will receive grants of additional warrant shares to keep their percentage of ownership in the Company consistent with the ownership percentage prior to the dilutive issuance. These provisions include the Pamplona warrant shares included in the 2019 Warrant in addition to the warrant shares included in the 2020 Warrant.

The holders have the right to require the Company to purchase the 2020 Warrants (or the shares issued pursuant to the exercise of the 2020 Warrants) at their fair value for cash during the period from November 29, 2026 to January 28, 2027. As such, the 2020 Warrants are classified as liabilities in the consolidated balance sheet as of May 31, 2021. The 2020 Warrants were recorded at fair value at inception and are subsequently remeasured at fair value, with changes in fair value recorded in earnings. The initial fair value of the 2020 Warrants was estimated to be $130.8 million and the fair value of the 2020 Warrants was $143.5 million as of May 31, 2021. The $12.7 million change in fair value of the warrant liability during fiscal 2021 was recorded in changes in fair value of warrant liabilities in the consolidated statements of operations and comprehensive income (loss). The following significant unobservable inputs were used to develop the fair value of the 2020 Warrants:

	As of May 31,
	2021
Fair value of common stock per share	$	10.26
Discount for lack of marketability		26.0	%
Warrant exercisable shares		18,899,244

16. Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss consists of the following (in thousands):

	Unrealized Gain (Loss) on Foreign Currency Contracts			Foreign Currency Translation Adjustments			Total
Balance at June 1, 2019	$	1		$	(10,841	)	$	(10,840	)
Current period other comprehensive income (loss)		(136	)		(633	)		(769	)

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	Unrealized Gain (Loss) on Foreign Currency Contracts			Foreign Currency Translation Adjustments			Total
Amounts reclassified to net income (loss)		(207	)		—			(207	)
Balance at May 31, 2020	$	(342	)	$	(11,474	)	$	(11,816	)

	Unrealized Gain (Loss) on Foreign Currency Contracts			Foreign Currency Translation Adjustments			Total
Balance at June 1, 2020	$	(342	)	$	(11,474	)	$	(11,816	)
Current period other comprehensive income (loss)		(1,598	)		7,503			5,905
Amounts reclassified to net income (loss)		915			—			915
Balance at May 31, 2021	$	(1,025	)	$	(3,971	)	$	(4,996	)

17. Income Taxes

Income (loss) before provision (benefit) for income taxes consists of the following (in thousands):

	Year Ended May 31,
	2019		2020			2021
United States	$	74,276	$	(96,495	)	$	(518,874	)
Foreign		3,024		421			4,151
Total income (loss) before provision (benefit) for income taxes	$	77,300	$	(96,074	)	$	(514,723	)

The provision (benefit) for income taxes consists of the following (in thousands):

	Year Ended May 31,
	2019			2020			2021
Current:
Federal	$	—		$	733		$	(533	)
State		363			213			390
Foreign		1,662			943			1,694
Total current	$	2,025		$	1,889		$	1,551
Deferred:
Federal	$	11,205		$	(10,837	)	$	(23,724	)
State		4,740			(1,618	)		(3,576	)
Foreign		(528	)		(678	)		110
Change in valuation allowance		3,291			13,713			27,622
Total deferred	$	18,708		$	580		$	432
Total provision (benefit) for income taxes	$	20,733		$	2,469		$	1,983

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The provision (benefit) for income tax differs from the amount computed by applying the statutory federal income tax rate to income before taxes as follows:

	Year Ended May 31,
	2019			2020			2021
Statutory federal income tax rate		21.0	%		21.0	%		21.0	%
State tax provision		5.1			2.9			0.7
Foreign income tax differential		(0.2	)		(0.4	)		(0.3	)
Change in valuation allowance		4.3			(14.3	)		(5.4	)
Adjustments to federal tax carryforwards		—			(0.6	)		—
Change in Uncertain Tax Positions		5.3			(1.1	)		(0.1	)
Research credits		(10.9	)		2.5			0.6
Warrant liability		—			(2.2	)		(11.1	)
Stock-based compensation		—			—			(1.7	)
Issuance of debt		—			(9.8	)		(3.8	)
Sale of subsidiary		2.2			—			—
Other		—			(0.6	)		(0.4	)
Provision (benefit) for income taxes		26.8	%		(2.6	)%		(0.5	)%

As of May 31, 2020 and 2021, the net deferred tax asset consisted of the following (in thousands):

	May 31, 2020			May 31, 2021
Deferred tax assets:
Foreign net operating loss carryforwards	$	714		$	715
Reserves and allowances		6,518			9,545
Domestic net operating loss carryforwards		19,752			24,908
Deferred compensation plan		2,368			3,542
Deferred revenue		7,771			11,661
Uniform capitalization of inventory		969			2,140
Research credit carryforwards		6,341			8,226
Stock-based compensation		2,563			12,778
Interest		3,349			7,053
Other		940			2,220
Total gross deferred tax assets		51,285			82,788
Less valuation allowance		(39,034	)		(66,656	)
Total deferred tax assets	$	12,251		$	16,132
Deferred tax liabilities:
Property and equipment	$	(3,757	)	$	(3,187	)
Prepaid expenses		(922	)		(1,875	)
Debt		(4,517	)		—
Intangible assets		(1,891	)		(8,014	)
Capitalized commissions		(1,293	)		(1,570	)
Foreign withholding tax		—			(313	)
Other		(708	)		(2,442	)
Total deferred tax liabilities		(13,088	)		(17,401	)
Net deferred tax asset/(liability)	$	(837	)	$	(1,269	)

On February 15, 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income, which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. The ASU is

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effective for years beginning after December 15, 2018 and can be adopted early. The Company adopted ASU 2018-02 as of June 1, 2018 and elected not to reclassify the income tax effect of the Tax Act from accumulated other comprehensive income to retained earnings. The adoption of ASU 2018-02 resulted in no impact to the Company’s financial statements.

Valuation allowances are established when necessary to reduce deferred tax assets, including temporary differences and net operating loss carryforwards, to the amount expected to be realized in the future. FASB guidance indicates that forming a conclusion that a valuation allowance is not needed is difficult when there is negative evidence such as cumulative losses in recent years. The Company had cumulative losses from continuing operations in the U.S. for the three-year period ended May 31, 2021. The Company considered this negative evidence along with all other available positive and negative evidence and concluded that, as of May 31, 2021, it is more likely than not that the Company’s U.S. deferred tax assets will not be realized. As of May 31, 2021, a valuation allowance of $66.5 million has been recorded on U.S and certain foreign deferred tax assets to recognize only the proportion of the deferred tax asset that is more likely than not to be recognized.

The Company reviewed all available evidence, both positive and negative, to evaluate the recovery of foreign deferred tax assets. The Company concluded that as of May 31, 2021, it is more likely than not that the Company’s China deferred tax assets will not be realized. The Company’s Canada, U.K., and France deferred tax assets are expected to be realized and no valuation allowance has been established. A reconciliation of the beginning and ending amount of the valuation allowance is as follows (in thousands):

	May 31, 2020		May 31, 2021
Valuation allowance at beginning of year	$	25,321	$	39,034
Change in valuation allowance		13,713		27,622
Valuation at end of year	$	39,034	$	66,656

As of May 31, 2021, the Company had a $88.3 million federal net operating loss. This net operating loss has an indefinite carryforward period. This loss carryforward has been offset by a liability for unrecognized tax benefits of $2.0 million.

As of May 31, 2021, the Company had a $10.6 million deferred tax asset related to a federal research and development credit carryforward. This credit has been offset by a liability for unrecognized tax benefits of $4.9 million. If not utilized, the credits will expire beginning in fiscal 2032 through fiscal 2041.

As of May 31, 2021, the Company had state net operating losses of $134.1 million. Of the total state net operating losses, $64.0 million, $22.1 million, $8.3 million and $7.1 million are attributable to Utah, California, Georgia, and Pennsylvania, respectively. $18.0 million of operating losses are carried forward indefinitely and the remaining net loss carryovers will expire beginning in fiscal 2022 through 2043 depending on the state in which the losses were incurred.

As of May 31, 2021, the Company had a $4.2 million deferred tax asset related to a Utah research and development credit carryforward. This credit has been offset by a liability for unrecognized tax benefits of $1.6 million. If not utilized, the credits will expire beginning in fiscal 2022 through fiscal 2035.

As of May 31, 2021, the Company had $2.9 million and $0.3 million in foreign losses from its China and France subsidiaries. The deferred tax asset for the France net operating loss has been fully offset by a liability for unrecognized tax benefits. Net operating loss carryovers in China and France are subject to certain annual limitations on the amount eligible to be utilized. However, any amount that is not utilized due to the limitations is carried forward five years in China, and indefinitely in France.

The Company asserts at the end of the current period that the earnings of its subsidiaries in Europe, China and Dubai are indefinitely reinvested.

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Accordingly, no deferred tax asset or liability is recorded for basis differences or cumulative other comprehensive income (loss). The Company has not made a determination of the amount of unremitted foreign earnings and the unrecognized deferred tax liability on unremitted foreign earnings, as such determination is not practicable.

ASC Topic 740-10-05 requires that the impact of a tax position be recognized in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. As of May 31, 2021, the Company had a $7.4 million liability for unrecognized tax benefits, of which $7.0 million is netted against deferred tax assets for related carryforward credits. The Company expects no material changes to the liability for unrecognized tax benefits in the next 12 months. Interest and penalties associated with uncertain tax positions are recorded as a component of provision (benefit) for income taxes. A reconciliation of the beginning and ending amounts of unrecognized benefits is as follows (in thousands):

	Year Ended May 31,
	2020			2021
Unrecognized tax benefits at the beginning of year	$	5,333		$	6,662
Gross increases – current year tax positions		326			1,520
Gross increases – prior year tax positions		1,289			—
Gross decreases – prior year tax positions		(286	)		(766	)
Unrecognized tax benefits at end of year	$	6,662		$	7,416
Interest and penalties in year-end balance	$	117		$	40

The Company files U.S., various foreign and various state tax returns in jurisdictions with various statutes of limitation. As of May 31, 2021, the tax returns for fiscal 2013 through fiscal 2020 remain subject to examination. Annual tax provisions include amounts considered necessary to pay assessments that may result from examination of prior year tax returns; however, the amount ultimately paid upon resolution of issues may differ materially from the amount accrued. As of May 31, 2021, there are no income tax returns currently under audit.

18. Commitments and Contingencies

Operating Leases

The Company has non-cancellable operating leases, primarily for warehouse and production facilities and computer and production equipment. These leases generally contain renewal options for periods ranging from three to five years and require the Company to pay all executory costs such as maintenance and insurance. Future minimum payments under non-cancellable operating leases consist of the following as of May 31, 2021 (in thousands):

Year Ending May 31,
2022	$	3,165
2023		2,072
2024		1,801
2025		1,701
2026		1,701
Thereafter		4,150
Total	$	14,590

Rent expense under non-cancellable operating leases was $4.6 million, $5.1 million, and $5.0 million for fiscal 2019, 2020 and 2021, respectively.

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Environmental Issues

The Company and its operations are subject to federal, state, local and foreign environmental, health and safety laws and regulations that, among other matters, impose workplace standards and limitations on the discharge of pollutants into the environment and establish standards for the use, management, handling, generation, treatment, storage, disposal, and release of, and exposure to, hazardous substances and wastes. The nature of the Company’s manufacturing and assembly operations exposes the Company to the risk of regulatory compliance and claims with respect to environmental, health and safety matters. As of the date of these financial statements, the Company was unaware of any material environmental, health or safety violations.

Product Liability

As a manufacturer and distributor of fitness equipment, the Company is inherently subject to the hazards and uncertainties of product liability claims and lawsuits, arising in the ordinary course of its business. These claims include injuries alleged to be sustained by individuals using the Company’s products. The Company has maintained, and expects to continue to maintain, product liability insurance, and it includes reserves for self-insured retention in accrued expenses in the consolidated balance sheets. While the Company believes its insurance coverage is adequate to cover the risks of product liability claims and awards, the Company may be subject to product liability claims which assert damages over the limits of its insurance coverage.

The Company currently carries an occurrence-based product liability insurance policy providing coverage for the period from October 1, 2020 to October 1, 2021 with limits of $2.0 million per occurrence and $4.0 million in the aggregate. The product liability insurance policy for the periods from October 1, 2017 to October 1, 2018, October 1, 2018 to October 1, 2019 and October 1, 2019 to October 1, 2020 was consistent with the policy covering the period from October 1, 2020 to October 1, 2021.

The Company believes that its insurance is generally adequate to cover product liability claims. Nevertheless, currently pending claims and any future claims are subject to the uncertainties related to litigation, and the ultimate outcome of any such proceedings or claims cannot be predicted. Due to uncertainty with respect to the nature and extent of manufacturers’ and distributors’ liability for personal injuries, the Company cannot guarantee that its product liability insurance is or will be adequate to cover such claims. The Company vigorously defends any and all product liability claims brought against it and does not believe that any current pending claims or series of claims will have a material effect on its results of operations, liquidity or financial position. As of May 31, 2020 and 2021, the Company accrued $3.1 million and $2.8 million, respectively, for known product liability claims and for claims incurred but not reported, which are included in accrued expenses in the consolidated balance sheets.

Other Litigation

Occasionally, the Company has been involved in various product reviews and recalls with the Consumer Product Safety Commission. The Company believes that resolutions of these reviews and recalls will not have a material effect on its results of operations, financial position or liquidity.

The Company is also involved in several intellectual property and patent infringement claims arising in the ordinary course of its business. The Company believes that the ultimate outcome of these matters will not have a material effect on its results of operations, financial position or liquidity.

The Company is occasionally a party to non-product liability commercial disputes involving contract claims. The Company believes that it is not able to determine at this time whether the resolution of these disputes will have a material effect on its results of operations, financial position, liquidity or cash flows.

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19. Stockholders’ Equity

On July 20, 1999, the Company authorized 37,800 shares of common stock, with a par value of $0.001 per share, in connection with the formation of the Company. On September 22, 1999, the Company increased the total number of authorized shares of common stock to 453,600,000. As of May 31, 2019 and 2020 there were 246,291,797 common stock shares legally issued and outstanding, and as of May 31, 2021 there were 240,175,493 common stock shares legally issued and outstanding. Common stock shares legally issued and outstanding as of May 31, 2019 and 2020 include 25,201,260 shares, which were issued to members of management in 1999 and simultaneously pledged as collateral in association with loans to management. The issuance of the common stock was accounted for as a stock option grant, therefore, the shares were not considered outstanding for accounting purposes and are excluded from the calculation of basic earnings per share. These loans were forgiven in October 2020 and as of May 31, 2021, all shares of common stock that had historically been pledged as collateral associated with the 1999 loans that had been forgiven have been released and are reflected as outstanding shares of common stock. Common stock shares legally issued and outstanding as of May 31, 2021 include 3,494,119 shares issued in June 2020. When pledged as collateral for the management loans issued in 2017 and 2019, the 3,494,119 shares were unvested options held by the member of management receiving the loan. In May 2020, the options were modified to vest immediately and were exercised into 3,494,119 shares of common stock in June 2020. As of May 31, 2021, the shares are still pledged as collateral under the management loans issued in 2017 and 2019 and as such, and for accounting purposes, they are treated in the same way as the shares previously pledged for the 1999 loans and are not included in treasury stock. See Note 23 for further detail regarding the management loans. The Company’s common stock is entitled to one vote per share. The Company has not declared or paid any dividends with respect to its common stock.

As of May 31, 2020, the Company had 10,000 authorized shares of preferred stock, with a par value of $0.001 per share. On October 2, 2020, in association with the issuance of the Series A preferred stock (see Note 13), the Company amended its articles of incorporation to reduce the authorized number of shares of preferred stock to 210. The Company further amended its articles of incorporation on March 17, 2021 to increase the authorized number of shares of preferred stock to 235, 210 of which are Series A preferred stock and 25 of which are Series B preferred stock, in association with the issuance of the Series B preferred stock (see Note 13). No shares of equity-classified preferred stock were issued or outstanding as of May 31, 2019, 2020 and 2021. See Note 13 for further detail on the Company’s liability-classified mandatorily redeemable preferred stock.

Treasury Stock

On August 21, 2017, June 20, 2019, October 9, 2020 and May 17, 2021 the Company made loans to certain members of management which were secured in part by shares of the Company’s common stock and therefore accounted for as a repurchase of the shares previously held by the employees (see Note 23). The repurchase was accounted for as a treasury stock transaction and the excess of the repurchase amount over the fair value of the shares was recognized as compensation cost. The Company repurchased a total of 7,436,016 shares related to the loans made to management in fiscal 2018 for an aggregate repurchase price of $10.9 million. The Company repurchased a total of 572,670 shares related to the loans made to management during fiscal 2020 for an aggregate repurchase price of $1.2 million. The Company repurchased a total of 7,380,564 shares related to the loans made to management in October 2020 for an aggregate purchase price of $59.6 million. The Company repurchased a total of 963,673 shares related to the loans made to management in May 2021 for an aggregate purchase price of $9.0 million. For the two loans issued in October 2020 and the loan issued in May 2021, the Company accounted for the original issuances, each secured by shares of common stock, as a repurchase of the shares and the grant of a stock option award in exchange for a non-recourse note with an effective exercise price equal to the borrowings under the loan plus interest accruing at the applicable federal rate which is capitalized into the principal of the loan on a quarterly basis. See Note 23 for additional detail on the options issued in exchange for the pledged assets on the loans to management.

Per the terms of the agreement signed in accordance with the 2020 Transactions, the Company may use up to $30 million of proceeds from the 2020 Transactions to redeem its stock from certain existing stockholders. As

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such, stockholders of the Company (other than the Company’s chief executive officer, and his affiliates, L Catterton, and Pamplona) were given an opportunity to sell up to 100% of their shares to the Company until April 2, 2021 at a price per share to be determined by its board of directors. As such, during fiscal 2021 the Company redeemed and subsequently retired an aggregate 12,515,164 shares of its common stock at a price of $1.10 per share for a total consideration price of $13.8 million.

20. Stock-Based Compensation

Stock Option Plan

In fiscal 2014, the Company established a stock option plan (“2014 Plan”). The 2014 Plan included a total reserved amount of 27,594,000 shares subject to options, stock appreciation rights, restricted stock, and other stock-based awards. On May 28, 2021, the Company’s board of directors approved an amendment to the 2014 Plan which provided for an additional 12,807,774 shares subject to options, stock appreciation rights, restricted stock and other stock-based awards, for a total of 40,401,774 total reserved shares. The Company has granted options in fiscal years 2014, 2017, 2020 and 2021 under the 2014 Plan. No shares subject to options remained available for issuance at May 31, 2020. In May 2021, following the approval of the board of directors and subsequent grants of 11,683,224 options, there were 1,124,550 shares subject to options, stock appreciation rights, restricted stock and other stock-based awards available for issuance at May 31, 2021. Options generally have a contractual term of 10 years from the grant date.

Certain option awards vested immediately and the Company recognized the associated stock-based compensation expense in full upon the grant date. Stock-based compensation expense recognized on immediately vested awards was $0, $7.9 million and $51.5 million for fiscal 2019, 2020 and 2021, respectively (excluding the impact of the fiscal 2020 modification discussed below).

In fiscal 2020, the vesting conditions of option awards exercisable into 3,494,119 shares previously granted to an employee in fiscal 2014 were modified by the Company, resulting in immediate vesting of the awards. Prior to this modification, vesting of the awards was subject to the occurrence of a performance condition and hence no stock-based compensation expense had been recognized as the performance condition was not probable to occur. The total fair value of the modified awards was $9.4 million, which was recognized as an additional expense in fiscal 2020.

All other option awards granted under the 2014 Plan were granted subject to both service and performance conditions that require an evaluation of whether the performance condition (i.e., liquidity event, such as an initial public offering) is probable. As of May 31, 2020 and 2021, the Company determined that the performance condition is not probable to occur, and, therefore, no stock-based compensation expense has been recognized for such. The 11,683,224 options were granted in fiscal 2021 using the 12,807,774 shares subject to options which were authorized under the amendment to the 2014 Plan. These options are subject only to service conditions. Therefore, stock-based compensation is recognized on those awards over the requisite service period.

Loans to Management

The Company provided loans to certain members of management that in some instances were secured by shares and options of the Company’s common stock that the respective members of management owned which have been treated as the grant of a stock option and are included in the table below. See Note 23 for additional details on Company loans to management. Total stock-based compensation expense associated with Company loans to management was $0, $1.2 million and $45.2 million for fiscal 2019, 2020 and 2021, respectively.

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Stock option activity related to the 2014 Plan and Company loans to management is as follows:

	Options Outstanding
	Number of Shares Subject to Options			Weighted Average Exercise Price		Weighted- Average Remaining Contractual Term		Total Fair Value at Grant
				(per share)		(years)		(in thousands)
Outstanding - May 31, 2019		45,408,687		$	0.09		2.9	$	25,191
Granted		13,876,721		$	0.10		6.6		34,204
Exercised		—			—		—		—
Remeasurement1		—		$	0.11		8.8		837
Cancelled		(10,956,142	)	$	0.12		—		(16,178	)
Outstanding - May 31, 2020		48,329,266		$	0.09		8.0	$	44,054
Granted		20,027,461		$	8.35		9.4		104,378
Exercised2		(28,106,001	)	$	0.00		—		(15,050	)
Remeasurement3		—			—		8.3		2,200
Cancelled		—			—		—		—
Outstanding - May 31, 2021		40,250,726		$	4.26		7.5	$	135,582
Vested and exercisable - May 31, 2021		30,764,816		$	5.27		8.2		122,008
Unvested awards - May 31, 2021		9,485,910		$	0.77		5.3	$	13,574

¹ During fiscal 2020, 25,201,260 shares subject to options associated with Company loans to management were modified that increased their remaining contractual term. Additionally, 7,436,016 shares subject to options associated with Company loans to management were modified that increased their exercise price.

² This excludes 3,494,119 shares issued upon option exercise under the 2014 Plan in June 2020, as the underlying shares remain as collateral for Company loans to management (see Note 23) and as such, do not represent an exercise under ASC 718, Compensation—Stock Compensation.

³  During fiscal 2021, 25,201,260 shares subject to options associated with Company loans to management were remeasured due to the forgiveness of the underlying loans, resulting in lowering the exercise price to zero and increasing the fair value of the awards. The forgiveness of the loans would likewise represent an exercise of the underlying options.

The fair value associated with unvested awards subject to a performance condition will be recognized as stock-based compensation expense when the Company determines the occurrence of the performance condition is probable and recognized over any remaining service periods. The weighted-average grant date fair value of awards granted in fiscal 2020 was $2.46 per share. The weighted-average grant date fair value of awards granted in fiscal 2021 was $5.21 per share. The Company determined that the aggregate intrinsic value of vested and exercisable awards was $105.2 million and $125.2 million as of May 31, 2020 and 2021, respectively. The aggregate intrinsic value of vested and exercisable awards was calculated as the difference between the exercise price of the options and the fair value of the Company’s common stock as of May 31, 2020 and 2021, as determined by the board of directors.

Total stock-based compensation expense was $0, $18.5 million and $96.7 million for fiscal 2019, 2020 and 2021, respectively, and is recorded in general and administrative expense in the consolidated statements of operations and comprehensive income (loss).

As of May 31, 2021, the Company had $13.6 million of unrecognized stock-based compensation expense related to non-vested awards. Awards that will vest immediately upon the consummation of an initial public offering of the Company’s stock represent $10.2 million of this total unrecognized expense, all of which will be recognized upon the completion of an initial public offering by the Company. Additionally, the Company had $3.4 million of unrecognized stock-based compensation expense related to non-vested awards that do not have a performance

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condition. The stock-based compensation expense related to these awards will be recognized over a weighted-average vesting period of 0.8 years.

In determining the grant-date fair value of the options, the Company uses the Black-Scholes option-pricing model and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment. Additionally, the Company elects to account for award forfeitures as they occur.

Fair value of common stock—The fair value of the shares of common stock underlying stock options has historically been established by the Company’s board of directors, which is responsible for these estimates, and has been based in part upon a valuation provided by an independent third-party valuation firm. Because there has been no public market for the Company’s common stock, the board of directors considered this independent valuation and other factors, including, but not limited to, revenue growth, the current status of the technical and commercial success of its operations, its financial condition, stage of development and competition to establish the fair value of the Company’s common stock at the time of grant of the options. The fair value of the underlying common stock will be determined by the board of directors until such time as its common stock is listed on a stock exchange.

Expected term—The expected term represents the period over which the Company anticipates stock-based awards to be outstanding. The Company estimates expected term based on its prior award history and expectations regarding future exercises.

Volatility—Expected volatility is a measure of the amount by which the stock price is expected to fluctuate. The Company estimates the expected volatility by taking the average historical volatility of the common stock of a group of comparable publicly traded companies over a period equal to the expected life of the options.

Risk-free rate—The risk-free interest rate is the estimated average interest rate based on U.S. Treasury zero-coupon notes with terms consistent with the expected term of the awards.

Dividend yield—The Company has never declared or paid any cash dividends and does not presently plan to pay cash dividends in the foreseeable future. Consequently, it used an expected dividend yield of zero.

The following table provides the weighted-average inputs for expected term, volatility, risk-free rate, and dividend yield that were utilized by the Company in its Black-Scholes option pricing model for options granted during fiscal 2020 and 2021:

	Year Ended May 31,
	2020		2021
Expected term		5—10 years		0.25—10 years
Volatility		75.0% — 80.0%		58.2% — 80.0%
Risk-free interest rate		0.4% — 2.0%		0.02% — 0.79%
Dividend yield		—		—

21. Earnings (Loss) Per Share

The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share attributable to common stockholders (in thousands, except share and per share amounts):

	Year Ended May 31,
	2019			2020			2021
Numerator:
Net income (loss)	$	56,567		$	(98,543	)	$	(516,706	)
Less: Earnings allocated to participating securities1		(7,496	)		—			—
Net income (loss) attributable to common stock - basic and diluted		49,071			(98,543	)		(516,706	)

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	Year Ended May 31,
	2019		2020			2021
Denominator:
Weighted average shares of common stock - basic and diluted		213,654,521		213,111,562			222,511,893
Net income (loss) per share
Basic	$	0.23	$	(0.46	)	$	(2.32	)
Diluted	$	0.23	$	(0.46	)	$	(2.32	)

¹  As discussed in Note 23, the pledge of shares in exchange for the non-recourse loans was treated as a repurchase of the common shares, accounted for as a treasury stock transaction, and the grant of vested stock options in exchange for the non-recourse note with an effective exercise price equal to the borrowings under the loan. Holders of the 32,637,276 total participative options are entitled to the same voting and dividend rights to which they were entitled as holders of shares of common stock, but are not contractually obligated to participate in periods when the Company incurs a net loss. As such, the Company has allocated earnings on a one to one basis with the participating securities.

The following common stock equivalents were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive or they were contingently issuable:

	Year Ended May 31,
	2019		2020		2021
Stock options1		12,771,411		48,329,266		36,756,607
Stock warrants		—		19,676,110		31,999,363
Total		12,771,411		68,005,376		68,755,970

¹ The stock options outstanding of 12,771,411 on May 31, 2019 are not included in basic or dilutive earnings per share as they are contingently issuable upon meeting certain performance conditions none of which were met as of the reporting date. For fiscal 2020 and 2021, the options outstanding include 33,209,946 and 16,352,923 options, respectively, related to the common shares pledged as collateral for the non-recourse loans issued to management of the Company in addition to 15,119,320 and 20,403,684 options, respectively, issued and outstanding as part of the 2014 Plan.

22. Segments

The Company has two operating and reportable segments: Interactive Fitness Products and Subscription. Segment information is presented in the same manner that the CODM reviews the operating results in assessing performance and allocating resources. The CODM reviews revenue, cost of revenue and gross profit for both of the segments. Gross profit is defined as revenue less cost of revenue incurred by the segment.

No operating segments have been aggregated to form the reportable segments. The Company does not allocate assets at the reportable segment level as these are managed on an entity wide group basis and, accordingly, the Company does not report asset information by segment. The Interactive Fitness Products segment derives revenue from sale of the treadmills, bikes, ellipticals, rowers, climbers, strength equipment, fitness mirrors, yoga equipment, and accessories. The Subscription segment derives revenue from iFIT subscriptions and the sale of extended warranties on fitness equipment. There are no intercompany revenue transactions between segments.

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Key financial performance measures of the segments including revenue, cost of revenue, and gross profit are as follows (in thousands):

	Year Ended May 31,
	2019		2020		2021
Interactive fitness products:
Revenue	$	626,189	$	727,703	$	1,515,288
Cost of revenue		444,908		503,353		989,873
Gross profit	$	181,281	$	224,350	$	525,415
Subscription:
Revenue	$	73,776	$	123,977	$	229,768
Cost of revenue		13,226		19,362		28,980
Gross profit	$	60,550	$	104,615	$	200,788
Consolidated:
Revenue	$	699,965	$	851,680	$	1,745,056
Cost of revenue		458,134		522,715		1,018,853
Gross profit	$	241,831	$	328,965	$	726,203

Reconciliation of Gross Profit

Operating expenditures, other expenses, and taxes are not allocated to individual segments as these are managed on an entity wide group basis. The reconciliation between reportable segment gross profit to consolidated income (loss) before tax is as follows (in thousands):

	Year Ended May 31,
	2019			2020			2021
Segment gross profit	$	241,831		$	328,965		$	726,203
Sales and marketing		193,173			278,492			619,431
Research and development		20,898			23,122			36,274
General and administrative		48,892			77,105			198,132
Total other expense (income)		(98,432	)		46,320			387,089
Income (loss) before provision (benefit) for income taxes	$	77,300		$	(96,074	)	$	(514,723	)

23. Related-Party Transactions

Loans to Management

On September 27, 1999, the Company made loans to members of management in the amounts of $1.2 million and $1.0 million, respectively (the “1999 loans”). On August 21, 2017, the Company made additional loans to two members of management in the amounts of $0.8 million each and on June 20, 2019 additional loans to two members of management of $0.2 million and $0.3 million, respectively. These loans bore interest on the outstanding principal balance at the applicable federal rate, as published monthly. The Company did not obligate the borrowers to pay the annual interest and reported the uncollected interest annually as taxable income on the employees’ W-2.

In connection with the 2020 Transactions, on October 9, 2020, the Company’s chief executive officer and an affiliate received $44.0 million and $8.0 million, respectively, in cash in exchange for non-recourse loans that were secured by 7,380,564 shares of the Company’s common stock owned by them. These loans bear interest on the outstanding principal balance at the applicable federal rate, to be capitalized into the principal of the loan on a

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quarterly basis. The Company did not obligate the borrowers to pay the annual interest and reported the uncollected interest annually as taxable income on the employees’ W-2. All of the notes are non-recourse to the borrowers’ assets except for the shares, or in some instances shares and options, of the Company’s common stock the respective persons owned. Each of the loans have terms of 10 years with payment due upon maturity.

On May 17, 2021, the Company made a loan to a member of management in the amount of $9.3 million in cash that was secured by 963,673 shares of the Company’s common stock owned by him. This loan bears interest on the outstanding principal balance at the applicable federal rate, to be capitalized into the principal of the loan on a quarterly basis. The note is non-recourse to the borrower’s assets except for the shares of the Company’s common stock the member of management owns. The loan has a term of two years and matures on or before the earlier of (i) immediately prior to the initial public offering of the Company or (ii) May 17, 2023. The loan may be prepaid without premium or penalty, with payment due upon maturity.

For some of the loans, the Company accepted the pledge of a mix of owned shares and unvested options exercisable into common shares of the Company. The Company accounted for the pledge of an option as a cancellation of the old option in exchange for a cash incentive and issuance of a replacement award whose strike price is the cumulative amount of the actual option exercise price and the attributable loan amount.

On January 1, 2009, and on September 24, 2019, certain loans were scheduled to mature and were extended by the Company, which was deemed as a modification of an option grant to extend exercisability. The loans subject to term extensions are in respect to fully vested shares. As the underlying shares are fully vested, the Company accounted for the modification by immediately recording incremental expense of $1.2 million and $0.8 million in fiscal 2009 and 2020, respectively.

One of the members of management who received a loan on June 20, 2019, had already secured the loan received on August 21, 2017 with the same pledged shares now being pledged for the June 2019 loan. Considering that the August 21, 2017 loan is deemed a repurchase and issuance of a new option, the incremental loan, in substance, represents a repricing of the option through the increase of the strike price. While the increase in the strike price did not result in additional expense, the cash payment and the issuance of the loan to the other member of management in June 2019 resulted in compensation expense of $0.4 million in fiscal 2020. Also, upon one of the members of management leaving the Company in fiscal 2020, the pledged options were canceled, but the loan collateralized by such options was not repaid and remained outstanding. The Company accounted for this modification as a probable-to-probable modification of a fully vested option related to the pledged common stock. The Company did not incur additional compensation expense related to the modification.

The Company does not enforce collection of contractual interest payments and these loans do not include periodic amortization payments of principal. Historically, the Company has extended maturity terms. In the event of an initial public offering, the loans to management will need to be extinguished. The Company is evaluating if the loans will be repaid or forgiven at the time of an initial public offering.

Forgiveness of Loans to Management

In October 2020, the Company forgave the outstanding balances of $2.2 million of the 1999 loans. As discussed above, the loans were non-recourse and the issuance of stock was considered a stock option for accounting purposes. Therefore, the forgiveness of the notes was in effect a repricing of the options’ exercise price to zero. As a result, on the forgiveness date, the Company applied modification accounting as prescribed by ASC 718, Compensation—Stock Compensation, in order to calculate any incremental compensation cost to be recognized. The modification calculation reflected assumptions pre-modification representative of the remaining loan maturity and associated assumptions of volatility and interest rate. Following the modification, there was no remaining expected life and the fair value represented the intrinsic value of the award. The forgiveness of the non-recourse loan represented a repricing of the strike price to $0, and the Company recognized incremental compensation expense equal to the principal amount forgiven, which amounted to $2.2 million.

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Purchases from Stockholders

During fiscal 2019, 2020 and 2021, the Company purchased certain inventories totaling $17.8 million, $18.3 million, and $31.2 million, respectively, from a company owned by a stockholder and board member.

Services Provided by Stockholders

During the fiscal 2021, the Company was provided services totaling $3.4 million from a company owned by a stockholder and board member. The Company was provided no other services by stockholders for any of the other periods presented.

Chief Executive Officer Bonus

On May 28, 2021, the board of directors of the Company approved a $35.0 million cash bonus payable to the chief executive officer contingent upon liquidity events, including an initial public offering.

24. Risks and Uncertainties

COVID-19

During March 2020, a global pandemic was declared by the World Health Organization related to the outbreak of a novel strain of coronavirus (COVID-19). The pandemic has significantly impacted worldwide economic conditions. While the Company experienced an increase in sales during the period since the pandemic was declared, the virus continues to cause significant economic uncertainty within the markets in which the Company operates. As a result, the Company is unable to predict the future impact, both in terms of severity and duration, COVID-19 will have on its operating results, cash flows and financial condition.

25. Subsequent Events

For the annual financial statements, subsequent events were evaluated from the balance sheet date of May 31, 2021 through August 18, 2021, the date the audited consolidated financial statements were issued (September     , 2021, as to the effects of the stock split described below). The Company has concluded that no events or transactions have occurred that require disclosure in or adjustment to the accompanying consolidated financial statements, other than the following:

Sweat Acquisition

On June 30, 2021, the Company acquired all of the outstanding equity interests of Sweat Group Pty Ltd (“Sweat”). Sweat operates an online fitness application focused on connecting a community of women with technologies, content and products through the development and innovation of its proprietary software and equipment. Upon completion and closing of the transaction, Sweat became a wholly-owned subsidiary of the Company. The acquisition increases the Company’s digital footprint and expands the Company’s subscription offerings and subscriber base.

Sweat stockholders received $40.6 million in cash (including $4.9 million placed in escrow and subject to certain estimated purchase price adjustments as set forth in the purchase agreement), and stock consideration in the form of shares of the Company’s common stock worth $40.0 million to be issued at a 10% discount of the price per share as of the initial public offering date, contingent on the Company undergoing an initial public offering within 2.5 years of the closing date. If the Company does not undergo an initial public offering during that time, the Company will instead pay $40.0 million in cash.

In addition to the consideration paid on the closing date, the Seller may receive contingent cash consideration of up to $30.0 million if the Company achieves specific revenue and growth targets during the three years following the close of the transaction.

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The Company is currently evaluating the accounting treatment of this transaction, as well as performing the valuation of assets acquired and the related purchase price allocation.

Issuance of Stock Options

In July 2021, the Company granted 1,124,550 options to certain executives. One third of the options vested immediately upon the grant date, with one third scheduled to vest in May 2022 and one third scheduled to vest in May 2023. Additionally, all of the options will vest immediately if the Company undergoes an initial public offering.

2021 Revolver

Following the close of fiscal 2021, the Company drew down $165.0 million under the 2021 Revolver as of August 18, 2021. The funds from the 2021 Revolver were used for general business purposes.

Stock Split

On September 14, 2021, the board of directors and the stockholders of the Company approved an amended and restated certificate of incorporation. As part of this amendment, the Company’s board of directors approved an increase to the total number of authorized common shares to 1,000,000,000 with a par value of $0.001 and a 37.8-for-1 stock split of the Company’s outstanding common shares, which will be effected prior to the effective date of the registration statement. All common stock and per share information has been retroactively adjusted, where applicable, to give effect to the stock split for all periods presented in the consolidated financial statements and accompanying notes. Shares of common stock underlying outstanding stock options and other equity instruments were proportionately increased and the respective per share value and exercise prices, if applicable, were proportionally decreased in accordance with the terms of the agreements governing such securities. There were no changes to the par value per share of the Company’s common stock as a result of the stock split.

26. Subsequent Events (Unaudited)

Convertible Notes

On September 20, 2021, the Company and certain shareholders entered into an Omnibus Investor Agreement (the “Investor Agreement”) with the investors in the 2019 Note and Series A preferred stock and certain executives, pursuant to which the Company outlined the distribution plan for proceeds received in connection with the Company’s initial public offering and agreed to complete (i) a note exchange pursuant to which any unpaid portion of the 2019 Note consideration issued to Pamplona would be cancelled in exchange for a new convertible senior note, (ii) settlement of the outstanding Series A preferred stock issued to Pamplona and Catterton in exchange for cash, Class A common stock and new convertible senior notes which would be determined based on the IPO proceeds, and (iii) any remaining unpaid portion of the chief executive officer bonus to be paid in connection with the initial public offering would be the principal balance of a convertible senior note (collectively, the “Convertible Notes”).

The Convertible Notes will bear interest at a rate of 7.00% per annum, payable quarterly in cash on March 31, June 30, September 30 and December 31 of each year commencing on December 31, 2021. At the election of the Company, any interest accrued can be paid-in-kind (“PIK”) or in the form of Class A common stock at a 15% discount to 10-day Volume-Weighted Average Price (“VWAP”) for the applicable interest payment date. If PIK interest is elected, such accrued interest should be added to the unpaid principal amount of the Convertibles Notes outstanding at such time. The Convertible Notes are pari passu in right of payment to any existing and future senior indebtedness, including indebtedness under the Senior ABL Revolving Credit Facility. The Convertible Notes will rank senior in right of payment to any future subordinated borrowings.

Holders of the Convertible Notes may convert the Convertible Notes at their option at any time. The Convertible Notes will be convertible, at the holder’s option, at an initial conversion price equal to 85% of the public offering

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price of the Company’s Class A common shares in its initial public offering. The Company may redeem the Convertible Notes at any time, upon an agreed notice period, at par plus any accrued and unpaid interest. In addition, at any time following the second anniversary of issuance, the Company may require all holders to convert if the share price exceeds 150% of the Company’s initial public offering price based on a 60-day VWAP. For as long as the Convertible Notes are outstanding, Pamplona and Catterton will retain a consent right on the Company’s maximum leverage.

The Convertible Notes mature on the sixth anniversary of the closing of the issuance. At maturity, the Company is required to repay the Convertible Notes in cash at par value plus any accrued but unpaid interest. The Company will pay the transaction costs for all parties related to the issuance of the Convertible Notes.

The Convertible Notes will be held initially by Pamplona, Catterton, and, if applicable, the chief executive officer and are subject to certain transfer restrictions for six months following the execution date. Each of Pamplona and Catterton, for so long as they hold the outstanding Convertible Notes, is entitled to nominate one director to the Company’s board of directors as well as to appoint one board observer. Once the Convertible Notes have been repaid or converted, both Pamplona and Catterton will lose this right.

Restricted Interest

On September 14, 2021, the board approved a grant, in connection with the closing of the offering, to the Company’s chief executive officer of a $50.0 million restricted interest in Convertible Notes which are subject to forfeiture if the CEO’s employment is terminated prior to the lapse of the forfeiture restrictions. The forfeiture restrictions shall lapse on the earlier of a liquidity event or the six year anniversary of the issuance of the Convertible Notes. A liquidity event includes mandatory conversion of the Convertible Notes by the Company, conversion or transfer of all notes held by Catterton and Pamplona, a mandatory prepayment event, and notice by the issuer of an optional prepayment in full, amongst other events. During the period of the forfeiture restrictions, the CEO shall have no rights of a holder under the Convertible Notes. Additionally, all interest payments made during the term of the forfeiture restrictions to the CEO shall be in the form of common stock and shall be included as part of the restricted property. Furthermore, during the forfeiture period, Catterton and Pamplona can require the Company to pay their interest in Class A common stock of the Company.

Loan Forgiveness and Loan Settlement

On August 31, 2021, upon approval of the board of directors, the Company forgave multiple loans with several members of management. The loans had an aggregate principal amount of $53.2 million (see Note 23) and were secured by 15,504,955 shares of the Company’s common stock and 550,670 stock options. In addition, the Company settled a May 17, 2021 loan agreement with a member of management. The loan had an aggregate principal amount of $9.3 million (see Note 23), as well as accrued and unpaid interest under the note which was collateralized by 963,673 shares of the Company’s common stock. Upon the settlement of the loan, the pledged shares of common stock previously held as treasury stock were retired by the Company.

Common Stock Conversion

The board of directors and the stockholders of the Company approved two new classes of common stock and one new class of preferred stock on September 14, 2021. The new authorized common stock is 3,000,000,000 of Class A common shares with a par value of $0.001, 3,000,000,000 of Class B common shares with a par value of $0.001, and 50,000,000 of preferred shares. The Class B common shares are entitled to 10 votes per share. In addition, the board of directors approved to amend and restate our certificate of incorporation to, among other things, effect the reclassification of the common stock of the Company into shares of Class A common stock and permit an exchange of Class A common held on behalf of the Scott R. Watterson holders for our newly designated Class B common stock.

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30,769,231 Shares

Class A Common Stock

Morgan Stanley BofA Securities Barclays

Citigroup Credit Suisse Jefferies Baird

Cowen	JMP Securities	Raymond James
Truist Securities	William Blair	Telsey Advisory Group

AmeriVet Securities Blaylock Van, LLC Loop Capital Markets Siebert Williams Shank

                    , 2021

Until                 , 2021 (25 days after the date of this prospectus), all dealers that buy, sell or trade in shares of these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PART II—INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth all costs and expenses, other than the underwriting discount, paid or payable by us in connection with the sale of the Class A common stock being registered. All amounts shown are estimates except for the SEC registration fee, the FINRA filing fee and the listing fee for NASDAQ.

	Amount Paid or to be Paid
SEC registration fee	$	81,070
FINRA filing fee		111,962
NASDAQ listing fee		295,000
Blue sky qualification fees and expenses		5,000
Printing and engraving expenses		600,000
Legal fees and expenses		5,000,000
Accounting fees and expenses		5,242,000
Transfer agent and registrar fees and expenses		4,000
Miscellaneous expenses		4,460,968
Total	$	15,800,000

Item 14. Indemnification of Officers and Directors.

The Registrant is governed by the Delaware General Corporation Law, or DGCL. Section 145 of the DGCL provides that a corporation may indemnify any person, including an officer or director, who was or is, or is threatened to be made, a party to any threatened, pending or completed legal action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person was or is an officer, director, employee or agent of such corporation or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided such officer, director, employee or agent acted in good faith and in a manner such person reasonably believed to be in, or not opposed to, the corporation’s best interest and, for criminal proceedings, had no reasonable cause to believe that such person’s conduct was unlawful. A Delaware corporation may indemnify any person, including an officer or director, who was or is, or is threatened to be made, a party to any threatened, pending or contemplated action or suit by or in the right of such corporation, under the same conditions, except that such indemnification is limited to expenses (including attorneys’ fees) actually and reasonably incurred by such person, and except that no indemnification is permitted without judicial approval if such person is adjudged to be liable to such corporation. Where an officer or director of a corporation is successful, on the merits or otherwise, in the defense of any action, suit or proceeding referred to above, or any claim, issue or matter therein, the corporation must indemnify that person against the expenses (including attorneys’ fees) which such officer or director actually and reasonably incurred in connection therewith.

The Registrant’s amended and amended and restated bylaws will authorize the indemnification of its officers and directors, consistent with Section 145 of the DGCL, as amended. The Registrant intends to enter into indemnification agreements with each of its directors and executive officers. These agreements, among other things, will require the Registrant to indemnify each director and executive officer to the fullest extent permitted by Delaware law, including indemnification of expenses such as attorneys’ fees, judgments, fines and settlement amounts incurred by the director or executive officer in any action or proceeding, including any action or proceeding by or in right of the Registrant, arising out of the person’s services as a director or executive officer.

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Reference is made to Section 102(b)(7) of the DGCL, which enables a corporation in its original certificate of incorporation or an amendment thereto to eliminate or limit the personal liability of a director for violations of the director’s fiduciary duty, except (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL, which provides for liability of directors for unlawful payments of dividends of unlawful stock purchase or redemptions or (iv) for any transaction from which a director derived an improper personal benefit.

The Registrant expects to maintain standard policies of insurance that provide coverage (i) to its directors and officers against loss rising from claims made by reason of breach of duty or other wrongful act and (ii) to the Registrant with respect to indemnification payments that it may make to such directors and officers.

The proposed form of Underwriting Agreement to be filed as Exhibit 1.1 to this Registration Statement provides for indemnification to the Registrant’s directors and officers by the underwriters against certain liabilities.

Item 15. Recent Sales of Unregistered Securities

The following sets forth information regarding all unregistered securities sold by the Registrant in transactions that were exempt from the requirements of the Securities Act in the last three years:

• The Registrant has issued 18,873,540 shares or options with respect to 40,401,774 shares under its 2014 Stock Option Plan.

• The Registrant will issue 239,211,835 shares of Class A common stock and Class B common stock as part of a reclassification and exchange to be effected immediately prior to the closing of the offering.

• The Registrant issued Warrants and Preferred Shares in connection with the 2019 Financing Transaction and the 2020 Financing Transaction and will issue shares of Class A common stock in respect thereof in connection with or following the offering.

• The Registrant issued Preferred Shares in 2021 and will issue shares of Class A common stock in respect thereof in connection with the offering.

• The Registrant will issue shares of Class A common stock as deferred consideration in connection with the 29029 and Sweat acquisitions upon closing of the offering.

• The Registrant will issue New Convertible Notes in connection with the offering and will issue shares of Class A common stock upon conversion thereof.

The shares of Class A and Class B common stock in all of the transactions listed above were issued or will be issued in reliance upon Section 4(2) or Section 3(a)(9) of the Securities Act or Rule 701 promulgated under Section 3(b) of the Securities Act as the sale of such securities did not or will not involve a public offering. The recipients of the securities in each of these transactions represented their intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were placed upon the stock certificates issued in these transactions. All recipients had adequate access, through their relationships with the Registrant, to information about the Registrant.

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Item 16. Exhibits and Financial Statement Schedules

(a) Exhibits:

Exhibit No.	Description
1.1	Form of Underwriting Agreement.
3.1*	Fourth Amended and Restated Certificate of Incorporation of iFIT Health & Fitness Inc, as currently in effect.
3.2*	Certificate of Amendment to Fourth Amended and Restated Certificate of Incorporation of iFIT Health & Fitness Inc.
3.3*	Bylaws of iFIT Health & Fitness Inc, as currently in effect.
3.4	Form of Amended and Restated Certificate of Incorporation of iFIT Health & Fitness Inc to be in effect prior to the consummation of the offering made under this Registration Statement.
3.5	Form of Amended and Restated Bylaws of iFIT Health & Fitness Inc to be in effect prior to the consummation of the offering made under this Registration Statement.
4.1	Form of Certificate of Class A Common Stock.
4.2	Form of Omnibus Investor Agreement, by and among iFIT Health & Fitness Inc and certain stockholders named therein.
4.3	Form of Registration Rights Agreement, by and among iFIT Health & Fitness Inc and certain stockholders named therein.
4.4	Form of New Convertible Note.
5.1	Opinion of Weil, Gotshal & Manges LLP.
10.1*	ABL Credit Agreement, dated as of May 12, 2021, among iFIT Health & Fitness Inc, ICON Health & Fitness, Inc., the other Borrowers Party Thereto, the Lenders Party thereto and Bank of America, N.A., as administrative agent.
10.2	Form of Indemnification Agreement.
10.3*	2014 Stock Option Plan.
10.4*	Form of Nonqualified Stock Option Award Agreement under 2014 Plan.
10.5	2021 Equity Incentive Plan.
10.6	Form of Stock Option Award Agreement under 2021 Plan.
10.7	Form of Restricted Property Award Agreement, by and between Scott Watterson and iFIT Health & Fitness Inc.
10.8	Second Amended & Restated Employment Agreement, by and among Scott Watterson, iFIT Health & Fitness Inc (formerly HF Holdings, Inc.) and iFIT Inc. (formerly ICON Health & Fitness Inc.).
10.9	Employment Agreement, by and among Scott Watterson, iFIT Health & Fitness Inc (formerly HF Holdings, Inc.) and iFIT Inc. (formerly ICON Health & Fitness Inc.).
10.10	Employment Agreement, by and between Steven J. Barr and iFIT Health & Fitness Inc.
21.1*	List of subsidiaries.
23.1	Consent of Deloitte & Touche LLP.

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Exhibit No.	Description
23.2	Consent of Weil, Gotshal & Manges LLP (included in Exhibit 5.1).
23.3*	Consent of Frost & Sullivan, Inc.
23.4*	Consent of Erica Berchtold.
23.5*	Consent of Abigail Taylor.
24.1*	Power of Attorney (included on signature page).

* Previously filed.

Item 17. Undertakings

The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer, or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Logan, State of Utah, on September 27, 2021.

iFIT Health & Fitness Inc
By:	/s/ Scott R. Watterson
	Name  Scott R. Watterson
	Title:   Co-Founder, Chief Executive Officer and Director

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated on September 27, 2021.

Signature	Title
/s/ Scott R. Watterson Scott R. Watterson	Co-Founder, Chief Executive Officer and Director (Principal Executive Officer and Director)
/s/ Steven J. Barr Steven J. Barr	Executive Vice President, Chief Financial Officer (Principal Financial Officer)
/s/ Troy Thornton Troy Thornton	Chief Accounting Officer (Principal Accounting Officer)
/s/ David J. Watterson David J. Watterson	Executive Vice President, Chief Strategy Officer and Director
* Greg Benson	Director
* Karen Boykin-Towns	Director

Signature	Title
* Scott Dahnke	Director
* Robert C. Gay	Director
* Alexander Hawkinson	Director
* Wen-Chung Ko	Director
* Charles Robins	Director
* Andrew Singer	Director
* Gary E. Stevenson	Director

*By:	/s/ Steven J. Barr
	Name Steven J. Barr
	Title: Attorney-in-fact

EX-1.1

Exhibit 1.1

[•] Shares

iFIT Health & Fitness Inc

CLASS A COMMON STOCK, PAR VALUE $0.001 PER SHARE

UNDERWRITING AGREEMENT

[•], 2021

[•], 2021

Morgan Stanley & Co. LLC

BofA Securities, Inc.

Barclays Capital Inc.

as Representatives of the several Underwriters

c/o Morgan Stanley & Co. LLC

     1585 Broadway

     New York, New York 10036

c/o BofA Securities, Inc.

     One Bryant Park

     New York, New York 10036

c/o Barclays Capital Inc.

     745 Seventh Avenue

     New York, New York 10019

Ladies and Gentlemen:

iFIT Health & Fitness Inc, a Delaware corporation (the “Company”), proposes to issue and sell to the several Underwriters named in Schedule I hereto (the “Underwriters”) an aggregate of [•] shares of Class A common stock, par value $0.001 per share, of the Company (the “Firm Shares”).

The Company also proposes to issue and sell to the several Underwriters not more than an additional [•] shares of its Class A common stock, par value $0.001 per share, (the “Additional Shares”) if and to the extent that Morgan Stanley & Co. LLC (“Morgan Stanley”), BofA Securities, Inc. (“BofA”) and Barclays Capital Inc. (“Barclays”), as representatives of the offering (the “Representatives”), shall have determined to exercise, on behalf of the Underwriters, the right to purchase such shares of common stock granted to the Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “Shares.” The shares of Class A common stock, par value $0.001 per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the “Common Stock.”

The Company has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-1 (File No. 333-259220), including a preliminary prospectus, relating to the Shares. The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended (the “Securities Act”), is hereinafter referred to as

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the “Registration Statement”; the prospectus in the form first used to confirm sales of Shares (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “Prospectus.” If the Company has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (a “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement.

For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, “preliminary prospectus” shall mean each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted information pursuant to Rule 430A under the Securities Act that was used after such effectiveness and prior to the execution and delivery of this Agreement, “Time of Sale Prospectus” means the preliminary prospectus contained in the Registration Statement at the time of its effectiveness together with the documents and pricing information set forth in Schedule II hereto, and “broadly available road show” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof.

Morgan Stanley has agreed to reserve a portion of the Shares to be purchased by it under this Agreement for sale to the Company’s directors, officers, employees and business associates and other parties related to the Company (collectively, “Participants”), as set forth in each of the Time of Sale Prospectus and the Prospectus under the heading “Underwriters” (the “Directed Share Program”). The Shares to be sold by Morgan Stanley and its affiliates pursuant to the Directed Share Program, at the direction of the Company, are referred to hereinafter as the “Directed Shares”. Any Directed Shares not orally confirmed for purchase by any Participant by the end of the business day on which this Agreement is executed will be offered to the public by the Underwriters as set forth in the Prospectus.

1. Representations and Warranties. The Company represents and warrants to and agrees with each of the Underwriters that:

(a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose or pursuant to Section 8A under the Securities Act are pending before or, to the Company’s knowledge, threatened by the Commission.

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(b) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not contain, as of the date of such amendment or supplement, any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will, as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 4), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus, as of its date, does not contain and, as amended or supplemented, if applicable, as of the date of such amendment or supplement and as of the Closing Date, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by or on behalf of any such Underwriter through the Representatives expressly for use therein.

(c) The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply in all material respects with the applicable requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule II hereto, and electronic road shows, if any, each furnished to the Representatives before first use, the Company has not prepared, used or referred to, and will not, without the Representatives’ prior consent, prepare, use or refer to, any free writing prospectus.

(d) The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own or lease its property and to conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact

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business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

(e) Each significant subsidiary of the Company as defined in Rule 1-02(w) of Regulation S-X under the Securities Act (each, a “Significant Subsidiary”) has been duly incorporated, organized or formed, is validly existing as a corporation or other business entity in good standing under the laws of the jurisdiction of its incorporation, organization or formation (to the extent that the concept of good standing is applicable in such jurisdiction), has the corporate or other business entity power and authority to own or lease its property and to conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction (to the extent that the concept of good standing is applicable in such jurisdiction) in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; all of the issued shares of capital stock or other equity interests of each Significant Subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable (to the extent that such concepts are applicable in such jurisdiction) and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims.

(f) This Agreement has been duly authorized, executed and delivered by the Company.

(g) The authorized capital stock of the Company conforms as to legal matters, in all material respects, to the description thereof contained in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus.

(h) The shares of Common Stock outstanding prior to the issuance of the Shares have been duly authorized and are validly issued, fully paid and non-assessable.

(i) The Shares have been duly authorized and, when issued, delivered and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of the Shares will not be subject to any preemptive or similar rights.

(j) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not contravene (i) any provision of applicable law, (ii) the certificate of incorporation or by-laws of the Company, (iii) any agreement or other instrument binding upon

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the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any subsidiary, except in the case of clauses (i), (iii) and (iv), where such contravention would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, and no consent, approval, authorization or order of, or qualification with, any governmental body, agency or court is required for the performance by the Company of its obligations under this Agreement, except such as have been obtained or waived or as may be required by the securities or Blue Sky laws of the various states or foreign jurisdictions or the rules and regulations of the Financial Industry Regulatory Authority (“FINRA”) in connection with the offer and sale of the Shares.

(k) Neither the Company nor any of its subsidiaries is (i) in violation of its charter, by-laws or similar organizational document, except, solely with respect to the Company’s subsidiaries that are not Significant Subsidiaries, for such violations that would not, singly or in the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole, (ii) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may be bound or to which any of the properties or assets of the Company or any subsidiary is subject (collectively, “Agreements and Instruments”), except for such defaults that would not, singly or in the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole, or (iii) in violation of any law, statute, rule, regulation, judgment, order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency having jurisdiction over the Company or any of its subsidiaries or any of their respective properties, assets or operations (each, a “Governmental Entity”), except for such violations that would not, singly or in the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein and in the Registration Statement, the Time of Sale Prospectus and the Prospectus (including the issuance and sale of the Securities and the use of the proceeds from the sale of the Securities as described therein under the caption “Use of Proceeds”) and compliance by the Company with its obligations hereunder have been duly authorized by all necessary corporate action and do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any properties or assets of the Company or any subsidiary pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not, singly or in

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the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole), nor will such action result in any violation of (A) the provisions of the charter, by-laws or similar organizational document of the Company or any of its subsidiaries or (B) any law, statute, rule, regulation, judgment, order, writ or decree of any Governmental Entity, except, with, respect to (A), solely with respect to the subsidiaries of the Company, such violations that would not, singly or in the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole and, with respect to respect to (B), such violations that would not, singly or in the aggregate, reasonably be expected to result in a material adverse effect on the Company and its subsidiaries, taken as a whole. As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries, excluding any such event that will be satisfied with the use of proceeds concurrently with the Closing Date.

(l) There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.

(m) There are no legal or governmental proceedings pending or, to the knowledge of the Company, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (i) other than proceedings accurately described in all material respects in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and proceedings that would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or (ii) that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus and are not so described; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus or to be filed as exhibits to the Registration Statement that are not described in all material respects or filed as required.

(n) Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the applicable requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder.

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(o) The Company is not, and after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

(p) Except as would not, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the Company and each of its subsidiaries (x) are, and have been, in compliance with any and all applicable foreign, federal, state and local laws, regulations, rules, agreements, decisions, orders, decrees, consents and other legally enforceable requirements relating to the protection of the environment, hazardous or toxic substances, wastes, pollutants, chemicals or contaminants (“Hazardous Substances”), or human health or safety as it relates to exposure to Hazardous Substances (“Environmental Laws”), (y) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (z) are in compliance with all terms and conditions of any such permit, license or approval, (ii) there are no pending, or to the Company’s knowledge, threatened, notices of any actual or potential violation or liability, liens, complaints, demands, orders, actions, suits, proceedings, investigations or claim, under or relating to Environmental Laws or Hazardous Substances and, to the knowledge of the Company, there are no events or circumstances that would reasonably be expected to form the basis for such notice, lien, complaint, demand, order, action, suit, proceeding, investigation or claim, and (iii) there are no costs, obligations or liabilities (including costs relating to clean-up, closure of properties or compliance with Environmental Laws, any related constraints on operating activities and third-party liabilities) associated with Environmental Laws or Hazardous Substances. Except as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) there are no proceedings pending, or that is known to be contemplated, against the Company or any of its subsidiaries under Environmental Laws in which a governmental authority is also a party, other than such proceedings regarding which it is reasonably believed no monetary sanctions of $300,000 or more will be imposed against the Company or its subsidiaries; (ii) to the knowledge of the Company, there are no facts or issues regarding compliance with Environmental Laws that could reasonably be expected to have a material effect on the capital expenditures, earnings or competitive position of the Company and its subsidiaries, and (iii) none of the Company or its subsidiaries anticipates any material capital expenditures to address compliance with any Environmental Laws.

(q) Except as has been validly waived or complied with in connection with the issuance and sale of the Shares contemplated hereby, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.

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(r) (i) None of the Company or any of its subsidiaries or affiliates controlled by the Company, nor, to the Company’s knowledge, any director, officer, employee, agent or representative of the Company or of any of its subsidiaries or affiliates controlled by the Company, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any government official (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) in order to influence official action, or to any person, in each case in violation of any applicable anti-corruption laws; (ii) the Company and each of its subsidiaries and affiliates controlled by the Company have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein; and (iii) neither the Company nor any of its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.

(s) The operations of the Company and each of its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and each of its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

(t) (i) None of the Company or any of its subsidiaries nor, to the knowledge of the Company, any director, officer, employee, agent, affiliate or representative of the Company or any of its subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by one or more Persons that are:

(A) the subject of any sanctions administered or enforced by the U.S. Department of the Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), or

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(B) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea and Syria).

(ii) The Company will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:

(A) to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or

(B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).

(iii) The Company and each of its subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not knowingly engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

(u) Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, other than the “Concurrent Transactions” described in the Prospectus (i) the Company and its subsidiaries, taken as a whole, have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material change in the capital stock, short-term debt or long-term debt of the Company and its subsidiaries, taken as a whole.

(v) The Company and each of its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as would not singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

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(w) (i) Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company and its subsidiaries own or possess, or have a valid and enforceable license or other right to use, all patents, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, trade dress, service marks, trade names, domain names, software, source code, databases, technology, social media identifiers and accounts and all other intellectual property or similar proprietary rights in any jurisdiction throughout the world (including all goodwill associated with, and all registrations of and applications for registrations of, the foregoing) (collectively, “Intellectual Property Rights”) used or held for use in, or otherwise necessary to, the conduct of their businesses as currently conducted and as proposed be conducted in the Registration Statement, the Time of Sale Prospectus and the Prospectus (provided that the foregoing shall not constitute a representation of non-infringement of any Intellectual Property Rights), which is covered by clause (vi) below; (ii) the material Intellectual Property Rights owned by the Company and its subsidiaries are subsisting and, to the Company’s knowledge, valid and enforceable, and, except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, all Intellectual Property Rights owned by the Company and its subsidiaries are owned solely and exclusively by the Company or the applicable subsidiary and are owned free and clear of all liens, encumbrances, defects and other restrictions; (iii) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the ownership, validity, scope or enforceability of any such material Intellectual Property Rights; (iv) neither the Company nor any of its subsidiaries has received any notice in the past five (5) years alleging, or is involved in any proceedings relating to, any infringement, misappropriation or other violation of third-party Intellectual Property Rights which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; (v) to the Company’s knowledge, no third party is infringing, misappropriating or otherwise violating, or has in the past five (5) years infringed, misappropriated or otherwise violated, any material Intellectual Property Rights owned by the Company or any of its subsidiaries; (vi) to the Company’s knowledge, neither the Company nor any of its subsidiaries, nor the conduct of their respective businesses, infringes, misappropriates or otherwise violates, or has in the past three (3) years infringed, misappropriated or otherwise violated, any third-party Intellectual Property Rights in any material respect; (vii) except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, all employees or contractors engaged in the development of material Intellectual Property Rights on behalf of the Company or any subsidiary of the Company

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execute an agreement whereby such employees or contractors presently assign all of their right, title and interest in and to such Intellectual Property Rights to the Company or the applicable subsidiary (to the extent ownership of such Intellectual Property Rights would not vest in the Company or such subsidiary of the Company under applicable law), and to the Company’s knowledge, no such agreement has been breached or violated; and (viii) the Company and its subsidiaries use, and have used, commercially reasonable efforts in accordance with customary industry practice to appropriately maintain all proprietary information intended to be maintained as a trade secret, and no such material trade secrets have been disclosed by the Company or any of its subsidiaries other than to employees, representatives and agents of the Company or any of its subsidiaries, all of whom are bound by written confidentiality agreements.

(x) (i) Except, in each case, as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Company and each of its subsidiaries have in the past five (5) years complied and are presently in compliance with (A) their respective contractual obligations with respect to the collection, use and other processing of any information, including any sensitive, confidential or regulated data and information, that identifies an individual person (“Personal Information”), (B) their respective external privacy policies, and (C) applicable laws, statutes, judgments, orders, rules and regulations relating to the collection, use, transfer, processing, storage, protection, disposal and disclosure of Personal Information by the Company or any of its subsidiaries (“Privacy Laws”); (ii) neither the Company nor any of its subsidiaries has received any written notification of or complaint regarding, and is unaware of any other facts that would reasonably indicate, non-compliance with any Privacy Law, except, in either case, as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and (iii) there is no action, suit or proceeding by or before any court or governmental agency, authority or body pending or, to the Company’s knowledge, threatened, alleging non-compliance with any Privacy Law.

(y) The Company and its subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software, websites, applications, and databases (collectively, “IT Systems”) are adequate for, and operate and perform in all material respects as required in connection with, the operation of the business of the Company and its subsidiaries as currently conducted and as proposed to by conducted in the Registration Statement, the Time of Sale Prospectus and the Prospectus, free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants. Without limiting the foregoing, the Company and each of its subsidiaries have used commercially reasonable efforts to establish and maintain commercially reasonable information technology, information security, cybersecurity and data protection controls, policies and procedures, including administrative, technological and physical safeguards and business continuity/disaster recovery plans designed to protect against and prevent breach, unauthorized destruction,

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loss or unauthorized distribution, use, access, disablement, misappropriation or modification, or other compromise or misuse of any IT Systems or Personal Information in the possession or control of the Company or its subsidiaries (“Breach”). To the Company’s knowledge, except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, there has been no Breach in the past five (5) years, and the Company and its subsidiaries have not been notified in writing of, and otherwise have no knowledge of, any event or condition that would reasonably be expected to result in any material Breach.

(z) No material labor dispute with the employees of the Company or any of its subsidiaries exists, or, to the knowledge of the Company, is imminent; and the Company is not aware of any existing, threatened or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers or contractors that could, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

(aa) The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are, in the reasonable judgment of the Company, prudent and customary in the businesses in which they are engaged; neither the Company nor any of its subsidiaries has been refused any insurance coverage sought or applied for, except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and neither the Company nor any of its subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

(bb) The Company and each of its subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses except where the failure to possess such certificates, authorizations and permits would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

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(cc) The financial statements included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, together with the related schedules and notes thereto, comply as to form in all material respects with the applicable accounting requirements of the Securities Act and present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates shown and its results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) applied on a consistent basis throughout the periods covered thereby except for any normal year-end adjustments in the Company’s quarterly financial statements. The other financial information included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus has been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects the information shown thereby. The statistical, industry-related and market-related data included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus are based on or derived from sources which the Company reasonably and in good faith believes are reliable and accurate and such data is consistent with the sources from which they are derived, in each case in all material respects.

(dd) Deloitte & Touche LLP, who have certified certain financial statements of the Company and its subsidiaries and delivered its report with respect to the audited consolidated financial statements and schedules filed with the Commission as part of the Registration Statement and included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, is an independent registered public accounting firm with respect to the Company within the meaning of the Securities Act and the applicable rules and regulations thereunder adopted by the Commission and the Public Company Accounting Oversight Board (United States).

(ee) The Company and each of its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting.

(ff) Except as described in the Time of Sale Prospectus and the Registration Statement, the Company has not sold, issued or distributed any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.

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(gg) The Registration Statement, the Prospectus, the Time of Sale Prospectus and any preliminary prospectus comply, and any amendments or supplements thereto will comply, with any applicable laws or regulations of foreign jurisdictions in which the Prospectus, the Time of Sale Prospectus or any preliminary prospectus, as amended or supplemented, if applicable, are distributed in connection with the Directed Share Program.

(hh) No consent, approval, authorization or order of, or qualification with, any governmental body or agency, other than those obtained, is required in connection with the offering of the Directed Shares in any jurisdiction where the Directed Shares are being offered.

(ii) The Company has not offered, or caused Morgan Stanley or any Morgan Stanley Entity as defined in Section 9 to offer, Shares to any person pursuant to the Directed Share Program with the specific intent to unlawfully influence (i) a customer or supplier of the Company to alter the customer’s or supplier’s level or type of business with the Company, or (ii) a trade journalist or publication to write or publish favorable information about the Company or its products.

(jj) The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns required to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes shown by such returns, which are due and payable (except for cases in which the failure to file or pay would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or, except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of the Company), and no unpaid tax deficiency has been determined adversely to the Company or any of its subsidiaries which, singly or in the aggregate, has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any unpaid tax deficiency which could reasonably be expected to be determined adversely to the Company or its subsidiaries and which could reasonably be expected to have) a material adverse effect on the Company and its subsidiaries, taken as a whole.

(kk) At the time of initial confidential submission of the Registration Statement to the Commission, the Company was an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).

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(ll) The Company (i) has not alone engaged in any Testing-the-Waters Communication with any person other than Testing-the-Waters Communications with the consent of the Representatives with entities that are reasonably believed to be qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are reasonably believed to be accredited investors within the meaning of Rule 501 under the Securities Act and (ii) has not authorized anyone other than the Representatives to engage in Testing-the-Waters Communications. The Company reconfirms that the Representatives have been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any “Written Testing-the-Waters Communication” that is a written communication within the meaning of Rule 405 under the Securities Act [other than those listed on Schedule [•] hereto]. “Testing-the-Waters Communication” means any communication with potential investors undertaken in reliance on Section 5(d) or Rule 163B of the Securities Act.

(mm) As of the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (A) the Time of Sale Prospectus, (B) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (C) any individual Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

2. Agreements to Sell and Purchase. The Company hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the terms and conditions hereinafter stated, agrees, severally and not jointly, to purchase from the Company the respective number of Firm Shares set forth in Schedule I hereto opposite its name at $[•] a share (the “Purchase Price”).

On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to [•] Additional Shares at the Purchase Price, provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares. The Representatives may exercise this right on behalf of the Underwriters in whole or from time to time in part by giving written notice not later than 30 days after the date of this Agreement. Any exercise notice shall specify the number of Additional Shares to be purchased by the Underwriters and the date on which such shares are to be purchased. Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares nor later than ten business days after the date of such notice. Additional Shares may be purchased as provided in Section 4 hereof solely

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for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. On each day, if any, that Additional Shares are to be purchased (an “Option Closing Date”), each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as the Representatives may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares.

3. Terms of Public Offering. The Company is advised by the Representatives that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in the Representatives’ judgment is advisable. The Company is further advised by the Representatives that the Shares are to be offered to the public initially at $[•] a share (the “Public Offering Price”) and to certain dealers selected by the Representatives at a price that represents a concession not in excess of $[•] a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $[•] a share, to any Underwriter or to certain other dealers.

4. Payment and Delivery. Payment for the Firm Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at [•] [a./p.m.], New York City time, on [•], 2021, or at such other time on the same or such other date, not later than [•], 2021, as shall be designated in writing by the Representatives. The time and date of such payment are hereinafter referred to as the “Closing Date.”

Payment for any Additional Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at [•] [a./p.m.], New York City time, on the date specified in the corresponding notice described in Section 2 or at such other time on the same or on such other date, in any event not later than [•], 2021, as shall be designated in writing by the Representatives.

The Firm Shares and Additional Shares shall be registered in such names and in such denominations as the Representatives shall request in writing not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be. The Firm Shares and Additional Shares shall be delivered to the Representatives on the Closing Date or an Option Closing Date, as the case may be, for the respective accounts of the several Underwriters. The Purchase Price payable by the Underwriters shall be reduced by any transfer taxes duly paid by, or on behalf of, the Underwriters in connection with the transfer of the Shares to the Underwriters.

5. Conditions to the Underwriters’ Obligations. The obligations of the Company to sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [•] (New York City time) on the date hereof.

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The several obligations of the Underwriters are subject to the following further conditions:

(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:

(i) no order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose or pursuant to Section 8A under the Securities Act shall be pending before or threatened by the Commission;

(ii) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of neither the Company nor any of its subsidiaries, nor its parent nor any affiliate has any securities rated by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and

(iii) there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in the Representatives’ judgment, is material and adverse and that makes it, in the Representatives’ judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.

(b) The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of the Company, to the effect set forth in Sections 5(a)(i) and 5(a)(ii) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.

The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.

(c) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Weil, Gotshal & Manges LLP, outside counsel for the Company, dated the Closing Date, set forth in Exhibit C hereto.

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(d) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Davis Polk & Wardwell LLP, counsel for the Underwriters, dated the Closing Date, in form and substance reasonably satisfactory to the Representatives.

With respect to the negative assurance letters to be delivered pursuant to Sections 5(c) and 5(d) above, Weil, Gotshal & Manges LLP and Davis Polk & Wardwell LLP may state that their opinions and beliefs are based upon their participation in the preparation of the Registration Statement, the Time of Sale Prospectus and the Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.

The opinion and negative assurance letter of Weil, Gotshal & Manges LLP described in Section 5(c) above shall be rendered to the Underwriters at the request of the Company and shall so state therein.

(e) The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from Deloitte & Touche LLP, independent public accountants, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.

(f) The Lock-up Agreements between the Representatives and certain shareholders, officers and directors of the Company shall be in full force and effect on the Closing Date.

(g) The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to the Representatives on the applicable Option Closing Date of the following:

(i) a certificate, dated the Option Closing Date and signed by an executive officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 5(b) hereof remains true and correct as of such Option Closing Date;

(ii) an opinion and negative assurance letter of Weil, Gotshal & Manges LLP, outside counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as required by Section 5(c) hereof;

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(iii) an opinion and negative assurance letter of Davis Polk & Wardwell LLP, counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 5(d) hereof;

(iv) a letter dated the Option Closing Date, in form and substance satisfactory to the Underwriters, from Deloitte & Touche LLP, independent public accountants, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 5(e) hereof; provided that the letter delivered on the Option Closing Date shall use a “cut-off date” not earlier than two business days prior to such Option Closing Date;

(v) a certificate, dated the date hereof and dated as of the Closing Date and addressed to the Underwriters, furnished from the Company of its chief financial officer with respect to certain financial data contained in the Time of Sale Prospectus and the Prospectus, providing “management comfort” with respect to such information, in form and substance reasonably satisfactory to the Underwriters; and

(vi) such other documents as the Representatives may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional Shares to be sold on such Option Closing Date and other matters related to the issuance of such Additional Shares.

6. Covenants of the Company. The Company covenants with each Underwriter as follows:

(a) To furnish to the Representatives, upon request and without charge, [•] signed copies of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) and to furnish to the Representatives in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 6(e) or 6(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as the Representatives may reasonably request.

(b) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to the Representatives a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Representatives reasonably object in a timely manner, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.

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(c) To furnish to the Representatives a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which the Representatives reasonably object in a timely manner.

(d) Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.

(e) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.

(f) If, during such period after the first date of the public offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representatives will furnish to the Company) to which Shares may have been sold by the Representatives on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.

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(g) To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request, provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it is not now so qualified, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.

(h) To make generally available (which may be satisfied by filing with the Commission on its Electronic Data Gathering Analysis and Retrieval System) to the Company’s security holders and to the Representatives as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.

(i) To comply with all applicable securities and other laws, rules and regulations in each jurisdiction in which the Directed Shares are offered in connection with the Directed Share Program.

(j) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company agrees to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel and the Company’s accountants in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or similar taxes payable upon the sale, issuance or delivery of the Shares to the Underwriters, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 6(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA (provided, that

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the amount payable by the Company with respect to fees and disbursements of counsel for the Underwriters pursuant to subsections (iii) and (iv) shall not exceed $40,000), (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to listing the Shares on the NASDAQ Global Select Market, (vi) the cost of printing certificates, if any, representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares (with the Underwriters agreeing to pay all costs and expenses related to their participation in investor presentations or any “road show” undertaken in connection with the marketing of the offering of the Shares) , including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives (not including the Underwriters and their representatives) and officers of the Company and any such consultants (not including the Underwriters and their representatives), and fifty percent (50%) of the cost of any aircraft chartered in connection with the road show with the remaining fifty percent (50%) of the cost of such aircraft to be paid by the Underwriters, (ix) the document production charges and expenses associated with printing this Agreement, (x) all fees and disbursements of counsel incurred by the Underwriters in connection with the Directed Share Program and stamp duties, similar taxes or duties or other taxes, if any, incurred by the Underwriters in connection with the Directed Share Program and (xi) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 8 entitled “Indemnity and Contribution,” Section 9 entitled “Directed Share Program Indemnification” and the last paragraph of Section 11 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on resale of any of the Shares by them and any advertising expenses connected with any offers they may make and any costs of hosting presentations or meetings, including meals, undertaken in connection with the marketing of the offering and the sale of the Shares to prospective investors.

(k) The Company will promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion of the distribution of the Shares within the meaning of the Securities Act and (ii) completion of the Restricted Period (as defined in this Section 6).

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(l) If at any time following the distribution of any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act there occurred or occurs an event or development as a result of which such Testing-the-Waters Communication included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will promptly amend or supplement, at its own expense, such Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.

(m) The Company will deliver to each Underwriter (or its agent), on the date of execution of this Agreement, a properly completed and executed Certification Regarding Beneficial Owners of Legal Entity Customers, together with copies of identifying documentation, and the Company undertakes to provide such additional supporting documentation as each Underwriter may reasonably request in connection with the verification of the foregoing Certification.

The Company also covenants with each Underwriter that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period ending 180 days after the date of the Prospectus (the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) publicly file or confidentially submit any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, provided that confidential or non-public submissions to the Commission of any registration statements under the Securities Act may be made if and only if no public announcement of such confidential or non-public submission shall be made during the Restricted Period.

The restrictions contained in the preceding paragraph shall not apply to (A) the Shares to be sold hereunder, (B) the issuance by the Company of shares of Common Stock upon the exercise (including net exercise) of an option or warrant or the conversion of a security outstanding on the date hereof as described in each of the Time of Sale Prospectus and Prospectus, (C) grants of stock options, stock awards, restricted stock or other equity awards and the issuance of Common Stock or securities convertible into or exercisable for Common Stock (whether upon the exercise of stock options or otherwise) to employees, officers, directors, advisors, or consultants of the Company pursuant to the terms of a plan in effect on the date hereof and described in the Time of Sale Prospectus and Prospectus, provided all recipients of any such securities shall enter into a “lock-up” agreement, substantially in the form of Exhibit A hereto covering the remainder of the Restricted Period, (D) the issuance of or entry into an agreement providing for the issuance of Common Stock or securities convertible into, exercisable for or which are otherwise exchangeable for or represent the right to receive Common Stock in connection with (x) the acquisition by the Company or any of its subsidiaries of the securities,

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business, technology, property or other assets of another person or entity or pursuant to an employee benefit plan assumed by the Company in connection with such acquisition or (y) the Company’s joint ventures, commercial relationships and other strategic transactions, provided that the aggregate number of shares of Common Stock (including shares of Common Stock issuable in respect of securities convertible into, exercisable for or which are otherwise exchangeable for or represent the right to receive Common Stock) that the Company may issue or agree to issue pursuant to this clause (D) shall not exceed 10% of the total number of shares of Common Stock outstanding as of the Closing Date immediately following the completion of the transactions contemplated by this Agreement to be completed as of that date and all recipients of any such securities shall enter into a “lock-up” agreement, substantially in the form of Exhibit A hereto covering the remainder of the Restricted Period, (E) facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period or (F) the filing of any registration statement on Form S-8 relating to securities granted or to be granted pursuant to any equity compensation plan in effect on the date hereof and described in the Time of Sale Prospectus and Prospectus or any assumed employee benefit plan contemplated by clause (D).

If the Representatives, in their sole discretion, agree to release or waive the restrictions on the transfer of Shares set forth in a Lock-up Agreement for an officer or director of the Company and provide the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service or any other method that satisfies the obligations described in FINRA Rule 5131(d)(2) at least two business days before the effective date of the release or waiver, if required by FINRA Rule 5131.

7. Covenants of the Underwriters. Each Underwriter, severally and not jointly, covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.

8. Indemnity and Contribution. (a) The Company agrees to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred

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in connection with defending or investigating any such action or claim) that arise out of, or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any “road show” as defined in Rule 433(h) under the Securities Act (a “road show”), the Prospectus or any amendment or supplement thereto, or any Written Testing-the-Waters Communication or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities arise out of, or are based upon any such untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by the Underwriters through the Representatives consists of the information described as such in paragraph (b) below.

(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show or the Prospectus or any amendment or supplement thereto, it being understood and agreed upon that the only such information furnished by any Underwriter consists of the following information in the Prospectus furnished on behalf of each Underwriter: (i) the [•] paragraph of text under the caption “Underwriting” in the Prospectus concerning the terms of the offering by the Underwriters; (ii) the [•] paragraph of text under the caption “Underwriting” in the Prospectus concerning sales to discretionary accounts; (iii) the [•] paragraph of text under the caption “Underwriting” in the Prospectus concerning stabilization and overallotments by the Underwriters; and (iv) the [•] paragraph of text under the caption “Underwriting” in the Prospectus concerning the availability of the prospectus in electronic format, the allocation of shares of common stock to online brokerage account holders, and Internet distributions.

(c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 8(a) or 8(b), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel

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reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonably incurred fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by the Representatives, in the case of parties indemnified pursuant to Section 8(a), and by the Company, in the case of parties indemnified pursuant to Section 8(b). The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding.

(d) To the extent the indemnification provided for in Section 8(a) or 8(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares or (ii) if the allocation provided by

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clause 8(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 8(d)(i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 8 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint.

(e) The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 8(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 8(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

(f) The indemnity and contribution provisions contained in this Section 8 and the representations, warranties and other statements of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.

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9. Directed Share Program Indemnification. (a) The Company agrees to indemnify and hold harmless Morgan Stanley, each person, if any, who controls Morgan Stanley within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of Morgan Stanley within the meaning of Rule 405 of the Securities Act (“Morgan Stanley Entities”) from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) (i) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in any material prepared by or with the consent of the Company for distribution to Participants in connection with the Directed Share Program or arise out of or are based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; (ii) that arise out of, or are based upon, the failure of any Participant to pay for and accept delivery of Directed Shares that the Participant agreed to purchase; or (iii) related to, arising out of, or in connection with the Directed Share Program, other than losses, claims, damages or liabilities (or expenses relating thereto) that are finally judicially determined to have resulted from the bad faith or gross negligence of Morgan Stanley Entities.

(b) In case any proceeding (including any governmental investigation) shall be instituted involving any Morgan Stanley Entity in respect of which indemnity may be sought pursuant to Section 9(a), the Morgan Stanley Entity seeking indemnity, shall promptly notify the Company in writing and the Company, upon request of the Morgan Stanley Entity, shall retain counsel reasonably satisfactory to the Morgan Stanley Entity to represent the Morgan Stanley Entity and any others the Company may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any Morgan Stanley Entity shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Morgan Stanley Entity unless (i) the Company shall have agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the Company and the Morgan Stanley Entity and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. The Company shall not, in respect of the legal expenses of the Morgan Stanley Entities in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Morgan Stanley Entities. Any such separate firm for the Morgan Stanley Entities shall be designated in writing by Morgan Stanley. The Company shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Company agrees to indemnify the Morgan

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Stanley Entities from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by the Company of the aforesaid request and (ii) the Company shall not have reimbursed the Morgan Stanley Entity in accordance with such request prior to the date of such settlement. The Company shall not, without the prior written consent of Morgan Stanley, effect any settlement of any pending or threatened proceeding in respect of which any Morgan Stanley Entity is or could have been a party and indemnity could have been sought hereunder by such Morgan Stanley Entity, unless such settlement includes an unconditional release of the Morgan Stanley Entities from all liability on claims that are the subject matter of such proceeding.

(c) To the extent the indemnification provided for in Section 9(a) is unavailable to a Morgan Stanley Entity or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then the Company in lieu of indemnifying the Morgan Stanley Entity thereunder, shall contribute to the amount paid or payable by the Morgan Stanley Entity as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Morgan Stanley Entities on the other hand from the offering of the Directed Shares or (ii) if the allocation provided by clause 9(c)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 9(c)(i) above but also the relative fault of the Company on the one hand and of the Morgan Stanley Entities on the other hand in connection with any statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Morgan Stanley Entities on the other hand in connection with the offering of the Directed Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Directed Shares (before deducting expenses) and the total underwriting discounts and commissions received by the Morgan Stanley Entities for the Directed Shares, bear to the aggregate Public Offering Price of the Directed Shares. If the loss, claim, damage or liability is caused by an untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact, the relative fault of the Company on the one hand and the Morgan Stanley Entities on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement or the omission or alleged omission relates to information supplied by the Company or by the Morgan Stanley Entities and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

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(d) The Company and the Morgan Stanley Entities agree that it would not be just or equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the Morgan Stanley Entities were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 9(c). The amount paid or payable by the Morgan Stanley Entities as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by the Morgan Stanley Entities in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 9, no Morgan Stanley Entity shall be required to contribute any amount in excess of the amount by which the total price at which the Directed Shares distributed to the public were offered to the public exceeds the amount of any damages that such Morgan Stanley Entity has otherwise been required to pay. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

(e) The indemnity and contribution provisions contained in this Section 9 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Morgan Stanley Entity or the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Directed Shares.

10. Termination. The Underwriters may terminate this Agreement by notice given by the Representatives to the Company, if after the execution and delivery of this Agreement and prior to or on the Closing Date or any Option Closing Date, as the case may be, (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the New York Stock Exchange, the NYSE American, the NASDAQ Global Market, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in the Representatives’ judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in the Representatives’ judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.

11. Effectiveness; Defaulting Underwriters. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

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If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the Representatives may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 11 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased on such date, and arrangements satisfactory to the Representatives and the Company for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter or the Company. In any such case either the Representatives or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.

If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the reasonably incurred fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder.

12. Entire Agreement. (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company, on the one hand, and the Underwriters, on the other, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.

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(b) The Company acknowledges that in connection with the offering of the Shares: (i) the Underwriters have acted at arm’s length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement, any contemporaneous written agreements and prior written agreements (to the extent not superseded by this Agreement), if any, (iii) the Underwriters may have interests that differ from those of the Company, and (iv) none of the activities of the Underwriters in connection with the transactions contemplated herein constitutes a recommendation, investment advice, or solicitation of any action by the Underwriters with respect to any entity or natural person. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.

13. Recognition of the U.S. Special Resolution Regimes. (a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

For purposes of this Section a “BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k). “Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). “Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

14. Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

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15. Applicable Law. This Agreement and any claim, controversy or dispute relating to or arising out of this Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.

16. Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.

17. Notices. All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to the Representatives c/o Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department; c/o BofA Securities, Inc., One Bryant Park, New York, New York 10036, Attention: Syndicate Department (facsimile: (646) 855-3073), with a copy to ECM Legal (facsimile: (212) 230-8730); c/o Barclays Capital Inc., 745 Seventh Avenue, New York, New York 10019, Attention: Syndicate Registration (facsimile: (646) 834-8133); and if to the Company shall be delivered, mailed or sent to 1500 South 1000 West, Logan, UT 84321, Attention: General Counsel.

[Signature Page Follows]

33

Very truly yours,
iFIT Health & Fitness Inc
By:
	Name:
	Title:

[Signature Page to Underwriting Agreement]

Accepted as of the date hereof

Morgan Stanley & Co. LLC

BofA Securities, Inc.

Barclays Capital Inc.

Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto

By:	Morgan Stanley & Co. LLC
By:
	Name:
	Title:
By:	BofA Securities, Inc.
By:
	Name:
	Title:
By:	Barclays Capital Inc.
By:
	Name:
	Title:

[Signature Page to Underwriting Agreement]

SCHEDULE I

Underwriter	Number of Firm Shares To Be Purchased
Morgan Stanley & Co. LLC	[•]
BofA Securities, Inc.	[•]
Barclays Capital Inc.	[•]
Citigroup Global Markets Inc.	[•]
Credit Suisse Securities (USA) LLC	[•]
Jefferies LLC	[•]
Robert W. Baird & Co. Incorporated	[•]
Cowen and Company, LLC	[•]
JMP Securities LLC	[•]
Raymond James & Associates, Inc.	[•]
Truist Securities, Inc.	[•]
William Blair & Company, L.L.C.	[•]
Telsey Advisory Group LLC	[•]
AmeriVet Securities, Inc.	[•]
Blaylock Van, LLC	[•]
Loop Capital Markets LLC	[•]
Siebert Williams Shank & Co., LLC	[•]
Total:	[•]

I-1

SCHEDULE II

Time of Sale Prospectus

1. Preliminary Prospectus issued                , 2021

2. Pricing Information Provided Orally by Underwriters

a) Firm Shares:

b) Additional Shares:

c) Public offering price per share: $

3. [Include free writing prospectuses filed by the Company under Rule 433(d), if any]

II-1

EXHIBIT A

FORM OF LOCK-UP AGREEMENT

                                             [•], 2021

Morgan Stanley & Co. LLC

BofA Securities, Inc.

as Representatives of the several Underwriters

c/o Morgan Stanley & Co. LLC

      1585 Broadway

      New York, NY 10036

c/o BofA Securities, Inc.

      One Bryant Park

      New York, New York 10036

Ladies and Gentlemen:

The undersigned understands that Morgan Stanley & Co. LLC (“Morgan Stanley”) and BofA Securities, Inc. (“BofA Securities”, and, together with Morgan Stanley, the “Representatives”) propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with iFit Health & Fitness Inc, a Delaware corporation (the “Company”), providing for the public offering (the “Public Offering”) by the several Underwriters, including Morgan Stanley and BofA Securities (the “Underwriters”), of shares of Class A common stock, par value $[•] per share, of the Company (the “Common Stock”).

To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period commencing on the date hereof and ending 180 days after the date of the final prospectus (the “Restricted Period”) relating to the Public Offering (the “Prospectus”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another “person” (as defined in Section 13(d)(3) of the Exchange Act), in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to:

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(a) transactions relating to shares of Common Stock or other securities acquired in open market transactions after the completion of the Public Offering, provided that no filing under Section 16(a) of the Exchange Act shall be required or shall be voluntarily made in connection with subsequent sales of Common Stock or other securities acquired in such open market transactions;

(b) transfers of shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock (i) as a bona fide gift, (ii) by will or intestate succession to an immediate family member or (iii) to a trust whose beneficiaries consist exclusive of one or more of the undersigned and/or an immediate family member;

(c) transfers of shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock to (i) any trust, partnership, limited liability company or other entity for the direct or indirect benefit of the undersigned or an immediate family member of the undersigned and (ii) any wholly owned subsidiary of the undersigned;

(d) transfers to the undersigned’s affiliates or to any investment fund or other entity controlled or managed by the undersigned or any of the undersigned’s affiliates;

(e) transfers to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (b) through (d) above;

(f) transfers or distributions of shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock to any partner, member or stockholder of the undersigned;

(g) transfers as a result of the operation of law, or pursuant to an order of a court (including a domestic order, divorce settlement, divorce decree or separation agreement) or regulatory agency,

provided that in the case of any transfer or distribution pursuant to clauses (b) through (g), (i) each donee, distributee, transferee, nominee or custodian, as applicable, shall sign and deliver a lock-up agreement substantially in the form of this agreement and (ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock, shall be required or shall be voluntarily made during the Restricted Period (other than a filing on a Form 5 that shall clearly indicate in the footnotes thereto the nature and conditions of such transfer, that such transfer is not for value and that the shares of Common Stock, or any security convertible into Common Stock, subject to such transfer remain subject to the restrictions set forth herein);

(h) the repurchase of shares of Common Stock or any security convertible into Common Stock by the Company pursuant to equity award agreements or other contractual arrangements providing for the right of said repurchase in connection with the termination of the undersigned’s employment or service with the Company, provided that no filing by the undersigned under the Section 16(a) of the Exchange Act, or other public announcement, shall be voluntarily made in connection with any such transfer, and if the undersigned is required to file a report under the Exchange Act related thereto during the Restricted Period, such report shall disclose that such transfer was a result of the repurchase of the shares of Common Stock or any security convertible into Common Stock or such other securities by the Company pursuant to equity award agreements or other contractual arrangements in connection with the termination of the undersigned’s employment or service with the Company;

2

(i) pursuant to the exercise of an option to purchase shares of Common Stock or any security convertible into Common Stock in connection with the termination or expiration of such option pursuant to its terms, provided that (1) such option was granted pursuant to a Company stock option plan or other equity incentive plan described in the Time of Sale Prospectus (as defined in the Underwriting Agreement) and the Prospectus, (2) any shares of Common Stock or any security convertible into Common Stock received upon such exercise shall be subject to the terms of this agreement and (3) no filing by the undersigned or any party (transferor or transferee) under the Exchange Act, or other public announcement shall be voluntarily made in connection with any such exercise, and if the holder is required to file a report under the Exchange Act related thereto during the Restricted Period, such report shall disclose that such transfer was a result of the exercise of an option or security convertible into Common Stock expiring or terminating in accordance with its terms, does not result in any aggregate reduction in beneficial ownership and remains subject to the restrictions set forth herein;

(j) to the Company (x) pursuant to the exercise, on a “cashless” or “net exercise” basis, of any option to purchase shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, or (y) for the purpose of satisfying any withholding taxes (including estimated taxes) due as a result of the exercise of any option to purchase shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock or the vesting of any equity awards granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, provided that no filing by the undersigned or any party (transferor or transferee) under the Exchange Act, or other public announcement, shall be voluntarily made in connection with any such transfer, and if the undersigned is required to file a report under the Exchange Act related thereto during the Restricted Period, such report shall disclose that such transfer was to the Company and was a result of the exercise, on a “cashless” or “net exercise” basis, of any option to purchase shares of Common Stock or any security convertible into Common Stock granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus, or for the purpose of satisfying any withholding taxes (including estimated taxes) due as a result of the exercise of any option to purchase shares of Common Stock or any security convertible into Common Stock or the vesting of any equity awards granted by the Company pursuant to stock option or equity incentive plans described in the Time of Sale Prospectus and the Prospectus;

(k) transfers to the Company upon death, disability or termination of employment, in each case, of the undersigned;

3

(l) transfers of shares of Common Stock or any security convertible into Common Stock as a bona fide gift or gifts, or for bona fide estate planning purposes, including a bona fide gift to a charitable organization, as such term is described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended; provided that no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock, shall be required or shall be voluntarily made during the Restricted Period (other than a filing on a Form 5 that shall clearly indicate in the footnotes thereto the nature and conditions of such transfer, that such transfer is not for value and that the shares of Common Stock, or any security convertible into Common Stock, subject to such transfer remain subject to the restrictions set forth herein);

(m) transfers (i) pursuant to a bona fide third-party tender offer, merger, purchase, consolidation or other similar transaction made to all holders of the Company’s Common Stock involving a change of control (as defined below) of the Company (and nothing in this Lock-Up Agreement shall prohibit the undersigned from voting in favor of any such transaction or taking any other action in connection with such transaction) that is approved by the Company’s board of directors, provided that, in the event that such tender offer, merger, purchase, consolidation or other such transaction is not completed, all of the undersigned’s shares of Common Stock subject to this agreement shall remain subject to this agreement or (ii) to the Company for the payment of the exercise price upon the automatic “cashless” or “net” exercise of an option to purchase shares of Common Stock in connection with the termination of such option pursuant to its terms upon a change of control of the Company, provided that such option was granted by the Company pursuant to a stock option or equity incentive plans described in the Prospectus;

(n) the exercise, conversion or repayment of warrants or preferred stock as described in the Time of Sale Prospectus (as defined in the Underwriting Agreement) and the Prospectus, provided that the restrictions contained in this agreement shall apply to shares of Common Stock issued upon such exercise, conversion or repayment; or

(o) facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period.

For purposes of this agreement, (a) “immediate family member” shall mean any person with whom the undersigned has a relationship by blood, marriage or adoption, not more remote than first cousin and (b) “change of control” shall mean the consummation of any bona fide third party tender offer, merger, purchase, consolidation or other similar transaction the result of which is that any “person” (as defined in Section 13(d)(3) of the Exchange Act), or group of persons, other than the Company, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 of the Exchange Act) of more than 50% of the total voting power of the voting stock of the Company.

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In addition, the undersigned agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, during the Restricted Period, make any demand for or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock. Notwithstanding the foregoing, to the extent the undersigned has demand and/or piggyback registration rights under any registration rights agreement described in the Prospectus, the undersigned may notify the Company privately that the undersigned is or will be exercising its demand and/or piggyback registration rights under any such registration rights agreement following the expiration of the Restricted Period and undertake preparations related thereto; provided that the foregoing notification and/or preparations do not request, require or result in the filing or confidential submission of a registration statement with the SEC or any other public announcement or activity regarding such registration by the undersigned, the Company or any third party during the Restricted Period (and no such filing, confidential submission, public announcement or activity shall be voluntarily made or taken by the undersigned, the Company or any third party during the Restricted Period). The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions. The undersigned acknowledges and agrees that the foregoing precludes the undersigned from engaging in any hedging or other transactions designed or intended, or which could reasonably be expected to lead to or result in, a sale or disposition of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock even if any such sale or disposition transaction or transactions would be made or executed by or on behalf of someone other than the undersigned.

If the undersigned is an officer or director of the Company, the undersigned further agrees that the foregoing restrictions shall be equally applicable to any issuer-directed shares of Common Stock the undersigned may purchase in the offering.

If the undersigned is an officer or director of the Company, (i) the Representatives agree that, at least three business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of shares of Common Stock, the Representatives will notify the Company of the impending release or waiver, and (ii) the Company has agreed in the Underwriting Agreement to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted by the Representatives hereunder to any such officer or director shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration or to an immediate family member as defined in FINRA Rule 5130(i)(5) and (b) the transferee has agreed in writing to be bound by the same terms described in this agreement to the extent and for the duration that such terms remain in effect at the time of the transfer.

5

The undersigned understands that the Company and the Underwriters are relying upon this agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.

The undersigned acknowledges and agrees that the Underwriters have not provided any recommendation or investment advice nor have the Underwriters solicited any action from the undersigned with respect to the Public Offering of the shares of Common Stock and the undersigned has consulted their own legal, accounting, financial, regulatory and tax advisors to the extent deemed appropriate. The undersigned further acknowledges and agrees that, although the Underwriters may provide certain Regulation Best Interest and Form CRS disclosures or other related documentation to you in connection with the Public Offering, the Underwriters are not making a recommendation to you to participate in the Public Offering or sell any shares of Common Stock at the price determined in the Public Offering, and nothing set forth in such disclosures or documentation is intended to suggest that any Underwriter is making such a recommendation. The undersigned further acknowledges and agrees that none of the Underwriters has made any recommendation or provided any investment or other advice to the undersigned with respect to this Lock-Up Agreement or the subject matter hereof, and the undersigned has consulted its own legal, accounting, financial, regulatory, tax and other advisors with respect to this Lock-Up Agreement and the subject matter hereof to the extent the undersigned has deemed appropriate.

Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Underwriters.

This agreement shall be terminated and the undersigned shall be released from their obligations hereunder upon the earlier of: (i) the date of filing with the U.S. Securities and Exchange Commission of a notice of withdrawal of the registration statement on Form S-1 related to the Public Offering pursuant to Rule 477 promulgated under the Securities Act of 1933, as amended, prior to its effectiveness, (ii) the date that the Company notifies the Representatives in writing prior to the execution of the Underwriting Agreement that it does not intend to proceed with the Public Offering, (iii) the date that the Underwriting Agreement (other than the provisions thereof that survive termination) terminates or is terminated prior to payment for and delivery of any shares of Common Stock to be sold thereunder, and (iv) December 31, 2021, in the event that the Underwriting Agreement has not been executed by such date.

This agreement may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com or www.echosign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

6

This agreement and any claim, controversy or dispute arising under or related to this agreement shall be governed by and construed in accordance with the laws of the State of New York.

[Signature page follows]

7

Very truly yours,

(Name)

(Address)

EXHIBIT B

FORM OF WAIVER OF LOCK-UP

[Name and Address of

Officer or Director

Requesting Waiver]

Dear Mr./Ms. [Name]:

This letter is being delivered to Morgan Stanley & Co. LLC and BofA Securities, Inc. (the “Representatives”) in connection with the offering by iFIT Health & Fitness Inc (the “Company”) of [•] shares of Class A common stock, par value $[•] per share (the “Common Stock”), of the Company and the lock-up agreement dated                 , 2021 (the “Lock-up Agreement”), executed by you in connection with such offering, and your request for a [waiver][release] dated                 , 20    , with respect to                  shares of Common Stock (the “Shares”).

The Representatives hereby agree to [waive][release] the transfer restrictions set forth in the Lock-up Agreement, but only with respect to the Shares, effective                 , 20    ; provided, however, that such [waiver][release] is conditioned on the Company announcing the impending [waiver][release] by press release through a major news service or any other method that satisfies the obligations described in FINRA Rule 5131(d)(2) at least two business days before the effective date of such [waiver][release], if required by FINRA Rule 5131. This letter will serve as notice to the Company of the impending [waiver][release].

Except as expressly [waived][released] hereby, the Lock-up Agreement shall remain in full force and effect.

Very truly yours,

Morgan Stanley & Co. LLC

BofA Securities, Inc.

Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto Morgan Stanley & Co. LLC
By:
	Name:
	Title:

BofA Securities, Inc.
By:
	Name:
	Title:

cc: Company

EXHIBIT C

FORM OF OPINION AND NEGATIVE ASSURANCE LETTER OF WEIL,

GOTSHAL & MANGES LLP

FORM OF PRESS RELEASE

iFIT Health & Fitness Inc

[Date]

iFIT Health & Fitness Inc (the “Company”) announced today that Morgan Stanley & Co. LLC and BofA Securities, Inc., the lead book-running managers in the Company’s recent public sale of                shares of its common stock are [waiving][releasing] a lock-up restriction with respect to                shares of the Company’s common stock held by [certain officers or directors][an officer or director] of the Company. The [waiver][release] will take effect on                , 20                , and the shares may be sold on or after such date.

This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.

EX-3.4

Exhibit 3.4

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION OF

iFIT Health & Fitness Inc

(Under Sections 242 and 245 of the Delaware General Corporation Law)

iFIT Health & Fitness Inc (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware, as amended (the “DGCL”), does hereby certify as follows:

FIRST. The Corporation filed its original Certificate of Incorporation with the Secretary of State of the State of Delaware on July 20, 1999, under the name “HF Holdings, Inc.” (the “Original Certificate of Incorporation”).

SECOND. The Board of Directors of the Corporation (the “Board of Directors”) adopted resolutions proposing to amend and restate the Original Certificate of Incorporation, as previously amended and/or restated, to read in its entirety as set forth in this Amended and Restated Certificate of Incorporation (the “Certificate”), and the stockholders of the Corporation have duly approved this Certificate by consent in lieu of a meeting of stockholders pursuant to Section 228 of the DGCL.

THIRD. Pursuant to Sections 242 and 245 of the DGCL, the Original Certificate of Incorporation of the Corporation, as previously amended and/or restated, is hereby further amended and restated to read in its entirety as follows:

ARTICLE I

NAME

The name of the Corporation is “iFIT Health & Fitness Inc”.

ARTICLE II

REGISTERED OFFICE AND AGENT

The address of the registered office of the Corporation in the State of Delaware is located at Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, County of New Castle, and the name of the registered agent of the Corporation in the State of Delaware at such address is The Corporation Trust Company.

ARTICLE III

PURPOSE

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL. Without limiting the generality of the foregoing, the Corporation shall have all of the powers conferred on corporations by the DGCL and other applicable law.

ARTICLE IV

AUTHORIZED STOCK

1. Total Authorized.

1.1. The total number of shares of all classes of stock that the Corporation has authority to issue is 6,050,000,000 shares, consisting of three classes: 3,000,000,000 shares of Class A Common Stock, $0.001 par value per share (“Class A Common Stock”), 3,000,000,000 shares of Class B Common Stock, $0.001 par value per share (“Class B Common Stock” and together with the Class A Common Stock, the “Common Stock”), and 50,000,000 shares of Preferred Stock, $0.001 par value per share (the “Preferred Stock”).

1.2. The number of authorized shares of Class A Common Stock or Class B Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of capital stock representing a majority of the voting power of all the then-outstanding shares of capital stock of the Corporation entitled to vote thereon, irrespective of the provisions of Section 242(b)(2) of the DGCL (or any successor provision thereto), and no vote of the holders of the Class A Common Stock or Class B Common Stock voting separately as a class shall be required therefor.

2. Preferred Stock.

2.1. The Board of Directors is authorized, to the fullest extent permitted by the law of the State of Delaware, by resolution or resolutions adopted from time to time, to provide for the issuance of shares of Preferred Stock in one or more series, and, by filing a certificate of designation pursuant to the applicable law of the State of Delaware (“Certificate of Designation”), to establish from time to time the number of shares to be included in each such series, to fix the designation, powers (including voting powers), preferences and relative, participating, optional or other special rights (and the qualifications, limitations or restrictions thereof) of the shares of each such series and, except where otherwise provided in this Certificate or in the applicable Certificate of Designation, to increase (but not above the total number of authorized shares of the Preferred Stock) or decrease (but not below the number of shares of such series then outstanding) the number of shares of any such series. The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of all the then-outstanding shares of capital stock of the Corporation entitled to vote thereon, without a separate vote of the holders of the Preferred Stock, irrespective of the provisions of Section 242(b)(2) of the DGCL, unless a separate vote of the holders of one or more series of Preferred Stock is required pursuant to the terms of any Certificate of Designation.

2.2. Except as otherwise expressly required pursuant to the terms of any Certificate of Designation, (i) any series of Preferred Stock may be designated, fixed and determined as provided herein by the Board of Directors without approval of the holders of Common Stock or the holders of Preferred Stock, or any series thereof, and (ii) any such series may have powers, preferences and rights, including, without limitation, voting powers, dividend rights, liquidation rights, redemption rights and conversion rights, senior to, junior to or pari passu with the rights of the Common Stock, any series of the Preferred Stock, or any future class or series of capital stock of the Corporation.

3. Rights of Class A Common Stock and Class B Common Stock.

3.1. Equal Status. Except as otherwise provided in this Certificate or required by applicable law, shares of Class A Common Stock and Class B Common Stock shall have the same rights and powers, rank equally (including as to dividends and distributions, and upon any liquidation, dissolution or winding up of the Corporation), share ratably and be identical in all respects and as to all matters.

3.2. Voting Rights. Except as otherwise provided in this Certificate or as required by applicable law, the holders of shares of Class A Common Stock and Class B Common Stock shall (a) at all times vote together as a single class on all matters (including the election of directors) submitted to a vote of the stockholders of the Corporation, (b) be entitled to notice of any stockholders’ meeting in accordance with the Bylaws of the Corporation

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(as the same may be amended and/or restated from time to time, the “Bylaws”) and (c) be entitled to vote upon such matters and in such manner as may be provided by applicable law; provided, however, that, except as otherwise required by law, holders of shares of Class A Common Stock and Class B Common Stock shall not be entitled to vote on any amendment to this Certificate (including any Certificate of Designation relating to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together as a class with the holders of one or more other such series, to vote thereon pursuant to applicable law or this Certificate (including any Certificate of Designation). Except as otherwise expressly provided herein or required by applicable law, each holder of Class A Common Stock shall have the right to one (1) vote per share of Class A Common Stock held of record by such holder and each holder of Class B Common Stock shall have the right to ten (10) votes per share of Class B Common Stock held of record by such holder.

3.3. Dividends and Distribution Rights. Subject to the last sentence of this Section 3.3, shares of Class A Common Stock and Class B Common Stock shall be treated equally, identically and ratably, on a per share basis, with respect to any dividends or distributions as may be declared and paid from time to time by the Board of Directors on the Class A Common Stock or the Class B Common Stock out of any assets of the Corporation legally available therefor, and no dividend or other distribution shall be declared or paid on the Class A Common Stock or the Class B Common Stock unless an identical dividend is simultaneously declared and paid on the other class of Common Stock; provided, however, that in the event a dividend is declared and paid in the form of shares of Class A Common Stock or Class B Common Stock (or rights to acquire such shares), then holders of Class A Common Stock shall receive shares of Class A Common Stock (or rights to acquire such shares, as the case may be) and holders of Class B Common Stock shall receive shares of Class B Common Stock (or rights to acquire such shares, as the case may be), with holders of shares of Class A Common Stock and Class B Common Stock receiving, on a per share basis, an identical number of shares of Class A Common Stock or Class B Common Stock, as applicable. Notwithstanding the foregoing, the Board of Directors may pay or make a disparate dividend or distribution per share of Class A Common Stock or Class B Common Stock (whether in the amount of such dividend or distribution payable per share, the form in which such dividend or distribution is payable, the timing of the payment, or otherwise) if such disparate dividend or distribution is approved in advance by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock, each voting separately as a class.

3.4. Subdivisions, Combinations or Reclassifications. Shares of Class A Common Stock or Class B Common Stock may not be subdivided, combined or reclassified unless the shares of the other class are concurrently therewith proportionately subdivided, combined or reclassified in a manner that maintains the same proportionate equity ownership and voting power between the holders of the outstanding Class A Common Stock and Class B Common Stock on the record date for such subdivision, combination or reclassification; provided, however, that shares of one such class may be subdivided, combined or reclassified in a different or disproportionate manner if such subdivision, combination or reclassification is approved in advance by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock, each voting separately as a class.

3.5. Liquidation, Dissolution or Winding Up. Except as expressly required pursuant to the terms of any Certificate of Designation, upon the liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, holders of Class A Common Stock and Class B Common Stock will be treated as a single class and shall be entitled to receive ratably all assets of the Corporation available for distribution to its stockholders unless disparate or different treatment of the shares of each such class with respect to distributions upon any such liquidation, dissolution or winding up is approved in advance by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock, each voting separately as a class. A merger or consolidation of the corporation shall not be a liquidation, dissolution or winding up of the corporation for purposes of this Section 3.5.

3.6. Merger or Consolidation. In the case of any consideration distributed or paid to holders in respect of the shares of Class A Common Stock or Class B Common Stock upon the merger or consolidation of the Corporation with or into any other entity, or in the case of any other transaction (other than the transactions identified in Sections 3.3, 3.4 or 3.5 resulting in a distribution or payment to holders of the Class A Stock or the Class B Stock in respect of their shares of Class A Common Stock or Class B Common Stock, such distribution or

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payment shall be made ratably on a per share basis among the holders of the Class A Common Stock and Class B Common Stock as a single class; provided, however, that shares of one such class may receive different or disproportionate distributions or payments in connection with such merger, consolidation or other transaction if (i) the only difference in the per share distribution to the holders of the Class A Common Stock and Class B Common Stock is that any securities distributed to the holder of a share Class B Common Stock have up to ten times the voting power of any securities distributed to the holder of a share of Class A Common Stock, and reflect any other rights of the Class B Common Stock that may differ from the Class A Common Stock, as set forth herein, or (ii) such merger, consolidation or other transaction is approved by the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock, each voting separately as a class.

3.7: Stapling. Transfer of the shares of Common Stock received by LC9 Connected Holdings LP, a Delaware limited partnership (“L Catterton”), pursuant to Section 1.1(e) of the Omnibus Investor Agreement, dated as of      , 2021 by and among L Catterton, Icon Preferred Holdings, L.P. (“Pamplona”), the Corporation and the other parties thereto (the “Omnibus Agreement”) shall be transferable to a transferee only if transferred in the manner set forth in Section 5.3 of the Company Bylaws, and any purported transfer that is not made in such manner shall be void ab initio and of no effect. It is the intention of the Corporation that for so long as a share of Common Stock is required to be transferred in the manner set forth in Section 5.3 of the Company Bylaws (as such Bylaws exist as of the date hereof) shall be treated for U.S. federal income tax purposes as a single integrated security that constitutes stock and this Section 3.7 shall be interpreted in a manner consistent therewith.

ARTICLE V

CLASS B COMMON STOCK CONVERSION

1. Optional Conversion. Each share of Class B Common Stock shall be convertible into one (1) fully paid and nonassessable share of Class A Common Stock at the option of the holder thereof at any time upon written notice to the Corporation. Before any holder of Class B Common Stock shall be entitled to convert any of such holder’s shares of such Class B Common Stock into shares of Class A Common Stock, such holder shall deliver an instruction, duly signed and authenticated in accordance with any procedures set forth in the Bylaws or any policies of the Corporation then in effect, at the principal corporate office of the Corporation or of any transfer agent for the Class B Common Stock, and shall give written notice to the Corporation at its principal corporate office of such holder’s election to convert the same and shall state therein the name or names in which the shares of Class A Common Stock issuable on conversion thereof are to be registered on the books of the Corporation. The Corporation shall, as soon as practicable thereafter, register on the Corporation’s books ownership of the number of shares of Class A Common Stock to which such record holder of Class B Common Stock, or to which the nominee or nominees of such record holder, shall be entitled as aforesaid. Such conversion shall be deemed to have occurred immediately prior to 5:00 p.m. ET on the date such notice of the election to convert is received by the Corporation, and the person or persons entitled to receive the shares of Class A Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Class A Common Stock as of such date.

2. Automatic Conversion. Each share of Class B Common Stock shall automatically, without further action by the Corporation or the holder thereof, be converted into one (1) fully paid and nonassessable share of Class A Common Stock immediately prior to the close of business on the earlier of (i) the date specified by the affirmative vote of the holders of Class B Common Stock representing not less than two-thirds (2/3) of the voting power of the outstanding shares of Class B Common Stock, voting separately as a single class, or (ii) 5:00 p.m. ET on the date on which the Corporation first has actual knowledge that the outstanding shares of Class B Common Stock represent less than fifteen percent (15%) of the aggregate number of shares of Class A Common Stock and Class B Common Stock then outstanding (the events referred to in (i) and (ii) are referred to herein as an “Automatic Conversion”). The Corporation shall provide notice of the Automatic Conversion of shares of Class B Common Stock pursuant to this Section 2 of Article V to record holders of such shares of Class B Common Stock as soon as practicable following the Automatic Conversion. Such notice shall be provided by any means then permitted by the DGCL; provided, however, that no failure to give such notice nor any defect therein shall affect the validity of the Automatic Conversion. Upon and after the Automatic Conversion, the person registered on the Corporation’s books as the record holder of the shares of Class B Common Stock so converted immediately prior to the Automatic

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Conversion shall be registered on the Corporation’s books as the record holder of the shares of Class A Common Stock issued upon Automatic Conversion of such shares of Class B Common Stock, without further action on the part of the record holder thereof. Immediately upon the effectiveness of the Automatic Conversion, the rights of the holders of shares of Class B Common Stock as such shall cease, and the holders shall be treated for all purposes as having become the record holder or holders of such shares of Class A Common Stock into which such shares of Class B Common Stock were converted.

3. Conversion on Transfer. Each share of Class B Common Stock shall automatically, without further action by the Corporation or the holder thereof, be converted into one (1) fully paid and nonassessable share of Class A Common Stock, at 5:00 p.m. ET on the day prior to a Transfer (as defined below), of such share of Class B Common Stock.

4. Policies and Procedures. The Corporation may, from time to time, establish such policies and procedures, not in violation of applicable law or this Certificate or the Bylaws, relating to the conversion of shares of the Class B Common Stock into shares of Class A Common Stock as it may deem necessary or advisable. If the Corporation has reason to believe that a Transfer has occurred, the Corporation may request that the purported transferor furnish affidavits or other evidence to the Corporation as it reasonably deems necessary to determine whether a Transfer has occurred, and if such transferor does not within ten (10) days after the date of such request furnish sufficient (as determined by the Board of Directors) evidence to the Corporation (in the manner provided in the request) to enable the Corporation to determine that no such Transfer has occurred, any such shares of Class B Common Stock, to the extent not previously converted, shall be automatically converted into shares of Class A Common Stock as of 5:00 p.m. ET on the date prior to the date the Corporation determines such Transfer to have occurred and such conversion shall thereupon be registered on the books and records of the Corporation. In connection with any vote of stockholders taken at a meeting, the stock ledger of the Corporation shall be presumptive evidence as to who are the stockholders entitled to vote in person or by proxy at any meeting of stockholders and the classes of shares held by each such stockholder and the number of shares of each class held by such stockholder. The stock certificates, if any, issued with respect to the Class B Common Stock shall, upon an Automatic Conversion or a conversion pursuant to Section 3 of this Article V, evidence and represent the same number of shares of Class A Common Stock into which the Class B Common Stock were converted until such certificates are surrendered to the Corporation for exchange for new certificates representing such shares of Class A Common Stock.

5. Definitions.

(a) “Family Member” shall mean with respect to any natural person who is a Qualified Stockholder, the spouse, domestic partner, parents, grandparents, lineal descendants, siblings and lineal descendants of siblings of such Qualified Stockholder. Lineal descendants shall include adopted persons, but only so long as they are adopted while a minor.

(b) “Parent” of an entity shall mean any entity that directly or indirectly owns or controls a majority of the voting power of the voting securities of such entity.

(c) “Permitted Entity” shall mean with respect to a Qualified Stockholder: (a) a Permitted Trust solely for the benefit of (1) such Qualified Stockholder, (2) one or more Family Members of such Qualified Stockholder, or (3) any entity described in clause (b); or (b) any general partnership, limited partnership, limited liability company, corporation or other entity majority owned (in voting and economic power) by (1) such Qualified Stockholder, (2) one or more Family Members of such Qualified Stockholder, or (3) any entity described in clause (b).

(d) “Permitted Transfer” shall mean, and be restricted to, any Transfer of a share of Class B Common Stock:

(i) by a Qualified Stockholder to (A) one or more Family Members of such Qualified Stockholder, (B) any Permitted Entity of such Qualified Stockholder, or (C) to such Qualified Stockholder’s revocable living trust, which revocable living trust is itself both a Permitted Trust and a Qualified Stockholder; or

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(ii) by a Permitted Entity of a Qualified Stockholder to (A) such Qualified Stockholder or one or more Family Members of such Qualified Stockholder, or (B) any other Permitted Entity of such Qualified Stockholder.

(e) “Permitted Transferee” shall mean a transferee of shares of Class B Common Stock received in a Permitted Transfer.

(f) “Permitted Trust” shall mean a bona fide trust where each trustee is (i) a Qualified Stockholder or Permitted Entity of the Qualified Stockholder, (ii) a Family Member or Permitted Entity of the Family Member, or (iii) a professional in the business of providing trustee services, including private professional fiduciaries, trust companies and bank trust departments.

(g) “Qualified Stockholder” shall mean: (a) Scott Watterson; (b) SW ICON LLC, for so long as it is majority owned (in voting and economic power) by Scott Watterson; and (c) a Permitted Transferee.

(h) “Transfer” of a share of Class B Common Stock shall mean any sale, assignment, transfer, conveyance, hypothecation or other transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law, that is not a Permitted Transfer, including, without limitation, a transfer of a share of Class B Common Stock to a broker or other nominee (regardless of whether there is a corresponding change in beneficial ownership), or the transfer of, or entering into a binding agreement with respect to, Voting Control over such share by proxy or otherwise; provided, however, that the following shall not be considered a “Transfer” within the meaning of this Section 5 of Article V:

(i) the granting of a revocable proxy to officers or directors of the Corporation at the request of the Board of Directors in connection with actions to be taken at an annual or special meeting of stockholders;

(ii) entering into a voting trust, agreement or arrangement (with or without granting a proxy) solely with stockholders who are holders of Class B Common Stock that (A) is disclosed either in a Schedule 13D filed with the Securities and Exchange Commission or in writing to the Secretary of the Corporation, (B) either has a term not exceeding one (1) year or is terminable by the holder of the shares subject thereto at any time and (C) does not involve any payment of cash, securities, property or other consideration to the holder of the shares subject thereto other than the mutual promise to vote shares in a designated manner;

(iii) entering into a voting trust, agreement or arrangement (with or without granting a proxy) pursuant to a written agreement to which the Corporation is a party;

(iv) the pledge of shares of Class B Common Stock by a stockholder that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction for so long as such stockholder continues to exercise Voting Control over such pledged shares; provided, however, that a foreclosure on such shares or other similar action by the pledgee shall constitute a Transfer unless such foreclosure or similar action qualifies as a Permitted Transfer;

(v) the fact that, as of the IPO Date or at any time after the IPO Date, the spouse of any holder of Class B Common Stock possesses or obtains an interest in such holder’s shares of Class B Common Stock arising solely by reason of the application of the community property laws of any jurisdiction, so long as no other event or circumstance shall exist or have occurred that constitutes a Transfer of such shares of Class B Common Stock; provided that any transfer of shares by any holder of shares of Class B Common Stock to such holder’s spouse, including a transfer in connection with a divorce proceeding, domestic relations order or similar legal requirement, shall constitute a “Transfer” of such shares of Class B Common Stock unless otherwise exempt from the definition of Transfer;

(vi) entering into a trading plan pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), with a broker or other nominee; provided, however, that a sale of such shares of Class B Common Stock pursuant to such plan shall constitute a “Transfer” at the time of such sale;

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(vii) the transfer of a member interest in a limited liability company or other entity that owns Class B Common Stock provided such transfer does not change the control or management of such entity; or

(viii) the entering into a support, voting, tender or similar agreement or arrangement (in each case, with or without the grant of a proxy) in connection with a merger or consolidation that has been approved by the Board of Directors.

A Transfer shall also be deemed to have occurred with respect to a share of Class B Common Stock beneficially owned by (i) an entity that is a Permitted Entity, if there occurs any act or circumstance that causes such entity to no longer be a Permitted Entity or (ii) an entity that is a Qualified Stockholder, if, in either case, there occurs a Transfer on a cumulative basis of a majority of the voting or economic power of the voting securities of such entity or any direct or indirect Parent of such entity, other than a Transfer to parties that are holders of voting securities of any such entity or Parent of such entity, or that are otherwise a Qualified Stockholder, Permitted Entity or Permitted Transferee.

(i) “Voting Control” shall mean, with respect to a share of Class B Common Stock, the power (whether exclusive or shared) to vote or direct the voting of such share including, without limitation, by proxy, voting agreement or otherwise.

6. Status of Converted Stock. In the event any shares of Class B Common Stock are converted into shares of Class A Common Stock pursuant to this Article V, the shares of Class B Common Stock so converted shall be automatically retired and shall not be reissued by the Corporation.

7. Effect of Conversion on Payment of Dividends. Notwithstanding anything to the contrary in Sections 1, 2 or 3 of this Article V, if the date on which any share of Class B Common Stock is converted into Class A Common Stock pursuant to the provisions of Sections 1, 2 or 3 of this Article V occurs after the record date for the determination of the holders of Class B Common Stock entitled to receive any dividend or distribution previously declared but not yet paid on the shares of Class B Common Stock, the holder of such shares of Class B Common Stock as of such record date will be entitled to receive such dividend or distribution on such payment date.

8. Reservation. The Corporation shall at all times reserve and keep available, out of its authorized and unissued shares of Class A Common Stock, solely for the purpose of effecting conversions of shares of Class B Common Stock into Class A Common Stock, such number of duly authorized shares of Class A Common Stock as shall from time to time be sufficient to effect the conversion of all then-outstanding shares of Class B Common Stock. If at any time the number of authorized and unissued shares of Class A Common Stock shall not be sufficient to effect the conversion of all then-outstanding shares of Class B Common Stock, the Corporation shall promptly take such corporate action as may be necessary to increase its authorized but unissued shares of Class A Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation, seeking the requisite stockholder approval of any necessary amendment to this Certificate. All shares of Class A Common Stock which are so issuable shall, when issued upon conversion of outstanding shares of Class B Common Stock as provided herein, be duly and validly issued, fully paid and non-assessable shares of Class A Common Stock. The Corporation shall take all such action as may be necessary to ensure that all such shares of Class A Common Stock may be so issued without violation of any applicable law or regulation.

ARTICLE VI

MATTERS RELATING TO THE BOARD OF DIRECTORS

1. Director Powers. Except as otherwise provided by the DGCL or this Certificate, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.

2. Number of Directors. Subject to the rights of the holders of any outstanding series of Preferred Stock to elect additional directors under specified circumstances, the total number of directors constituting the Board shall be fixed from time to time exclusively by resolution adopted by a majority of the Board.

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3. Classified Board. Other than any directors elected by the holders of one or more outstanding series of Preferred Stock, the directors shall be divided, with respect to the time for which they severally hold office, into three classes designated as Class I, Class II and Class III, respectively (the “Classified Board”). The Board of Directors is authorized to assign members of the Board of Directors already in office to such classes of the Classified Board. The number of directors in each class shall be divided as nearly equal as is practicable. The initial term of office of the Class I directors shall expire at the Corporation’s first annual meeting of stockholders following the closing of the Corporation’s initial public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), covering the offer and sale of Class A Common Stock to the public (the “Initial Public Offering Closing”), the initial term of office of the Class II directors shall expire at the Corporation’s second annual meeting of stockholders following the Initial Public Offering Closing, and the initial term of office of the Class III directors shall expire at the Corporation’s third annual meeting of stockholders following the Initial Public Offering Closing. At each annual meeting of stockholders following the Initial Public Offering Closing, directors elected to succeed those directors of the class whose terms then expire shall be elected for a term of office expiring at the third succeeding annual meeting of stockholders after their election.

4. Term and Removal. Each director shall hold office until the annual meeting at which such director’s term expires and until such director’s successor is duly elected and qualified, or until such director’s earlier death, resignation, disqualification or removal. Any director may resign at any time upon notice to the Corporation given in writing or by any electronic transmission. Any director (other than any director elected solely by the holders of any outstanding series of Preferred Stock) may be removed from the Board of Directors at any time with or without cause by the affirmative vote of the holders of a majority of the voting power of the then-outstanding shares of capital stock of the Corporation entitled to vote thereon, voting together as a single class. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any director.

5. Vacancies and Newly Created Directorships. Subject to the rights of the holders of any series of Preferred Stock to elect directors, any vacancy occurring in the Board of Directors, and any newly created directorship resulting from any increase in the authorized number of directors, may be filled by the Board of Directors, or by a sole remaining director, or, until such time as all shares of Class B Common Stock of the Corporation have converted into shares of Class A Common Stock of the Corporation pursuant to the terms of Article V of this Certificate, by the stockholders. Any director elected in accordance with the preceding sentence shall hold office for a term expiring at the next annual meeting of stockholders and until such director’s successor shall have been duly elected and qualified, or until such director’s earlier death, resignation, disqualification or removal.

6. Preferred Directors. Whenever the holders of any one or more series of Preferred Stock issued by the Corporation shall have the right, voting separately as a series or separately as a class with one or more such other series, to elect directors at an annual or special meeting of stockholders, the election, term of office, removal and other features of such directorships shall be governed by the terms of this Certificate and the Certificate of Designation applicable thereto. The number of directors that may be elected by the holders of any such series of Preferred Stock shall be in addition to the number fixed pursuant to Section 2 of this Article VI, and the total number of directors constituting the Board of Directors shall be automatically adjusted accordingly. Except as otherwise provided by the Board of Directors the Certificate of Designation establishing such series, whenever the holders of any series of Preferred Stock having such right to elect additional directors are divested of such right pursuant to the provisions of such stock, the terms of office of all such additional directors elected by the holders of such stock, or elected to fill any vacancies resulting from the death, resignation, disqualification or removal of such additional directors, shall forthwith terminate (in which case each such director thereupon shall cease to be qualified as, and shall cease to be, a director) and the total authorized number of directors of the Corporation shall automatically be reduced accordingly.

7. Vote by Ballot. Election of directors need not be by written ballot unless the Bylaws shall so provide.

8. Fractional Voting. The member of the Board nominated by the Board Rights Holder (as such term is defined in the Corporation’s 7.0% Note due      , 2027 issued to Icon Preferred Holdings, L.P. under the Omnibus Investor Agreement dated as of         , 2021, the “Omnibus Investor Agreement”) by and among Icon Preferred Holdings L.P., LC9 Connected Holdings, LP, a Delaware limited partnership, the Corporation and others in respect of the Pamplona Note IPO Entitlement Amount (as defined in the Omnibus Investor Agreement))

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shall (i) at any time when the Board has fewer than eleven (11) members, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of the Board (whether under this Certificate of Incorporation, the Bylaws, the DGCL or otherwise), whether taken at a meeting of the Board or by written consent of the Board, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of the Board at such time and (ii) in the case of matters of a committee of the Board that includes such member, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of such committee (whether taken under this Certificate of Incorporation, the Bylaws, the DGCL or otherwise), whether taken at a meeting of such committee or by written consent of such committee, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of such committee at such time.

ARTICLE VII

DIRECTOR LIABILITY

To the fullest extent permitted by law, no director of the Corporation shall be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. Without limiting the effect of the preceding sentence, if the DGCL is hereafter amended to authorize the further elimination or limitation of the liability of a director, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. Any alteration, amendment, addition to or repeal of this Article VII Section 1, or adoption of any provision of this Certificate (including any certificate of designations relating to any series or class of Preferred Stock) inconsistent with this Section 1 of Article VII, shall not reduce, eliminate or adversely affect any right or protection of a director of the Corporation existing at the time of such alteration, amendment, addition to, repeal or adoption with respect to acts or omissions occurring prior to such alteration, amendment, addition to, repeal or adoption.

ARTICLE VIII

MATTERS RELATING TO STOCKHOLDERS

1. Action by Written Consent of Stockholders. Subject to the rights of any series of Preferred Stock then outstanding, from and after the time that the outstanding shares of Class B Common Stock represent less than forty percent (40%) of the total voting power of the then outstanding shares of Common Stock of the Corporation entitled to vote generally in the election of directors, then any action required or permitted to be taken by the stockholders of the Corporation must be effected at a duly called annual or special meeting of such stockholders of the Corporation and may not be effected by any written consent in lieu of a meeting by such stockholders.

2. Special Meeting of Stockholders. Special meetings of the stockholders of the Corporation may be called only by the Chief Executive Officer or the Board of Directors acting pursuant to a resolution adopted by a majority of the Board, and may not be called by the stockholders or any other person or persons.

3. Advance Notice of Stockholder Nominations and Business Transacted at Special Meetings. Advance notice of stockholder nominations for the election of directors of the Corporation and of business to be brought by stockholders before any meeting of stockholders of the Corporation shall be given in the manner provided in the Bylaws. Business transacted at special meetings of stockholders shall be limited to the purpose or purposes stated in the notice of meeting.

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ARTICLE IX

SECTION 203 OF THE DGCL

The Corporation shall not be governed by Section 203 of the DGCL (or any successor provision thereto) (“Section 203”), and the restrictions contained in Section 203 shall not apply to the Corporation, until immediately following the time at which both of the following conditions exist (if ever): (a) Section 203 by its terms would, but for the provisions of this Article IX, apply to the Corporation; and (b) all shares of Class B Common Stock of the Corporation have converted into shares of Class A Common Stock of the Corporation pursuant to the terms of Article V of this Certificate, and the Corporation shall thereafter be governed by Section 203 if and for so long as Section 203 by its terms shall apply to the Corporation.

ARTICLE X

AMENDMENT OF CERTIFICATE

The Corporation reserves the right to amend or repeal any provision contained in this Certificate in the manner prescribed by the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation; provided, however, that in addition to any vote of the holders of any class or series of the stock of the Corporation required by law or by this Certificate (including any Certificate of Designation), the affirmative vote of the holders of Class B Common Stock representing at least a majority of the voting power of the then-outstanding shares of Class B Common Stock, voting separately as a single class, shall be required to amend, repeal, or adopt any provision adversely affecting the rights of holders of shares of Class B Common Stock, including, without limitation, changes to or inconsistent with Section 3 of Article IV, Article V or this Article X.

ARTICLE XI

CHOICE OF FORUM

Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery lacks jurisdiction, a state court located within the State of Delaware or the federal district court for the District of Delaware) shall, to the fullest extent permitted by law, be the sole and exclusive forum for: any (a) derivative action or proceeding brought on behalf of the Corporation; (b) action asserting a claim of breach of a fiduciary duty owed by or other wrongdoing by any current or former director, officer, employee, agent or stockholder of the Corporation to the Corporation or the Corporation’s stockholders; (c) action asserting a claim arising under any provision of the DGCL or this Certificate or the Bylaws (as either may be amended from time to time), or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware; or (d) action asserting a claim governed by the internal affairs doctrine.

The federal district courts of the United States of America shall be the sole and exclusive forum for the resolution of any action asserting a claim arising under the Securities Act, or the rules and regulations promulgated thereunder. The provisions of this Article XI shall not preclude or contract the scope of exclusive federal jurisdiction for suits brought under the Exchange Act or the rules and regulations promulgated thereunder.

Any person or entity purchasing or otherwise acquiring or holding any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of Article XI.

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ARTICLE XII

SEVERABILITY

If any provision of this Certificate shall be held to be invalid, illegal, or unenforceable as applied to any circumstance for any reason, then such provision shall nonetheless be enforced to the maximum extent possible consistent with such holding and the remaining provisions of this Certificate (including without limitation, all portions of any section of this Certificate containing any such provision held to be invalid, illegal, or unenforceable, which is not invalid, illegal, or unenforceable) shall remain in full force and effect. To the fullest extent permitted by law, the provisions of this Certificate (including, without limitation, any provision held to be invalid, illegal or unenforceable) shall be construed so as to provide the maximum protection permitted by law to directors, officers, employees and agents of the Corporation in respect of their good faith service or for the benefit of the Corporation.

[The remainder of this page is intentionally left blank.]

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IN WITNESS WHEREOF, the Corporation has caused this Certificate to be executed on its behalf on the     day of the month of in the year 2021.

iFIT Health & Fitness Inc
By:
	Name:
	Title:

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EX-3.5

Exhibit 3.5

IFIT HEALTH & FITNESS INC

(a Delaware corporation)

AMENDED AND RESTATED BYLAWS

As Amended and Restated on                     , 2021

IFIT HEALTH & FITNESS INC

(a Delaware corporation)

AMENDED AND RESTATED BYLAWS

TABLE OF CONTENTS

Table of Contents

	Page
ARTICLE I: STOCKHOLDERS		4
Section 1.1:Annual Meetings		4
Section 1.2:Special Meetings		4
Section 1.3:Stockholder Action by Written Consent		4
Section 1.4:Notice of Meetings		4
Section 1.5:Adjournments		5
Section 1.6:Quorum		5
Section 1.7:Organization		6
Section 1.8:Voting; Proxies		6
Section 1.9: Fixing Date for Determination of Stockholders of Record		6
Section 1.10:List of Stockholders Entitled to Vote		7
Section 1.11:Inspectors of Elections		8
Section 1.12:Conduct of Meetings		9
Section 1.13:Notice of Stockholder Business; Nominations		9
ARTICLE II: BOARD OF DIRECTORS		18
Section 2.1:Number; Qualifications		18
Section 2.2:Election; Resignation; Removal; Vacancies		18
Section 2.3:Regular Meetings		18
Section 2.4:Special Meetings		18
Section 2.5:Remote Meetings Permitted		18
Section 2.6:Quorum; Vote Required for Action		18
Section 2.7:Organization		19
Section 2.8:Unanimous Action by Directors in Lieu of a Meeting		19
Section 2.9:Powers		19
Section 2.10:Compensation of Directors		19
Section 2.11:Confidentiality		19
Section 2.12:Fractional Voting		19
ARTICLE III: COMMITTEES		20
Section 3.1:Committees		20

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Section 3.2:Committee Rules	20
ARTICLE IV: OFFICERS; CHAIRPERSON	20
Section 4.1:Generally	20
Section 4.2:Chief Executive Officer	21
Section 4.3:Chairperson of the Board	21
Section 4.4:Chief Financial Officer	22
Section 4.5:Treasurer	22
Section 4.6:Vice President	22
Section 4.7:Secretary	22
Section 4.8:Delegation of Authority	22
Section 4.9:Removal	22
ARTICLE V: STOCK	22
Section 5.1:Certificates; Uncertificated Shares	22
Section 5.2:Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates or Uncertificated Shares	23
Section 5.3:Stapling	23
Section 5.4:Other Regulations	24
ARTICLE VI: INDEMNIFICATION	24
Section 6.1:Indemnification of Officers and Directors	24
Section 6.2:Advance of Expenses	24
Section 6.3:Non-Exclusivity of Rights	24
Section 6.4:Indemnification Contracts	25
Section 6.5:Right of Indemnitee to Bring Suit	25
Section 6.6:Nature of Rights	25
Section 6.7:Insurance	26
ARTICLE VII: NOTICES	26
Section 7.1:Notice	26
Section 7.2:Waiver of Notice	27
ARTICLE VIII: INTERESTED DIRECTORS	27
Section 8.1:Interested Directors	27
Section 8.2:Quorum	27
ARTICLE IX: MISCELLANEOUS	28
Section 9.1:Fiscal Year	28
Section 9.2:Seal	28
Section 9.3:Form of Records	28
Section 9.4:Reliance Upon Books and Records	28
Section 9.5:Certificate of Incorporation Governs	28
Section 9.6:Severability	28
Section 9.7:Time Periods	28
Section 9.8:Dividends	28
Section 9.9:Execution of Instruments	29
ARTICLE X: AMENDMENT OF BYLAWS	29

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IFIT HEALTH & FITNESS INC

(a Delaware corporation)

AMENDED AND RESTATED BYLAWS

As Amended and Restated on                     , 2021

ARTICLE I: STOCKHOLDERS

Section 1.1: Annual Meetings. If required by applicable law, an annual meeting of stockholders shall be held for the election of directors at such date and time as the Board of Directors (the “Board”) of iFIT Health & Fitness Inc (the “Corporation”) shall each year fix. The meeting may be held either at a place, within or without the State of Delaware as permitted by the Delaware General Corporation Law (the “DGCL”), or by means of remote communication as the Board in its sole discretion may determine. Any proper business may be transacted at the annual meeting.

Section 1.2: Special Meetings. Special meetings of stockholders for any purpose or purposes shall be called in the manner set forth in the Amended and Restated Certificate of Incorporation of the Corporation (as the same may be amended and/or restated from time to time, the “Certificate of Incorporation”). The special meeting may be held either at a place, within or without the State of Delaware, or by means of remote communication as the Board in its sole discretion may determine. Business transacted at any special meeting of stockholders shall be limited to matters relating to the purpose or purposes stated in the notice of the meeting.

Section 1.3: Stockholder Action by Written Consent. The provisions relating to the ability of stockholders to act by written consent shall be set forth in the Certificate of Incorporation.

Section 1.4: Notice of Meetings. Notice of all meetings of stockholders shall be given in writing or by electronic transmission in the manner provided by applicable law and these bylaws (including, without limitation, as set forth in Section 7.1.1 of these Bylaws) stating the date, time and place, if any, of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting (if such date is different from the record date for stockholders entitled to notice of the meeting). In the case of a special meeting, such notice shall also set forth the purpose or purposes for which the meeting is called. Unless otherwise required by applicable law or the Certificate of Incorporation, notice of any meeting of stockholders shall be given not less than ten (10), nor more than sixty (60), days before the date of the meeting to each stockholder of record entitled to vote at such meeting as of the record date for determining the stockholders entitled to notice of the meeting.

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Section 1.5: Adjournments. Notwithstanding Section 1.6 of these Bylaws, the chairman of the meeting shall have the power to adjourn the meeting to another time, date and place (if any) regardless of whether a quorum is present, at any time and for any reason. Any meeting of stockholders, annual or special, may be adjourned from time to time, and notice need not be given of any such adjourned meeting if the time, date and place (if any) thereof and the means of remote communication (if any) by which stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken; provided, however, that if the adjournment is for more than thirty (30) days, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If, after the adjournment, a new record date for determination of stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix as the record date for determining stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote at the adjourned meeting, and shall give notice of the adjourned meeting to each stockholder of record as of the record date so fixed for notice of such adjourned meeting. At the adjourned meeting, the Corporation may transact any business that might have been transacted at the original meeting. If a quorum is present at the original meeting, it shall also be deemed present at the adjourned meeting. To the fullest extent permitted by law, the Board may postpone, reschedule or cancel at any time and for any reason any previously scheduled special or annual meeting of stockholders before it is to be held, regardless of whether any notice or public disclosure with respect to any such meeting has been sent or made pursuant to Section 1.4 hereof or otherwise, in which case notice shall be provided to the stockholders of the new date, time and place, if any, of the meeting as provided in Section 1.4 above.

Section 1.6: Quorum. Except as otherwise provided by applicable law, the Certificate of Incorporation or these Bylaws, at each meeting of stockholders the holders of a majority of the voting power of the shares of stock issued and outstanding and entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum for the transaction of business; provided, however, that where a separate vote by a class or classes or series of stock is required by applicable law or the Certificate of Incorporation, the holders of a majority of the voting power of the shares of such class or classes or series of the stock issued and outstanding and entitled to vote on such matter, present in person or represented by proxy at the meeting, shall constitute a quorum entitled to take action with respect to the vote on such matter. If a quorum shall fail to attend any meeting, the chairman of the meeting or, if directed to be voted on by the chairman of the meeting, the holders of a majority of the voting power of the shares entitled to vote thereon who are present in person or represented by proxy at the meeting may adjourn the meeting. Shares of the Corporation’s capital stock shall neither be entitled to vote nor counted for quorum purposes if such shares belong to (i) the Corporation, (ii) another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly by the Corporation, or (iii) any other entity, if a majority of the voting power of such other entity is otherwise controlled, directly or indirectly, by the Corporation; provided, however that the foregoing shall not limit the right of the Corporation to vote stock, including but not limited to its own stock held by it in a fiduciary capacity. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum.

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Section 1.7: Organization. At every meeting of stockholders, the chairman of such meeting shall be the Chairman of the Board or, if no Chairman of the Board has been elected or in the event of his or her absence or disability, the Lead Independent Director, or, if no Lead Independent Director has been elected or in the event of his or her absence or disability, a chairman chosen by the Board of Directors. The Secretary of the Corporation, or in the event of his or her absence or disability, an Assistant Secretary, if any, or if there be no Assistant Secretary, in the absence of the Secretary of the Corporation, an appointee of the chairman of the meeting, shall act as Secretary of the meeting. The order of business and all other matters of procedure at every meeting of stockholders may be determined by the chairman of such meeting.

Section 1.8: Voting; Proxies. Each stockholder of record entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy. Such a proxy may be prepared, transmitted and delivered in any manner permitted by applicable law. Except as may be required in the Certificate of Incorporation, directors shall be elected by a majority of the votes cast by the holders of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. A plurality vote standard shall apply to contested elections where the number of nominees exceeds the number of directors to be elected. At all meetings of stockholders at which a quorum is present, unless a different or minimum vote is required by applicable law, rule or regulation applicable to the Corporation or its securities, the rules or regulations of any stock exchange applicable to the Corporation, the Certificate of Incorporation or these Bylaws, in which case such different or minimum vote shall be the applicable vote on the matter, every matter other than the election of directors shall be decided by the affirmative vote of the holders of a majority of the voting power of the shares of stock that are present in person or represented by proxy at the meeting and entitled to vote on such matter (or if there are two or more classes or series of stock entitled to vote as separate classes, then in the case of each class or series, the holders of a majority of the voting power of the shares of stock of that class or series present in person or represented by proxy at the meeting).

Section 1.9: Fixing Date for Determination of Stockholders of Record

1.9.1. Meetings. In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) days before the date of such meeting. If the Board so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at 5:00 p.m. Eastern Time on the day next preceding the day on which notice is given, or, if notice is waived, at 5:00 p.m. Eastern Time on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for determination of stockholders entitled to vote at the adjourned meeting, and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance herewith at the adjourned meeting.

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1.9.2 Stockholder Action by Written Consent. In order that the Corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board. If no record date has been fixed by the Board pursuant to the first sentence of this Section 1.9.2, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business, or to any officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. If no record date has been fixed by the Board pursuant to the first sentence of this Section 1.9.2, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting if prior action by the Board is required by applicable law shall be at the close of business on the date on which the Board adopts the resolution taking such prior action.

1.9.3. Other Matters. In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board may fix, in advance, a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the Board and which shall not be more than sixty (60) days prior to such action. If no such record date is fixed by the Board, then the record date for determining stockholders for any such purpose shall be at 5:00 p.m. Eastern Time on the day on which the Board adopts the resolution relating thereto.

Section 1.10: List of Stockholders Entitled to Vote. The Corporation shall prepare, at least ten (10) days before every meeting of stockholders, a complete list of stockholders entitled to vote at the meeting (provided, however, if the record date for determining the stockholders entitled to vote is less than ten (10) days before the date of the meeting, the list shall reflect the stockholders entitled to vote as of the tenth (10th) day before the meeting date), arranged in alphabetical order and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, for a period of at least ten (10) days prior to the meeting, (a) on a reasonably accessible electronic network as permitted by applicable law (provided that the information required to gain access to the list is provided with the notice of the meeting), or (b) during ordinary business hours, at the principal place of business of the Corporation. If the meeting is held at a location where stockholders may attend in person, a list of stockholders entitled to vote at the meeting shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present at the meeting. If the meeting is held solely by means of remote communication, then the list shall be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access the list shall be provided with the notice of the meeting. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the list of stockholders required by this Section 1.10 or to vote in person or by proxy at any meeting of stockholders. The Corporation shall not be required to include electronic mail addresses or other electronic contact information on such list.

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Section 1.11: Inspectors of Elections.

1.11.1 Applicability. Unless otherwise required by the Certificate of Incorporation or by applicable law, the following provisions of this Section 1.11 shall apply only if and when the Corporation has a class of voting stock that is: (a) listed on a national securities exchange; (b) authorized for quotation on an interdealer quotation system of a registered national securities association; or (c) held of record by more than two thousand (2,000) stockholders. In all other cases, observance of the provisions of this Section 1.11 shall be optional, and at the discretion of the Board.

1.11.2 Appointment. The Corporation shall, in advance of any meeting of stockholders, appoint one or more inspectors of election to act at the meeting and make a written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the person presiding at the meeting shall appoint one or more inspectors to act at the meeting.

1.11.3 Inspector’s Oath. Each inspector of election, before entering upon the discharge of his duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspector’s ability.

1.11.4 Duties of Inspectors. At a meeting of stockholders, the inspectors of election shall (a) ascertain the number of shares outstanding and the voting power of each share, (b) determine the shares represented at a meeting and the validity of proxies and ballots, (c) count all votes and ballots, (d) determine and retain for a reasonable period of time a record of the disposition of any challenges made to any determination by the inspectors, and (e) certify their determination of the number of shares represented at the meeting, and their count of all votes and ballots. The inspectors may appoint or retain other persons or entities to assist the inspectors in the performance of the duties of the inspectors.

1.11.5 Opening and Closing of Polls. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced by the chairman of the meeting at the meeting. No ballot, proxies or votes, nor any revocations thereof or changes thereto, shall be accepted by the inspectors after the closing of the polls unless the Delaware Court of Chancery upon application by a stockholder shall determine otherwise.

1.11.6 Determinations. In determining the validity and counting of proxies and ballots, the inspectors shall be limited to an examination of the proxies, any envelopes submitted with those proxies, any information provided in connection with proxies pursuant to Section 211(a)(2)b.(i) of the DGCL, or in accordance with Sections 211(e) or 212(c)(2) of the DGCL, ballots and the regular books and records of the Corporation, except that the inspectors may consider other reliable information for the limited purpose of reconciling proxies and ballots submitted by or on behalf of banks, brokers, their nominees or similar persons which represent more votes than the holder of a proxy is authorized by the record owner to cast or more votes

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than the stockholder holds of record. If the inspectors consider other reliable information for the limited purpose permitted herein, the inspectors at the time they make their certification of their determinations pursuant to this Section 1.11 shall specify the precise information considered by them, including the person or persons from whom they obtained the information, when the information was obtained, the means by which the information was obtained and the basis for the inspectors’ belief that such information is accurate and reliable.

Section 1.12: Conduct of Meetings. The Board may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board, the person presiding over any meeting of stockholders shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such presiding person, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the presiding person of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the presiding person of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; (v) limitations on the time allotted to questions or comments by participants; (vi) restricting the use of audio/video recording devices and cell phones; and (vii) complying with any state and local laws and regulations concerning safety and security. The presiding person at any meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a matter or business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board or the person presiding over the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.

Section 1.13: Notice of Stockholder Business; Nominations.

1.13.1 Annual Meeting of Stockholders.

(a) Nominations of persons for election to the Board and the proposal of other business to be considered by the stockholders may be made at an annual meeting of stockholders only: (i) pursuant to the Corporation’s notice of such meeting (or any supplement thereto), (ii) by or at the direction of the Board, any duly authorized committee thereof or Scott Watterson or (iii) by any stockholder of the Corporation who was a stockholder of record at the time of giving of the notice provided for in this Section 1.13 (the “Record Stockholder”), who is entitled to vote at such meeting and who complies with the notice and other procedures set forth in this Section 1.13 in all applicable respects. For the avoidance of doubt, the foregoing clause (iii) shall be the exclusive means for a stockholder to make nominations or propose business (other than business included in the Corporation’s proxy materials pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended (such act, and the rules and regulations promulgated thereunder, the “Exchange Act”)), at an annual meeting of stockholders, and such stockholder must fully comply with the notice and other procedures set forth in this Section 1.13 to make such nominations or propose business before an annual meeting.

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(b) For nominations or other business to be properly brought before an annual meeting by a Record Stockholder pursuant to Section 1.13.1(a) of these Bylaws:

(i) the Record Stockholder must have given timely notice thereof in writing to the Secretary of the Corporation and provide any updates or supplements to such notice at the times and in the forms required by this Section 1.13;

(ii) such other business (other than the nomination of persons for election to the Board) must otherwise be a proper matter for stockholder action;

(iii) if the Proposing Person (as defined below) has provided the Corporation with a Solicitation Notice (as defined below), such Proposing Person must, in the case of a proposal other than the nomination of persons for election to the Board, have delivered a proxy statement and form of proxy to holders of at least the percentage of the Corporation’s voting shares required under applicable law to carry any such proposal, or, in the case of a nomination or nominations, have delivered a proxy statement and form of proxy to holders of a percentage of the Corporation’s voting shares reasonably believed by such Proposing Person to be sufficient to elect the nominee or nominees proposed to be nominated by such Record Stockholder, and must, in either case, have included in such materials the Solicitation Notice; and

(iv) if no Solicitation Notice relating thereto has been timely provided pursuant to this Section 1.13, the Proposing Person proposing such business or nomination must not have solicited a number of proxies sufficient to have required the delivery of such a Solicitation Notice under this Section 1.13.

To be timely, a Record Stockholder’s notice must be delivered to the Secretary at the principal executive offices of the Corporation not later than 5:00 p.m. Eastern Time on the ninetieth (90th) day nor earlier than 9:00 a.m. Eastern Time on the one hundred and twentieth (120th) day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is more than thirty (30) days before or more than seventy (70) days after such anniversary date, notice by the Record Stockholder to be timely must be so delivered (A) no earlier than 5:00 p.m. Eastern Time on the one hundred and twentieth (120th) day prior to such annual meeting and (B) no later than 5:00 p.m. Eastern Time on the later of the ninetieth (90th) day prior to such annual meeting or 5:00 p.m. Eastern Time on the tenth (10th) day following the day on which Public Announcement (as defined below) of the date of such meeting is first made by the Corporation. In no event shall an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for providing the Record Stockholder’s notice.

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(c) As to each person whom the Record Stockholder proposes to nominate for election or reelection as a director, in addition to the matters set forth in paragraph (e) below, such Record Stockholder’s notice shall set forth:

(i) the name, age, business address and residence address of such person;

(ii) the principal occupation or employment of such nominee;

(iii) the class, series and number of any shares of stock of the Corporation that are beneficially owned or owned of record by such person or any Associated Person (as defined in Section 1.13.4(c));

(iv) the date or dates such shares were acquired and the investment intent of such acquisition;

(v) all other information relating to such person that would be required to be disclosed in solicitations of proxies for election of directors in an election contest (even if an election contest is not involved), or would be otherwise required, in each case pursuant to and in accordance with Section 14(a) (or any successor provision) under the Exchange Act and the rules and regulations thereunder;

(vi) such person’s written consent to being named in the Corporation’s proxy statement as a nominee, to the public disclosure of information regarding or related to such person provided to the Corporation by such person or otherwise pursuant to this Section 1.13 and to serving as a director if elected;

(vii) whether such person meets the independence requirements of the stock exchange upon which the Corporation’s Class A Common Stock is primarily traded;

(viii) a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three (3) years, and any other material relationships, between or among such Proposing Person or any of its respective affiliates and associates, on the one hand, and each proposed nominee, and his or her respective affiliates and associates or others acting on concert therewith, on the other hand, including all information that would be required to be disclosed pursuant to Rule 404 promulgated under Regulation S-K if the Proposing Person or any of its respective affiliates and associates, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant; and

(ix) a completed and signed questionnaire, representation and agreement required by Section 1.13.2 of these Bylaws. The Corporation may require any proposed nominee to furnish such other information as may reasonably be required by the Corporation to determine the eligibility of the proposed nominee to serve as an independent director of the Corporation or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of the nominee.

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The number of nominees a Record Stockholder may nominate for election at the annual meeting (or in the case of a Record Stockholder giving the notice on behalf of a beneficial owner, the number of nominees a stockholder may nominate for election at the annual meeting on behalf of such beneficial owner) shall not exceed the number of directors to be elected at such annual meeting.

(d) As to any business other than the nomination of a director or directors that the Record Stockholder proposes to bring before the meeting, in addition to the matters set forth in paragraph (e) below, such Record Stockholder’s notice shall set forth:

(i) a reasonably detailed description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the Bylaws, the text of the proposed amendment), the reasons for conducting such business at the meeting and any material direct or indirect interest in such business of such Proposing Person, including any anticipated benefit to any Proposing Person therefrom; and

(ii) a description of all agreements, arrangements and understandings between or among any such Proposing Person and any of its respective affiliates or associates, on the one hand, and any other person or persons, on the other hand, (including their names) in connection with the proposal of such business by such Proposing Person;

(e) As to each Proposing Person giving the notice, such Record Stockholder’s notice shall set forth:

(i) the current name and address of such Proposing Person, including, if applicable, their name and address as they appear on the Corporation’s stock ledger, if different;

(ii) the class or series and number of shares of stock of the Corporation that are directly or indirectly owned of record or beneficially owned by such Proposing Person, including any shares of any class or series of the Corporation as to which such Proposing Person has a right to acquire beneficial ownership at any time in the future;

(iii) whether and the extent to which any derivative interest in the Corporation’s equity securities (including without limitation any option, warrant, convertible security, stock appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Corporation or with a value derived in whole or in part from the value of any class or series of shares of the Corporation, whether or not such instrument or right shall be subject to settlement in the underlying class or series of shares of the Corporation or otherwise, and any cash-settled equity swap, total return swap, synthetic equity position or similar derivative arrangement (any of the foregoing, a “Derivative Instrument”), as well as any rights to dividends on the shares of any class or series of shares of the Corporation that are separated or separable from the underlying shares of the Corporation) or any short interest in any security of the Corporation (for purposes of this Bylaw a person shall be deemed to have a short interest in a security if such person directly or indirectly, through any contract, arrangement, understanding, relationship or

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otherwise, has the opportunity to profit or share in any profit derived from any increase or decrease in the value of the subject security, including through performance-related fees) is held directly or indirectly by or for the benefit of such Proposing Person, including without limitation whether and the extent to which any ongoing hedging or other transaction or series of transactions has been entered into by or on behalf of, or any other agreement, arrangement or understanding (including without limitation any short position or any borrowing or lending of shares) has been made, the effect or intent of which is to mitigate loss to or manage risk or benefit of share price changes for, or to increase or decrease the voting power of, such Proposing Person with respect to any share of stock of the Corporation (any of the foregoing, a “Short Interest”);

(iv) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such Proposing Person or any of its respective affiliates or associates is a general partner or, directly or indirectly, beneficially owns an interest in a general partner of such general or limited partnership;

(v) any direct or indirect material interest in any material contract or agreement with the Corporation, any affiliate of the Corporation or any Competitor (as defined below) (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement);

(vi) any significant equity interests or any Derivative Instruments or Short Interests in any Competitor held by such Proposing Person and/or any of its respective affiliates or associates;

(vii) any other material relationship between such Proposing Person, on the one hand, and the Corporation, any affiliate of the Corporation or any Competitor, on the other hand;

(viii) all information that would be required to be set forth in a Schedule 13D filed pursuant to Rule 13d-1(a) or an amendment pursuant to Rule 13d-2(a) if such a statement were required to be filed under the Exchange Act and the rules and regulations promulgated thereunder by such Proposing Person and/or any of its respective affiliates or associates;

(ix) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the meeting pursuant to Section 14(a) (or any successor provision) under the Exchange Act and the rules and regulations thereunder;

(x) such Proposing Person’s written consent to the public disclosure of information provided to the Corporation pursuant to this Section 1.13;

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(xi) a complete written description of any agreement, arrangement or understanding (whether oral or in writing) between or among such Proposing Person, any of its respective affiliates or associates;

(xii) a representation that the Record Stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person, by virtual means, as applicable, or by proxy at the meeting to propose such business or nomination;

(xiii) a representation whether such Proposing Person intends (or is part of a group that intends) to deliver a proxy statement or form of proxy to holders of, in the case of a proposal, at least the percentage of the Corporation’s voting shares required under applicable law to carry the proposal or, in the case of a nomination or nominations, a sufficient number of holders of the Corporation’s voting shares to elect such nominee or nominees (an affirmative statement of such intent being a “Solicitation Notice”);

(xiv) any proxy, contract, arrangement, or relationship pursuant to which the Proposing Person has a right to vote, directly or indirectly, any shares of any security of the Corporation; and

(xv) any other information as reasonably requested by the Corporation.

The disclosures to be made pursuant to the foregoing clauses (ii), (iii), (iv) and (vi) shall not include any information with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner.

(f) A stockholder providing written notice required by this Section 1.13 shall update such notice in writing, if necessary, so that the information provided or required to be provided in such notice is true and correct in all material respects as of (i) the record date for determining the stockholders entitled to notice of the meeting and (ii) 5:00 p.m. Eastern Time on the tenth (10th) business day prior to the meeting or any adjournment or postponement thereof. In the case of an update pursuant to clause (i) of the foregoing sentence, such update shall be received by the Secretary of the Corporation at the principal executive office of the Corporation not later than five (5) business days after the record date for determining the stockholders entitled to notice of the meeting, and in the case of an update and supplement pursuant to clause (ii) of the foregoing sentence, such update and supplement shall be received by the Secretary of the Corporation at the principal executive office of the Corporation not later than eight (8) business days prior to the date for the meeting, and, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed). For the avoidance of doubt, the obligation to update as set forth in this paragraph shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any proposal or nomination or to submit any new proposal, including by changing or adding nominees, matters, business and/or resolutions proposed to be brought before a meeting of the stockholders.

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1.13.2 Submission of Questionnaire, Representation and Agreement. To be eligible to be a nominee of any stockholder for election or reelection as a director of the Corporation, the person proposed to be nominated must deliver (in accordance with the time periods prescribed for delivery of notice under Section 1.13 of these Bylaws) to the Secretary at the principal executive offices of the Corporation a completed and signed questionnaire in the form required by the Corporation (which form the stockholder shall request in writing from the Secretary of the Corporation and which the Secretary shall provide to such stockholder within ten days of receiving such request) with respect to the background and qualification of such person to serve as a director of the Corporation and the background of any other person or entity on whose behalf, directly or indirectly, the nomination is being made and a signed representation and agreement (in the form available from the Secretary upon written request) that such person: (a) is not and will not become a party to (i) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the Corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed to the Corporation or (ii) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the Corporation, with such person’s fiduciary duties under applicable law, (b) is not and will not become a party to any Compensation Arrangement (as defined below) that has not been disclosed to the Corporation, (c) if elected as a director of the Corporation, will comply with all informational and similar requirements of applicable insurance policies and laws and regulations in connection with service or action as a director of the Corporation, (d) if elected as a director of the Corporation, will comply with all corporate governance, conflict of interest, stock ownership requirements, confidentiality and trading policies and guidelines of the Corporation publicly disclosed from time to time, and (e) intends to serve as a director for the full term for which such individual is to stand for election.

1.13.3 Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of such meeting. Nominations of persons for election to the Board may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of such meeting (a) by or at the direction of the Board or any duly authorized committee thereof or (b) provided that the Board has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice of the special meeting, who shall be entitled to vote at the meeting and who complies with the notice and other procedures set forth in this Section 1.13 in all applicable respects. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board, any such stockholder may nominate a person or persons (as the case may be), for election to such position(s) as specified in the Corporation’s notice of meeting, if the stockholder’s notice required by Section 1.13.1(b) of these Bylaws shall be delivered to the Secretary of the Corporation at the principal executive offices of the Corporation (i) no earlier than the one hundred and twentieth (120th) day prior to such special meeting and (ii) no later than 5:00 p.m. Eastern Time on the later of the ninetieth (90th) day prior to such special meeting or the tenth (10th) day following the day on which Public Announcement is first made of the date of the special meeting and of the nominees

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proposed by the Board to be elected at such meeting. The number of nominees a stockholder may nominate for election at a special meeting (or in the case of a stockholder giving the notice on behalf of a beneficial owner, the number of nominees a stockholder may nominate for election at the special meeting on behalf of such beneficial owner) shall not exceed the number of directors to be elected at such special meeting. In no event shall an adjournment or postponement of a special meeting commence a new time period (or extend any time period) for providing such notice.

1.13.4 General.

(a) Except as otherwise expressly provided in any applicable rule or regulation promulgated under the Exchange Act, only such persons who are nominated in accordance with the procedures set forth in this Section 1.13 shall be eligible to be elected at a meeting of stockholders and serve as directors and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 1.13. Except as otherwise provided by law or these Bylaws, the chairman of the meeting shall have the power and duty to determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 1.13 and, if any proposed nomination or business is not in compliance herewith, to declare that such defective proposal or nomination shall be disregarded. Notwithstanding the foregoing provisions of this Section 1.13, unless otherwise required by law, if the stockholder (or a Qualified Representative of the stockholder (as defined below)) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or proposed business, such nomination shall be disregarded and such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation.

(b) Notwithstanding the foregoing provisions of this Section 1.13, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein. Nothing in this Section 1.13 shall be deemed to affect any rights of (a) stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (b) the holders of any series of Preferred Stock to elect directors pursuant to any applicable provisions of the Certificate of Incorporation.

(c) For purposes of these Bylaws the following definitions shall apply:

(A) “affiliate” and “associate” shall have the meanings ascribed thereto in Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”); provided, however, that the term “partner” as used in the definition of “associate” shall not include any limited partner that is not involved in the management of the relevant partnership;

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(B) “Associated Person” shall mean with respect to any subject stockholder or other person (including any proposed nominee) (1) any person directly or indirectly controlling, controlled by or under common control with such stockholder or other person, (2) any beneficial owner of shares of stock of the Corporation owned of record or beneficially by such stockholder or other person, (3) any associate of such stockholder or other person, and (4) any person directly or indirectly controlling, controlled by or under common control with any such Associated Person;

(C) “Compensation Arrangement” shall mean any direct or indirect compensatory payment or other financial agreement, arrangement or understanding with any person or entity other than the Corporation, including any agreement, arrangement or understanding with respect to any direct or indirect compensation, reimbursement or indemnification in connection with candidacy, nomination, service or action as a nominee or as a director of the Corporation;

(D) “Competitor” shall mean any entity that provides products or services that compete with or are alternatives to the principal products produced or services provided by the Corporation or its affiliates;

(E) “Proposing Person” shall mean (1) the Record Stockholder providing the notice of business proposed to be brought before an annual meeting or nomination of persons for election to the Board at a stockholder meeting, (2) the beneficial owner or beneficial owners, if different, on whose behalf the notice of business proposed to be brought before the annual meeting or nomination of persons for election to the Board at a stockholder meeting is made, and (3) any Associated Person on whose behalf the notice of business proposed to be brought before the annual meeting or nomination of persons for election to the Board at a stockholder meeting is made;

(F) “Public Announcement” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act; and

(G) to be considered a “Qualified Representative” of a stockholder, a person must be a duly authorized officer, manager, trustee or partner of such stockholder or must be authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as a proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction thereof, at the meeting. The Secretary of the Corporation, or any other person who shall be appointed to serve as secretary of the meeting, may require, on behalf of the Corporation, reasonable and appropriate documentation to verify the status of a person purporting to be a “Qualified Representative” for purposes hereof.

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ARTICLE II: BOARD OF DIRECTORS

Section 2.1: Number; Qualifications. The total number of directors constituting the Board shall be fixed from time to time in the manner set forth in the Certificate of Incorporation. No decrease in the authorized number of directors constituting the Board shall shorten the term of any director. Directors need not be stockholders of the Corporation.

Section 2.2: Election; Resignation; Removal; Vacancies. Election of directors need not be by written ballot. Subject to the special rights of the holders of one or more series of Preferred Stock to elect directors, the Board shall be divided into three classes, designated as Class I, Class II and Class III. The number of directors in each class shall be divided as nearly equal as practicable. Each director shall hold office until the annual meeting at which such director’s term expires and until such director’s successor is duly elected and qualified, or until such director’s earlier death, resignation, disqualification or removal. Any director may resign at any time upon notice to the Corporation given in writing or by any electronic transmission. Subject to the special rights of holders of any series of Preferred Stock to elect directors, any director may be removed only as provided by the Certificate of Incorporation and applicable law. All vacancies occurring in the Board and any newly created directorships resulting from any increase in the authorized number of directors shall be filled in the manner set forth in the Certificate of Incorporation.

Section 2.3: Regular Meetings. Regular meetings of the Board may be held at such places, within or without the State of Delaware, and at such times as the Board may from time to time determine. Notice of regular meetings need not be given if the date, times and places thereof are fixed by resolution of the Board.

Section 2.4: Special Meetings. Special meetings of the Board may be called by or at the direction of the Chairman of the Board, the Chief Executive Officer, or the Board and may be held at any time, date or place, within or without the State of Delaware, as the person or persons calling the meeting shall fix. Notice of the time, date and place of such meeting shall be given, orally, in writing or by electronic transmission (including electronic mail), by the person or persons calling the meeting (or by an officer at the direction of the person calling the meeting) to all directors at least twelve (12) hours before the meeting if such notice is given by telephone, electronic mail or other means of electronic transmission or by reputable overnight courier, or by hand, to such director’s last known business or home address. Unless otherwise indicated in the notice, any and all business may be transacted at a special meeting.

Section 2.5: Remote Meetings Permitted. Members of the Board, or any committee of the Board, may participate in a meeting of the Board or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to conference telephone or other communications equipment shall constitute presence in person at such meeting.

Section 2.6: Quorum; Vote Required for Action. Except as otherwise provided herein or in the Certificate of Incorporation, or required by law, at all meetings of the Board, a majority of the Board shall constitute a quorum for the transaction of business. Except as otherwise provided herein or in the Certificate of Incorporation, or required by law, each director present shall cast a single vote and a vote equal to a majority of the votes of the directors present at a meeting at which a quorum is present shall be the act of the Board.

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Section 2.7: Adjournment. A majority of the directors present, whether or not a quorum is present, may adjourn any meeting of the Board to another time or place. No notice need be given of any adjourned meeting unless the time and place of the adjourned meeting are not announced at the time of adjournment, in which case notice conforming to the requirements of Section 2.4 of these Bylaws shall be given to each director.

Section 2.8: Organization. Meetings of the Board shall be presided over by (a) the Chairman of the Board, (b) in such person’s absence, by the Lead Independent Director, if any, (c) in such person’s absence, by the Chief Executive Officer, or (d) in such person’s absence, by a chairman chosen by the Board at the meeting. The Secretary shall act as secretary of the meeting, but in such person’s absence the chairman of the meeting may appoint any person to act as secretary of the meeting.

Section 2.9: Unanimous Action by Directors in Lieu of a Meeting. Any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting if all members of the Board or such committee, as the case may be, consent thereto in writing or by electronic transmission. After the action is taken, the writing or writings or electronic transmission or transmissions shall be filed with the minutes of proceedings of the Board or committee, as applicable. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

Section 2.10: Powers. Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, the business and affairs of the Corporation shall be managed by or under the direction of the Board

Section 2.11: Compensation of Directors. Members of the Board, as such, may receive, pursuant to a resolution of the Board, fees and other compensation for their services as directors, including without limitation their services as members of committees of the Board.

Section 2.12: Fractional Voting. The member of the Board nominated by the Board Rights Holder (as such term is defined in the Corporation’s 7.0% Note due     , 2027 issued to Icon Preferred Holdings, L.P. under the Omnibus Investor Agreement dated as of , 2021, the “Omnibus Investor Agreement”) by and among Icon Preferred Holdings, L.P., LC9 Connected Holdings LP, a Delaware limited partnership, the Corporation and others in respect of the Pamplona Note IPO Entitlement Amount (as defined in the Omnibus Investor Agreement)) shall (i) at any time when the Board has fewer than eleven (11) members, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of the Board (whether under the Certificate of Incorporation, these Bylaws, the DGCL or otherwise), whether taken at a meeting of the Board or by written consent of the Board, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of the Board at such time and (ii) in the case of matters of a committee of the Board that includes such member, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of such committee (whether taken under the Certificate of Incorporation, these Bylaws, the DGCL or otherwise), whether taken at a meeting of such committee or by written consent of such committee, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of such committee at such time.

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ARTICLE III: COMMITTEES

Section 3.1: Committees. The Board, may designate one (1) or more committees of the Board, each consisting of one or more directors as from time to time may be fixed by the Board. Any such committee shall serve at the pleasure of the Board. The Board may appoint a chairman of any committee, who shall preside at meetings of any such committee. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee upon the request of the Chairman of the Board or the chairman of such committee. In the absence or disqualification of a member of the committee, the member or members thereof present at any meeting of such committee who are not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent provided in a resolution of the Board or in charters or other organizational documents of such committee approved by the Board, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation and may authorize the seal of the Corporation to be affixed to all papers that may require it; but no such committee shall have the power or authority in reference to the following matters: (a) approving, adopting, or recommending to the stockholders any action or matter (other than the election or removal of members of the Board) expressly required by the DGCL to be submitted to stockholders for approval or (b) adopting, amending or repealing any bylaw of the Corporation.

Section 3.2: Committee Rules. Each committee shall keep records of its proceedings and make such reports as the Board may from time to time request. Unless the Board otherwise provides, each committee designated by the Board may make, alter and repeal rules for the conduct of its business. In the absence of such rules, each committee shall conduct its business in the same manner as the Board conducts its business pursuant to Article II of these Bylaws.

Except as otherwise provided in the Certificate of Incorporation, these Bylaws or the resolution of the Board designating the committee, any committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and may delegate to any such subcommittee any or all of the powers and authority of the committee.

ARTICLE IV: OFFICERS; CHAIRMAN

Section 4.1: Generally. The officers of the Corporation may consist of a Chief Executive Officer (who may be the Chairman of the Board), a Secretary, a Treasurer and such other officers, including, without limitation, a Chief Financial Officer, and one or more Vice Presidents, as may from time to time be appointed by the Board. All officers shall be elected by the Board. Except as otherwise provided by law, by the Certificate of Incorporation or these Bylaws, each officer shall hold office until such officer’s successor is duly elected and qualified or until such officer’s earlier resignation, death, disqualification or removal. Any number of offices may be held by the same person. The officers of the Corporation shall have such

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authority and shall exercise such powers and perform such duties as may be specified in these Bylaws or pursuant to authorization of the Board, and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors. Any officer may resign by delivering a resignation in writing or by electronic transmission to the Corporation at its principal office or to the Chairman of the Board, the Chief Executive Officer, or the Secretary. Such resignation shall be effective upon delivery unless it is specified to be effective at some later time or upon the happening of some later event. Any vacancy occurring in any office of the Corporation by death, resignation, removal or otherwise may be filled by the Board and the Board may, in its discretion, leave unfilled, for such period as it may determine, any offices. Each such successor shall hold office for the unexpired term of such officer’s predecessor and until a successor is duly elected and qualified or until such officer’s earlier resignation, death, disqualification or removal.

Section 4.2: Chief Executive Officer. Subject to the control of the Board and such supervisory powers, if any, as may be given by the Board, the powers and duties of the Chief Executive Officer of the Corporation are:

(a) to supervise the implementation of policies adopted and approved by the Board;

(b) to act as the general manager and, subject to the control of the Board, to have general supervision, direction and control of the business and affairs of the Corporation;

(c) to appoint and remove subordinate officers, agents and employees, except those appointed by the Board,

(d) subject to Section 1.7 of these Bylaws, to preside at all meetings of the stockholders;

(e) subject to Section 1.4 of these Bylaws, to call special meetings of the stockholders to be held at such times and, subject to the limitations prescribed by law or by these Bylaws, at such places as he or she shall deem proper;

(f) to affix the signature of the Corporation to all deeds, conveyances, mortgages, guarantees, leases, obligations, bonds, certificates and other papers and instruments in writing which have been authorized by the Board or which, in the judgment of the Chief Executive Officer, should be executed on behalf of the Corporation; to sign certificates for shares of stock of the Corporation (if any); and, subject to the direction of the Board, to have general charge of the property of the Corporation and to supervise and control all officers, agents and employees of the Corporation; and

(g) possess such other powers and perform such other duties as may be assigned by these Bylaws, as may from time to time be assigned by the Board and as may be incident to the office of Chief Executive Officer.

Section 4.3: Chairman of the Board. Subject to the provisions of Section 2.8 of these Bylaws, the Chairman of the Board shall have the power to preside at all meetings of the Board and shall have such other powers and duties as provided in these Bylaws and as the Board may from time to time prescribe. The Chairman of the Board may or may not be an officer of the Corporation.

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Section 4.4: Chief Financial Officer. The person holding the office of Chief Financial Officer shall be the Treasurer of the Corporation unless the Board shall have designated another officer as the Treasurer of the Corporation. Subject to the direction of the Board and the Chief Executive Officer, the Chief Financial Officer shall perform all duties and have all powers that are commonly incident to the office of Chief Financial Officer, or as the Board or the Chief Executive Officer may from time to time prescribe.

Section 4.5: Treasurer. The person holding the office of Treasurer shall have custody of all monies and securities of the Corporation. The Treasurer shall make such disbursements of the funds of the Corporation as are authorized and shall render from time to time an account of all such transactions. The Treasurer shall also perform such other duties and have such other powers as are commonly incident to the office of Treasurer, or as the Board or the Chief Executive Officer may from time to time prescribe.

Section 4.6: Vice President. Each Vice President shall have all such powers and duties as are commonly incident to the office of Vice President or that are delegated to him or her by the Board or the Chief Executive Officer. A Vice President may be designated by the Board to perform the duties and exercise the powers of the Chief Executive Officer in the event of the Chief Executive Officer’s absence or disability.

Section 4.7: Secretary. The Secretary shall issue or cause to be issued all authorized notices for, and shall keep, or cause to be kept, minutes of all meetings of the stockholders and the Board. The Secretary shall have charge of the corporate minute books and similar records and shall perform such other duties and have such other powers as are commonly incident to the office of Secretary, or as the Board or the Chief Executive Officer may from time to time prescribe.

Section 4.8: Delegation of Authority. The Board may from time to time delegate the powers or duties of any officer of the Corporation to any other officers or agents of the Corporation, notwithstanding any provision hereof.

Section 4.9: Removal. Any officer of the Corporation shall serve at the pleasure of the Board and may be removed at any time, with or without cause, by the Board; provided that if the Board has empowered the Chief Executive Officer to appoint any officer of the Corporation, then such officer may also be removed by the Chief Executive Officer. Such removal shall be without prejudice to the contractual rights of such officer, if any, with the Corporation.

ARTICLE V: STOCK

Section 5.1: Certificates; Uncertificated Shares. The shares of capital stock of the Corporation shall be uncertificated shares; provided, however, that this Section 5.1 shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation (or the transfer agent or registrar, as the case may be). Notwithstanding the foregoing, the Board may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be certificated shares. Every holder of stock represented by certificates shall be

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entitled to have a certificate signed by, or in the name of the Corporation, by any two authorized officers of the Corporation (it being understood that each of the Chairman of the Board, the Chief Executive Officer, any Vice-President, the Treasurer, any Assistant Treasurer, the Secretary, and any Assistant Secretary shall be an authorized officer for such purpose), representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were an officer, transfer agent or registrar at the date of issue.

Section 5.2: Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates or Uncertificated Shares. The Corporation may issue a new certificate of stock or uncertificated shares in the place of any certificate previously issued by it, alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to agree to indemnify the Corporation and/or to give the Corporation a bond sufficient to indemnify it, against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.

Section 5.3: Stapling. In accordance with Section 3.7 of the Certificate of Incorporation, the shares of Common Stock received by LC9 Connected Holdings LP, a Delaware limited partnership (“L Catterton”), pursuant to Section 1.1(e) of the Omnibus Investor Agreement, dated as of                      , 2021 by and among L Catterton, Icon Preferred Holdings, L.P. (“Pamplona”), the Corporation and the other parties thereto (the “Omnibus Agreement”) shall be transferable to a transferee only if transferred together with a proportionate principal amount of the 2021 IPO Convertible Note B (as defined in the Omnibus Investor Agreement) issued to L Catterton and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted and any attempted transfer of such shares of Common Stock without a transfer of the proportional portion of the 2021 IPO Convertible Note B and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted shall be void ab initio and of no effect. The shares of Common Stock received by Pamplona pursuant to Section 1.1(e) of the Omnibus Agreement shall be transferable to a transferee only if transferred together with a proportionate principal amount of the 2021 IPO Convertible Note B (as defined in the Omnibus Investor Agreement) issued to Pamplona and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted and any attempted transfer of such shares of Common Stock without a transfer of the proportional portion of the 2021 IPO Convertible Note B and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted shall be void ab initio and of no effect. It is the intention of the Corporation that for so long as a share of Common Stock is required to be transferred with a proportionate amount of a 2021 IPO Convertible Note B and shares of Common Stock into which such 2021 IPO Convertible Note has been converted, such share of Common Stock and such principal amount of the 2021 IPO Convertible Note B and shares into which such 2021 IPO Convertible Note B have been converted shall be treated for U.S. federal income tax purposes as a single integrated security that constitutes stock and this Section 5.3 shall be interpreted in a manner consistent therewith.

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Section 5.4: Other Regulations. Subject to applicable law, the Certificate of Incorporation and these Bylaws, the issue, transfer, conversion and registration of shares represented by certificates and of uncertificated shares shall be governed by such other regulations as the Board may establish.

ARTICLE VI: INDEMNIFICATION

Section 6.1: Indemnification of Officers and Directors. Each person who was or is made a party to, or is threatened to be made a party to, or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, legislative or any other type whatsoever (a “Proceeding”), by reason of the fact that such person (or a person of whom such person is the legal representative), is or was a director or officer of the Corporation or, while serving as a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee, agent or trustee of another corporation, or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans (for purposes of this Article VI, an “Indemnitee”), shall be indemnified and held harmless by the Corporation to the fullest extent permitted by the DGCL as the same exists or may hereafter be amended, against all expenses, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such Indemnitee in connection therewith, provided such Indemnitee acted in good faith and in a manner that the Indemnitee reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal Proceeding, had no reasonable cause to believe the Indemnitee’s conduct was unlawful. Such indemnification shall continue as to an Indemnitee who has ceased to be a director or officer of the Corporation and shall inure to the benefit of such Indemnitees’ heirs, executors and administrators. Notwithstanding the foregoing, subject to Section 6.5 of these Bylaws, the Corporation shall indemnify any such Indemnitee seeking indemnity in connection with a Proceeding (or part thereof) initiated by such Indemnitee only if such Proceeding (or part thereof) was authorized by the Board or such indemnification is authorized by an agreement approved by the Board.

Section 6.2: Advance of Expenses. The Corporation shall pay all expenses (including attorneys’ fees) incurred by an Indemnitee in defending any Proceeding in advance of its final disposition; provided, however, that if the DGCL then so requires, the advancement of such expenses shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such Indemnitee, to repay such amounts if it shall ultimately be determined that such Indemnitee is not entitled to be indemnified under this Article VI or otherwise.

Section 6.3: Non-Exclusivity of Rights. The rights conferred on any person in this Article VI shall not be exclusive of any other right that such person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, Bylaws, agreement, vote or consent of stockholders or disinterested directors, or otherwise. Additionally, nothing in this Article VI shall limit the ability of the Corporation, in its discretion, to indemnify or advance expenses to persons whom the Corporation is not obligated to indemnify or advance expenses pursuant to this Article VI.

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Section 6.4: Indemnification Contracts. The Board is authorized to cause the Corporation to enter into indemnification contracts with any director, officer, employee or agent of the Corporation, or any person serving at the request of the Corporation as a director, officer, employee, agent or trustee of another corporation, partnership, joint venture, trust or other enterprise, including employee benefit plans, providing indemnification or advancement rights to such person. Such rights may be greater than those provided in this Article VI.

Section 6.5: Right of Indemnitee to Bring Suit.

6.5.1 Right to Bring Suit. If a claim under Section 6.1 or 6.2 of these Bylaws is not paid in full by the Corporation within sixty (60) days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be thirty (30) days, the Indemnitee may at any time thereafter bring suit against the Corporation. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Indemnitee shall be entitled to be paid, to the fullest extent permitted by law, the expense of prosecuting or defending such suit. In any suit brought by the Indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the Indemnitee to enforce a right to an advancement of expenses) it shall be a defense that the Indemnitee has not met any applicable standard of conduct which makes it permissible under the DGCL (or other applicable law) for the Corporation to indemnify the Indemnitee for the amount claimed.

6.5.2 Effect of Determination. The absence of a determination prior to the commencement of such suit that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct set forth in applicable law shall not create a presumption that the Indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the Indemnitee, be a defense to such suit.

6.5.3 Burden of Proof. In any suit brought by the Indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the Indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article VI, or otherwise, shall be on the Corporation.

Section 6.6: Nature of Rights. The rights conferred upon Indemnitees in this Article VI shall be contract rights and such rights shall continue as to an Indemnitee who has ceased to be a director, officer or trustee and shall inure to the benefit of the Indemnitee’s heirs, executors and administrators. Any amendment, repeal or modification of any provision of this Article VI that adversely affects any right of an Indemnitee or an Indemnitee’s successors shall be prospective only, and shall not adversely affect any right or protection conferred on a person pursuant to this Article VI with respect to any Proceeding involving any occurrence or alleged occurrence of any action or omission to act that took place prior to such amendment, repeal or modification.

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Section 6.7: Insurance. The Corporation may purchase and maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the DGCL.

ARTICLE VII: NOTICES

Section 7.1: Notice.

7.1.1 Form and Delivery. Except as otherwise specifically required in these Bylaws (including, without limitation, Section 7.1.2 of these Bylaws) or by applicable law, all notices required to be given pursuant to these Bylaws may (a) in every instance in connection with any delivery to a member of the Board, be effectively given by hand delivery (including use of a delivery service), by depositing such notice in the mail, postage prepaid, or by sending such notice by overnight express courier, facsimile, electronic mail or other form of electronic transmission and (b) be effectively delivered to a stockholder when given by hand delivery, by depositing such notice in the mail, postage prepaid, by email, unless the stockholder has notified the Corporation that such stockholder objects to receiving notice by email or, if specifically consented to by the stockholder as described in Section 7.1.2 of these Bylaws, by sending such notice by other form of electronic transmission. Any such notice shall be addressed to the person to whom notice is to be given at such person’s address as it appears on the records of the Corporation. Notice shall be given (i) if mailed, when deposited in the United States mail, postage prepaid, (ii) if delivered by courier service, the earlier of when the notice is received or left at the stockholder’s address, or (iii) if given by electronic mail, when directed to such stockholder’s electronic mail address. A notice by electronic mail must include a prominent legend that the communication is an important notice regarding the corporation. A notice by electronic mail will include any files attached thereto and any information hyperlinked to a website if such electronic mail includes the contact information of an officer or agent of the corporation who is available to assist with accessing such files or information. In the case of deliver electronic transmission (other than email), notice shall be deemed given at the time provided in Section 7.1.2 of these Bylaws.

7.1.2 Electronic Transmission. Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation, or these Bylaws shall be effective if given by a form of electronic transmission (other than email) consented to by the stockholder to whom the notice is given in accordance with Section 232 of the DGCL. Any such consent shall be revocable by the stockholder by written notice to the Corporation. Notwithstanding anything in this Article VII to the contrary, notice may not be given by form of electronic transmission (including email) from and after the time (a) the Corporation is unable to deliver by electronic transmission two consecutive notices given by the Corporation and (b) such inability becomes known to the Secretary or an Assistant Secretary of the Corporation or to the transfer agent, or other person responsible for the giving of notice; provided, however, the inadvertent failure to discover such inability shall not invalidate any meeting or other action. Notice given pursuant to this Section 7.1.2 shall be deemed given: (i) if by facsimile telecommunication, when directed to a number at which the stockholder has consented to receive notice; (ii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of such posting and the giving of such separate notice; and (iii) if by any other form of electronic transmission, when directed to the stockholder.

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7.1.3 Affidavit of Giving Notice. An affidavit of the Secretary or an Assistant Secretary or of the transfer agent or other agent of the Corporation that the notice has been given in writing or by a form of electronic transmission shall, in the absence of fraud, be prima facie evidence of the facts stated therein.

Section 7.2: Waiver of Notice. Whenever notice is required to be given under any provision of the DGCL, the Certificate of Incorporation or these Bylaws, a written waiver of notice, signed by the person entitled to notice, or waiver by electronic transmission by such person, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, directors or members of a committee of directors need be specified in any waiver of notice.

ARTICLE VIII: INTERESTED DIRECTORS

Section 8.1: Interested Directors. No contract or transaction between the Corporation and one or more of its members of the Board or officers, or between the Corporation and any other corporation, partnership, association or other organization in which one or more of its directors or officers are members of the board of directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board or committee thereof that authorizes the contract or transaction, or solely because his, her or their votes are counted for such purpose, if: (a) the material facts as to his, her or their relationship or interest and as to the contract or transaction are disclosed or are known to the Board or the committee, and the Board or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; (b) the material facts as to his, her or their relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (c) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified by the Board, a committee thereof, or the stockholders.

Section 8.2: Quorum. Interested directors may be counted in determining the presence of a quorum at a meeting of the Board or of a committee which authorizes the contract or transaction.

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ARTICLE IX: GENERAL PROVISIONS

Section 9.1: Fiscal Year. The fiscal year of the Corporation shall be determined by resolution of the Board.

Section 9.2: Seal. The Board may provide for a corporate seal, which may have the name of the Corporation inscribed thereon and shall otherwise be in such form as may be approved from time to time by the Board.

Section 9.3: Form of Records. Any records administered by or on behalf of the Corporation in the regular course of its business, including its stock ledger, books of account and minute books, may be kept on or by means of, or be in the form of any other information storage device, method or one or more electronic networks or databases (including one or more distributed electronic networks or databases), electronic or otherwise, provided that the records so kept can be converted into clearly legible paper form within a reasonable time and otherwise comply with the DGCL. The Corporation shall so convert any records so kept upon the request of any person entitled to inspect such records pursuant to any provision of the DGCL.

Section 9.4: Reliance Upon Books and Records. A member of the Board, or a member of any committee designated by the Board shall, in the performance of such person’s duties, be fully protected in relying in good faith upon the books and records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of the Corporation’s officers or employees, or committees of the Board, or by any other person as to matters the member reasonably believes are within such other person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.

Section 9.5: Certificate of Incorporation Governs. In the event of any conflict between the provisions of the Certificate of Incorporation and Bylaws, the provisions of the Certificate of Incorporation shall govern.

Section 9.6: Severability. If any provision of these Bylaws shall be held to be invalid, illegal, unenforceable or in conflict with the provisions of the Certificate of Incorporation, then such provision shall nonetheless be enforced to the maximum extent possible consistent with such holding and the remaining provisions of these Bylaws (including without limitation, all portions of any section of these Bylaws containing any such provision held to be invalid, illegal, unenforceable or in conflict with the Certificate of Incorporation, that are not themselves invalid, illegal, unenforceable or in conflict with the Certificate of Incorporation) shall remain in full force and effect.

Section 9.7: Time Periods. In applying any provision of these Bylaws which requires that an act be done or not be done a specified number of days prior to an event or that an act be done during a period of a specified number of days prior to an event, calendar days shall be used, the day of the doing of the act shall be excluded, and the day of the event shall be included.

Section 9.8: Dividends. Subject to any applicable provisions of law or the Certificate of Incorporation, dividends upon the shares of capital stock of the Corporation may be declared by the Board at any regular or special meeting of the Board of Directors and any such dividend may be paid in cash, property or shares of the Corporation’s capital stock. A member of the Board, or

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a member of any committee designated by the Board, shall be fully protected in relying in good faith upon the records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or committees of the Board of Directors, or by any other person as to matters the director reasonably believes are within such other person’s professional or expert competence and who the director or member reasonably believes or determines has been selected with reasonable care by or on behalf of the Corporation, as to the value and amount of the assets, liabilities and/or net profits of the Corporation, or any other facts pertinent to the existence and amount of surplus or other funds from which dividends might properly be declared and paid.

Section 9.9: Execution of Instruments. The Board may authorize, or provide for the authorization of, officers, employees or agents to enter into any contract or execute and deliver any instrument in the name and on behalf of the Corporation. Any such authorization may be general or limited to specific contracts or instruments.

ARTICLE X: AMENDMENT OF BYLAWS

The Board of Directors shall have the power to adopt, amend or repeal the Bylaws. Any adoption, amendment or repeal of the Bylaws by the Board of Directors shall require the approval of a majority of the Board. In addition to any vote of the holders of any class or series of stock of the Corporation required by applicable law or by the Certificate of Incorporation, the affirmative vote of the holders of at least a majority of the voting power of all of the then-outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required for the stockholders to adopt, amend or repeal any provision of the Bylaws.

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EX-4.1

Exhibit 4.1

IFIT INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE CUSIP 45174G 10 9 SEE REVERSE FOR CERTAIN DEFINITIONS AND LEGENDS This certifies that is the record holder of FULLY PAID AND NONASSESSABLE SHARES OF CLASS A COMMON STOCK, $0.001 PAR VALUE PER SHARE, OF IFIT HEALTH & FITNESS INC transferable on the books of the Corporation in person or by duly authorized attorney upon surrender of this Certificate properly endorsed. This Certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar. WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers. Dated: CHIEF EXECUTIVE OFFICER GENERAL COUNSEL & SECRETARY COUNTERSIGNED AND REGISTERED: AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC (BROOKLYN, NY) TRANSFER AGENT AND REGISTRAR BY: AUTHORIZED SIGNATURE

The Corporation shall furnish without charge to each stockholder who so requests a statement of the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock of the Corporation or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Such requests shall be made to the Corporation’s Secretary at the principal office of the Corporation. KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR DESTROYED THE CORPORATION WILL REQUIRE A BOND INDEMNITY AS A CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE. The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM – as tenants in common UNIF GIFT MIN ACT – ......................... Custodian TEN ENT – as tenants by the entireties (Cust) (Minor) JT TEN – as joint tenants with right of under Uniform Gifts to Minors survivorship and not as tenants Act (State) in common COM PROP – as community property UNIF TRF MIN ACT – ................. Custodian (until age ..................) (Cust) ..................................... (Minor) under Uniform Transfers to Minors Act (State) Additional abbreviations may also be used though not in the above list. FOR VALUE RECEIVED, hereby sell(s), assign(s) and transfer(s) unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE) shares of the capital stock represented by within Certificate, and do hereby irrevocably constitute and appoint attorney-in-fact to transfer the said stock on the books of the within named Corporation with full power of the substitution in the premises. Dated X X Signature(s) Guaranteed: NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER. By THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION, (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. GUARANTEES BY A NOTARY PUBLIC ARE NOT ACCEPTABLE. SIGNATURE GUARANTEES MUST NOT BE DATED.

EX-4.2

Exhibit 4.2

Execution Version

OMNIBUS INVESTOR AGREEMENT

This Omnibus Investor Agreement (this “Agreement”) is made and entered into on and as of September 27, 2021 (the “Effective Date”), by and among LC9 Connected Holdings, LP, a Delaware limited partnership, (“L Catterton”), Icon Preferred Holdings, L.P. (“Pamplona” and together with L Catterton, the “Institutional Investors”), Scott R. Watterson, an individual residing in River Heights, UT (“Watterson”), SW ICON LLC, a Delaware limited liability company (together with Watterson, “SW”), Gary E. Stevenson, an individual residing in Bountiful, UT (“Stevenson”), GS ICON LLC, a Delaware limited liability company (together with Stevenson, “GS”), Robert C. Gay, an individual residing in Wellington, FL (“Robert Gay”), BG ICON LLC, a Nevada limited liability company, BG ICON II LLC, a Delaware limited liability company (together with Robert Gay, “BG”), Wen-Chung Ko, an individual residing in Yaoyuan Hsien, Taiwan (“Ko” and together with SW, GS, BG and the Institutional Investors, the “Investors”) and iFIT Health & Fitness Inc (f/k/a HF Holdings, Inc.), a Delaware corporation (the “Company”).

RECITALS

WHEREAS, reference is hereby made to (a) that certain Amended and Restated Investors’ Agreement, dated as of October 2, 2020, by and among L Catterton, Pamplona, SW, the Company and the other investors party thereto (the “Investors’ Agreement”), (b) that certain Securities Purchase Agreement, dated as of October 2, 2020, by and among L Catterton, Pamplona the Company (the “Preferred SPA”), (c) that certain subordinated promissory note issued to Pamplona on November 29, 2019 (the “Pamplona Note”) and (d) the Fourth Amended and Restated Certificate of Incorporation of the Company, filed on March 17, 2021, with the Secretary of State of the State of Delaware (as amended, “Company COI” and together with the Investors’ Agreement, the Preferred SPA and the Pamplona Note, the “Stockholder Agreements”);

WHEREAS, pursuant to the Pamplona Note, Pamplona is the holder of a subordinated promissory note with a principal balance equal to $200,000,000 (subject to increase for any PIK Payment (as defined in the Pamplona Note)) accruing interest at the rate of seven percent (7%) per annum (subject to increase as set forth therein), which such balance is payable on the conditions set forth in the Pamplona Note, including in connection with an Initial Public Offering (as defined in the Investors’ Agreement) and, in connection with an Initial Public Offering, Pamplona is entitled to the payment of the specified entitlements accrued in accordance with the terms of the Pamplona Note (such entitlement, the “Pamplona Note IPO Entitlement” and such amount determined as of any applicable date of determination and without reduction for any cash paid in respect thereof pursuant to this Agreement, the “Pamplona Note IPO Entitlement Amount”);

WHEREAS, pursuant to the Preferred SPA, each of the Institutional Investors purchased certain shares of Preferred Stock, $0.001 par value per share, of the Company (the “Preferred Stock”), which, among other things, are entitled to receive, in connection with an Initial Public Offering that is consummated on or prior to September 30, 2021, in respect of all but not less than all of the shares of Preferred Stock, a price equal to 125% of the Liquidation Value (as defined in the Company COI) of each such share of Preferred Stock, which, if an Initial Public Offering is not consummated on or prior to September 30, 2021, such price increases by an amount equal to 5% of the Liquidation Value on October 1, 2021 and on each six (6)-month anniversary of October 1, 2021 until the applicable mandatory prepayment event occurs (such entitlement, the “Preferred Stock IPO Entitlement,” such event, the “Preferred Stock Entitlement Event” and the amount thereof, as of any applicable date of determination and without reduction for any cash or stock paid or issued in respect thereof pursuant to this Agreement, the “Preferred Stock IPO Entitlement Amount”);

WHEREAS, (a) pursuant to a Board of Directors resolution dated May 28, 2021, Watterson is entitled to a cash payment in an amount equal to $35,000,000, contingent upon the consummation of an initial public offering (the “CEO Existing Entitlement Amount”) and (b) subject to the satisfaction of the conditions set forth in Section 8.8 of the Investors’ Agreement, the Board of Directors pursuant to a resolution dated September 14, 2021 has approved an award to the chief executive officer of $50,000,000, consisting of a grant of a restricted unvested interest in a 2021 IPO Convertible Note (as defined herein), pursuant to a Restricted Property Award Agreement to be dated as of the date of issuance of the 2021 IPO Convertible Notes (the “Award Agreement”) (such amount, the “CEO Restricted Award Amount” and, together with the CEO Existing Entitlement Amount, the “CEO IPO Award Amount”); and

WHEREAS, on August 31, 2021, Board of Directors of the Company authorized and caused to file that certain Registration Statement on Form S-1 (File No. 333-259220) relating to the offer and sale of shares of the Company’s common stock in an underwritten initial public offering (“2021 IPO”).

NOW, THEREFORE, in consideration of the representations and warranties, covenants and other obligations contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto (the “Parties”) hereby agree as follows:

ARTICLE 1

DISTRIBUTION OF IPO PROCEEDS

1.1 Agreement Regarding the Distribution of IPO Proceeds. The Parties hereby acknowledge and agree that, notwithstanding anything in the Stockholder Agreements or any other governing documents of the Company or its Subsidiaries to the contrary, one hundred (100%) percent of the proceeds received by the Company in connection with the consummation of the 2021 IPO (and subject to the occurrence thereof) shall be used and/or distributed as follows:

(a) in the case that the 2021 IPO results in proceeds to the Company in an amount equal to or less than $465,000,000 after deducting fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses), the Company shall retain any such proceeds;

(b) in the case that the 2021 IPO results in proceeds to the Company in an amount greater than $465,000,000 after deducting fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses), and the aggregate gross size of the 2021 IPO does not equal or exceed $700,000,000 (prior to deduction for fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses)), the Company shall, in the following order of priority, (i) retain an amount of such proceeds equal to (A) $465,000,000 plus (B) all fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses), (ii) use an amount up to $35,000,000 to repay the CEO Existing Entitlement Amount and (iii) use the remainder of such proceeds to repay all or any portion of the Pamplona IPO Note Entitlement Amount owed to Pamplona under the Pamplona Note;

(c) in the case that the 2021 IPO results in gross proceeds to the Company in an amount greater than $700,000,000 (prior to deduction for fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses)) (such IPO, a “High Proceeds IPO”), the Company shall, in the following order of priority, (i) retain an amount of such proceeds equal to (A) $465,000,000 plus (B) all fees and expenses payable by the Company to its third party advisors in connection with the 2021 IPO (including underwriting fees and expenses), (ii) use an

amount up to $35,000,000 to repay the CEO Existing Entitlement Amount and (iii) use the remainder of such proceeds as follows: (A) eighty percent (80%) of the remainder of such proceeds shall be used by the Company to pay all or any portion of the Pamplona IPO Note Entitlement Amount to Pamplona under the Pamplona Note, until Pamplona has received an amount of payment of the Pamplona IPO Note Entitlement Amount equal to $300,000,000 and (B) twenty percent (20%) of the remainder of such proceeds shall be used by the Company to pay amounts to the Institutional Investors in respect of the Preferred Stock IPO Entitlement Amount (but subject to Section 1.1(d)); provided, that if additional proceeds from the 2021 IPO are available to the Company after deducting all amounts to be retained or used by the Company pursuant to clauses (i), (ii) and (iii) of this Section 1.1(c), such remaining proceeds shall be used by the Company as additional amounts to be paid to L Catterton in respect of the Preferred Stock IPO Entitlement Amount (but subject to Section 1.1(d));

(d) any amounts payable in cash to the Institutional Investors in connection with the consummation of the 2021 IPO pursuant to Section 1.1(c)(iii)(B) shall not exceed fifty percent (50%) of the Preferred Stock IPO Entitlement Amount, and shall only reduce the amount of the Preferred Stock IPO Entitlement Amount payable to the Institutional Investors in cash under the Company COI, and shall not reduce the portion of the Preferred Stock IPO Entitlement Amount to be paid in shares of common stock pursuant to Section 1.1(e); and

(e) the Company shall issue to each of L Catterton and Pamplona, in respect of fifty percent (50%) of the Preferred Stock IPO Entitlement Amount of each of L Catterton and Pamplona, common stock of the Company upon the consummation of the 2021 IPO with the number of shares of common stock of the Company issued to each of L Catterton and Pamplona, respectively, being calculated by dividing (x) fifty percent (50%) of the Preferred Stock IPO Entitlement Amount owed to L Catterton and Pamplona, respectively, by (y) an amount equal to (A) the per share offering price to the public of the Company’s common stock in connection with the 2021 IPO multiplied by (B) eighty-five percent (85%).

Exhibit A attached hereto sets forth, for illustrative purposes only, an example of the distribution of proceeds pursuant to this Section 1.1 at various potential levels of proceeds to the Company in connection with the 2021 IPO.

1.2 Convertible Note Exchange. Following the distribution of proceeds in accordance with Section 1.1:

(a) the remaining portion of the Pamplona Note IPO Entitlement Amount that is not otherwise repaid in accordance with the applicable subsection of Section 1.1 (if any) shall be cancelled in exchange for a convertible note, in the form attached hereto as Exhibit B (a “2021 IPO Convertible Note A”), with such 2021 IPO Convertible Note A having a principal balance in an amount equal to the portion of the Pamplona Note IPO Entitlement Amount that is not paid in cash in accordance with the applicable subsection of Section 1.1, and, thereafter, the Company’s obligations under the Pamplona Note shall be deemed fully satisfied and performed;

(b) one hundred percent (100%) of the then-outstanding Preferred Stock shall be redeemed by the Company in exchange for a convertible note, in the form attached hereto as Exhibit C (a “2021 IPO Convertible Note B”), with any holder of Preferred Stock receiving a 2021 IPO Convertible Note B with a principal balance equal to (A) the Preferred Stock IPO Entitlement Amount less (B) the portion of the Preferred Stock IPO Entitlement Amount payable in cash that is paid pursuant to Section 1.1(c) less (C) the portion of the Preferred Stock IPO Entitlement Amount payable in common stock that is paid in accordance with Section 1.1(e), and, thereafter, the Company’s obligations owed to the holders of Preferred Stock under the Company COI shall be deemed fully satisfied and performed; and

(c) the Company shall (i) pursuant to the Award Agreement grant a restricted unvested interest in a convertible note, in the form attached hereto as Exhibit D (a “2021 IPO Convertible Note C” and, together with each 2021 IPO Convertible Note A and each 2021 IPO Convertible Note B, a “2021 IPO Convertible Note”) to SW with a principal balance equal to the CEO Restricted Award Amount and (ii) issue a 2021 IPO Convertible Note C to SW with a principal balance equal to the remaining portion of the CEO Existing Entitlement Amount that is not otherwise paid in cash accordance with the applicable subsection of Section 1.1 (if any), thereafter, any obligation of the Company under the Investors’ Agreement, including if applicable Section 8.8 thereunder, with respect to the CEO IPO Award Amount shall be deemed fully satisfied and performed.

Exhibit A attached hereto sets forth, for illustrative purposes only, an example of the issuances of 2021 IPO Convertible Note pursuant to this Section 1.2 at various potential levels of proceeds to the Company in connection with the 2021 IPO.

1.3 Greenshoe Exercise.

(a) In connection with, but prior to, the consummation of the 2021 IPO (the “2021 IPO Closing”), the Company shall enter into a customary underwriting agreement with each of the underwriters party thereto providing, among other things, that the underwriters may purchase from the Company, at the election of the underwriters, for an agreed period of time following the IPO Closing (such election, the “Greenshoe Exercise”), an additional number of the Company’s common stock as determined in accordance with the underwriting agreement (any such proceeds from the Greenshoe Exercise, the “Greenshoe Proceeds”). Notwithstanding anything to the contrary in this Section 1.3, in the event that the Greenshoe Exercise occurs in whole or in part such that any portion of the Greenshoe Proceeds are received at the initial 2021 IPO Closing, then such portion of the Greenshoe Proceeds will be used together with the other proceeds as described in Section 1.1 (with such adjustments so that the parties will remain in the same position as if the distribution of Greenshoe Proceeds had been made as set forth in this Section 1.3), and any portion of Greenshoe Proceeds received after the initial 2021 IPO Closing will be used as set forth in this Section 1.3.

(b) In connection with any IPO that is not a High Proceeds IPO, the Company shall use one hundred percent (100%) of the Greenshoe Proceeds received in connection with any Greenshoe Exercise in connection therewith to prepay, in the following order of priority: (i) subject to the Award Agreement, all or a portion of the 2021 IPO Convertible Note issued to SW solely to the extent that such 2021 IPO Convertible Note was issued in respect of any portion of the CEO Existing Entitlement Amount that is not otherwise repaid in accordance with the applicable subsection of Section 1.1 (if any) and (ii) all or a portion of the 2021 IPO Convertible Notes held by Pamplona or its permitted transferees, in each case in accordance with the terms of the applicable 2021 IPO Convertible Note.

(c) In connection with any IPO that is a High Proceeds IPO, the Company shall use one hundred percent (100%) of the Greenshoe Proceeds received in connection with any Greenshoe Exercise in connection therewith to prepay, in the following order of priority: (i) subject to the Award Agreement, all or a portion of the 2021 IPO Convertible Note issued to SW solely to the extent that such 2021 IPO Convertible Note was issued in respect of any portion of the CEO Existing Entitlement Amount that is not otherwise repaid in accordance with the applicable subsection of Section 1.1 (if any) and (ii) all or a portion of the 2021 IPO Convertible Note held by each of Pamplona, L Catterton or their respective permitted transferees based on the following entitlements: (A) seventy-eight percent (78%) of any such Greenshoe Proceeds shall be used to prepay all or a portion of the 2021 IPO Convertible Notes held by Pamplona or its permitted transferees until Pamplona receives an aggregate amount, when taken together with any amounts received by it in cash under Section 1.1, equal to $300,000,000, and (B) twenty-two percent (22%) of any such Greenshoe Proceeds, plus any portion otherwise allocable to Pamplona under clause (A) but for Pamplona’s receipt of an aggregate amount, when taken together with any amounts received under Section 1.1, equal to $300,000,000, which such amounts shall be used to prepay all or a portion of the 2021 IPO Convertible Note held by L Catterton or its permitted transferees.

Exhibit A attached hereto sets forth, for illustrative purposes only, an example of the prepayments of 2021 IPO Convertible Note pursuant to this Section 1.3 at various potential levels of proceeds to the Company in connection with the 2021 IPO.

1.4 Closing; Consent to 2021 IPO.¹ The transactions contemplated by this Section 1.1 shall take place upon the 2021 IPO Closing (if the 2021 IPO Closing occurs prior to termination of this Agreement), subject to satisfaction or waiver of the conditions set forth in Article 3 (including, for the avoidance of doubt, Section 3.4). Subject to compliance by the Company and the Investors (other than the Institutional Investors) with the covenants and agreements set forth in this Agreement, upon consummation of the transactions contemplated by this Agreement, each of the Institutional Investors consents to the consummation of the 2021 IPO pursuant to the Investors’ Agreement. Each of the Company and the Investors further agree that upon the 2021 IPO Closing (if the 2021 IPO Closing occurs prior to termination of this Agreement), the Investors Agreement shall be terminated and of no further effect. For the avoidance of doubt, by entering into this Agreement, the Company is not obligated to execute an underwriting agreement or otherwise proceed with the 2021 IPO.

1.5 Intended Tax Treatment.

(a) The Company and L Catterton agree to treat, for U.S. federal income tax purposes:

(i) the 2021 IPO Convertible Note issued to L Catterton pursuant to this Agreement together with the shares of common stock of the Company issued to L Catterton pursuant to Section 1.1(e) of this Agreement (and any shares of common stock of the Company issued to L Catterton pursuant to such 2021 IPO Convertible Note, but, for the avoidance of doubt, excluding the L Catterton Warrant Shares) as a single integrated security that constitutes stock that is not “preferred stock” within the meaning of Section 305 of the Internal Revenue Code of 1986 (as amended from time to time, the “Code”) and the Treasury Regulations promulgated thereunder;

(ii) the L Catterton Warrant Exercise, to the extent it is regarded, as part of the transaction described in clause (iii);

(iii) the transactions contemplated by this Agreement as involving the exchange by L Catterton of the existing single integrated security represented by its Preferred Stock and the L Catterton Warrant for the single integrated security described in clause (i) and the L Catterton Warrant Shares as a recapitalization within the meaning of Section 368(a)(1)(E) of the Code that is not taxable to L Catterton pursuant to Section 354 of the Code, except to the extent of any cash received by L Catterton pursuant to Section 1.1(c) and Section 1.3 that is required to be treated as “boot” for purposes of Section 354 and Section 356 of the Code; and

¹  The parties acknowledge and agree that, for purposes of this Agreement, the 2021 IPO shall be deemed to have occurred on September 30, 2021 in the event the Company executes a customary underwriting agreement for the 2021 IPO prior to October 12, 2021 and the consummation of the 2021 IPO occurs within five (5) Business Days such execution.

(iv) neither L Catterton (nor any of its Affiliates) as being required to include in income any dividend income by reason of the application of Section 305 of the Code to the single integrated security described in clause (i) (or any of its component parts), except to the extent of the amount of any dividends that are declared and paid on shares of common stock of the Company issued to L Catterton pursuant to Section 1.1(e).

(b) The Company and Pamplona agree to treat:

(i) the 2021 IPO Convertible Note issued to Pamplona in respect of its Preferred Stock IPO Entitlement Amount, and the common shares issued to Pamplona in respect of its Preferred Stock IPO Entitlement Amount (together with any shares of common stock issued to Pamplona pursuant to the 2021 IPO Convertible Note issued to Pamplona in respect of the Preferred Stock IPO Entitlement Amount), but not any common shares issued pursuant to the warrant exercise provided for in Section 3.6, as a single integrated security for U.S. federal income tax purposes that constitutes stock that is not “preferred stock” within the meaning of Section 305 of the Code and the Treasury Regulations promulgated thereunder;

(ii) the transfers hereunder in respect of the Pamplona Note IPO Entitlement Amount and in respect of the Preferred Stock IPO Entitlement Amount associated with the Preferred Stock held by Pamplona as separate transactions for federal, and applicable state and local, income tax purposes, with (x) the exercise pursuant to Section 3.6 hereof by Pamplona of Warrant No. 1 issued by the Company to Pamplona on November 29, 2019 treated as a separate transaction and (y) the exercise pursuant to Section 3.6 hereof by Pamplona of Warrant No. 3 issued by the Company to Pamplona on October 14, 2020 treated as part of the transaction that includes the transfers hereunder in respect of Pamplona’s Preferred Stock IPO Entitlement Amount;

(iii) the transactions contemplated by this Agreement with respect to the Preferred Stock held by Pamplona as involving the exchange by Pamplona of its Preferred Stock and the Warrant No 3 issued by the Company to Pamplona on October 14, 2020 for any cash, common stock and 2021 IPO Convertible Notes received by Pamplona in respect of the Preferred Stock IPO Entitlement Amount and the common shares issued pursuant to the exercise of Warrant No. 3 issued by the Company to Pamplona on October 14, 2020 in a recapitalization within the meaning of Section 368(a)(1)(E) of the Code that is not taxable to Pamplona pursuant to Section 354 of the Code, except to the extent of any cash received pursuant to this Agreement in such exchange that is required to be treated as “boot” for purposes of Section 354 and Section 356 of the Code;

(iv) neither Pamplona (nor any of its Affiliates) as being required to include in income any dividend income for U.S. federal income tax purposes by reason of the application of Section 305 of the Code, except to the extent of the amount of any dividends that are declared and paid on shares of common stock of the Company held by Pamplona;

(v) the transaction contemplated by this Agreement with respect to the Pamplona Note as a recapitalization within the meaning of Section 368(a)(1)(E) of the Code that does not involve payments treated as interest for federal income tax purposes in excess of the accrued and unpaid interest on the Pamplona Note as of the date of the exchange provided for in Section 1.2;

(vi) the 2021 IPO Convertible Note A received by Pamplona in respect of the Pamplona Note IPO Entitlement Amount as indebtedness for U.S. federal income tax purposes; and

(vii) the transactions provided for in this Agreement with respect to Pamplona as not giving rise, including for information reporting purposes, to a dividend under Section 356(a)(2) of the Code.

(c) The Company shall not withhold under Section 1441 of the Code or the Treasury Regulations thereunder in connection with the transactions contemplated by this Agreement with respect to Pamplona; provided that Pamplona provides the Company a duly executed IRS Form W-9 at or prior to the 2021 IPO Closing.

1.6 The Company, L Catterton and Pamplona agree to take no positions or actions inconsistent with the foregoing (including on IRS Form 1099 and any other tax return or tax form), unless otherwise required by a change in applicable law after the date hereof or pursuant to a “determination” within the meaning of Section 1313(a) of the Code.

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

2.1 Representations and Warranties of the Company. The Company hereby represents and warrants to the Investors that the following statements are true and correct:

(a) Organization. The Company is a corporation duly organized, validly existing and in good standing under the laws of Delaware and has the requisite power and authority to conduct its business, and to own and lease its properties and assets. The Company is properly qualified to do business as a foreign entity and is in good standing (to the extent such concept is relevant in any particular jurisdiction) in each jurisdiction in which such qualification is necessary under the applicable law in respect of the conduct of its business and the ownership of its assets.

(b) Authorization. The execution and delivery of this Agreement by the Company and the performance by the Company of its obligations hereunder have been authorized by all necessary action on the part of the Company and its affiliates, if applicable. No other action or approval is necessary for the execution, delivery or performance of this Agreement by the Company. The Company has full right, power, authority and capacity to execute, deliver and perform this Agreement and the other agreements and instruments contemplated hereby to which the Company is a party. This Agreement and each other agreement and instrument to be executed or delivered by the Company in connection herewith constitutes, or will constitute when executed and delivered, a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

(c) No Conflict. Neither the execution and delivery of this Agreement or any other agreement or instrument executed and delivered in connection herewith by the Company, the consummation of the transactions contemplated hereby or thereby, or the performance by the Company or its subsidiaries of its or their respective obligations hereunder, will: (i) conflict with, or constitute or result in, a breach or default by the Company or any of its subsidiaries of (or constitute an event that, with or without the giving of notice, the obtaining of any approval or consent or the lapse of time, would result in a breach or default by the Company or any of its subsidiaries of), or give any party any right to terminate, accelerate or modify any term of or right under: (A) the Company’s or any of its subsidiaries’ organizational and governing documents; (B) any (x) judgment or order that involves the Company or (y) law, rule or regulation; or (C) other than the provisions of the ABL Credit Agreement (as defined herein) which may be breached upon consummation of the 2021 IPO and which will be waived by receipt of the Waiver and Consent (as defined herein), any contract to which the Company or any of its subsidiaries is or will be a party upon consummation of the 2021 IPO; or (ii) result in the creation or imposition of any lien or encumbrance on any of the Company’s or any of its subsidiaries’ assets.

(d) Broker. There is no broker or finder or other person entitled to a commission or brokerage fee or payment in connection with this Agreement or the transactions contemplated hereby as a result of any agreement of or action taken by the Company.

(e) No Claims. There is no action, proceeding, suit, at law or in equity, or any arbitration or administrative proceeding by or before any court or other governmental entity, pending, or, to the Company’s knowledge, threatened, against the Company or any of its respective properties that could reasonably be expected to impair the ability of the Company to perform its obligations hereunder or the consummation of the transactions contemplated hereby.

2.2 Representations and Warranties of the Investors. Each Investor hereby represents and warrants to the Company that the following statements are true and correct:

(a) Authorization. The execution and delivery of this Agreement by such Investor and the performance by such Investor of its obligations hereunder have been authorized by all necessary action on the part of such Investor. No other action or approval is necessary for the execution, delivery or performance of this Agreement by such Investor. Such Investor has full right, power, authority and capacity to execute, deliver and perform this Agreement and such other agreements and instruments as are contemplated hereby to which such Investor is a party. This Agreement and each other agreement and instrument to be executed or delivered by such Investor constitute, or will constitute when executed and delivered, valid and binding obligations of such Investor, enforceable against such Investor in accordance with their respective terms.

(b) No Conflict. Neither the execution and delivery of this Agreement or any other agreement or instrument to be executed and delivered in connection herewith by such Investor nor the consummation of the transactions contemplated hereby or thereby nor the fulfillment by such Investor of any of the terms contemplated hereby or thereby will conflict with or result in a breach by such Investor of, or constitute a default under, or create an event that, with or without the giving of notice or the lapse of time, or both, would be a default under or breach of, or give a right to terminate or cancel, under (A) the organizational and governing documents of such Investor or (B) any judgment, order, writ, injunction, decree or demand of any governmental entity involving such Investor.

(c) Broker. There is no broker or finder or other person entitled to a commission or brokerage fee or payment in connection with this Agreement or the transactions contemplated hereby as a result of any agreement of or action taken by such Investor.

ARTICLE 3

COVENANTS

3.1 Closing Deliveries by the Company. Prior to or at the 2021 IPO Closing, the Company shall have delivered the following documents to the Institutional Investors, and the Company shall use best efforts to deliver such documents to the Investors:

(a) an (i) amended and restated Certificate of Incorporation of the Company, which has been filed with the Secretary of State of the State of Delaware and is effective prior to the 2021 IPO Closing, which (A) provides for the removal of any provisions regarding, or relating to, the Preferred Stock (including (x) the preferences owed to the holders thereof, (y) the rights and obligations of the holders

thereof and (z) any associated defined terms)) and (B) includes the language set forth in Exhibit E attached hereto that is entitled “Stapling Language in Company COI” and (ii) amended and restated Bylaws of the Company which (A) includes the language set forth on Exhibit E attached hereto that is entitled “Stapling Language in Bylaws of the Company,” providing for (x) the stapling of the 2021 IPO Convertible Note received by L Catterton to the common stock issued to L Catterton pursuant to Section 1.1(e) of the Agreement and (y) the stapling of the 2021 IPO Convertible Note received by Pamplona in respect of the Preferred Stock IPO Entitlement Amount to the common stock received by Pamplona in respect of the Preferred Stock IPO Entitlement Amount (but neither such language nor any other stapling language in such Bylaws shall apply to any 2021 IPO Convertible Note received by Pamplona in respect of the Pamplona Note IPO Entitlement Amount or to the common shares received on the exercise pursuant to Section 3.6 of the exercise of Warrant No. 1 and Warrant No,. 3 issued by the Company to Pamplona on November 29, 2019 and October 14, 2020, respectively) and (B) includes the language set forth on Exhibit F attached hereto, with respect to the board right provided in the 2021 IPO Convertible Notes received by Pamplona in respect of the Pamplona Note IPO Entitlement Amount; and

(b) the Registration Rights Agreement, attached hereto as Exhibit G (the “Registration Rights Agreement”), duly executed and delivered by the Company and each of the Investors (other than the Institutional Investors).

3.2 Closing Deliveries by the Investors. Prior to or at the 2021 IPO Closing, the Investors shall have delivered the Registration Rights Agreement to the Company and each of the other Investors, and each of the Investors shall use best efforts to deliver such duly executed Registration Rights Agreement to the other Investors and the Company.

3.3 Withholding Tax Forms. Prior to or at the 2021 IPO Closing, each Institutional Investor shall have delivered to the Company a duly executed IRS Form W-9.

3.4 Credit Agreement Waiver. The obligations of the Investors to consummate the transactions contemplated by this Agreement is subject to receipt by the Company on or prior to consummation of the 2021 IPO of a valid waiver and consent to the transactions contemplated by this Agreement to the extent required under that certain ABL Credit Agreement (the “ABL Credit Agreement”), dated as of May 12, 2021, by and among the Company, certain subsidiaries of the Company, Bank of America, N.A., and the other parties thereto, delivered by the Requisite Lenders (as defined therein) (the “Waiver and Consent”). The Company shall use its reasonable best efforts to obtain the Waiver and Consent prior to consummation of the 2021 IPO.

3.5 Minimum IPO Proceeds. The obligations of the Investors to consummate the transactions contemplated by this Agreement is subject to receipt by the Company, in connection with the consummation of the 2021 IPO, of gross proceeds to the Company in an amount greater than $400,000,000.

3.6 Warrant Exercise. In connection with the consummation of, but subject in all cases to the occurrence of, the 2021 IPO, (i) L Catterton desires to exercise its rights under that certain Warrant No. 2 issued by the Company to L Catterton on October 2, 2020 (such exercise, the “L Catterton Warrant Exercise” and the shares of common stock of the Company received pursuant to the exercise, the “L Catterton Warrant Shares”) and (ii) Pamplona desires to exercise its rights under each of Warrant No. 1 and Warrant No. 3 issued by the Company to Pamplona on November 29, 2019 and October 14, 2020, respectively, and, in each case, upon the exercise thereof, the Company hereby agrees to issue to each of L Catterton and Pamplona shares of common stock of the Company in accordance with the terms of the applicable warrants; provided, however, that, the number of shares of common stock of the Company available for purchase under each of Warrant No. 1, Warrant No. 2 and Warrant No. 3 shall be updated to reflect the requisite anti-dilution adjustments to which the Institutional Investors are entitled under the

applicable warrants, with such number of additional shares of common stock of the Company available for purchase under the applicable warrants being determined immediately prior to the consummation of the 2021 IPO in accordance with the illustrative allocation schedule set forth on Exhibit H attached hereto (the “Illustrative Closing Allocation Schedule”). The Company acknowledges and agrees that such requisite anti-dilution adjustments to which the Institutional Investors are entitled under the applicable warrants includes, as of the date hereof, (A) (x) 5,353 shares (for Warrant No. 2) of common stock of the Company in the case of L Catterton and (y) 9,157 shares (for Warrant No. 1) and 382 (for Warrant No. 3) shares of common stock of the Company in the case of Pamplona, in each case with an exercise price per share of $342.35 (in satisfaction of certain anti-dilution adjustments to which the Institutional Investors are entitled with respect to option issuances made by the Company) and (B) in the case of L Catterton with respect to Warrant No. 2 and Pamplona with respect to Warrant No. 3, anti-dilution adjustments for the common shares issuable to Planet Fitness Holdings, LLC, a New Hampshire limited liability company (“Planet Fitness”) or any affiliate thereof pursuant to the applicable agreements between Planet Fitness and the Company.

3.7 Closing Allocation Schedule. The Company shall, in connection with the consummation of the IPO, but immediately prior to the occurrence thereof, subject to the prior written consent of each of the Institutional Investors (in each case not to be unreasonably withheld, conditioned or delayed), update the Illustrative Closing Allocation Schedule to reflect (a) the requisite price per share of common stock of the Company to be sold in connection with the 2021 IPO and (b) the updated amount of common stock of the Company available for purchase under each of Warrant No. 1, Warrant No. 2 and Warrant No. 3 taking into account the final determination of the respective anti-dilution entitlements in respect of anti-dilution adjustments in respect thereof, including under Sections 3.6(A) and (B).

3.8 Further Assurances. Without prejudice to the Company’s right to determine whether or not to proceed with the 2021 IPO or any Investor’s right to consent thereto, the Company shall use its reasonable efforts to take or cause to be taken all actions necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement as and when reasonably requested by an Investor from time to time.

ARTICLE 4

TERMINATION

4.1 Termination Events. Notwithstanding anything to the contrary contained herein, this Agreement may be terminated at any time prior to the 2021 IPO Closing only as follows:

(a) by mutual written consent of the Parties;

(b) by L Catterton or Pamplona, if the 2021 IPO Closing and the transactions contemplated by this Agreement shall not have occurred on or prior to October 31, 2021 (the “Outside Date”); provided, that the terminating Party under this Section 4.1(b) is not (at such time of termination) in breach of any representation, warranty, covenant or other agreement in this Agreement so as to cause any conditions to the 2021 IPO Closing not to be satisfied; or

(c) by L Catterton or Pamplona, in the event of any material breach of, or failure to perform, by the Company of any of its agreements, covenants, representations or warranties contained herein, which material breach or failure to perform (i) would result in the Company being unable to satisfy any applicable condition to the transactions contemplated by this Agreement prior to the Outside Date and (ii) (A) cannot be cured within ten (10) Business Days or (B) if curable, has not been cured by the Company within ten (10) Business Days, in each case, after another Party notifies the Company of such breach in writing.

4.2 Effect of Termination. In the event of termination of this Agreement by any Party pursuant to this Article 4, this Agreement shall become null and void and have no effect and all rights and obligations of the Parties hereunder shall terminate without any liability of any Party to any other Party except (i) nothing herein shall relieve any Party from liability for any breach of this Agreement occurring prior to such termination and (ii) the provisions of Section 5.1 (Expenses), Section 5.10 (Remedies), Section 5.12 (Applicable Law; Consent to Jurisdiction), Section 5.13 (MUTUAL WAIVER OF JURY TRIAL) and this Section 4.2 (and, to the extent applicable to the interpretation of enforcement of such provisions, Section 5.3 (Interpretation)), shall expressly survive the termination of this Agreement.

ARTICLE 5

MISCELLANEOUS

5.1 Expenses. Irrespective of whether the 2021 IPO or the transactions contemplated by this Agreement are consummated, the Company shall pay on demand, on behalf of each Institutional Investor, each Party’s reasonable costs, fees and expenses relating to the preparation, negotiation, execution, delivery and performance of its obligations under this Agreement and any of the other agreements or arrangements contemplated hereby or thereby (including, but not limited to, the 2021 IPO Convertible Notes and the Registration Rights Agreement).

5.2 Notices. All notices or other communications which are required or permitted hereunder shall be in writing and shall be deemed notice hereunder if (a) delivered personally, (b) sent by registered or certified mail, postage prepaid, (c) sent overnight by a nationally recognized courier or (d) sent by email (with a copy sent overnight by a nationally recognized courier to follow) in accordance with the following:

If to the Company:

c/o iFit Health & Fitness Inc.

1500 South 1000 West

Logan, Utah 84321

Email:            steve@ifit.com

                        everett@ifit.com

Attention:       Steve Barr, CFO

                        Everett Smith, GC

with a copy to:

Weil, Gotshal & Manges, LLP

100 Federal Street, 34^th Floor

Boston, Massachusetts 02110

Email:            corey.chivers@weil.com

Attention:      Corey Chivers

If to L Catterton:

c/o L Catterton Management Limited

599 West Putnam Avenue

Greenwich, CT 06830

Email:            marc.magliacano@lcatterton.com;

                        jennifer.reid@lcatterton.com

                        legalnotice@lcatterton.com

Attention:       Marc Magliacano;

                        Jennifer Reid

with a copy to:

Kirkland & Ellis LLP

601 Lexington Avenue

New York, NY 10022

Email:           joshua.kogan@kirkland.com

Attention:     Joshua Kogan, P.C.

If to Pamplona:

c/o Pamplona Capital Management LLC

667 Madison Avenue, 22nd Floor

New York, NY 10065

Email:            asinger@pamplonafunds.com

Attention:      Andrew Singer

with a copy to:

Lowenstein Sandler LLP

1251 Avenue of the Americas, 18^th Floor

New York, NY 10020

Email:            mbrosse@lowenstein.com

Attention:      Michael Brosse

If to the Investors (other than the Institutional Investors):

c/o iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Email:            swatterson@iconfitness.com

Attention:      Scott Watterson

with a copy for informational purposes only to:

Weil, Gotshal & Manges LLP

100 Federal Street, 34^th Floor

Boston, Massachusetts 02110

Email:            corey.chivers@weil.com

Attention:      Corey Chivers

5.3 Interpretation. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a substantive part of this Agreement. The use of the word “including” in this Agreement shall be by way of example rather than by limitation. The phrase “at any time” shall be deemed to be followed by the words “and on one or more occasions”. Reference to any agreement, document or instrument means such agreement, document or instrument as amended or otherwise modified in accordance with the terms thereof. Where this Agreement states that a Person “shall,” “will” or “must” perform in some manner or otherwise act or omit to act, it means such Person is legally obligated to do so in accordance with this Agreement. The word “breach” means (x) in the context of a breach of a representation and warranty, such representation and warranty was not true and correct when made and (y) in the context of a breach of a covenant or other obligation by a Person, that such Person has not complied with or performed such covenant or other obligation. Any reference to a statute is deemed also to refer to any amendments or successor legislation as in effect at the relevant time and any reference to any law includes the rules and regulations promulgated thereunder. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. The use of the words “or,” “either” and “any” shall not be exclusive. “Person” means any natural person, any corporation, limited liability company, partnership, trust or other legal entity and any governmental entity, authority or body.

5.4 Assignment. This Agreement shall bind and inure to the benefit of the Parties and their respective successors, assigns, heirs and representatives; provided, however, that none of the Parties may assign any of its rights hereunder without the prior written consent of the other Parties.

5.5 Successors. Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the Parties shall bind and inure to the benefit of the respective successors and assigns of the Parties whether so expressed or not.

5.6 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same instrument. Signed counterparts of this Agreement may be delivered by facsimile or by portable document format (.pdf) image and shall be deemed originals for all purposes hereunder.

5.7 Headings. The headings contained in this Agreement are included for convenience of reference and do not affect the meaning or interpretation of this Agreement.

5.8 Severability. If any term or provision contained herein is held by a court of competent jurisdiction or other authority to be illegal, void, unenforceable, invalid or against its public policy, the remainder of the terms and provisions contained herein shall remain in full force and effect and shall in no way be affected or impaired, and this Agreement shall be reformed, construed and enforced in such jurisdiction as if such illegal, unenforceable or invalid term or provision or any portion thereof had never been part of this Agreement.

5.9 Complete Agreement. This Agreement and those documents expressly referred to herein and therein (or attached thereto) and other documents of even date herewith embody the complete agreement and understanding among the Parties and supersede and preempt and prior understandings, agreement, or representations by or among the Parties, written or oral, which may have related to the subject matter hereof in any way.

5.10 Remedies. Each Party will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including reasonable attorney’s fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The Parties agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any Party may in its sole discretion apply to any court of law or equity of competent

jurisdiction for specific performance and/or other injunctive relief in order to enforce any violations of the provisions of this Agreement. It is accordingly agreed that the Investors shall be entitled to an injunction or injunctions, specific performance and/or other equitable relief to prevent breaches of this Agreement by the Company and to enforce specifically the terms and provisions of this Agreement against the Company, in each case without posting a bond or undertaking, this being in addition to any other remedy to which such Party is entitled at law or in equity. The Company agrees that the Company will not oppose the granting of an injunction, specific performance or other equitable relief on the basis that the Investors have an adequate remedy at law or that an award of an injunction or specific performance is not an appropriate remedy for any reason at law or in equity. If any action, suit or proceeding is brought to enforce or interpret the terms of this Agreement or to protect the rights obtained hereunder, or to recover damages for breach of this Agreement, then, if successful in whole or in part in such action, the Investors shall be entitled to recover from the Company any and all of the costs of suit and reasonable attorneys’ fees incurred by the Investors in connection therewith, including attorneys’ fees on appeal, costs and disbursements, in addition to such other relief to which any Investor may be entitled.

5.11 Amendment and Waiver. The provisions of this Agreement may be amended and waived only with the prior written consent of the Parties.

5.12 Applicable Law; Consent to Jurisdiction.

5.12.1 This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Subject to Section 5.12.2, any dispute relating hereto shall be heard in the state or federal courts of Delaware, and the parties agree to jurisdiction and venue therein.

5.12.2 Each Party, by its execution hereof, (a) hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts in the State of Delaware for the purposes of any claim or action arising out of or based upon this Agreement or relating to the subject matter hereof, (b) hereby waives, to the extent not prohibited by applicable law, and agrees not to assert by way of motion, as a defense or otherwise, in any such claim or action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that any such proceeding brought in the above-named court is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court and (c) hereby agrees not to commence any claim or action arising out of or based upon this Agreement or relating to the subject matter hereof other than before the above-named courts nor to make any motion or take any other action seeking or intending to cause the transfer or removal of any such claim or action to any court other than the above-named courts whether on the grounds of inconvenient forum or otherwise. Each Party hereby consents to service of process in any such proceeding, and agrees that service of process by registered or certified mail, return receipt requested, at its address specified in Section 5.2 is reasonably calculated to give actual notice.

5.13 MUTUAL WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO

ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTY HERETO THAT THIS SECTION 5.13 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 5.13 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

* * *

The undersigned have executed and delivered this Agreement as of the date first above written.

COMPANY:

IFIT HEALTH & FITNESS INC

By:

Name:

Title:

INVESTORS:

ICON PREFERRED HOLDINGS, L.P.

By:

Name:

Title:

LC9 CONNECTED HOLDINGS, LP

By:

Name:

Title:

GS ICON LLC

By:

Name:

Title:

SW ICON LLC

By:

Name:

Title:

BG ICON LLC

By:

Name:

Title:

[Signature Page to Omnibus Agreement]

By:

Gary E. Stevenson, individually

By:

Scott R. Watterson, individually

By:

Robert C. Gay

By:

Wen-Chung Ko

EXHIBIT A

Illustrative Payment Calculations

See attached.

EXHIBIT B

Form of 2021 Convertible Note A

See attached.

EXHIBIT C

Form of 2021 Convertible Note B

See attached.

EXHIBIT D

Form of 2021 Convertible Note C

See attached.

EXHIBIT E

Stapling Language in Company COI

3.7: Stapling. Transfer of the shares of Common Stock received by LC9 Connected Holdings LP, a Delaware limited partnership (“L Catterton”), pursuant to Section 1.1(e) of the Omnibus Investor Agreement, dated as of September 27, 2021 by and among L Catterton, Icon Preferred Holdings, L.P. (“Pamplona”), the Corporation and the other parties thereto (the “Omnibus Agreement”) shall be transferable to a transferee only if transferred in the manner set forth in Section [ ] of the Company Bylaws, and any purported transfer that is not made in such manner shall be void ab initio and of no effect. Transfer of the shares of Common Stock received by Pamplona pursuant to Section 1.1(e) of the Omnibus Agreement shall be transferable to a transferee only if transferred in the manner set forth in Section [ ] of the Company Bylaws, and any purported transfer that is not made in such manner shall be void ab initio and of no effect. It is the intention of the Corporation that for so long as a share of Common Stock is required to be transferred in the manner set forth in [Section [ ] of [the Company Bylaws] (as such [Company Bylaws] exist as of the date hereof) shall be treated for U.S. federal income tax purposes as a single integrated security that constitutes stock and this Section 3.7 shall be interpreted in a manner consistent therewith.

Stapling Language in Bylaws of the Company

[ ]. In accordance with [Section 3.7 of the Company COI], the shares of Common Stock received by LC9 Connected Holdings LP, a Delaware limited partnership (“L Catterton”), pursuant to Section 1.1(e) of the Omnibus Investor Agreement, dated as of September 27, 2021 by and among L Catterton, Icon Preferred Holdings, L.P. (“Pamplona”), the Corporation and the other parties thereto (the “Omnibus Agreement”) shall be transferable to a transferee only if transferred together with a proportionate principal amount of the 2021 IPO Convertible Note B (as defined in the Omnibus Investor Agreement) issued to L Catterton and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted and any attempted transfer of such shares of Common Stock without a transfer of the proportional portion of the 2021 IPO Convertible Note B and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted shall be void ab initio and of no effect.    The shares of Common Stock received by Pamplona pursuant to Section 1.1(e) of the Omnibus Agreement shall be transferable to a transferee only if transferred together with a proportionate principal amount of the 2021 IPO Convertible Note B (as defined in the Omnibus Investor Agreement) issued to Pamplona and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted and any attempted transfer of such shares of Common Stock without a transfer of the proportional portion of the 2021 IPO Convertible Note B and a proportionate amount of any shares of Common Stock into which such 2021 Convertible Note B has been converted shall be void ab initio and of no effect. It is the intention of the Corporation that for so long as a share of Common Stock is required to be transferred with a proportionate amount of a 2021 IPO Convertible Note B and shares of Common Stock into which such 2021 IPO Convertible Note has been converted, such share of Common Stock and such principal amount of the 2021 IPO Convertible Note B and shares into which such 2021 IPO Convertible Note B have been converted shall be treated for U.S. federal income tax purposes as a single integrated security that constitutes stock and this Section [] shall be interpreted in a manner consistent therewith.

EXHIBIT F

Board Right Language

Section 2.6: Quorum; Vote Required for Action. Except as otherwise provided herein or in the Certificate of Incorporation, or required by law, at all meetings of the Board, a majority of the Whole Board shall constitute a quorum for the transaction of business. Except as otherwise provided herein or in the Certificate of Incorporation, or required by law, each direct present shall cast a single vote and a vote equal to a majority of the votes of the directors present at a meeting at which a quorum is present shall be the act of the Board.

Section 2.12: Fractional Voting. The member of the Board nominated by the Board Rights Holder (as such term is defined in the Corporation’s 7.0% Note due [    ], 2027 issued to Icon Preferred Holdings, L.P. under the Omnibus Investor Agreement dated as of September 27, 2021 (the “Omnibus Investor Agreement”) by and among Icon Preferred Holdings, L.P., LC9 Connected Holdings, LP, a Delaware limited partnership, the Corporation and others in respect of the Pamplona Note IPO Entitlement Amount (as defined in the Omnibus Investor Agreement)) shall (i) at any time when the Board has fewer than eleven (11) members, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of the Board (whether under the Certificate of Incorporation, these Bylaws, the Delaware General Corporation Law or otherwise), whether taken at a meeting of the Board or by written consent of the Board, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of the Board at such time and (ii) in the case of matters of a committee of the Board that includes such member, cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of such committee (whether taken under the Certificate of Incorporation, these Bylaws, the Delaware General Corporation Law or otherwise), whether taken at a meeting of such committee or by written consent of such committee, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of such committee at such time.

EXHIBIT G

Form of Registration Rights Agreement

See attached.

EXHIBIT H

Illustrative Closing Allocation Schedule

See attached.

EX-4.3

Exhibit 4.3

IFIT HEALTH & FITNESS INC

REGISTRATION RIGHTS AGREEMENT

Dated as of [•], 2021

TABLE OF CONTENTS

			Page
1.	DEFINITIONS			1
	1.1	Certain Definitions		1
	1.2	Certain Matters of Construction		9
	1.3	Cross Reference Table		9
2.	LOCK-UP			10
	2.1	Lock Up		10
	2.2	Transfer Conditions		11
	2.3	Stop Transfer Instruction		11
3.	REGISTRATION RIGHTS			11
	3.1	Piggyback Registration Rights		11
	3.2	Demand Registration Rights		13
	3.3	Certain Other Provisions		15
	3.5	Officer Obligations		21
	3.6	In-Kind Distributions		21
	3.7	Indemnification and Contribution		21
	3.8	Lock-up		23
4.	REMEDIES			24
	4.1	Generally		24
5.	LEGENDS			24
	5.1	Securities Act Legend		24
	5.2	Registration Rights Agreement Legend		24
	5.3	Stop Transfer Instruction		25
6.	AMENDMENT, TERMINATION, ETC.			25
	6.1	No Oral Modification		25
	6.2	Written Modifications		25
7.	MISCELLANEOUS			26
	7.1	Authority; Effect		26
	7.2	Notices		26
	7.3	Binding Effect, etc.		28
	7.4	Descriptive Headings		29
	7.5	Counterparts		29
	7.6	Severability		29
	7.7	Third Party Beneficiaries		29
	7.8	Specific Performance		29
	7.9	Effectiveness		29
8.	GOVERNING LAW			29
	8.1	Governing Law		29
	8.2	Consent to Jurisdiction		30
	8.3	WAIVER OF JURY TRIAL		30
	8.4	Reliance		30

i

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (the “Agreement”) is entered into on [•], 2021 and effective upon the Initial Public Offering (as defined below), by and among:

(i) iFIT Health & Fitness Inc, a Delaware corporation (the “Company”),

(ii) iFIT Inc., a Delaware corporation (“ICON”),

(iii) HF Investment Holdings, LLC, a Delaware limited liability company (the “LLC”),

(iv) each of (A) Gary E. Stevenson, an individual residing in Riverheight, UT (“Stevenson”), (B) GS ICON LLC (“GS”), a Delaware limited liability company, (C) Scott R. Watterson (“Watterson”), an individual residing in Providence, UT, and (D) SW ICON LLC (“SW”), a Delaware limited liability company,

(v) Robert C. Gay, an individual residing in Wellington, FL (“Robert Gay”), BG ICON LLC, a Nevada limited liability company (“BG”), and BG ICON II LLC, a Delaware limited liability company (“BG II”),

(vi) Icon Preferred Holdings, L.P.,

(vii) LC9 Connected Holdings, LP, a Delaware limited partnership, and

(viii) Wen-Chung Ko, an individual residing in Yaoyuan Hsien, Taiwan (“Ko”), and

(ix) any other parties signing a counterpart signature page hereto as of the date hereof (collectively, the “Other Investors,” and each an “Other Investor”).

Capitalized terms used herein but not defined herein shall have the meanings assigned to such terms in Section 1.1.

Recitals

1. Whereas, certain Investors and the Company entered into that Amended and Restated Investors’ Agreement, dated as of October 2, 2020, as amended by that certain Amendment No. 1, dated as of March 17, 2021 (the “Investors’ Agreement”);

2. Whereas, the Company intends to consummate an Initial Public Offering;

3. Whereas, L Catterton (as defined below), Pamplona (as defined below), Watterson and the Company entered into the Omnibus Agreement, pursuant to which L Catterton, Pamplona and Watterson, effective upon the Initial Public Offering, are purchasing from the Company the Convertible Notes; and

4. Whereas, effective upon the Initial Public Offering, in connection with L Catterton’s, Pamplona’s, and Watterson’s purchase of the Convertible Notes, the parties wish to terminate the Investors’ Agreement and effectuate this Agreement.

Agreement

Now, therefore, in consideration of the foregoing and the mutual agreements set forth below, the parties hereto, each intending to be legally bound, hereby agree as follows:

1. DEFINITIONS.

1.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

1.1.1 “Affiliate” shall mean, with respect to any specified Person, any Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, the Person specified.

1.1.2 “Board” shall mean the Board of Directors of the Company.

1.1.3 “Business Day” shall mean a day when national banks are open for business in Boston and New York City.

1.1.4 “Common Stock” shall mean the Class A common stock and Class B common stock of the Company.

1.1.5 “Convertible Notes” shall mean those certain convertible notes issued to each of L Catterton, Pamplona and Watterson pursuant to the Omnibus Agreement, as they may, from time to time, be divided into further multiple notes, and as amended, modified or supplemented in accordance with such convertible notes.

1.1.6 “Convertible Notes Registration Rights Holders” shall mean, as of any date, the holders of the Convertible Notes or any shares of Equity Securities obtained upon the conversion or exchange of the Convertible Notes.

1.1.7 “Equity Securities” shall mean, with respect to any Person, any (a) shares of capital stock, partnership or joint venture interest, membership interest, limited liability company interest, beneficial interest in a trust, or similar security or equity interest, voting security or other ownership interests in such Person, (b) security, debt instrument or other interest directly or indirectly convertible into or exercisable or exchangeable for (with or without consideration) any of the foregoing or (c) option, warrant, call, subscription, “phantom” right, interest appreciation right, performance unit, profits interest or other right, convertible, exercisable or exchangeable securities, contracts or commitments of any character obligating such Person to issue, transfer, deliver or sell any of the foregoing or securities convertible into or, exercisable or exchangeable for any of the foregoing.

1.1.8 “Equivalent Shares” shall mean as to any outstanding Options, the maximum number of shares of Common Stock for which or into which such Options may at the time be exercised or converted.

1.1.9 “Exchange Act” shall mean Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, all as from time to time in effect.

1.1.10 “Gay Investors” shall mean BG, BG II and any Permitted Transferees thereof which, from time to time, acquire Securities and becomes party to this Agreement by executing and delivering to the Company an instrument in form satisfactory to the Company pursuant to which such Persons agree to be bound by the terms of this Agreement to the same extent as BG and BG II.

1.1.11 “Gay Majority Holders” shall mean, as of any date, the holders of a majority of the Gay Securities outstanding on such date.

1.1.12 “Gay Securities” shall mean (a) all shares of Common Stock issued to, purchased by or held by, directly or indirectly (for the avoidance of doubt, including such shares held by the LLC for the benefit of any Gay Investor), any Gay Investor, whenever issued, including, without limitation, all shares of Common Stock issued pursuant to the exercise or conversion of any Options; (b) all Options granted or issued to any Gay Investor (treating such Options as a number of shares of Common Stock equal to the number of Equivalent Shares represented by such Options for all purposes of this Agreement); and (c) all securities into which any such shares or Options are converted or exchanged; provided that Gay Securities shall not include any shares of Common Stock, Options or other securities that are not held by a Gay Investor at the relevant time; and provided, further, that Gay Securities Transferred shall in the hands of the recipient not constitute Gay Securities for any purpose of this Agreement.

1.1.13 “Immediate Family” shall mean, with respect to any individual, each spouse, parent, brother, sister or child of such individual, each spouse of any such Person, each child of any of the aforementioned Persons, each trust created solely for the benefit of one or more of the aforementioned Persons and each custodian or guardian of any property of one or more of the aforementioned Persons in his capacity as such custodian or guardian.

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1.1.14 “Initial Public Offering” shall mean the first Public Offering of shares of Common Stock registered on form S-1 (or any successor form) under the Securities Act or a SPAC Transaction.

1.1.15 “Investor” shall mean any of the Management Investors, the Gay Investors, the Ko Investors, the Stevenson Investors, the Pamplona Warrantholders, the Pamplona Noteholders, the L Catterton Warrantholders, the L Catterton Noteholders, the Watterson Noteholders and the Other Investors.

1.1.16 “Junior Management Investors” shall mean each officer or employee of the Company or any of its subsidiaries who hold Junior Management Securities and any Permitted Transferee thereof who, from time to time, acquires such Securities and becomes party to this Agreement by executing and delivering to the Company an instrument in form satisfactory to the Company pursuant to which such person agrees to be bound by the terms of this Agreement to the same extent as a Junior Management Investor.

1.1.17 “Junior Management Options” shall mean all Options issued under the Company’s 2014 Stock Option Plan.

1.1.18 “Junior Management Securities” shall mean (a) all Junior Management Options and all shares of Common Stock issued pursuant to the exercise or conversion of any Junior Management Options and (b) all securities into which any such shares or Junior Management Options are converted or exchanged; provided that Junior Management Securities shall not include any shares of Common Stock, Options or other securities that are not held by a Junior Management Investor at the relevant time; and provided, further, that Junior Management Securities Transferred shall in the hands of the recipient not constitute Junior Management Securities for any purpose of this Agreement.

1.1.19 “Ko Investors” shall mean Ko and any Permitted Transferee thereof which, from time to time, acquires Securities and becomes party to this Agreement by executing and delivering to the Company an instrument in form satisfactory to the Company pursuant to which such Person agrees to be bound by the terms of this Agreement to the same extent as Ko.

1.1.20 “Ko Majority Holders” shall mean, as of any date, the holders of a majority of the Ko Securities outstanding on such date.

1.1.21 “Ko Securities” shall mean (a) all shares of Common Stock issued to, purchased by or held by, directly or indirectly (for the avoidance of doubt, including such shares held by the LLC for the benefit of any Ko Investor), any Ko Investor, whenever issued, including, without limitation, all shares of Common Stock issued pursuant to the exercise or conversion of any Options; (b) all Options granted or issued to any Ko Investor (treating such Options as a number of shares of Common Stock equal to the number of Equivalent Shares represented by such Options for all purposes of this Agreement); and (c) all securities into which any such shares or Options are converted or exchanged; provided that Ko Securities shall not include any shares of Common Stock, Options or other securities that are not held by a Ko Investor at the relevant time; and provided, further, that Ko Securities Transferred shall in the hands of the recipient not constitute Ko Securities for any purpose of this Agreement.

1.1.22 “L Catterton” shall mean LC9 Connected Holdings, LP, a Delaware limited partnership and its Permitted Transferees.

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1.1.23 “L Catterton Key Noteholder” shall mean one (1) L Catterton Noteholder designated by the L Catterton Noteholders. The L Catterton Key Noteholder shall initially be L Catterton and the L Catterton Noteholders shall provide written notice to the Company of any change in the L Catterton Key Noteholder.

1.1.24 “L Catterton Note” shall mean that certain Convertible Note issued to L Catterton pursuant to the Omnibus Agreement, as it may, from time to time, be divided into multiple notes, and as amended, modified or supplemented in accordance with such Convertible Note.

1.1.25 “L Catterton Noteholder” shall mean each holder of all or any portion the L Catterton Note.

1.1.26 “L Catterton Purchase Agreement” shall mean that certain Securities Purchase Agreement, dated as of October 2, 2020, by and between the Company, L Catterton and Pamplona.

1.1.27 “L Catterton Warrant” shall mean that certain Warrant issued by the Company to L Catterton on October 2, 2020, as it may, from time to time, be divided into multiple warrants, and as amended, modified or supplemented in accordance with such Warrant.

1.1.28 “L Catterton Warrantholder” shall mean each holder of all or any portion of the L Catterton Warrant or the L Catterton Warrant Securities.

1.1.29 “L Catterton Warrant Securities” shall mean all shares of Common Stock that have been issued upon exercise of the L Catterton Warrant or are issuable upon exercise of the L Catterton Warrant. For the purposes of this Agreement, any L Catterton Warrantholder shall be deemed to be the holder of the shares of Common Stock that are issuable upon the exercise of the L Catterton Warrant.

1.1.30 “Legacy Warrantholder” shall mean each Person who holds Legacy Warrant Securities, and any other Person which, from time to time, acquires Legacy Warrant Securities and thereby becomes entitled to the benefits of certain provisions of this Agreement.

1.1.31 “Legacy Warrant Securities” shall mean all shares of Common Stock as of the date hereof which were issued pursuant to an exercise or conversion of warrants (or issued upon conversion of or otherwise with respect to shares of Common Stock issued upon exercise or conversion of warrants); provided, that Legacy Warrant Securities Transferred shall in the hands of the recipient not constitute Legacy Warrant Securities for any purpose of this Agreement. For the avoidance of doubt, the Pamplona Warrant, the L Catterton Warrant and any shares of Common Stock issued upon conversion of the Pamplona Warrant or the L Catterton Warrant or otherwise with respect to shares of Common Stock issued upon exercise or conversion thereof shall not be Legacy Warrant Securities under this Agreement.

1.1.32 “Majority Legacy Warrantholders” shall mean, as of any date, the holders of a majority of the Legacy Warrant Securities outstanding on such date.

1.1.33 “Management Investor” shall mean any Watterson Investor or Junior Management Investor.

1.1.34 “Management Majority Holders” shall mean, as of any date, the holders of a majority of the Management Securities outstanding on such date.

1.1.35 “Management Securities” shall mean the Watterson Securities and the Junior Management Securities.

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1.1.36 “Omnibus Agreement” shall mean that certain Omnibus Investor Agreement, dated as of the date hereof, by and among the Company, L Catterton, Pamplona, Watterson, SW, Stevenson, GS, Robert Gay, BG, BG II, Lee Ming Tsung and Ko.

1.1.37 “Options” shall mean (i) any options or warrants or other rights to subscribe for, purchase or otherwise acquire Common Stock, and (ii) any evidence of indebtedness, shares of stock (other than Common Stock) or other securities which are directly or indirectly convertible or exchangeable for shares of Common Stock.

1.1.38 “Pamplona” shall mean Icon Preferred Holdings, L.P. and its Permitted Transferees.

1.1.39 “Pamplona Additional Warrant” shall mean that certain Warrant issued by the Company to Pamplona pursuant to the L Catterton Purchase Agreement, as it may, from time to time, be divided into multiple warrants, and as amended, modified or supplemented in accordance with such Warrant.

1.1.40 “Pamplona Key Noteholder” shall mean one (1) Pamplona Noteholder designated by the Pamplona Noteholders. The Pamplona Key Noteholder shall initially be Pamplona and the Pamplona Noteholders shall provide written notice to the Company of any change in the Pamplona Key Noteholder.

1.1.41 “Pamplona Note” shall mean that certain Convertible Note issued to Pamplona pursuant to the Omnibus Agreement, as it may, from time to time, be divided into multiple notes, and as amended, modified or supplemented in accordance with such Convertible Note.

1.1.42 “Pamplona Noteholder” shall mean each holder of all or any portion the Pamplona Note.

1.1.43 “Pamplona Original Warrant” shall mean that certain Warrant issued by the Company to Pamplona on November, 29, 2019, as it may, from time to time, be divided into multiple warrants, and as amended, modified or supplemented in accordance with such Warrant.

1.1.44 “Pamplona Warrant” shall mean the Pamplona Original Warrant and the Pamplona Additional Warrant.

1.1.45 “Pamplona Warrantholder” shall mean each holder of all or any portion of the Pamplona Warrant or the Pamplona Warrant Securities.

1.1.46 “Pamplona Warrant Securities” shall mean all shares of Common Stock that have been issued upon exercise of the Pamplona Warrant or are issuable upon exercise of the Pamplona Warrant. For the purposes of this Agreement, any Pamplona Warrantholder shall be deemed to be the holder of the shares of Common Stock that are issuable upon the exercise of the Pamplona Warrant.

1.1.47 “Permitted Transfer” shall mean any of the following Transfers of Securities:

1.1.47.1 if an individual, any Transfer of any or all Securities held by such Investor following such Investor’s death by will or intestacy to such Investor’s legal representative, heir, legatee or distributes, whether or not such transferee is a member of such Investor’s Immediate Family;

1.1.47.2 if an individual, any Transfer of any or all Securities held by such Investor as a gift or gifts during such Investor’s lifetime to such Investor’s Immediate Family and/or Affiliate or other gifts or transfers for estate planning purposes; provided that the Transferring Investor shall retain voting control of the Transferred Securities; and provided, further, that any such Affiliate shall re-Transfer such Securities to such Investor within five (5) calendar days after ceasing to be an Affiliate of such Investor;

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1.1.47.3 any Transfer of any or all Securities held by such Investor as a charitable gift to any Person which is described in Section 501(c)(3) of the Internal Revenue Code of 1986 or any Transfer to such Investor’s (or such Investor’s Affiliate’s) “rabbi trust” or deferred compensation accounts with the Company or any to any Affiliate of such Investor; provided, that any such Affiliate shall re-Transfer such Securities to such Investor within five (5) calendar days after ceasing to be an Affiliate of such Investor;

1.1.47.4 if an institutional investor (other than BG, BG II or any Gay Investor), any Transfer of any or all Securities held by such Investor to any Affiliate of such Investor in a bona fide Transfer not part of a transaction or series of transactions that results in the direct or indirect Transfer of such Securities to a Person not an Affiliate of such Investor; provided, that any such Affiliate shall re-Transfer such Securities to such Investor within five (5) calendar days after ceasing to be an Affiliate of such Investor;

1.1.47.5 if a member of the LLC (other than the Watterson Investors), by such member (other than any of the Watterson Investors) to any of the Watterson Investors, Gay Investors, Ko Investors or Stevenson Investors, or by such member (other than any of the Watterson Investors, Gay Investors, Ko Investors or Stevenson Investors) to any other Person approved by the Board; or

1.1.47.6 if an Investor, any Transfer upon the terms and conditions approved by the Board; provided, however, that (x) such Person shall not be deemed a “Management Investor”, “Watterson Investor”, “Junior Management Investor”, “Gay Investor”, “Ko Investor”, “Stevenson Investor”, as applicable, for the purposes of this Agreement and shall not be entitled to the rights of a Management Investor, Watterson Investor, Junior Management Investor, Gay Investor, Ko Investor or Stevenson Investor, as applicable, pursuant to Sections 3 or 6.2 hereof; (y) upon such Transfer, such Securities shall cease to be Management Securities, Watterson Securities, Junior Management Securities, Gay Securities, Ko Securities or Stevenson Securities for the purposes of this Agreement; and (z) such Person shall become subject to all of the obligations of this Agreement.

1.1.48 “Permitted Transferee” shall mean a transferee of an Investor in respect of any Permitted Transfer.

1.1.49 “Person” shall mean any individual, partnership, corporation, company, association, trust, joint venture, unincorporated organization or entity, or any government, governmental department or agency or political subdivision thereof.

1.1.50 “Purchase Agreements” shall mean (i) the Omnibus Agreement, (ii) the Securities Purchase Agreement, dated as of November 18, 2019, by and between the Company and Pamplona, as the same may be amended from time to time in accordance with its terms and (iii) the L Catterton Purchase Agreement.

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1.1.51 “Registrable Securities” shall mean (i) all shares of Common Stock held by any party to this Agreement or that certain Series B Investors’ Agreement, dated as of March 17, 2021, by and between the Company and Planet Fitness Holdings, LLC (to the extent they constitute “Registrable Securities” as defined therein), (ii) all shares of Common Stock issued or issuable upon exercise or conversion of any Option, the Pamplona Warrant, the L Catterton Warrant or the Convertible Notes held by any party to this Agreement, and (iii) all shares of Common Stock directly or indirectly issued or issuable with respect to the securities referred to in clauses (i) and (ii) above by way of stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization. For purposes of this Agreement, a Person will be deemed to be a holder of Registrable Securities, and the Registrable Securities will be deemed to be in existence, whenever such Person has the right to acquire, directly or indirectly, such Registrable Securities (upon conversion or exercise or otherwise and disregarding any restrictions or limitations upon the exercise of such right, but excluding equity or equity-linked securities issued to directors, officers or employees subject to vesting and/or forfeiture), whether or not such acquisition has actually been effected, and such Person will be entitled to exercise the rights of a holder of Registrable Securities hereunder (it being understood that a holder of Registrable Securities may only request that Registrable Securities in the form of Common Stock or securities received under clause (iii) above be registered pursuant to this Agreement). As to any particular Registrable Securities, such shares shall cease to be Registrable Securities when (a) they have been effectively registered under the Securities Act and disposed of in accordance with the registration statement covering them, (b) they have been distributed to the public through a broker, dealer or market maker pursuant to Rule 144, or (c) the holder thereof may sell all of its shares of Common Stock under Rule 144 within a three month period, provided such holder owns less than 1% of the outstanding shares of Common Stock, in each case in compliance with any applicable provisions of this Agreement.

1.1.52 “Rule 144” shall mean Rule 144, as from time to time in effect, promulgated by the Securities and Exchange Commission under the Securities Act (including, without limitation, clause (k) thereof).

1.1.53 “Securities” shall mean all shares of Common Stock, the Pamplona Warrant Securities, the Pamplona Warrant, the L Catterton Warrant Securities, the L Catterton Warrant, the Convertible Notes and all Options, but shall not include the Legacy Warrant Securities.

1.1.54 “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, all as from time to time in effect.

1.1.55 “SPAC” means a special purpose acquisition company (i.e., a blank check company formed to effect a business combination) that (i) at the time of measurement, owns or controls less than 5% of the Company’s shares of Common Stock and is not controlled by or under common control with any Person that owns 5% or more of the Company’s shares of Common Stock, (ii) if listed on a securities exchange in the United States, is a registrant under the Exchange Act and (iii) is listed on a securities exchange (whether in the United States or otherwise).

1.1.56 “SPAC Transaction” means any transaction or series of related transactions in which the Company or its Subsidiaries is, directly or indirectly, acquired by or combines with, whether by purchase, exchange, tender offer, merger, consolidation or otherwise, a SPAC.

1.1.57 “Stevenson Investors” shall mean Stevenson, GS and any Permitted Transferee thereof which, from time to time, acquire Securities and become party to this Agreement by executing and delivering to the Company an instrument in form satisfactory to the Company pursuant to which such Person agrees to be bound by the terms of this Agreement to the same extent as Stevenson.

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1.1.58 “Stevenson Majority Holders” shall mean, as of any date, the holders of a majority of the Stevenson Securities outstanding on such date.

1.1.59 “Stevenson Securities” shall mean (a) all shares of Common Stock issued to, purchased by or held by, directly or indirectly (for the avoidance of doubt, including such shares held by the LLC for the benefit of any Stevenson Investor), any Stevenson Investor, whenever issued, including, without limitation, all shares of Common Stock issued pursuant to the exercise or conversion of any Options; (b) all Options granted or issued to any Stevenson Investor (treating such Options as a number of shares of Common Stock equal to the number of Equivalent Shares represented by such Options for all purposes of this Agreement); and (c) all securities into which any such shares or Options are converted or exchanged; provided that Stevenson Securities shall not include any shares of Common Stock, Options or other securities that are not held by a Stevenson Investor at the relevant time; and provided, further, that Stevenson Securities Transferred shall in the hands of the recipient not constitute Stevenson Securities for any purpose of this Agreement.

1.1.60 “Transfer” shall mean any sale, pledge, assignment, encumbrance, hypothecation, mortgage, exchange or other transfer or disposition of any Securities to any other Person, whether directly, indirectly, voluntarily, involuntarily, by operation of law, pursuant to judicial process or otherwise.

1.1.61 “Watterson Investors” shall mean each of Watterson and SW and any of their Permitted Transferees who, from time to time, acquires Securities and becomes party to this Agreement by executing and delivering to the Company an instrument in form satisfactory to the Company pursuant to which such Person agrees to be bound by the terms of this Agreement to the same extent as Watterson or SW, as applicable.

1.1.62 “Watterson Key Noteholder” shall mean one (1) Watterson Noteholder designated by the Watterson Noteholders. The Watterson Key Noteholder shall initially be Watterson and the Watterson Noteholders shall provide written notice to the Company of any change in the Watterson Key Noteholder.

1.1.63 “Watterson Majority Holders” shall mean, as of any date, the holders of a majority of the Watterson Securities outstanding on such date.

1.1.64 “Watterson Note” shall mean that certain Convertible Note issued to Watterson pursuant to the Omnibus Agreement, as it may, from time to time, be divided into multiple notes, and as amended, modified or supplemented in accordance with such Convertible Note.

1.1.65 “Watterson Noteholder” shall mean each holder of all or any portion the Watterson Note.

1.1.66 “Watterson Securities” shall mean (a) all shares of Common Stock issued to, purchased by or held by, directly or indirectly (for the avoidance of doubt, including such shares held by the LLC for the benefit of any Watterson Investor), any Watterson Investor, whenever issued, including, without limitation, all shares of Common Stock issued pursuant to the exercise or conversion of any Options or the Watterson Note; (b) all Options granted or issued to any Watterson Investor (treating such Options as a number of shares of Common Stock equal to the number of Equivalent Shares represented by such Options for all purposes of this Agreement); and (c) all securities into which any such shares or Options are converted or exchanged; provided that Watterson Securities shall not include any shares of Common Stock, Options or other securities that are not held by a Watterson Investor on the relevant time; and provided, further, that Watterson Securities Transferred shall in the hands of the recipient not constitute Watterson Securities for any purpose of this Agreement.

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1.2 Certain Matters of Construction. In addition to the definitions referred to as set forth in the Section 1.1:

(a) The words “hereof”, “herein”, “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular Section or provision of this Agreement, and reference to a particular Section of this Agreement shall include all subsections thereof;

(b) References to a Section, Schedule or Exhibit are to a Section of, or Schedule or Exhibit to, this Agreement;

(c) Definitions shall be equally applicable to both the singular and plural forms of the terms defined;

(d) The masculine, feminine and neuter genders shall each include the others;

(e) The words “including” and “include” and other words of similar import shall be deemed to be followed by the phrase “without limitation”;

(f) References to agreements and other documents shall be deemed to include all subsequent amendments and other modifications thereto (unless otherwise specified);

(g) The language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction shall be applied against any party;

(h) Except as otherwise provided herein, any Person who holds Options shall be deemed to be the holder of the Registrable Securities obtainable upon exercise or conversion of the Options in connection with the transfer thereof or otherwise regardless of any restriction or limitation on the exercise or conversion of the Options;

(i) Any Person who holds the Pamplona Warrant, the L Catterton Warrant or Convertible Notes shall be deemed to be the holder of the Registrable Securities obtainable upon exercise or conversion of the Pamplona Warrant, the L Catterton Warrant or Convertible Notes, as applicable, in connection with the transfer thereof or otherwise regardless of any restriction or limitation on the exercise or conversion of the Pamplona Warrant, of the L Catterton Warrant or of Convertible Notes, as applicable; and

(j) Whenever a percentage of one or more types of Securities is specified, such percentage shall be calculated on the basis of the number of Registrable Securities represented by such one or more types.

1.3 Cross Reference Table. The following terms defined elsewhere in this Agreement in the Sections set forth below shall have the respective meanings therein defined:

Term	Definition
“Agreement”	Preamble
“BG”	Preamble
“BG II”	Preamble
“Carved-Out Transfer”	Section 2.1
“Common Initiating Holder”	Section 3.2.1.1
“Common Stock”	Recitals
“Company”	Preamble

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Term	Definition
“Covered Person”	Section 3.7.1
“Exclusive Convertible Notes Registration Demand”	Section 3.2.1.1(v)
“Final Prospectus Date”	Section 2.1
“GS”	Preamble
“ICON”	Preamble
“Individual Underwriting Agreement Representations”	Section 3.1.2
“Initiating Holder”	Section 3.2.1.1
“Initiating Seller”	Section 6
“Ko”	Preamble
“LLC”	Preamble
“Majority Initiating Holders”	Section 3.2.2
“Original Investors’ Agreement”	Recitals
“Other Investors(s)”	Preamble
“Public Offering”	Section 3.1.1
“Robert Gay”	Preamble
“Stevenson”	Preamble
“SW”	Preamble
“Watterson”	Preamble

2. LOCK-UP.

2.1 Lock Up. Without the prior written consent of either one of the Pamplona Key Noteholder or the L Catterton Key Noteholder (provided that if one of the Pamplona Key Noteholder or the L Catterton Key Noteholder sells or assigns a majority of its interest in its Convertible Notes to a third party, then only with the prior written consent of the other of the Pamplona Key Noteholder or the L Catterton Key Noteholder that did not sell or assign a majority of its interest in its Convertible Notes, provided that if both of the Pamplona Key Noteholder and the L Catterton Key Noteholder sell or assign a majority of its interest in its Convertible Notes, then with either such party’s prior written consent), for a period beginning upon the date of the final prospectus relating to the Initial Public Offering (the “Final Prospectus Date”) and ending eighteen (18) months following the Final Prospectus Date, neither (x) Watterson nor (y) any holder of Securities or Legacy Warrant Securities (in each case, other than the Pamplona Noteholders, Pamplona Warrantholders, holders of Pamplona Warrant Securities, L Catterton Noteholders, L Catterton Warrantholders and holders of L Catterton Warrant Securities) who, together with such Person’s Affiliates and the Permitted Transferees of such Person and such Person’s Affiliates, at such applicable time holds in the aggregate, directly or indirectly, at least five percent (5%) of the outstanding shares of Common Stock (on a fully diluted basis) (whether or not a selling shareholder pursuant to such registration statement) (the “Locked-up Holders”), in each case, shall (a) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise Transfer, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for such Common Stock or (b) enter into any swap or other management that transfers to another, in whole or in part, any of the economic consequences of ownership of Common Stock, whether any such transaction described in clause (a) or (b) above is to be settled by delivery of such Common Stock or such other securities, in cash or otherwise; provided, however, that the foregoing restrictions shall not apply to (i) Transfers among any Affiliates, provided that the Transferee Affiliate agrees to be bound by the terms of this Agreement, including this Section 2.1, (ii) Transfers constituting the exercise of the Junior Management Options (provided that the foregoing restrictions do apply to the equity underlying such options), or (iii) any Permitted Transfer; provided, further, that the restrictions set forth in this Section 2.1 shall terminate upon the return of proceeds in cash to each of Pamplona and L Catterton equal to the aggregate principal amount of the Convertible Notes owned by each of them and their Affiliates as of September [•], 2021

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(including for the avoidance of doubt cash proceeds received by Pamplona or L Catterton, as the case may be, from any sale of the Convertible Notes, Warrants or any Registrable Securities or any cash payments on the Convertible Notes) (each, a “Cash Return Condition”). Notwithstanding the foregoing in this Section 2.1, but subject to the other terms of this Agreement, (1) Robert Gay and (2) Stevenson, after twelve (12) months following the Final Prospectus Date, shall each have the right to (a) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise Transfer, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for such Common Stock or (b) enter into any swap or other management that transfers to another, in whole or in part, any of the economic consequences of ownership of Common Stock, in the aggregate, shares of Common Stock in exchange for proceeds of up to $2,500,000 (I) during any open trading window established pursuant to a bona fide insider trading policy of the Company or (II) pursuant to a trading plan on behalf of such Investor pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock (each, a “Carved-Out Transfer”).

2.2 Transfer Conditions. Notwithstanding anything to the contrary herein, until the Cash Return Condition has been satisfied, no Locked-up Holder may Transfer any Securities (other than any issuance upon exercise of any Options, the Pamplona Warrant or the L Catterton Warrant to the holders thereof) unless (i) such Transfer is not in violation of the provisions of this Section 2, and (ii) the transferee or the purchaser of such Securities (if other than (A) the Company or another existing stockholder thereof that is already a party to this Agreement or (B) a transferee of Securities from Robert Gay or Stevenson pursuant to a Carved-Out Transfer in connection with a transfer made under Rule 144 or any successor provision under the Securities Act or pursuant to an offer and sale registered under the Securities Act or (C) any Transfer of any or all Securities as a charitable gift to any Person which is described in Section 501(c)(3) of the Internal Revenue Code of 1986) agrees to become a party to this Agreement and executes such further documents as may be necessary, in the opinion of the Company, to make him, her or it a party hereto.. Any purported Transfer, issuance or sale of Securities other than in accordance with this Agreement by any holder thereof or the Company shall be null and void, and the Company shall refuse to recognize any such Transfer, issuance or sale for any purpose and shall not reflect in its records any change in record ownership of Securities pursuant to any such Transfer or issuance.

2.3 Stop Transfer Instruction. The Company shall instruct any transfer agent not to register the Transfer of any Securities until the conditions specified in the legends set forth in Section 5 are satisfied. Either of Pamplona, L Catterton or any of their respective Affiliates shall have the right to instruct any transfer agent not to register the Transfer of any Securities until the conditions specified in the legends set forth in Section 5 (including, for the avoidance of doubt, the restrictions set forth in Section 2.1) are satisfied.

3. REGISTRATION RIGHTS. The Company will perform and comply, and cause each of its subsidiaries to perform and comply, with such of following provisions as are applicable to it. Each holder of Securities or Legacy Warrant Securities will perform and comply with such of the following provisions as are applicable to such holder.

3.1 Piggyback Registration Rights.

3.1.1 Election. Whenever the Company proposes to register (other than a registration pursuant to Section 3.3.2) on form S-1 or S-3 (or any successor form) any shares of Common Stock for its own or others’ account under the Securities Act for a public offering (each a “Public Offering”), the Company shall furnish each holder of Registrable Securities prompt notice of its intent to do so, provided that no notice shall be required to holders subject to the lock-up set forth in Section 2.1 above. Subject to the terms and restrictions of any applicable lock-up agreement, upon the request of any such holder given by notice to the Company within ten (10) calendar days after the effectiveness of such notice from the Company, the Company will cause to be included in such registration all of the Registrable Securities which such holder requests.

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3.1.2 Further Assurances. Holders of Registrable Securities participating in any Public Offering shall take all such actions and execute all such documents and instruments that are reasonably requested by the Company to effect the sale of their Registrable Securities in such Public Offering, including without limitation being parties to the underwriting agreement entered into by the Company and any other selling shareholders in connection therewith and being liable in respect of any representations and warranties being made by each selling shareholder and any indemnification agreements and “lock-up” agreements made by each selling shareholder for the benefit of the underwriters in such underwriting agreement; provided, however, that (i) no Management Investor party to an employment agreement with the Company or any of its subsidiaries shall be required hereunder to extend the term thereof and (ii) except with respect to individual representations and warranties regarding such matters as legal capacity or due organization of such participating holder, authority to participate in the Public Offering, compliance by such selling shareholder with laws and agreements applicable to it, ownership (free and clear of liens, charges, encumbrances and adverse claims) of Registrable Securities to be sold by such selling shareholder and accuracy of information with respect to such selling shareholder furnished for inclusion in any disclosure document relating to each Public Offering (“Individual Underwriting Agreement Representations”), the aggregate amount of the liabilities of such participating holder of Registrable Securities pursuant to such underwriting agreement shall not exceed the lesser of (a) such participating holder’s pro rata portion of any such liability, in accordance with such participating holder’s portion of the total number of Registrable Securities included in the Public Offering, and (b) the net proceeds received by such participating holder from the Public Offering. If any Management Investor holding Registrable Securities shall request participation in any Public Offering pursuant to this Section 3.1, the Company shall use its commercially reasonable efforts to induce the managing underwriter of the securities being offered to permit such Management Investor to make no representations or warranties in the underwriting agreement other than Individual Underwriting Agreement Representations, but to be liable as indemnitors with respect to any other representations or warranties made by other selling holders in such underwriting agreement, but in the event the managing underwriter shall not accede to such request, such Management Investor shall, within five (5) calendar days of notice to that effect from the managing underwriter or its counsel, either elect to make such other representations and warranties in the underwriting agreement as shall be made by other participating holders or to withdraw from participation.

3.1.3 Expenses. The Company shall pay all expenses of the holders of Registrable Securities participating in any Public Offering pursuant to this Section 3.1, other than (i) underwriting discounts and commissions, if any, attributable to the Registrable Securities being sold by such holder, (ii) applicable transfer taxes, if any, and (iii) fees and charges of any attorneys or other advisors (other than attorneys and advisors retained by the Company to advise it in connection with such Public Offering and one counsel retained to advise all holders of Registrable Securities in connection with such Public Offering) retained by any such holders.

3.1.4 Excluded Transactions. Notwithstanding the preceding provisions of this Section 3.1, no holder of Registrable Securities shall have any right of participation or otherwise with respect to the following Public Offerings:

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(a) Any Public Offering on Form S-8 (or successor registration statement) relating solely to employee benefit plans, or

(b) Any Public Offering the proceeds of which are used principally to finance the acquisition after the date hereof by the Company or any of its subsidiaries of any acquired businesses or any Public Offering constituting an exchange of securities for securities of any such acquired businesses.

3.2 Demand Registration Rights.

3.2.1 Registration on Request of Holders of Certain Securities.

3.2.1.1 Demand. After the closing of the Initial Public Offering and subject to the terms and restrictions of any applicable lock-up agreement including Section 2.1 above, each of (i) the Watterson Majority Holders, (ii) the Ko Majority Holders, (iii) the Stevenson Majority Holders, (iv) the Gay Majority Holders, (v) Other Investors holding the majority of the outstanding shares of Common Stock (on a fully diluted basis) other than the Watterson Securities and the Gay Securities, (vi) Pamplona or (vi) L Catterton (as to each such registration, each an “Initiating Holder”) may, by notice to the Company specifying the intended method or methods of disposition, request that the Company effect the registration under the Securities Act of all or a specified part of the Registrable Securities held by such Initiating Holders, subject to the following terms and conditions:

(i) the market value of the Registrable Securities to be sold in any such registration shall be estimated to be at least Fifty Million Dollars ($50,000,000) (or such lesser amount as represents all of such Holder’s remaining Registrable Securities) at the time of filing such registration statement (provided, that such limitation shall not apply to any Exclusive Convertible Notes Registration Demand);

(ii) the Company shall not be required to file more than two (2) such registration statements pursuant to this Section 3.2.1.1 in any twelve (12)-month period; provided that such limitation shall not apply to any Exclusive Convertible Notes Registration Demand;

(iii) the Company shall not be required to file more than (A) three (3) such registration statements pursuant to a demand made by the Watterson Majority Holders, (B) two (2) such registration statements pursuant to a demand made by the Ko Majority Holders, (C) two (2) such registration statements pursuant to a demand made by the Stevenson Majority Holders, (D) two (2) such registration statements pursuant to a demand made by holders of Legacy Warrant Securities (other than the Company, the Management Investors, the Gay Investors or the Other Investors) representing an aggregate of at least 25% of the Legacy Warrant Securities then outstanding, (E) two (2) such registration statements pursuant to a demand made by the Gay Majority Holders, (F) two (2) such registration statements per annum pursuant to a demand made by the Pamplona Key Noteholder and/or L Catterton Key Noteholder and (G) one (1) such registration statements pursuant to a demand made by the Other Investors;

(iv) in the event the number of shares requested to be included in a Public Offering by the Initiating Holders with respect thereto is reduced by operation of the provisions of Section 3.3.1, such demand shall be excluded in determining the number of demands exercisable by such Initiating Holders; and

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(v) no demand may be made unless the Initiating Holders with respect thereto hold Registrable Securities constituting at least ten percent (10%) of the aggregate outstanding number of shares of Common Stock (provided, that Pamplona and L Catterton shall be entitled to make demands pursuant to this Section 3.2.1.1 regardless of the amount of Registrable Securities then held by Pamplona and L Catterton).

Notwithstanding anything herein or otherwise to the contrary, Pamplona and L Catterton may make up to two (2) demands pursuant to this Section 3.2.1.1 which shall not be subject to cutback pursuant to Section 3.3 and shall not be subject to piggyback registration rights by any other Holder hereunder (and no notice of such registration or offering shall be required to be given to any Holder other than Pamplona or L Catterton) (each an “Exclusive Convertible Notes Registration Demand”), and if another holder is an Initiating Holder of a demand, either Pamplona or L Catterton may elect to cause such demand to be an Exclusive Convertible Notes Registration Demand. The right to such Exclusive Convertible Notes Registration Demands by each of Pamplona and/or L Catterton, as the case may be, shall terminate with respect to such holder upon satisfaction of a Cash Return Condition, and will be subject, solely to the extent required thereunder, to any rights of holders of Registrable Securities under the Series B Investors’ Agreement, dated as of March 17, 2021, by and between the Company and Planet Fitness Holdings, LLC.

3.2.1.2 Revocation of Demand Notice or Shelf Offering Notice. At any time prior to the effective date of the registration statement relating to a Demand Registration initiated by Pamplona or L Catterton, such Initiating Holder may revoke or withdraw such notice of a Demand Registration on behalf of all holders participating in such Demand Registration without liability to such holders (including, for the avoidance of doubt, Pamplona or L Catterton), in each case by providing written notice to the Company. A notice of Demand Registration that has been revoked or withdrawn shall not count as one of Pamplon or L Catterton’s permitted two (2) demand registrations per annum.

3.2.1.3 Certain Provisions. Promptly after receipt of any notice requesting registration of Registrable Securities pursuant to this Section 3.2.1, the Company will give notice of such requested registration to all other holders of Registrable Securities. The Company will then use its commercially reasonable efforts to effect the registration under the Securities Act of the Registrable Securities which the Company has been requested to register by the holders requesting registration pursuant to this Section 3.2.1, and, subject to all of the provisions of this Section 3, all other Registrable Securities which the Company has been requested to register pursuant to Section 3.1.1 by notice delivered to the Company within ten (10) calendar days after the giving of such notice by the Company (which request shall specify the intended method of disposition of such Registrable Securities), all to the extent requisite to permit the disposition (in accordance with the intended methods thereof as aforesaid) of the Registrable Securities which the Company has been so requested to register.

3.2.2 Form. Each registration requested pursuant to this Section 3.2 shall be effected by the filing of a registration statement on Form S-1 (or any other form which includes substantially the same information as would be required to be included in a registration statement on such form as currently constituted), unless the use of a different form that the Company is eligible to use has been requested in writing by holders of at least a majority of the Registrable Securities held by the applicable Initiating Holders (the “Majority Initiating Holders”).

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3.2.3 Registrations Pursuant to Section 3.2. In the case of a registration pursuant to Section 3.2, whenever the Majority Initiating Holders shall request that such registration shall be effected pursuant to an underwritten offering, such registration shall be so effected, and all Registrable Securities requested to be included in such registration shall be included in such underwritten offering, subject to the cutback provisions of Section 3.3.1. If requested by such underwriters, the Company will enter into an underwriting agreement with such underwriters for such offering containing such representations and warranties by the Company and such other terms and provisions as are customarily contained in underwriting agreements with respect to secondary distributions, including, without limitation, customary indemnity and contribution provisions.

3.2.4 Expenses. The Company shall pay all expenses of the holders of Registrable Securities participating in any Public Offering pursuant to this Section 3.2, other than (i) underwriting discounts and commissions, if any, (ii) applicable transfer taxes, if any, and (iii) fees and charges of any attorneys or other advisors (other than attorneys and advisors retained by the Company to advise it in connection with such Public Offering and one counsel retained to advise all holders of Registrable Securities in connection with such Public Offering) retained by any such holders.

3.3 Certain Other Provisions.

3.3.1 Cutbacks. Notwithstanding the foregoing provisions of this Section 3, if the Company is advised in good faith by any managing underwriter of securities being offered pursuant to any Public Offering under this Section 3 that the number of shares requested to be sold in such Public Offering is greater than the number of such shares which can be included in such Public Offering without materially adversely affecting such Public Offering, the shares to be included in such offering shall be reduced to the extent requested by such managing underwriter as provided in this Section 3.3.1:

3.3.1.1 Company Registration. Upon registration of securities initiated by the Company as contemplated by Section 3.1.1, shares to be included in such offering shall be reduced in the following order and fashion:

(i) first, securities requested to be included by Persons other than the Company and holders of Registrable Securities shall be reduced pro rata (based on the number of shares requested to be included by such Persons);

(ii) second, Registrable Securities requested to be included in the Public Offering shall be reduced pro rata (based on the number of Registrable Securities then-owned by the holders thereof); and

(iii) third, securities proposed to be included by the Company shall be reduced.

3.3.1.2 Demand Registration Rights. Upon the exercise of demand registration rights by the Initiating Holders pursuant to Section 3.2, shares to be included in such offering shall be reduced in the following order and fashion:

(i) first, (A) with respect to an Exclusive Convertible Note Registration Demand, securities requested to be included by Persons other than the Company and the Convertible Notes Registration Rights Holders shall be reduced pro rata (based on the number of shares requested to be included by such Persons) or (B) with respect to the exercise of demand registration rights that are not pursuant to an Exclusive Convertible Note Registration Demand, securities requested to be included by Persons other than the Company and holders of Registrable Securities shall be reduced pro rata (based on the number of shares requested to be included by such Persons);

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(ii) second, securities requested to be included in the Public Offering by the Company shall be reduced; and

(iii) third, Registrable Securities requested to be included in the Public Offering (other than Registrable Securities requested to be included by the Convertible Notes Registration Rights Holders pursuant to an Exclusive Convertible Note Registration Demand) shall be reduced pro rata (based upon the number of Registrable Securities then-owned by the holders thereof).

3.3.2 Resale Shelf Registration for Legacy Warrant Securities. In addition to the registration rights granted pursuant to Sections 3.1 and 3.2 above, upon the request of the Majority Legacy Warrantholders, the Pamplona Warrantholders, the Pamplona Noteholders, the L Catterton Warrantholders or the L Catterton Noteholders, the Company will at its own expense, not later than three hundred and ninety five (395) calendar days after the effectiveness of the first underwritten Public Offering, file, and use its commercially reasonable efforts to cause to become and remain effective, a shelf registration statement under the Securities Act covering the Registrable Securities included in the Legacy Warrant Securities or the Registrable Securities held by the Pamplona Warrantholders or L Catterton Warrantholders, as applicable, until such time as may be consented to by the Majority Legacy Warrantholders, the Pamplona Warrantholders or the L Catterton Warrantholders, as applicable; provided, however, that the rights provided by this Section 3.3.2 shall expire on such date, if any, as all Legacy Warrant Securities and all Registrable Securities held by Pamplona, the Pamplona Warrantholders, L Catterton and the L Catterton Warrantholders (including Registrable Securities to be received upon conversion of Convertible Notes), as applicable, are freely tradeable under Rule 144 and no holder of Legacy Warrant Securities or Registrable Securities held by the Pamplona Warrantholders or L Catterton Warrantholders, as applicable, holds more than one percent (1%) of all outstanding shares of Common Stock.

3.3.3 Underwritten Block Trade. Following the filing of a shelf registration statement as provided in the foregoing, if Pamplona or L Catterton desire to engage in an underwritten block trade or bought deal pursuant to such registration statement (provided the Company is eligible to use Form S-3 for such registration statement) (each, an “Underwritten Block Trade”), then Pamplona or L Catterton may notify the Company of the Underwritten Block Trade not less than two (2) Business Days prior to the day such offering is first anticipated to commence. The Company will promptly notify the other of Pamplona and L Catterton of such Underwritten Block Trade and such notified holder (each, a “Potential Participant”) may elect whether or not to participate no later than the next Business Day (i.e. one (1) Business Day prior to the day such offering is to commence) (unless a longer period is agreed to by Pamplona or L Catterton as the Initiating Holder), and the Company will as expeditiously as possible use its commercially reasonable efforts to facilitate such Underwritten Block Trade (which may close as early as two (2) Business Days after the date it commences); provided such request is to be consummated at a time which is no later than two weeks prior to any fiscal quarter end and ending no earlier than the filing by the Company of any earnings release; provided further that, no holder (other than Pamplona and L Catterton) will be permitted to participate in such Underwritten Block Trade without the written consent of Pamplona and L Catterton. Any Potential Participant’s

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request to participate in an Underwritten Block Trade shall be binding on the Potential Participant provided, that each such Potential Participant that elects to participate may condition its participation on the Underwritten Block Trade being completed within fifteen (15) Business Days of its acceptance at a price per share (after giving effect to any underwriters’ discounts or commissions) to such Potential Participant of not less than ninety percent (90%) of the closing price for the shares on their principal trading market on the Business Day immediately prior to such Potential Participant’s election to participate (the “Participation Conditions”). Any such Underwritten Block Trade shall not constitute an Exclusive Convertible Notes Registration Demand. The rights of each of Pamplona and/or L Catterton, as the case may be, under this paragraph shall terminate with respect to such holder upon satisfaction of a Cash Return Condition.

3.3.4 Selection of Managing Underwriters. In the case of any registration proposed by the Company for the Public Offering of securities for its own account, the managing underwriters, if any, with respect thereto shall be selected by the Company. In the case of any registration pursuant to Section 3.2 hereof initiated by Pamplona or L Catterton, Pamplona or L Catterton shall select the managing underwriters, if any, with respect thereto. In the case of any registration pursuant to Section 3.2 hereof initiated by Persons other than Pamplona or L Catterton, the holders of a majority of the Registrable Securities requested to be included therein shall select the managing underwriters, if any, with respect thereto.

3.3.5 Selection of Counsel. Counsel to the Company in connection with any Public Offering shall be selected by the Company, and counsel to the selling holders of Registrable Securities shall be selected by (i) in the case of any registration pursuant to Section 3.2 hereof initiated by Pamplona or L Catterton, Pamplona or L Catterton, respectively or (ii) in the case of any registration pursuant to Section 3.2 hereof initiated by Persons other than Pamplona or L Catterton, the holders of a majority of the Registrable Securities requested pursuant to the provisions hereof to be included therein.

3.4 Company Obligations. Whenever any holders have requested that any Registrable Securities be registered pursuant to this Agreement, the Company will use its commercially reasonable efforts to effect the registration and the sale of such Registrable Securities in accordance with the intended method of disposition thereof, and pursuant thereto the Company will as expeditiously as possible:

3.4.1 prepare and file with (or submit confidentially to) the Securities and Exchange Commission (the “SEC”) a registration statement, and all amendments and supplements thereto and related prospectuses, with respect to such Registrable Securities and use its commercially reasonable efforts to cause such registration statement to become effective, all in accordance with the Securities Act and all applicable rules and regulations promulgated thereunder (provided that before filing or confidentially submitting a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to the counsel selected by such holders covered by such registration statement copies of all such documents proposed to be filed or submitted, which documents will be subject to the review and comment of such counsel);

3.4.2 notify each holder of (A) the issuance by the SEC of any stop order suspending the effectiveness of any registration statement or the initiation of any proceedings for that purpose, (B) the receipt by the Company or its counsel of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, and (C) the effectiveness of each registration statement filed hereunder;

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3.4.3 prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for a period ending when all of the securities covered by such registration statement have been disposed of in accordance with the intended methods of distribution by the sellers thereof set forth in such registration statement (but not in any event before the expiration of any longer period required under the Securities Act or, if such registration statement relates to an underwritten Public Offering, such longer period as in the opinion of counsel for the underwriters a prospectus is required by law to be delivered in connection with sale of Registrable Securities by an underwriter or dealer) and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such registration statement;

3.4.4 furnish, without charge, to each seller of Registrable Securities thereunder and each underwriter, if any, such number of copies of such registration statement, each amendment and supplement thereto, the prospectus included in such registration statement (including each preliminary prospectus) (in each case including all exhibits and documents incorporated by reference therein), each amendment and supplement thereto, each free writing prospectus, as defined in Rule 405 of the Securities Act (each, a “Free Writing Prospectus”) and such other documents as such seller or underwriter, if any, may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such seller (the Company hereby consenting to the use in accordance with all applicable laws of each such registration statement, each such amendment and supplement thereto, and each such prospectus (or preliminary prospectus or supplement thereto) or Free Writing Prospectus by each such seller of Registrable Securities and the underwriters, if any, in connection with the offering and sale of the Registrable Securities covered by such registration statement or prospectus);

3.4.5 use its commercially reasonable efforts to register or qualify such Registrable Securities under such other securities or blue sky laws of such jurisdictions as any seller reasonably requests and do any and all other acts and things which may be reasonably necessary or advisable to enable such seller to consummate the disposition in such jurisdictions of the Registrable Securities owned by such seller (provided that the Company will not be required to (A) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph or (B) consent to general service of process in any such jurisdiction or (C) subject itself to taxation in any such jurisdiction);

3.4.6 notify in writing each seller of such Registrable Securities (A) promptly after it receives notice thereof, of the date and time when such registration statement and each post-effective amendment thereto has become effective or a prospectus or supplement to any prospectus relating to a registration statement has been filed and when any registration or qualification has become effective under a state securities or blue sky law or any exemption thereunder has been obtained, (B) promptly after receipt thereof, of any request by the SEC for the amendment or supplementing of such registration statement or prospectus or for additional information, and (C) at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event or of any information or circumstances as a result of which the prospectus included in such registration statement contains an untrue statement of a material fact or omits any fact necessary to make the statements therein not misleading, and, if required by applicable law

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or to the extent requested by an Initiating Holder, the Company will use its commercially reasonable efforts to promptly prepare and file a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not contain an untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading and (D) if at any time the representations and warranties of the Company in any underwriting agreement, securities sale agreement, or other similar agreement, relating to the offering shall cease to be true and correct;

3.4.7 (A) use commercially reasonable efforts to cause all such Registrable Securities to be listed on each securities exchange on which similar securities issued by the Company are then listed and, if not so listed, to be listed on a securities exchange and, without limiting the generality of the foregoing, to arrange for at least two market markers to register as such with respect to such Registrable Securities with FINRA, and (B) comply (and continue to comply) with the requirements of any self-regulatory organization applicable to the Company, including without limitation all corporate governance requirements;

3.4.8 use commercially reasonable efforts to provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of such registration statement;

3.4.9 enter into and perform such customary agreements (including, as applicable, underwriting agreements in customary form) and take all such other actions as the holders of Registrable Securities or the underwriters, if any, reasonably request in order to expedite or facilitate the disposition of such Registrable Securities (including, without limitation, making available the executive officers of the Company and participating in “road shows,” investor presentations, marketing events and other selling efforts and effecting a stock or unit split or combination, recapitalization or reorganization);

3.4.10 make available for inspection by any seller of Registrable Securities, any underwriter participating in any disposition or sale pursuant to such registration statement and any attorney, accountant or other agent retained by any such seller or underwriter, all financial and other records, pertinent corporate and business documents and properties of the Company as will be necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors, employees, agents, representatives and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with such registration statement and the disposition of such Registrable Securities pursuant thereto;

3.4.11 take all actions to ensure that any Free-Writing Prospectus utilized in connection with any Demand Registration or Piggyback Registration or Underwritten Block Trade hereunder complies in all material respects with the Securities Act, is filed in accordance with the Securities Act to the extent required thereby, is retained in accordance with the Securities Act to the extent required thereby and, when taken together with the related prospectus, prospectus supplement and related documents, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;

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3.4.12 permit any holder which, in its sole and exclusive judgment, might be deemed to be an underwriter or a controlling person of the Company, to participate in the preparation of such registration or comparable statement and to allow such holder to provide language for insertion therein, in form and substance satisfactory to the Company, which in the reasonable judgment of such holder and its counsel should be included;

3.4.13 use commercially reasonable efforts to prevent the issuance of any stop order suspending the effectiveness of a registration statement, or the issuance of any order suspending or preventing the use of any related prospectus or suspending the qualification of any Registrable Securities included in such registration statement for sale in any jurisdiction use, and in the event any such order is issued, commercially reasonable efforts to obtain promptly the withdrawal of such order;

3.4.14 use its commercially reasonable efforts to cause such Registrable Securities covered by such registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the sellers thereof to consummate the disposition of such Registrable Securities;

3.4.15 if requested by any managing underwriter, include in any prospectus or prospectus supplement updated financial or business information for the Company’s most recent period or current quarterly period (including estimated results or ranges of results) if required for purposes of marketing the offering in the view of the managing underwriter;

3.4.16 take no direct or indirect action prohibited by Regulation M under the Securities Exchange Act of 1934 (the “Exchange Act”); provided, however, that to the extent that any prohibition is applicable to the Company, the Company will take such action as is necessary to make any such prohibition inapplicable;

3.4.17 cooperate with each holder covered by the registration statement and each underwriter or agent participating in the disposition of such Registrable Securities and their respective counsel in connection with the preparation and filing of applications, notices, registrations and responses to requests for additional information with FINRA, the New York Stock Exchange, Nasdaq or any other national securities exchange on which the shares of Registrable Securities are or are to be listed, and (B) to the extent required by the rules and regulations of FINRA, retain a Qualified Independent Underwriter acceptable to the managing underwriter;

3.4.18 in the case of any underwritten offering, use its commercially reasonable efforts to obtain, and deliver to the underwriter(s), in the manner and to the extent provided for in the applicable underwriting agreement, one or more cold comfort letters from the Company’s independent public accountants in customary form and covering such matters of the type customarily covered by cold comfort letters;

3.4.19 use its commercially reasonable efforts to provide (A) a legal opinion of the Company’s outside counsel, dated the effective date of such registration statement addressed to the Company, (B) on the date that such Registrable Securities are delivered to the underwriters for sale in connection with a Demand Registration or Piggyback Offering, if such securities are being sold through underwriters, or, if such securities are not being sold through underwriters, on the closing date of the applicable sale, (1) one or more legal opinions of the Company’s outside counsel, dated such date, in form and substance as

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customarily given to underwriters in an underwritten public offering or, in the case of a non-underwritten offering, to the broker, placement agent or other agent of the Holders assisting in the sale of the Registrable Securities and (2) one or more “negative assurances letters” of the Company’s outside counsel, dated such date, in form and substance as is customarily given to underwriters in an underwritten public offering or, in the case of a non-underwritten offering, to the broker, placement agent or other agent of the holders assisting in the sale of the Registrable Securities, in each case, addressed to the underwriters, if any, or, if requested, in the case of a non-underwritten offering, to the broker, placement agent or other agent of the holders assisting in the sale of the Registrable Securities and (3) customary certificates executed by authorized officers of the Company as may be requested by any Holder or any underwriter of such Registrable Securities;

3.4.20 pay the filing fee at such time or times as the Registrable Securities are to be sold; and

3.4.21 if an automatic shelf registration statement has been outstanding for at least three (3) years, at the end of the third year, refile a new automatic shelf registration atatement covering the Registrable Securities, and, if at any time when the Company is required to re-evaluate its WKSI status the Company determines that it is not a WKSI, use its commercially reasonable efforts to refile the Shelf Registration Statement on Form S-3 and, if such form is not available, Form S-1 and keep such registration statement effective during the period during which such registration statement is required to be kept effective.

3.5 Officer Obligations. Each holder that is an officer of the Company agrees that if and for so long as he or she is employed by the Company or any Subsidiary thereof, he or she will participate fully in the sale process in a manner customary for persons in like positions and consistent with his or her other duties with the Company, including the preparation of the registration statement and the preparation and presentation of any road shows.

3.6 In-Kind Distributions. If either Pamplona or L Catterton (and/or any of their affiliates) seeks to effectuate an in-kind distribution of all or part of their Registrable Securities to their respective direct or indirect equityholders, the Company will, subject to any applicable lock-ups, work with the foregoing Persons to facilitate such in-kind distribution in the manner reasonably requested and consistent with the Company’s obligations under the Securities Act.

3.7 Indemnification and Contribution.

3.7.1 Indemnities of the Company. In the event of any registration of any Registrable Securities or other debt or equity securities under the Securities Act, and in connection with any registration statement or any other disclosure document produced by or on behalf of the Company and any of its subsidiaries pursuant to which securities of the Company and any of its subsidiaries are sold (whether or not for the account of the Company) or any other disclosure document produced by or on behalf of the Company and any of its subsidiaries, including without limitation reports required or other documents filed under the Exchange Act, the Company will, and hereby does, and will cause its subsidiaries, jointly and severally to, indemnify and hold harmless each seller of Registrable Securities, any other holder of Securities or Legacy Warrant Securities who is or might be deemed to be a controlling Person of the Company and any of its subsidiaries within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, their respective direct and indirect partners, advisory board members, directors, officers and shareholders, and each other Person, if any, who controls any such seller or any such

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holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (each such Person being referred to herein as a “Covered Person”), against any losses, claims, damages or liabilities, joint or several, to which such Covered Person may be or become subject under the Securities Act, the Exchange Act, any other securities or other law of any jurisdiction, common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained or incorporated by reference in any registration statement under the Securities Act, any preliminary prospectus or final prospectus included therein, or any related summary or free writing prospectus, or any amendment or supplement thereto, or any document incorporated by reference therein, or any other such disclosure document or other document or report, (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or (iii) any violation by the Company and any of its subsidiaries of any federal, state or common law rule or regulation applicable to the Company and to any of its subsidiaries and relating to action or inaction in connection with any such registration, disclosure document or other document or report, and will reimburse such Covered Person for any legal or any other expenses incurred by it in connection with investigating or defending any such loss, claim, damage, liability, action or proceeding; provided, however, that neither the Company nor any of its subsidiaries shall be liable to any Covered Person in any such case to the extent that any such loss, claim, damage, liability, action or proceeding arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, any such preliminary prospectus, final prospectus, summary or free writing prospectus, amendment or supplement, incorporated document or other such disclosure document or other document or report, in reliance upon and in conformity with written information furnished to the Company or to any of its subsidiaries through an instrument duly executed by such Covered Person specifically stating that it is for use in the preparation thereof. The indemnities of the Company and of its subsidiaries contained in this Section 3.7.1 shall remain in full force and effect regardless of any investigation made by or on behalf of such Covered Person and shall survive any transfer of securities.

3.7.2 Indemnities to the Company. Each seller of Registrable Securities in any registration statement filed pursuant to this Section 3, agrees, severally but not jointly, to indemnify and hold harmless the Company and any of its subsidiaries, each director of the Company or any of its subsidiaries, each officer of the Company or any of its subsidiaries who shall sign such registration statement and each other Person (other than such seller), if any, who controls the Company and any of its subsidiaries within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, with respect to any statement in or omission from such registration statement, any preliminary prospectus or final prospectus included therein, or any amendment or supplement thereto, or any free writing prospectus or other document incorporated therein, if such statement or omission was made in reliance upon and in conformity with written information furnished to the Company or to any of its subsidiaries through an instrument executed by such seller specifically stating that it is for use in the preparation of such registration statement, preliminary prospectus, final prospectus, free writing prospectus, summary prospectus, amendment or supplement, or incorporated document. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Company, any of its subsidiaries, or any such director, officer or controlling Person and shall survive any transfer of securities.

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3.7.3 Contribution. If the indemnification provided for in Sections 3.7.1 or 3.7.2 hereof is unavailable to a party that would have been an indemnified party under any such Section in respect of any losses, claims, damages or liabilities (or actions or proceedings in respect thereof) referred to therein, then each party that would have been an indemnifying party thereunder shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) in such proportion as is appropriate to reflect the relative fault of such indemnifying party on the one hand and such indemnified party on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions or proceedings in respect thereof). The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or such indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties agree that it would not be just or equitable if contribution pursuant to this Section 3.7.3 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentence. The amount paid or payable by a contributing party as a result of the losses, claims, damages or liabilities (or actions or proceedings in respect thereof) referred to above in this Section 3.7.3 shall include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

3.7.4 Limitation on Liability of Holders of Registrable Securities. The liability of each holder of Registrable Securities in respect of all indemnification and contribution obligations of such holder arising under this Section 3.7 shall not in any event exceed an amount equal to the net proceeds to such holder (after deduction of all underwriters’ discounts and commissions and all other expenses paid by such holder in connection with the registration in question) from the disposition of the Registrable Securities disposed of by such holder pursuant to such registration.

3.8 Lock-up.

3.8.1 Without the prior written consent of the Company, for a period beginning ten calendar days immediately preceding and ending on the one hundred eightieth (180th) calendar day (in the case of the Initial Public Offering, or ninetieth (90th) calendar day in the case of any other offering, or such shorter period as the managing underwriter shall agree) following the effective date of the registration statement used in connection with any offering of shares of Common Stock by the Company, no holder of Securities (whether or not a selling shareholder pursuant to such registration statement) shall (a) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise Transfer, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for such Common Stock or (b) enter into any swap or other management that transfers to another, in whole or in part, any of the economic consequences of ownership of Common Stock, whether any such transaction described in clause (a) or (b) above is to be settled by delivery of such Common Stock or such other securities, in cash or otherwise; provided, however, that the foregoing restrictions shall not apply to (i) transactions relating to shares of Common Stock or other securities acquired in open market transactions after the completion of the Initial Public

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Offering, (ii) Transfers among any Affiliates, provided that the Transferee Affiliate agrees to be bound by the terms of this Agreement, including this Section 3.8.1, (iii) Transfers to the Company or any subsidiary of the Company in one or more transactions approved by the Board, (iv) Transfers constituting the exercise of the Junior Management Options, the Pamplona Warrant or the L Catterton Warrant or the conversion of Convertible Notes; or (v) such other Transfers of the type permitted by the underwriters in the IPO; provided, further, that any such lock-up agreement shall provide that if the managing underwriter releases any shares from the lock-up with respect to such offering prior to the scheduled expiration date, such release shall contemporaneously apply to the holders of all Securities and each such holder shall be entitled to release their pro rata shares of Common Stock so released; provided, further, that any such lock-up agreement shall provide that no shares of Common Stock shall be released from such lock-up prior to the scheduled expiration date except pro rata according to the holdings of all holders of Securities subject to the lock-up agreement.

4. REMEDIES.

4.1 Generally. The Company and all holders of Securities and Legacy Warrant Securities shall have all remedies available at law, in equity or otherwise in the event of any breach or violation of this Agreement or any default hereunder by the Company, any holder of Securities or any holder of Legacy Warrant Securities. The parties acknowledge and agree that in the event of any breach of this Agreement, in addition to any other remedies which may be available, each of the parties hereto shall be entitled to specific performance of the obligations of the other parties hereto and, in addition, to such other equitable remedies (including, without limitation, preliminary or temporary relief) as may be appropriate in the circumstances.

5. LEGENDS.

5.1 Securities Act Legend. Each certificate representing Securities (not including the Convertible Notes) or Legacy Warrant Securities shall have the following legend endorsed conspicuously thereupon:

“The securities represented by this certificate were issued in a private placement, without registration under the Securities Act of 1933, as amended (the “Act”), and may not be sold, assigned, pledged or otherwise transferred in the absence of an effective registration under the Act covering the transfer or an opinion of counsel, satisfactory to the issuer, that registration under the Act is not required.”

The legend required by this Section 5.1 shall cease to be required as to any particular Securities (i) when, in the opinion of Weil Gotshal & Manges, LLP or other counsel reasonably acceptable to the Company, such restrictions are no longer required in order to assure compliance with the Securities Act, or (ii) when such Securities shall have been registered under the Securities Act or transferred pursuant to Rule 144 thereunder. Whenever (x) such requirement shall cease and terminate as to any Securities or (y) such Securities shall be freely transferable under Rule 144, the holder thereof shall be entitled to receive from the Company, without expense, new certificates not bearing the legend set forth in this Section 5.1.

5.2 Registration Rights Agreement Legend. Each certificate representing Securities shall have the following legend endorsed conspicuously thereupon:

“The securities represented by this certificate are subject to the restrictions on transfer and the provisions as set forth in the Registration Rights Agreement dated as of [•], 2021, as amended and in effect from time to time, and constitute _______ Securities as defined in such Registration Rights Agreement. The Company will furnish a copy of such agreement to the holder of this certificate without charge upon written request.”

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Any Person who acquires Securities which are not subject to all or part of the terms of this Agreement shall have the right to have such legend (or the applicable portion thereof) removed from certificates representing such Securities.

5.3 Stop Transfer Instruction. The Company shall instruct any transfer agent not to register the Transfer of any Securities until the conditions specified in the foregoing legends are satisfied.

6. AMENDMENT, TERMINATION, ETC.

6.1 No Oral Modification. This Agreement may not be orally amended, modified, extended or terminated, nor shall any oral waiver of any of its terms be effective.

6.2 Written Modifications. This Agreement may be amended, modified, extended or terminated, and the provisions hereof may be waived, by an agreement in writing signed by holders of Securities representing each of (a) the Management Majority Holders, (b) the Pamplona Key Noteholder, (c) the L Catterton Key Noteholder, (d) Stevenson, (e) Ko and (f) Robert Gay; provided, however, that the consent of the Management Majority Holders shall not be required if the Management Investors, together with their Permitted Transferees, hold in the aggregate, directly or indirectly, less than ten percent (10%) of the outstanding shares of Common Stock (on a fully diluted basis); provided, further, that the consent of Stevenson shall not be required if Stevenson, together with his Affiliates hold in the aggregate, directly or indirectly, less than ten percent (10%) of the outstanding shares of Common Stock (on a fully diluted basis); provided, further, that the consent of Ko shall not be required if Ko, together with his Affiliates hold in the aggregate, directly or indirectly, less than ten percent (10%) of the outstanding shares of Common Stock (on a fully diluted basis); provided, further, that the consent of Robert Gay shall not be required if any one of the following groups of Investors, together with their respective Permitted Transferees, hold in the aggregate, directly or indirectly, less than ten percent (10%) of the outstanding shares of Common Stock (on a fully diluted basis): (i) the Management Investors, (ii) Stevenson and SW or (iii) Ko; provided, further, that the consent of the Company shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of the Company under this Agreement; provided, further, that the consent of the Pamplona Key Noteholder shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of any of the Pamplona Noteholders (or any adverse effect on any right or obligation specific to any of the Pamplona Noteholders); provided, further, that the consent of the L Catterton Key Noteholder shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of any of the L Catterton Noteholders (or any adverse effect on any right or obligation specific to any of the L Catterton Noteholders); provided, further, that the consent of the Watterson Key Noteholder shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of any of the Watterson Noteholders (or any adverse effect on any right or obligation specific to any of the Watterson Noteholders); provided, further, that the consent of the holders of a majority of the Pamplona Warrant Securities shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of any of the holders of the Pamplona Warrant Securities (or any adverse effect on any right or obligation specific to any of the holders of the Pamplona Warrant Securities); provided, further, that the consent of the holders of a majority of the L Catterton Warrant Securities shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of any of the holders of the L Catterton Warrant Securities (or any adverse effect on any right or obligation specific to any of the holders of the L Catterton Warrant Securities); provided, further, that this Agreement may not be terminated without the consent of holders of a majority of the Pamplona Warrant Securities, the holder of a majority of the L Catterton Warrant Securities, the Pamplona

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Key Noteholder, the L Catterton Key Noteholder, and the Watterson Key Noteholder; and provided, further, that the consent of the Management Majority Holders, Robert Gay, Ko, Stevenson, the Majority Legacy Warrantholders, the Pamplona Key Noteholder, the holders of a majority of the Pamplona Warrant Securities, the L Catterton Key Noteholder, the holders of a majority of the L Catterton Warrant Securities or the Watterson Key Noteholder, as applicable, shall be required for any amendment, modification, extension, termination or waiver which has a material adverse effect on the rights or obligations of such Investors under this Agreement. Each party hereto and each holder of Securities or Legacy Warrant Securities subject hereto may waive any of its rights hereunder by an instrument in writing signed by such party or holder.

7. MISCELLANEOUS.

7.1 Authority; Effect. Each party hereto represents and warrants to and agrees with each other party that the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized on behalf of such party and do not violate any agreement or other instrument applicable to such party or by which its assets are bound. This Agreement does not, and shall not be construed to, give rise to the creation of a partnership among any of the parties hereto, or to constitute any of such parties members of a joint venture or other association.

7.2 Notices. Notices and other communications provided for in this Agreement shall be in writing and shall be effective (i) when one day shall have elapsed (exclusive of Saturdays, Sundays and banking holidays in the City of Boston or New York City) from their deposit for overnight delivery with Federal Express or other bonded courier (charges prepaid), addressed to the party or parties sought to be charged with notice of the same at the respective addresses set forth or referred to below, subject to written notice of change of address given by any party to each other party, (ii) when three (3) days shall have elapsed (exclusive of Saturdays, Sundays and banking holidays in the City of Boston or New York City) from their deposit in the U.S. mail, postage prepaid and registered or certified, addressed to the party or parties sought to be charged with notice of the same at the respective addresses set forth or referred to below, subject to written notice of change of address given by any party to each other party, (iii) if delivered by facsimile transmission to the facsimile numbers provided for below, upon receipt of facsimile confirmation, or (iv) if earlier, upon receipt.

If to the Company, to it at:

c/o iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Fax: (435) 750-5238

Attention: Chief Executive Officer

with a copy to:

Weil, Gotshal & Manges, LLP

767 5th Ave

New York, New York 10153

Fax: (212) 310-8007

Attention: Corey Chivers

If to SW or to Watterson, to them at:

c/o iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Fax: (435) 750-5238

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with a copy to:

Weil, Gotshal & Manges, LLP

767 5th Ave

New York, New York 10153

Fax: (212) 310-8007

Attention: Corey Chivers

If to GS or to Stevenson, to them at:

Gary E. Stevenson

4316 Summerview Circle

Bountiful, Utah 84010

Fax: (801) 240-1628

If to Robert Gay, BG or to BG II, to them at:

Kensington Capital Holdings, LLC

26 Patriot Place, Suite 301

Foxboro, Massachusetts 02035

Fax: (508) 546-0064

with a copy to:

Honigman Miller Schwartz & Cohn, LLP

600 Woodward Ave.

2290 First National Building

Detroit, Michigan 48226

Fax: (313) 465-7457

Attention: Joshua Opperer

if to Ko, to him at:

c/o Chang Chen Instrument Co. Ltd.

No. 342, Datong Rd., Gueishan Dist.,

Taoyuan City 333, Taiwan, R.O.C.

Fax: 011-88-633-505101

with a copy to:

Brad H. Bearnson

Bearnson & Caldwell, LLC

399 North Main, Suite 270

Logan, Utah 84321

Fax: (435) 752-6301

if to the Legacy Warrantholders, to them at:

c/o IBJ Whitehall Bank & Trust Company

One State Street

New York, New York 10004

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with a copy to:

Weil, Gotshal & Manges, LLP

767 Fifth Avenue

New York, New York 10028

Fax: (212) 310-8007

Attention: Corey Chivers

if to Pamplona, to it at:

c/o Pamplona Capital Management LLC

667 Madison Avenue, 22nd Floor

New York, NY 10065

Email: asinger@pamplonafunds.com

Attention: Andrew Singer

with a copy to:

Lowenstein Sandler LLP

1251 Avenue of the Americas, 18^th Floor

New York, NY 10020

Email: mbrosse@lowenstein.com

Attention: Michael Brosse

if to L Catterton, to it at:

c/o L Catterton Management Limited

599 West Putnam Avenue

Greenwich, CT 06830

Email: marc.magliacano@lcatterton.com; jennifer.reid@lcatterton.com and legalnotice@lcatterton.com

Attention: Marc Magliacano and Jennifer Reid

with a copy to:

Kirkland & Ellis LLP

601 Lexington Avenue

New York, NY 10022

Email: joshua.kogan@kirkland.com and elizabeth.freechack@kirkland.com

Attention: Joshua Kogan, P.C. and Elizabeth Freechack

If to any other Investor, to such Investor at the address set forth in the stock record book of the Company.

Notice to the holder of record of any shares of capital stock shall be deemed to be notice to the holder of such shares for all purposes hereof.

7.3 Binding Effect, etc. This Agreement constitutes the entire agreement of the parties with respect to its subject matter, supersedes all prior or contemporaneous oral or written agreements or discussions with respect to such subject matter (including the Investors’ Agreement, which, for the avoidance of doubt, is hereby terminated in its entirety effective upon the closing of the Initial Public Offering), and shall be binding upon and inure to the benefit of the parties hereto and their respective heirs,

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representatives, successors and permitted assigns. For the avoidance of doubt, this Agreement does not supersede the Purchase Agreements, the Convertible Notes, the Pamplona Warrant or the L Catterton Warrant. No provision of this Agreement providing for the expiration of any provision by lapse of time or upon the occurrence of specified events or otherwise shall relieve any Person of liability for breach or violation prior to such expiration. In the event of any conflict between the terms of this Agreement and the Company’s By-laws or Certificate of Incorporation (as amended or amended and restated), the terms of this Agreement will prevail and the parties hereto will forthwith cause any necessary alterations to be made to the Company’s By-laws or Certificate of Incorporation (as amended or amended and restated), as applicable, so as to resolve the conflict.

7.4 Descriptive Headings. The descriptive headings of this Agreement are for convenience of reference only, are not to be considered a part hereof and shall not be construed to define or limit any of the terms or provisions hereof.

7.5 Counterparts. This Agreement may be executed in multiple counterparts (including by electronic or .PDF delivery), each of which shall be deemed an original, but all of which taken together shall constitute one instrument. Facsimile signatures and those delivered by other electronic means shall constitute original signatures for all purposes of this Agreement.

7.6 Severability. If in any judicial or arbitral proceedings a court or arbitrator shall refuse to enforce any provision of this Agreement, then such unenforceable provision shall be deemed eliminated from this Agreement for the purpose of such proceedings to the extent necessary to permit the remaining provisions to be enforced. To the full extent, however, that the provisions of any applicable law may be waived, they are hereby waived to the end that this Agreement be deemed to be valid and binding agreement enforceable in accordance with its terms, and in the event that any provision hereof shall be found to be invalid or unenforceable, such provision shall be construed by limiting it so as to be valid and enforceable to the maximum extent consistent with and possible under applicable law.

7.7 Third Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto (including the Other Investors) and any signatories to a joinder hereto, and nothing herein express or implied shall give or be construed to give to any Person, other than the parties hereto (including the Other Investors), any signatories to a joinder hereto and their respective permitted assigns, (including any transferee of Registrable Securities from Pamplona or L Catterton, including upon transfer of their Convertible Notes or warrants in accordance with the terms thereof), any legal or equitable rights hereunder.

7.8 Specific Performance. Due to, among other things, the fact that the securities of the Company cannot be readily purchased or sold in the open market and for other reasons, the parties would be irreparably damaged in the event that this Agreement is not specifically enforced. In the event of a breach or threatened breach of the terms, covenants and/or conditions of this Agreement by any of the parties hereto, one or more of the other parties, in addition to all other remedies, shall be entitled to obtain (without any bond or other security being required) a temporary and/or permanent injunction, without showing any actual damage or that monetary damages would not provide an adequate remedy, and/or an award providing a decree for specific performance, in accordance with the provisions hereof.

7.9 Effectiveness. This Agreement shall take effect immediately upon the closing of the Initial Public Offering, and, for the avoidance of doubt, shall have no force or effect until the Initial Public Offering. If the Initial Public Offering does not occur by [•], this Agreement shall be void and of no force and effect and all rights and obligations of the parties hereto shall terminate without any further liability on the part of any party hereto in respect thereof.

8. GOVERNING LAW.

8.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of New York without giving effect to any choice or conflict of laws provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction.

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8.2 Consent to Jurisdiction. Each party to this Agreement, by its execution hereof, (a) hereby irrevocably submits to the exclusive jurisdiction of the state courts of the State of New York sitting in the County of New York or the United States District Court for the Southern District of New York for the purpose of any action, claim, cause of action or suit (in contract, tort or otherwise), inquiry, proceeding or investigation arising out of or based upon this Agreement or relating to the subject matter hereof, (b) hereby waives to the extent not prohibited by applicable law, and agrees not to assert, and agrees not to allow any of its subsidiaries to assert, by way of motion, as a defense or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that any such proceeding brought in one of the above-named courts is improper, or that this Agreement or the subject matter hereof or thereof may not be enforced in or by such court, and (c) hereby agrees not to commence or maintain any action, claim, cause of action or suit (in contract, tort or otherwise), inquiry, proceeding or investigation arising out of or based upon this Agreement or relating to the subject matter hereof or thereof other than before one of the above-named courts nor to make any motion or take any other action seeking or intending to cause the transfer or removal of any such action, claim, cause of action or suit (in contract, tort or otherwise), inquiry, proceeding or investigation to any court other than one of the above-named courts whether on the grounds of inconvenient forum or otherwise. Notwithstanding the foregoing, to the extent that any party hereto is or becomes a party in any litigation in connection with which it may assert indemnification rights set forth in this agreement, the court in which such litigation is being heard shall be deemed to be included in clause (a) above. Each party hereto hereby consents to service of process in any such proceeding in any manner permitted by New York law, and agrees that service of process by registered or certified mail, return receipt requested, at its address specified pursuant to Section 7.2 hereof is reasonably calculated to give actual notice. The provisions of this Section 8.2 shall not restrict the ability of any party to enforce in any court any judgment obtained in the federal or state courts of the State of New York.

8.3 WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THIS SECTION 8.3 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 8.3 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

8.4 Reliance. Each of the parties hereto acknowledges that he or it has been informed by each other party that the provisions of Section 8 constitute a material inducement upon which such party is relying and will rely in entering into this Agreement and the transactions contemplated hereby.

[THE REST OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

THE COMPANY:	IFIT HEALTH & FITNESS INC
	By
	Name: Scott R. Watterson
	Title: Chairman & Chief Executive Officer
ICON:	IFIT INC.
	By
	Name: Scott R. Watterson
	Title: Chairman & Chief Executive Officer
THE LLC:	HF INVESTMENT HOLDINGS, LLC
	By
	Name: Scott R. Watterson
	Title: Chairman & Chief Executive Officer

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

THE WATTERSON
INVESTORS:	By:
	Scott R. Watterson, individually
	SW ICON LLC
	By:
	Name: Scott R. Watterson
	Title: Chairman & Chief Executive Officer

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

THE STEVENSON
INVESTORS:	By:
	Gary E. Stevenson, individually
	GS ICON LLC
	By:
	Name: Gary E. Stevenson
	Title: Manager

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

THE GAY INVESTORS	By:
	Robert C. Gay, individually
	BG ICON LLC
	By:
		Name: Robert C. Gay
		Title: Managing Member
	BG ICON II LLC
	By:
		Name: Robert C. Gay
		Title: Managing Member

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

By:
	Wen-Chung Ko, individually
	W-C KO USA, LLC
By:
	Name: Wen-Chung Ko
	Title: Manager

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

By:
	David Watterson, individually

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

PAMPLONA:	ICON PREFERRED HOLDINGS, L.P.
	By: Icon Preferred Holdings GP, Inc.
		its general partner
	By
	Name: Andrew Singer
	Title: Vice President

[Signature Page to Registration Rights Agreement]

IN WITNESS WHEREOF, each of the undersigned has duly executed this Agreement (or caused this Agreement to be executed on its behalf by its officer or representative thereunto duly authorized) under seal as of the date first above written.

L CATTERTON:	LC9 Connected Holdings, LP
	By: LC9 Management, L.L.C.
	Its: General Partner
	By
	Name: Scott Dahnke
	Title: Managing Member

[Signature Page to Registration Rights Agreement]

EX-4.4

Exhibit 4.4

THE SECURITIES REPRESENTED BY THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED EXCEPT IN COMPLIANCE THEREWITH.

[THIS NOTE WAS ISSUED WITH “ORIGINAL ISSUE DISCOUNT” AS DEFINED IN SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (“OID”). YOU MAY OBTAIN INFORMATION REGARDING THE AMOUNT OF OID, THE ISSUE PRICE, THE ISSUE DATE AND THE YIELD TO MATURITY BY CONTACTING THE ISSUER AT ITS ADDRESS SET FORTH IN ARTICLE 16.] [OID legend to be included on all non-stapled notes.]

[•], 2021 $[•]¹        

[No. 1][No. 2][No. 3][No. 4]

IFIT HEALTH & FITNESS INC

7.0% NOTES

DUE [•], 2027

THIS NOTE (this “Note”) is a duly authorized issue of notes of iFIT Health & Fitness Inc, a Delaware corporation (the “Issuer”), designated as its 7.0% Notes due [•], 2027 (the “Maturity Date”), in an aggregate principal amount of [•] ($[•]).

FOR VALUE RECEIVED, the Issuer promises to pay to [•], a [•]², [registered address, contact and telephone] [which promise to pay, and all terms of this Note as applicable, with respect to the promise to pay and issuance to Scott Watterson, is qualified by and subject to the Award Agreement]³ or its registered Transferees (together with its successors and Transferees, the “Holder”), the aggregate principal sum of [•] ($[•]) on the Maturity Date and to pay interest (each, an “Interest Payment”) on the principal sum outstanding from time to time under this Note. Interest on this Note will accrue at the rate per annum equal to 7.0%, and will be due and payable in cash in immediately available funds in arrears on a quarterly basis on March 31, June 30, September 30 and December 31 of each year during the term of this Note (each, an “Interest Payment Date”), commencing on December 31, 2021; provided that at the election of the Issuer any interest accrued can instead (i) be paid (a “PIK Payment”) by adding such accrued amounts to the unpaid principal amount of the Note outstanding at such time (“PIK Interest”) or (ii) be paid in the form of Common Stock at a 15% discount to 10-day VWAP for the applicable Interest Payment Date. Any such election by the Issuer shall apply to all Convertible Notes on a pro rata basis; provided that, during any period during the applicability of the Forfeiture Restrictions (as defined in the Award Agreement) interest on the Note issued to

¹  Principal amount to be calculated in accordance with Sections 1.2 and 1.3 of the Omnibus Agreement.

²  Scott Watterson note will registered individually in Scott Watterson’s name

³  This language to be inserted in note issued to Scott Watterson.

Scott Watterson shall only be paid in the form of Common Stock; provided, further, that in the event the Issuer intends to pay PIK Interest or make an Interest Payment in cash during the applicability of the Forfeiture Restrictions, the Issuer shall provide notice to each Noteholder other than Scott Watterson no less than ten (10) Business Days prior to the applicable Interest Payment Date and, at the election of the Holder, shall make such Interest Payment in the form of Common Stock. Notwithstanding the foregoing, in the event of (and during the continuation of) an Event of Default, the interest rate hereunder shall increase by an additional 2.0% per annum. Any failure by the Issuer to pay interest in cash or Common Stock on any Interest Payment Date shall be deemed to be an election to make a PIK Payment of such interest by adding such interest to the unpaid principal amount of the Note outstanding at such time. Following an increase in the principal amount of any outstanding Note as a result of a PIK Payment, such Note will bear interest on such increased principal amount from and after the date of such PIK Payment. For purposes of this Note, all references to (i) “principal amount” of the Notes shall include any increase in the principal amount of the Notes as a result of a PIK Payment and (ii) “original principal amount” of the Notes shall exclude any increase in the principal amount of the Notes as a result of a PIK Payment. Interest may only be paid in the form of Common Stock if (i) the Common Stock is then currently listed for trading on the New York Stock Exchange or Nasdaq and (ii) the market capitalization of the Issuer at the time of such payment is at least $1,000,000,000; provided, during the applicability of the Forfeiture Restrictions, interest must be paid in Common Stock solely with respect to the Note issued to Scott Watterson regardless of whether the foregoing conditions are met.

Interest will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from and including the original issue date of this Note. Interest will be computed on the basis of a 365/366-day year. Interest Payments will be paid to the Person in whose name this Note is registered on the Notes Register on the Business Day prior to the applicable payment date. The Issuer shall maintain the Notes Register at its principal office in which it shall provide for the registration of Notes and transfers and exchanges thereof.

This Note is one of a series of promissory notes issued on the Issue Date by the Issuer (collectively, the “Convertible Notes”), which Convertible Notes shall constitute a single class of loans. Except for any provisions regarding the stapling of transfers of this Note and the provisions of the Award Agreement, the terms and conditions of this Note shall be the same terms and condition as in each other Convertible Note and each of the Holder and the Issuer agree that there shall be not change to the terms and conditions of this Note unless such terms or conditions are also modified in each other Convertible Note, including, for clarity, that there shall be no more favorable change to the terms and conditions of any other Convertible Note unless such terms or conditions are also modified in this Note to reflect such more favorable change. Neither Holder nor any other holder holding a Convertible Note shall have the right to take any action or exercise any remedies under this Note, or any Convertible Note, on an individual basis.

[Transfers of this Note are subject to the stapling provisions contained in Section [•] of the bylaws of the Issuer (the “Stapling Transfer Restriction”). For federal (and applicable state and local) income tax purposes, the Issuer and the Holder agree to treat this Note, taking into account the Stapling Transfer Restriction, as part of a single integrated instrument that is treated as equity and consistent with Section 1.5 of the Omnibus Agreement (the “Intended Tax Treatment”). The Issuer and the Holder shall prepare and file all tax returns in a manner consistent with this paragraph and shall take no position inconsistent with such treatment.]⁴

⁴  To be included in the LCat Note and the PCM Note issued in respect of PCM’s preferred stock, but not in PCM Note issued in respect of 2019 note or in the SW Note.

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This Note is subject to the following additional provisions:

ARTICLE 1

EXCHANGE

This Note is exchangeable for an equal aggregate principal amount of Notes of different denominations, as requested by the Holder surrendering the same. No service charge will be charged to the Holder for such registration, transfer or exchange.

ARTICLE 2

TRANSFERS

This Note has been issued subject to investment representations of the original purchaser hereof and may be transferred or exchanged in the United States only in compliance with the Securities Act of 1933, as amended, applicable state securities laws and the other provisions hereof. Prior to due presentment for transfer of this Note, the Issuer may treat the Person in whose name this Note is duly registered on the Notes Register as the owner hereof for the purpose of receiving payment as herein provided and all other purposes, whether or not this Note be overdue, and the Issuer shall not be affected by notice to the contrary.

ARTICLE 3

DEFINITIONS

For purposes of this Note, the following terms shall have the following meanings.

“10-day VWAP” means, as of any date, the average VWAP per share of Common Stock for the 10 Trading Days immediately preceding the third Business Day immediately preceding the applicable Interest Payment Date.

“Affiliate” means, with respect to any specified Person, any Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, the Person specified.

“Award Agreement” means the Restricted Property Award Agreement, dated as of the date hereof, between Scott Watterson and the Issuer.

-3-

“Bankruptcy Law” means Title 11, United States Code, or any similar Federal or state law for the relief of debtors.

“Business Day” means any day other than a Saturday, Sunday or any other day on which commercial banks in the City of New York or Boston are authorized or required by law to remain closed.

“Cash Return Condition” means the return of proceeds in cash to [Pamplona and its Affiliates] / [L Catterton and its Affiliates] of an amount equal to the aggregate principal amount of all Convertible Notes owned by such Persons as of the closing of the IPO from (a) any sale of (i) the Convertible Notes, or (ii) Common Equity or (b) any cash payments in respect of principal or interest of the Convertible Notes.

“Charter” means the Amended and Restated Certificate of Incorporation of the Issuer as filed with the Secretary of State of the State of Delaware on the Issue Date.

“Common Equity” means the Common Stock and any shares of capital stock of the Issuer issued or issuable with respect to such Common Stock by way of a stock dividend or distribution payable thereon or stock split, reverse stock split, recapitalization, reclassification, reorganization, exchange, subdivision or combination thereof.

“Common Stock” means the Issuer’s Class A common stock of the same class to be issued in the IPO.

“Consolidated EBITDA” means, as of any date of determination, “Consolidated Adjusted EBITDA” (as defined in the ABL Credit Agreement, by and among inter alios the Issuer, iFIT Inc. (f/k/a ICON Health & Fitness, Inc.), Bank of America, N.A., as the administrative agent, and the other lenders party thereto from time to time, dated as of May 12, 2021 (as may be amended, otherwise modified or replaced from time to time provided that if replaced by multiple debt instruments or agreements the instrument or agreement that is most senior in priority will govern)).

“Conversion” has the meaning set forth in Section 4.01.

“Conversion Amount” means all of the outstanding amounts due under this Note as of such time, including outstanding principal (including PIK Interest) and accrued interest thereon.

“Conversion Price” means a (x) the IPO Price multiplied by (y) 0.85. The Conversion Price and number of shares of Common Stock to be delivered upon conversion shall automatically be adjusted, without duplication, proportionately to give effect to any stock split, reverse stock split, stock dividend, spin- or split-off or similar corporate transaction affecting the shares of Common Stock in which Holders do not otherwise participate with respect to the shares of Common Stock underlying the Note. Whenever the Conversion Price or conversion rate are adjusted as set forth in the prior sentence, the Issuer shall calculate such new amounts and as soon as practicable following the event resulting in such adjustment delivery to the Holder an executed certificate signed by an officer of the Issuer providing such adjusted amounts and explaining in reasonable detail the transaction and calculation related thereto.

-4-

“Conversion Date” means (i) with respect to an optional conversion pursuant to Section 4.01, the date on which such Holder delivers the completed, executed Conversion Notice (and, if applicable, the satisfaction of any conditions to conversion set forth in the Conversion Notice) and (ii) with respect to Mandatory Conversion pursuant to Section 4.02, the Mandatory Conversion Date.

“Convertible Note” has the meaning set forth in the introductory paragraphs of this Note.

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

“Equity Percentage” means, with respect to any Noteholder or holder of Common Equity and at any time of determination, an amount, expressed as a percentage, equal to (x) (A) the number of shares of Common Stock held by such holder, plus (B) the number of shares of Common Stock issuable to such holder upon the conversion of the full Conversion Amount (calculated as of such time of determination) of all Notes held by such holder, divided by (y) (A) all outstanding shares of Common Stock of the Issuer, plus (B) the maximum number of shares issuable by the Issuer upon conversion of all outstanding Notes as of such time of determination.

“Event of Default” has the meaning set forth in Section 10.01.

“Holder” has the meaning set forth on the first page of this Note.

“Greenshoe Proceeds” means the net proceeds received by the Issuer upon the exercise by the underwriters of the IPO of any overallotment option granted by the Issuer to such underwriters.

“Immediate Family” means, with respect to any individual, each spouse, parent, brother, sister or child of such individual, each spouse of any such Person, each child of any of the aforementioned Persons, each trust created solely for the benefit of one or more of the aforementioned Persons and each custodian or guardian of any property of one or more of the aforementioned Persons in his capacity as such custodian or guardian.

“Interest Payment” has the meaning set forth on the first page of this Note.

“Interest Payment Date” has the meaning set forth on the first page of this Note.

“Investor” means any Affiliate of the Issuer.

“IPO” means the Issuer’s initial underwritten public offering on an effective registration statement under the Securities Act of 1933, as amended.

“IPO Price” means the price to the public in the IPO, which is $[•].

“Issue Date” means [•], 2021.

“Issuer” has the meaning set forth on the first page of this Note.

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“L Catterton” means LC9 Connected Holdings, LP and its Permitted Transferees.

“LTM EBITDA” means as of any date of determination, Consolidated EBITDA for the 12-month period through the most recent fiscal quarter ending immediately preceding such date of determination.

“Mandatory Prepayment Event” means any of the following: (a) any liquidation, dissolution or winding-up of the operations of the Issuer or any of its Material Subsidiaries; (b) the merger or consolidation of the Issuer or any of its Subsidiaries with another entity, or sale of securities of the Issuer or any of its Subsidiaries, in which the holders of outstanding voting securities of the Issuer cease to own, directly or indirectly, greater than 50% of the outstanding voting securities of the entity surviving such merger or consolidation or sale; (c) the sale of all or substantially all of the assets of the Issuer and its Subsidiaries; (d) a de-listing of the Common Stock from its primary securities exchange if not concurrently re-listed on another exchange satisfactory to the Holder; (e) an acceleration in accordance with Section 10.02 below and (f) the receipt of any Greenshoe Proceeds.

“Market Disruption Event” means, with respect to any date, the occurrence or existence, during the one-half hour period ending at the scheduled close of trading on such date on the principal U.S. national or regional securities exchange or other market on which the Common Stock is listed for trading or trades (or for purposes of determining the VWAP per share of Common Stock, any period or periods aggregating one half-hour or longer during the regular trading session on the relevant day), of any material suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the relevant exchange or otherwise) in the Common Stock or in any options contracts or futures contracts relating to the Common Stock.

“Material Indebtedness” means indebtedness in an aggregate principal amount equal to or greater than $10,000,000.

“Material Subsidiary” means any Subsidiary of the Issuer now existing or hereafter acquired or formed and each successor thereto that (i) for the most recent period of four consecutive fiscal quarters of the Issuer accounted (on a consolidated basis with its Subsidiaries) for 10% or more of the revenues of the Issuer or (ii) as of the end of such fiscal quarter, was (on a consolidated basis with its Subsidiaries) the owner of 10% or more of the total assets of the Issuer, as shown on the consolidated financial statements of the Issuer for such fiscal quarter.

“Maturity Date” has the meaning set forth on the first page of this Note.

“Necessary Action” means, with respect to the Issuer, all actions (to the extent such actions are not prohibited by applicable law, and in the case of any action that requires a vote or other action on the part of the Board to the extent such action is consistent with fiduciary duties that the Issuer’s directors may have in such capacity) necessary to cause such result, including (a) calling special meetings of stockholders, (b) voting or providing a written consent or proxy, if applicable in each case, with respect to shares of Common Stock, (c) causing the adoption of stockholders’ resolutions and amendments to the organizational documents of the Issuer, (d) executing agreements and instruments, (e) making, or causing to be made, all filings, registrations or similar actions that are required to achieve such result and (f) nominating certain Persons for election to the Board in connection with the annual or special meeting of stockholders of the Issuer.

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“Noteholders” means the registered holders from time to time of the Notes.

“Notes” means this Note, the other Convertible Notes and any other notes issued upon an exchange or transfer of this Note in accordance with Article 2, Article 3 or Article 13, as applicable, or as a replacement in accordance with Article 8.

“Notes Register” means the register maintained by the Issuer, which includes a list of the names and addresses of each Holder, as well as the outstanding principal amount and interest amount owing to such Holder from time to time. The entries in the Notes Register shall be conclusive, and the Issuer may treat each Person whose name is recorded in the Notes Register pursuant to the terms hereof as a Holder hereunder for all purposes of this Note. The Notes Register shall be available for inspection by any Holder, at any reasonable time and from time to time upon reasonable prior notice.

“Omnibus Agreement” means that certain Omnibus Investor Agreement, dated as of [•], 2021, by and among LC9 Connected Holdings, LP, Icon Preferred Holdings, L.P., Scott R. Watterson, SW ICON LLC, Gary E. Stevenson, GS ICON LLC, Robert C. Gay, BG ICON LLC, Wen-Chung Ko and the Issuer.

“Options” means (a) any options or warrants or other rights to subscribe for, purchase or otherwise acquire Common Stock, and (b) any evidence of indebtedness, shares of stock (other than Common Stock) or other securities which are directly or indirectly convertible or exchangeable for shares of Common Stock.

“Pamplona” means Icon Preferred Holdings, L.P. and its Permitted Transferees.

“Permitted Transferee” means, in respect of any Noteholder, (a) if an institutional investor, any Affiliate of such Noteholder in a bona fide transfer not part of a transaction or series of transactions that results in the direct or indirect transfer of all or any portion of a Convertible Note to a Person not an Affiliate of such Noteholder, and (b) if an individual, (x) any Transferee of such Noteholder following such Noteholder’s death by will or intestacy to such Noteholder’s legal representative, heir, legatee or distributees, or (y) (i) as a gift or gifts to such Noteholder’s Immediate Family and/or Affiliate, (ii) charitable gifts or (iii) transfers for bona fide estate planning purposes; provided, in the case of this clause (iii), that the Noteholder retains voting control of all Common Equity into which the Convertible Note may convert.

“Person” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation, limited liability company, institution, public benefit corporation, other entity or government (whether federal, state, county, city, municipal, local, foreign, or otherwise, including any instrumentality, division, agency, body or department thereof).

“PIK Interest” has the meaning set forth on the first page of this Note.

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“PIK Payment” has the meaning set forth on the first page of this Note.

“Required Note” means that certain Note No. [•]⁵ originally issued to Pamplona and any other notes issued upon an exchange or transfer of such Note in accordance with Article 2, Article 3 or Article 13, as applicable, or as a replacement in accordance with Article 8.

“Required Noteholders” means, as of any date, (i) the Holder of fifty-one percent (51%) of the outstanding principal amount due under the Required Note (which, for the avoidance of doubt, shall initially be Pamplona) or (ii) if there is no such Holder, then Pamplona; provided that, (i) at any time after which L Catterton holds more than 65% of the aggregate principal amount of Notes originally held by Pamplona and L Catterton, then L Catterton is the Required Noteholder and (ii) if, collectively, L Catterton and Pamplona do not hold any of the Notes and there is no Holder of fifty-one percent (51%) of the outstanding principal amount due under the Required Note then the Required Noteholder shall be the Noteholder(s) holding at least a majority of the aggregate principal amount of Notes outstanding on such date.

“Subsidiary” means, with respect to any Person (other than any natural Person), a corporation or other entity (including partnerships or limited liability companies), the equity interests of which having ordinary voting power to elect a majority of the board of directors of such corporation or managers of such other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries or both, by such Person.

“Trading Day” means a day on which the primary stock exchange on which the Common Stock is then listed is open for the transaction of business and on which there has not occurred a Market Disruption Event.

“Transferee” means any Person or Persons who acquires all or a portion of this Note.

“VWAP” per share of Common Stock on any Trading Day means the per share volume-weighted average price as displayed under the heading Bloomberg VWAP on Bloomberg (or, if Bloomberg ceases to publish such price, any successor service mutually agreed between the Issuer and the Holder) (or its equivalent successor if such page is not available) in respect of the period from the open of trading on the relevant Trading Day until the close of trading on such Trading Day (or if such volume-weighted average price is unavailable, the market price of one (1) share of Common Stock on such Trading Day determined, using a volume-weighted average method, by an independent financial advisor mutually agreed between the Issuer and the Holder and retained by the Issuer for such purpose).

⁵  To reference 2021 IPO Convertible Note issued to Pamplona in respect of its Pamplona Note IPO Entitlement Amount.

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ARTICLE 4

CONVERSION

Section 4.01 Conversion by the Holder. Until the date on which all principal and accrued interest owed on this Note has been paid in full, upon the election of the Holder (at its sole discretion), the Conversion Amount shall convert into (i) the number of shares of Common Stock equal to the quotient of (A) the Conversion Amount elected to be converted by the Holder, divided by (B) the Conversion Price as of the applicable Conversion Date, plus (ii) cash in lieu of fractional shares (the “Conversion”). The right of conversion may be exercised as to all or any portion of such Holder’s Conversion Amount from time to time. To receive shares of Common Stock upon conversion of the Conversion Amount pursuant to this Section 4.01, the Holder must deliver a completed, executed conversion notice in the form attached hereto as Exhibit A (the “Conversion Notice”), to the Issuer; provided, however, that a Conversion Notice may be conditional on the completion of a change of control or other corporate transaction as such Holder may specify.

Section 4.02 Mandatory Conversion by the Issuer.

(a) At any time after the 24-month anniversary of the date hereof, if the VWAP per share of Common Stock was greater than 150% of the IPO Price for 60 consecutive Trading Days (with such 60-Trading Day period ending no earlier than 5 Business Days prior to delivery of the Notice of Mandatory Conversion), the Issuer may elect to convert (a “Mandatory Conversion”) all, but not less than all, of the Conversion Amount into shares of Common Stock (the date selected by the Issuer for any Mandatory Conversion pursuant to this Section 4.02(a), the “Mandatory Conversion Date”). In the case of a Mandatory Conversion, the Conversion Amount shall be converted into the number of shares and cash in lieu as set forth in Section 4.01 above. A Mandatory Conversion may only be effectuated by the Issuer if the Common Stock is then currently listed for trading on the New York Stock Exchange or Nasdaq and a resale shelf registration statement is in effect at the time of delivery of Common Stock permitting the Holder to sell all such shares of Common Stock to be received upon the Mandatory Conversion, unless the Holder thereof may sell all such shares under Rule 144 within a three-month period and such Holder, together with its affiliates, owns less than 1% of the outstanding shares of Common Stock.

(b) If the Issuer elects to effect Mandatory Conversion, the Issuer shall, within five (5) Business Days following the completion of the applicable 60-Trading Day period referred to in Section 4.02(a) above, provide notice of Mandatory Conversion to each Holder (such notice, a “Notice of Mandatory Conversion”). The Mandatory Conversion Date selected by the Issuer shall be no less than ten (10) Business Days and no more than twenty (20) Business Days after the date on which the Issuer provides the Notice of Mandatory Conversion to the Holders. The Notice of Mandatory Conversion shall state, as appropriate:

(i) the Mandatory Conversion Date selected by the Issuer; and

(ii) the conversion rate in effect on the Mandatory Conversion Date, the amount of the outstanding principal amount and accrued interest on the Mandatory Conversion Date and the number of shares of Common Stock and cash in lieu to be delivered to such Holder upon conversion.

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Section 4.03 Effectiveness of Conversion. The Conversion shall be deemed to have been made immediately prior to the close of business on the Conversion Date, and the Holder shall be treated for all purposes as the record holder of the shares of Common Stock issued in the Conversion as of such date.

Section 4.04 Reservation of Shares. The Issuer shall at all times reserve and keep available out of its authorized and unissued Common Stock, solely for issuance upon the conversion of the Convertible Notes, such number of shares of Common Stock as shall from time to time be issuable upon the conversion of all amounts outstanding under the Convertible Notes then outstanding. Any shares of Common Stock issued upon conversion of amounts outstanding under the Convertible Notes shall be duly authorized, validly issued, fully paid and non-assessable.

Section 4.05 Fractional Shares. No fractional shares of Common Stock will be delivered to the Holders upon conversion. In lieu of fractional shares otherwise issuable, the Holders will be entitled to receive, at the Issuer’s sole discretion, either (i) an amount in cash equal to the fraction of a share of Common Stock multiplied by the price of the Common Stock as of the close of trading on the Trading Day immediately preceding the applicable Conversion Date or (ii) one (1) additional whole share of Common Stock. To determine whether the number of shares of Common Stock to be delivered to a Holder upon the conversion of such Holder’s Conversion Amount will include a fractional share, such determination shall be based on the aggregate Conversion Amount of such Holder that are being converted on any single Conversion Date.

Section 4.06 Reorganization Events.

(a) In the event of:

(i) any reclassification, statutory exchange, merger, consolidation or other similar business combination of the Issuer with or into another Person, in each case, pursuant to which at least a majority of the Common Stock is changed or converted into, or exchanged for, cash, securities or other property of the Issuer or another Person or entity;

(ii) any sale, transfer, lease or conveyance to another Person of all or a majority of the property and assets of the Issuer, in each case pursuant to which the Common Stock (but not the Note) is converted into cash, securities or other property; or

(iii) any statutory exchange of securities of the Issuer with another Person (other than in connection with a merger or acquisition) or reclassification, recapitalization or reorganization of the Common Stock (but not the Note) into other securities;

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(each of which is referred to as a “Reorganization Event”), the Note (including the Conversion Amount outstanding immediately prior to such Reorganization Event) will, without the consent of the Holders and subject to Section 4.06(d), remain outstanding but shall become convertible into, out of funds legally available therefor, the number, kind and amount of securities, cash and other property (the “Exchange Property”) (without any interest on such Exchange Property and without any right to dividends or distribution on such Exchange Property which have a record date that is prior to the applicable Conversion Date) that the Holder of the Note would have received in such Reorganization Event had such Holder converted its Conversion Amount into the applicable number of shares of Common Stock immediately prior to the effective date of the Reorganization Event using the conversion rate applicable immediately prior to the effective date of the Reorganization Event and the Conversion Amount applicable at the time of such subsequent conversion. If the kind or amount of securities, cash and other property receivable upon such Reorganization Event is not the same for each share of Common Stock held immediately prior to such Reorganization Event, then for the purpose of this Section 4.06(a), the kind and amount of securities, cash and other property receivable upon conversion following such Reorganization Event will be deemed to be the weighted average of the types and amounts of consideration received by the holders of Common Stock.

(b) The above provisions of this Section 4.06 shall similarly apply to successive Reorganization Events and the anti-dilution adjustments set forth in the definition of “Conversion Price” shall apply to any shares of capital stock or property received by the holders of the Common Stock in any such Reorganization Event.

(c) The Issuer (or any successor) shall, no less than thirty (30) days prior to the anticipated effective date of any Reorganization Event, provide written notice to the Holders of such occurrence of such event and of the kind and amount of the cash, securities or other property that constitutes the Exchange Property. Failure to deliver such notice shall not affect the operation of this Section 4.06.

(d) The Issuer shall not enter into any agreement for a transaction constituting a Reorganization Event unless (i) such agreement provides for or does not interfere with or prevent (as applicable) conversion of the Conversion Amount into the Exchange Property in a manner that is consistent with and gives effect to this Section 4.06 and (ii) to the extent that the Issuer is not the surviving corporation in such Reorganization Event or will be dissolved in connection with such Reorganization Event, proper provision shall be made in the agreements governing such Reorganization Event for the conversion of the Conversion Amount into stock of the Person surviving such Reorganization Event or such other continuing entity in such Reorganization Event.

ARTICLE 5

PREPAYMENT

Section 5.01 Optional Prepayments. The Issuer may, at any time and from time to time, upon 30 days’ prior written notice to the Holder and subject to the Holder’s conversion rights set forth in Section 4.01, prepay all or any portion (in the case of less than 100% of the outstanding amounts of the Notes, in whole number multiples of $100,000 only) of the outstanding principal amount of the Notes at a prepayment price equal to the principal amount of the Note to be prepaid (i.e., the portion of the original principal amount of the Note being prepaid plus all PIK

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Interest previously added in respect of such portion of the original principal amount). In connection with each prepayment of principal hereunder, the Issuer shall also pay all accrued and unpaid interest on the principal amount of the Note being repaid. For the avoidance of doubt, a prepayment of less than the entire outstanding principal amount of each of the Notes under this Section 5.01 shall not relieve the Issuer of its other obligations (including under Section 5.02 below).

Section 5.02 Mandatory Prepayments. The Issuer shall prepay in full this Note, upon 30 days’ prior written notice to the Holder and subject to the Holder’s conversion rights set forth in Section 4.01, upon the occurrence of a Mandatory Prepayment Event at a prepayment price equal to the principal amount of the Note at the time of payment (i.e., the original principal amount of the Note being prepaid plus all PIK Interest previously added in respect of such original principal amount). In connection with such mandatory prepayment, the Issuer shall also pay all accrued and unpaid interest on the principal amount of the Note being repaid.

Section 5.03 Reduction in Principal. If the Issuer has elected to exercise its prepayment pursuant to Section 5.01, the principal sum required to be paid on the Maturity Date shall be reduced by the amount of principal prepaid. Any prepayment of this Note (other than a prepayment required under Section 1.3 of the Omnibus Agreement), whether optional or mandatory, shall be preceded by 30 days’ prior written notice to the Holder and the Holder shall be permitted to elect to convert its Conversion Amount at or prior to the time that such prepayment would otherwise occur.

Section 5.04 Multiple Notes. If more than one Convertible Note is outstanding at the time of any payment by the Issuer, the Issuer shall make such payment pro rata among the Notes (based on the aggregate principal amount of each Note), except as otherwise provided in Section 1.3 of the Omnibus Agreement; provided that in the event of any payment pursuant to Section 5.02 or any other acceleration of the Convertible Notes then such payments shall be applied (i) first, to any amounts owed to Pamplona and L Catterton pursuant to Article 10 of the applicable Convertible Note, (ii) second, to accrued but unpaid interest and principal on the Convertible Notes held by Pamplona and L Catterton on a pro rata basis, (iii) third, to any other outstanding obligations owed to Pamplona and L Catterton under the Convertible Notes, (iv) fourth, to any amounts owed to all other Noteholders of the Convertible Notes pursuant to Article 10, (v) fifth, to accrued but unpaid interest and principal on the Convertible Notes held by all other Noteholders on a pro rata basis, (vi) sixth, to any other outstanding obligations owed to all other Noteholders under the Convertible Notes.

ARTICLE 6

NO REISSUANCE OF NOTE

No Notes acquired by the Issuer by reason of redemption, purchase, conversion or otherwise shall be reissued, and all such Notes shall be retired. No additional Notes shall be authorized or issued without the consent of the Required Noteholders.

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ARTICLE 7

COVENANTS

Section 7.01 Reports. The Issuer shall provide the following information to the Holder; provided, that the Holder may elect at any time to not receive all or any portion of such information upon written notice (e-mail to suffice) to the Issuer, and upon receipt of such notice the Issuer shall cease to provide the information specified in such notice unless and until the Holder provides notice to the Issuer (e-mail to suffice) that it elects to continue to receiving such information; and provided, further the provision of the following information, if not otherwise publicly disclosed, will be subject to customary confidentiality restrictions; and provided, further, that, if the Holder is not the Board Rights Holder (as defined below) or the Observer Rights Holder (as defined below), the information set forth in clause (e) below shall be provided to the Board Rights Holder and/or Observer Rights Holder rather than the Holder:

(a) no later than 45 days after the end of each quarterly accounting period in each fiscal year, unaudited consolidated and consolidating statements of income and cash flows of the Issuer and its consolidated subsidiaries for such quarterly periods, and unaudited consolidated and consolidating balance sheets of the Issuer and its consolidated subsidiaries as of the end of such quarterly periods, in each case prepared in accordance with GAAP, subject to the absence of footnote disclosures and to normal year-end adjustments;

(b) no later than 90 days after the end of each fiscal year, audited consolidated and consolidating statements of income and cash flows of the Issuer and its consolidated subsidiaries for such fiscal year, and audited consolidated and consolidating balance sheets of the Issuer and its consolidated subsidiaries as of the end of such fiscal year, and accompanied by the report of the Issuer’s independent certified public accountants, prepared in accordance with GAAP;

(c) no later than 40 days after the end of each fiscal month (provided, with respect to the period until the 12-month anniversary of the date hereof, to the extent the Issuer may provide the following within 45 days using reasonable best efforts), a monthly management report including monthly financial data; provided that in no event shall the Holder receive information with respect to each fiscal month that is less detailed or less favorable than the information received by each of Pamplona and L Catterton prior to the IPO, which shall include, but not be limited to, the operational data, including key performance indicators, that has previously been provided to each of Pamplona and L Catterton;

(d) all reports and other information provided to the lenders or the agent under the Issuer’s and its subsidiaries’ senior credit facilities, substantially concurrently with the delivery of such reports or other information to the lenders or the agent thereunder;

(e) all reports and other information provided to any director of the Issuer or any of its subsidiaries, substantially concurrently with the delivery of such reports or other information to such Person (other than, in any such case, to any such person solely in their capacity as an employee, vendor or customer of the Issuer or any of its subsidiaries);

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(f) all reports and other information provided to any direct or indirect stockholder of the Issuer (in their capacity as such), substantially concurrently with the delivery of such reports or other information to such Person (other than, in any such case, to any such person solely in their capacity as an employee, vendor or customer of the Issuer or any of its subsidiaries);

(g) no later than the beginning of any fiscal year, the Issuer’s and its subsidiaries’ annual consolidated operating budget for such fiscal year, including both (i) expected key performance indicatory drivers of results and (ii) the resultant three statement financial outputs; and

(h) such other information requested by the Holder which is reasonably available or may be reasonably obtained or produced relating to the business, operations, financial condition, assets or properties of the Issuer or any of its subsidiaries.

Section 7.02 Holder Consent Rights. None of the Issuer and/or any of its subsidiaries will directly or indirectly take any of the following actions without the prior written approval of the Required Noteholders (which may be given or withheld in its sole discretion):

(a) any amendment, modification, repeal or restatement of the governing, constituent or organizational documents or any recapitalization in a manner that materially adversely affects the terms, rights, preferences or privileges of the Notes[, including any amendment of Section 3.7 of the bylaws of the Issuer]⁶;

(b) create or authorize the creation of or issue any other equity security, or security convertible into or exercisable for any equity security, having rights, preferences or privileges that would be senior to or on parity with the Notes if the Notes were preferred stock of the Issuer mutatis mutandis (e.g., any equity security that is entitled to receive cash dividends or distributions, or to be redeemed, at a time when the Notes are outstanding), and with respect to any subsidiary, issue any equity to any Person other than the Issuer or a wholly owned subsidiary of the Issuer, unless the Notes are paid in full upon the consummation of any such issuance;

(c) the declaration or payment of any dividend or distribution or the redemption or repurchase of any equity securities; provided to the extent consent under the Notes is provided for any such dividend or distribution or the redemption or repurchase of any equity securities, such dividend, distribution, redemption or repurchase, as the case may be, shall be made on a pro rata basis to all equity holders and Noteholders based on each holder’s Equity Percentage;

⁶  To be included in the LCat Note and the PCM Note issued in respect of PCM’s preferred stock, but not in PCM Note issued in respect of 2019 note or in the SW Note.

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(d) the incurrence of any indebtedness (other than any unsecured indebtedness that is subordinated and junior to, in all respects (including in right of payment), the Notes) greater than $10,000,000 in the aggregate other than (i) any indebtedness incurred pursuant to an asset-based revolving line of credit pursuant to which loans are made on a borrowing base based upon accounts receivable, inventory and other customary borrowing based assets (including intellectual property), (ii) any cash flow loan which, together with all other outstanding cash flow loans of the Issuer and its Subsidiaries, is not in excess of (A) four (4) times LTM EBITDA on the date of incurrence of such indebtedness or (B) five (5) times LTM EBITDA on the date of incurrence of such indebtedness only if (x) a regulated commercial bank is the lead arranger and administrative agent and (y) regulated commercial banks (or such other lenders consented to in writing by the Required Noteholders which instill the same level of comfort and confidence in the Required Noteholders as regulated commercial banks) hold, at all times, at least 51% of the principal amounts of the loans outstanding thereunder or (iii) any mortgage loan or real property secured financing not in excess of $15,000,000 in the aggregate; provided, that, the Issuer and/or any of its subsidiaries may not incur indebtedness concurrently under clauses (i) and (ii) without the prior written approval of the Required Noteholders (which may be given or withheld in its sole discretion); provided, further, that any amendment, modification, amendment and restatement, consent, waiver, forbearance or other arrangement with the agent or lenders under any existing credit facilities or loan agreement that modifies the rate, term or other provisions which could have a material adverse economic impact shall be treated as a new incurrence of indebtedness hereunder; provided, further, that nothing in this Section 5.1.6 shall apply to any indebtedness incurred solely in connection with the payment in full of the Notes on the date such indebtedness is incurred; or

(e) any agreement or commitment to do any of the foregoing.

Section 7.03 Investor Rights.⁷

(a) [Prior to and conditioned upon the consummation of the IPO, the Issuer shall take all Necessary Action to cause its Board of Directors (the “Board”) to include one (1) individual nominated by the Holder (the “Holder Nominee”), who initially shall be [•]⁸, and who shall serve as a Class III Director (as such term is defined in the Charter). Until the Cash Return Condition is satisfied, [Icon Preferred Holdings, L.P.]⁹ / [LC9 Connected Holdings, L.P.]¹⁰ (such holder, together with any of its Permitted Transferees, the “Board Rights Holder”) shall have the right, but not the obligation, to nominate at all times to the Board at least one (1) Holder Nominee, and the Issuer shall take all Necessary Action to include in the slate of nominees recommended by the Board for election as directors at each applicable annual or special meeting of stockholders at which directors are to be elected the Holder Nominee. The rights of a Board Rights Holder to nominate a Holder Nominee are not transferable. Upon any transfer of Notes by [Icon Preferred Holdings, L.P.]¹¹ / [LC9 Connected Holdings, L.P.]¹², of 51% or more of its

⁷  Applicable to PCM “Required Note” and LCat Note only.

⁸  For LCat, to be Scott Dahnke. For PCM, to be Andrew Singer.

⁹  To be included in PCM’s notes.

¹⁰  To be included in LCat’s note.

¹¹  To be included in PCM’s notes.

¹²  To be included in LCat’s note.

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Notes, [Icon Preferred Holdings, L.P.]¹³ / [LC9 Connected Holdings, L.P.]¹⁴ shall cease to have the right to nominate a Holder Nominee, and its Holder Nominee shall immediately tender his or her resignation to the Board.

(b) So long as any amount payable under this Note remains outstanding, [Icon Preferred Holdings, L.P.]¹⁵ / [LC9 Connected Holdings, L.P.]¹⁶ shall have the right, but not the obligation, to appoint at all times one non-voting observer to the Board and the board of directors or equivalent governing body of each direct or indirect Subsidiary of the Issuer (an “Observer”), who shall initially be [•]; provided, subject to Section 14.01, [Icon Preferred Holdings, L.P.]¹⁷ / [LC9 Connected Holdings, L.P.]¹⁸ may, at its election, transfer the foregoing right to appoint one Observer to any Person holding at least 51% of the outstanding principal amount under this Note ([Icon Preferred Holdings, L.P.]¹⁹ / [LC9 Connected Holdings, L.P.]²⁰, or any such Person, for so long as such Holder (and its Affiliates) continue to hold at least 51% of the outstanding principal amount under this Note, the “Observer Rights Holder”).²¹ From the date that is six months following the Issue Date through the date that is 12 months following the Issue Date, the proposed Observer appointee of any transferee that is the Observer Rights Holder (if the Observer Rights Holder is not the Board Rights Holder) shall be acceptable to the Issuer (the Issuer’s consent to any such individual not to be unreasonably withheld, conditioned or delayed). The Observer shall be entitled to be notified of, and attend, all meetings of the Board and any Subsidiary governing bodies, participate in all deliberations of such governing bodies, in each case in the same manner as the directors thereon, and to receive copies of all notices, minutes, consents and other materials provided to the members of such governing bodies, at the same time and in the same manner as such notices, minutes, consents and other materials are provided to the members thereof, provided, however, that the Observer shall not have any voting rights with respect to actions taken or elected not to be taken by such governing bodies; provided, further, that the Issuer shall be entitled to withhold any information from the Observer or exclude the Observer from any meeting or portion thereof if the Board determines (reasonably, in good faith and upon advice of counsel) that access to such information or attendance at such meeting (or portion thereof) would be reasonably likely to adversely affect the attorney-client privilege between (i) the Issuer or the applicable governing body and (ii) its respective counsel. The Issuer shall reimburse the Observer for his or her reasonable travel and out-of-pocket expenses incurred in connection with attendance of any meetings of the Board or any Subsidiary governing body.

¹³  To be included in PCM’s notes.

¹⁴  To be included in LCat’s note.

¹⁵  To be included in PCM’s notes.

¹⁶  To be included in LCat’s note.

¹⁷  To be included in PCM’s notes.

¹⁸  To be included in LCat’s note.

¹⁹  To be included in PCM’s notes.

²⁰  To be included in LCat’s note.

²¹  For LCat, to be Marc Magliacano. PCM to provide name of observer.

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(c) [The Issuer shall cause the Charter and any amendment or restatement thereof, in accordance with the authority provided in Section 141(d) of the Delaware General Corporation Law, to provide that, (i) at any time when the Board has fewer than eleven (11) members, the member of the Board, if any, that is the Holder Nominee shall cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of the Board (whether under the Certificate of Incorporation, the Bylaws, the Delaware General Corporation Law or otherwise), whether taken at a meeting of the Board or by written consent of the Board, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of the Board at such time and (ii) in the case of matters of a committee of the Board that includes the member of the Board, if any, that is the Holder Nominee, such member shall cast a fraction (rounded down to the nearest tenth of a vote) of a vote on any action of such committee (whether taken under the Certificate of Incorporation, the Bylaws, the Delaware General Corporation Law or otherwise), whether taken at a meeting of such committee or by written consent of such committee, such that the number of votes that may be cast by such member does not exceed nine percent (9%) of the total number of votes that may be cast by all of the members of such committee at such time.]²² .

Section 7.04 Marketing.²³ Upon the request of the Holder, the Issuer will use its commercially reasonable efforts to assist the Holder in the marketing and disposition of this Note, including taking such actions as the Holder reasonably requests in order to expedite or facilitate the disposition of this Note (including, without limitation, making available the executive officers of the Issuer and participating in “road shows,” investor presentations, marketing events and other selling efforts, at reasonable times and frequency, and, upon request of the Holder, will make available for inspection by the Holder and any attorney, accountant or other agent retained by the Holder, such financial and other records, pertinent corporate and business documents and properties of the Issuer as reasonably requested to enable them to satisfy any potential buyer’s due diligence responsibility, and cause the Issuer’s officers, directors, employees, agents, representatives and independent accountants to supply information reasonably requested by the Holder or its attorneys, accountants or agents in connection with such disposition of the Note.

Section 7.05 Board Conflicts Policy. The Issuer shall adopt and, at all times maintain and enforce compliance with, a conflicts of interest policy applicable to members of the Board and officers of the Issuer in substantially the form provided to the Noteholders prior to the date hereof.

²²  To be included in PCM “Required Note” only.

²³  This provision will apply to PCM and LCat Notes only.

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ARTICLE 8

WAIVERS OF DEMAND, ETC.

The Issuer hereby expressly waives (to the extent permitted by applicable law) demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and will be directly and primarily liable for the payment of all sums owing and to be owing hereon, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder.

ARTICLE 9

REPLACEMENT NOTES

In the event that the Holder notifies the Issuer that this Note has been lost, stolen or destroyed, a replacement Note identical in all respects to the original Note (except for registration number and outstanding principal amount, if different than that shown on the original Note) shall be issued by the Issuer to the Holder; provided that the Issuer receives an indemnity against any loss incurred by it in connection with such lost, stolen or destroyed Note, such indemnity to be in form and substance, and from a Person reasonably acceptable to the Issuer.

ARTICLE 10

PAYMENT OF EXPENSES

The Issuer agrees to pay all reasonable, out-of-pocket expenses, including reasonable attorneys’ fees, which may be incurred by the Holder in connection with any waiver or consent hereunder, any amendment hereof, any Event of Default hereunder or in successfully enforcing the provisions of this Note and/or successfully collecting any amount due under this Note.

ARTICLE 11

DEFAULTS AND REMEDIES

Section 11.01 Events of Default. Each of the following shall constitute an “Event of Default”:

(a) any default by the Issuer in (i) the payment of any principal on this Note when the same becomes due and payable at the Maturity Date, upon acceleration or otherwise or (ii) the making of any payment required to be made under Section 5.02 or any other amount due hereunder, and such default continues for a period of five (5) Business Days;

(b) the Issuer fails to comply in any material respect with Article VII or any other term hereunder as and when required and, to the extent such failure is capable of being remedied, such failure continues for thirty (30) days after notice by the Holder or by the Issuer of such failure;

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(c) the Issuer, or any Material Subsidiary or any group of Subsidiaries of the Issuer that, taken together, would constitute a Material Subsidiary, makes an assignment for the benefit of creditors generally, files a petition in bankruptcy, is adjudicated insolvent or has entered against it an order for relief under Bankruptcy Laws, petitions or applies to any tribunal for any receiver or trustee (for itself or its assets in connection with the bankruptcy, insolvency, or in the case of the Issuer only, the liquidation of such Person ), commences any proceeding relating to itself under any bankruptcy, reorganization, readjustment of debt law or statute of any jurisdiction, has commenced against it involuntarily any such proceeding (provided such involuntary proceeding remains undismissed for the earlier of a period of 60 days or until an order for relief is entered), or indicates its consent to, approval of or acquiescence in any such proceeding, or any receiver of or trustee for the Issuer or any of its Subsidiaries or any substantial part of their property is appointed;

(d) the Issuer fails to observe or perform any term of (i) one or more items of Material Indebtedness or (ii) any loan agreement, mortgage, indenture or other agreement relating to such item(s) of Material Indebtedness, in each case beyond the grace period provided therein, if any, if the effect of such breach or default is to cause that Material Indebtedness to become or be declared due and payable (or redeemable) prior to its stated maturity or the stated maturity of any underlying obligation, as the case may be; provided, that this paragraph (d) shall not apply to secured Material Indebtedness that becomes due (and is paid in accordance with its terms) as a result of the voluntary sale or transfer of the property or assets securing such Material Indebtedness if such sale or transfer is permitted hereunder; or

(e) the Issuer breaches any of the covenants and agreements of the Issuer set forth in Article 4 and such failure to convert continues for five (5) Business Days.

The Issuer shall deliver to the Holder, within five (5) Business Days after its knowledge of the occurrence thereof, written notice in the form of a certificate signed by the Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer, Treasurer, or Vice-President-Finance of the Issuer of any Event of Default and any event which with the giving of notice or the lapse of time would become an Event of Default and what action the Issuer is taking or proposes to take with respect thereto.

Section 11.02 Acceleration. If an Event of Default (other than an Event of Default specified in Section 11.01(c)) occurs and is continuing, the Required Noteholders, by ten (10) days’ prior notice to the Issuer and each other Noteholder, subject to each Noteholder’s conversion rights set forth in Section 4.01 of such Noteholder’s respective Note, may declare the outstanding principal amount of and accrued but unpaid interest on the Notes (in the amount set forth in Section 5.02) to be due and payable. Upon such a declaration, such outstanding principal amount and interest shall be due and payable immediately. If an Event of Default specified in Section 11.01(c) occurs and is continuing, the outstanding principal amount of, and accrued interest on (as set forth in Section 5.02), all the Notes shall ipso facto become and be immediately due and payable without any declaration or other act on the part of any Noteholder. The Required Noteholders may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal or interest that has become due solely because of acceleration. No such rescission shall affect any subsequent Default or impair any right consequent thereto.

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A delay or omission by the Holder or any other Noteholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are, to the extent permitted by law, cumulative.

Section 11.03 Waiver of Past Defaults. The Required Noteholders may waive any past or existing Default and its consequences except (i) a Default in the payment of the outstanding principal amount of or interest on the Notes or (ii) a Default in respect of a provision that under Section 11.04 or Article 13 cannot be amended without the consent of each Noteholder affected. When a Default is waived, it is deemed cured, and any Event of Default arising therefrom shall be deemed to have been cured, but no such waiver shall extend to any subsequent or other Default or impair any consequent right.

Section 11.04 Rights of Holder to Receive Payment. Notwithstanding any other provision of this Note, the right of the Holder to receive payment of the outstanding principal amount of and interest on this Note on or after the respective due dates expressed in this Note, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of the Holder.

Section 11.05 Waiver of Stay or Extension Laws. The Issuer (to the extent it may lawfully do so) shall not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Note, and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and shall not hinder, delay or impede the execution of any power herein granted to the Holder, but shall suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE 12

SAVINGS CLAUSE

In case any provision of this Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.

ARTICLE 13

ENTIRE AGREEMENT; AMENDMENTS

This Note (together with the Omnibus Agreement and any documents, agreements, or instruments required to be delivered pursuant thereto and exhibits and schedules attached thereto) constitutes the full and entire understanding and agreement between the Issuer and the Holder with respect to the subject hereof. Except as otherwise provided in Section 11.03, neither this Note nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Issuer and the Required Noteholders; provided that any amendment (i) of the Maturity Date, (ii) with respect to the reduction of the outstanding principal amount or any interest rate or premium hereunder, or the interest payment provisions set forth on the first page of this Note, (iii) with respect to the stapling provisions set forth on the first page of this Note, (iv) of Section 4.01, Section 4.02(a), Article 5, Section 7.01, Section 7.02, Section 7.03, Article 10, Article 11 or Article 14 or (iii) that adversely affects any individual Noteholder disproportionately to any other Noteholder shall require, in each case, the written consent of each Noteholder affected.

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After an amendment under this Article 13 becomes effective, the Issuer shall mail to the Noteholders a notice briefly describing such amendment. The failure to give such notice to all Noteholders, or any defect therein, shall not impair or affect the validity of an amendment under this Article 13.

ARTICLE 14

TRANSFER; ASSIGNMENT, ETC.

Section 14.01 Transfers Generally. [Subject to compliance with applicable federal and state securities laws[, with the Stapling Transfer Restriction]²⁴ and with Section 14.02, other than transfers to Permitted Transferees, after the date that is six (6) months following the Issue Date, this Note and any portion hereof and the rights hereunder may be transferred by the Holder in its sole discretion at any time and to any Person or Persons without the consent of the Issuer; provided that in no event shall the Holder transfer this note to any of the Persons (or any Affiliate thereof) listed on Schedule 14.01 to this Note.]²⁵ [None of this Note, any portion hereof or any rights hereunder may be transferred by the Noteholder without the prior written consent of the Required Noteholders, other than transfers to Permitted Transferees.]²⁶ In connection with any transfer, if the Issuer reasonably requests, the transferor shall deliver a representation in writing that such transfer is pursuant to an effective registration statement under the Securities Act of 1933, as amended, or pursuant to an available exemption from, or in a transaction not subject to, registration under the Securities Act of 1933, as amended. Promptly following due presentment of a duly completed and executed Registration of Transfer Notice (in the form set forth in Exhibit B hereto) for transfer of this Note, the Issuer shall register such transfer and provide evidence to the Holder and such transferee of such transfer. The Issuer agrees that in connection with any transfer, assignment, pledge or encumbrance permitted pursuant to the terms hereof, the Issuer shall cause such transfer, assignment, pledge or encumbrance to be reflected in the Notes Register, and all principal, interest and other amounts which are then, and thereafter become, due under this Note shall be paid to such Transferee at the place of payment designated in such notice. Absent manifest error, no such transfer, assignment, pledge or encumbrance shall be effective unless recorded in the Note Register. If within ten (10) Business Days of delivery of a duly completed and executed Registration of Transfer Notice, the Issuer shall not have provided evidence of such registration as provided above, the Registration of Transfer Notice shall be deemed for all purposes hereunder to constitute the Notes Register with respect to the portion of this Note to be transferred; however, such transfer shall not prejudice the Issuer’s rights in respect of any transfer that violated the terms hereof. The Issuer may not assign this Note or any of its rights or obligations hereunder. This Note shall be binding upon the Issuer and its respective successors and shall inure to the benefit of the Holder and its successors and permitted assigns.

²⁴  To be included in PCM note issued in respect of PCM’s preferred stock and LCat Note only.

²⁵  To be included in notes issued to PCM and LCat.

²⁶  To be included in notes issued to Scott Watterson.

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Section 14.02 Tag-Along Rights. No Noteholder (for purposes of this Section 14.02, a “Proposed Seller”) shall transfer (a “Sale”) all or any portion of any Note to any other Person, including the Issuer or any of its Subsidiaries (a “Proposed Buyer”), other than to a Permitted Transferee (excluding transfers to the Issuer or any of its Subsidiaries), except in the manner and on the terms set forth in this Section 14.02 and in compliance with Article II and Section 14.01, and attempted transfers in violation of this Section 14.02, Article II or Section 14.01 shall be null and void.

(a) A written notice (the “Tag Along Notice”) shall be furnished by the Proposed Seller to each of Pamplona and L Catterton (the “Tag Along Offerees”) at least ten (10) Business Days prior to a proposed Sale. The Tag Along Notice shall include:

(i) The principal terms of the proposed Sale insofar as it relates to the Notes, including the portion of the principal amount to be purchased from the Proposed Seller, the percentage of the aggregate principal amount of Notes held by the Proposed Seller which such portion constitutes (the “Sale Percentage”), the maximum and minimum purchase price, the name and address of the Proposed Buyer, and (if the Proposed Buyer is not subject to the periodic reporting requirements of the Exchange Act) the name of each director of the Proposed Buyer and of each Person which is the beneficial owner of more than twenty percent (20%) of the equity interests of the Proposed Buyer; and

(ii) An offer by the Proposed Seller to include, at the option of each Tag Along Offeree, in the Sale to the Proposed Buyer such percentage of the aggregate principal amount of Notes held by such Tag Along Offeree up to the Sale Percentage, on the same terms and conditions (subject to the remainder of this Section 14.02) as the Proposed Seller shall sell any portion of its Note; provided that any consideration to be received by the Tag Along Offerees must be in the form of cash.

(b) Each Tag Along Offeree desiring to accept the offer contained in the Tag Along Notice shall send a written commitment to the Proposed Seller specifying the percentage of the aggregate principal amount of Notes held by such Tag Along Offeree (not in any event to exceed the Sale Percentage) which such Tag Along Offeree desires to have included in the Sale within ten (10) Business Days after receipt of the Tag Along Notice (each a “Participating Seller”). Each Tag Along Offeree who has not so accepted such offer shall be deemed to have waived all of his or her rights with respect to the applicable Sale, and the Proposed Seller and the Participating Sellers shall thereafter be free to sell to the Proposed Buyer, at a price no greater than the maximum price set forth in the Tag Along Notice and otherwise on terms not more favorable in any material respect to them than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerees. If, prior to consummation, the terms of such proposed Sale shall change with the result that the price shall be greater than 105% of the maximum price set forth in the Tag Along Notice or the other terms shall be more favorable in any material respect than as set forth in the Tag Along Notice, it shall be necessary for a separate Tag Along Notice to have been furnished, and the terms and provisions of this Section 14.02 separately complied with, in order to consummate such proposed Sale pursuant to this Section 14.02; provided, however, that in the case of such a separate Tag Along Notice, the applicable period referred to in Section 14.02(a) and this Section 14.02(b) shall be five (5) Business Days.

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(c) The acceptance of each Participating Seller shall be irrevocable except as hereinafter provided, and each such Participating Seller shall be bound and obligated to sell in the Sale, on the same terms and conditions specified in the Tag Along Notice (subject to the remainder of this Section 14.02), such percentage of the aggregate principal amount of all Notes held by such Participating Seller as such Participating Seller shall have specified in such Participating Seller’s written commitment. In the event the Proposed Seller shall be unable (otherwise than by reason of the circumstances described in Section 14.02(e)) to obtain the inclusion in the Sale of the full percentage of the aggregate principal amount of all Notes which the Proposed Seller and each Participating Seller desires to have included in the Sale (as evidenced in the case of the Proposed Seller by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s written commitment), the percentage of the aggregate principal amount of all Notes to be sold in the Sale by the Proposed Seller and each Participating Seller shall be reduced on a pro rata basis according to the proportion which the percentage of the aggregate principal amount of all Notes which each such Person desires to have included in the Sale bears to the aggregate principal amount of the Notes desired by all such Persons to have included in the Sale.

(d) If at the end of the 90th calendar day following the date of the effectiveness of the Tag Along Notice the Proposed Seller has not completed the Sale as provided in the foregoing provisions of this Section 14.02, each Participating Seller shall be released from his obligations under his written commitment, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to have been furnished, and the terms and provisions of this Section 14.02 separately complied with, in order to consummate such Sale pursuant to this Section 14.02, unless the failure to complete such Sale resulted from any failure by any Tag Along Offeree to comply in any material respect with the terms of this Section 14.02.

(e) Each Participating Seller shall, whether in his capacity as a Participating Seller, stockholder, officer or director of the Issuer, or otherwise, take or cause to be taken all such actions (subject as to entering into agreements to the provisions of the next sentence hereof) as may be reasonably requested in order expeditiously to consummate each Sale pursuant to Section 14.02. Notwithstanding the foregoing or anything else to the contrary set forth herein, in no event shall any of Pamplona, L Catterton or any of their respective Affiliates (i) be required to give any representations or warranties, or agree to any non-competition, non-solicitation or similar restrictive covenants, other than customary representations or warranties as to such Person’s due organization, title to the securities it is selling, authority and capacity to effect the sale of such securities and the absence of any conflict under law or its organizational documents that in each case would prevent or impair the sale by such Person of such securities in such Sale, (ii) be subject to any indemnification obligations (including any escrowed amounts) for representations, warranties or agreements made by any other Person; (iii) be liable for any breach of any representations, warranties or agreements made by any other Person; or (iv) be subject to obligations in excess of the actual proceeds it received in the Sale; or (v) be required to participate in any Sale to an Affiliate of any Proposed Seller.

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(f) The closing of a Sale pursuant to Section 14.02 shall take place at such time and place as the Proposed Seller shall specify by notice to each Participating Seller. At the closing of any Sale under this Section 14.02, each Participating Seller shall deliver the Note to be sold by such Participating Seller, duly endorsed, or other appropriate instruments duly endorsed, for transfer, free and clear of any liens, encumbrances or adverse claims, against delivery of the applicable consideration.

ARTICLE 15

NO WAIVER

No failure on the part of the Holder to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by the Holder of any right, remedy or power hereunder preclude any other or future exercise of any other right, remedy or power. Each and every right, remedy or power hereby granted to the Holder or allowed it by law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by the Holder from time to time.

ARTICLE 16

NOTICES

Unless otherwise provided herein, any notices, consents, waivers or other communications required or permitted to be given under the terms of this Note must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally, (ii) upon receipt, when sent by e-mail or (iii) one Business Day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses for such communications shall be:

If to the Issuer:

c/o iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Email: swatterson@iconfitness.com

Attention: Chief Executive Officer

with a copy to:

Weil, Gotshal & Manges LLP

767 5th Ave.

New York, New York 10153

Email: Corey.Chivers@weil.com

Attention: Corey Chivers

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If to the Holder, to its address appearing in the Notes Register²⁷, or to such other address and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party five (5) Business Days prior to the effectiveness of such change. Written confirmation (including by email) of receipt (x) given by the recipient of such notice, consent, waiver or other communication, or (y) provided by a courier or overnight courier service shall be rebuttable evidence of personal service, receipt by email or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, as applicable.

ARTICLE 17

MISCELLANEOUS

Whenever the sense of this Note requires, words in the singular shall be deemed to include the plural and words in the plural shall be deemed to include the singular. Paragraph headings are for convenience only and shall not affect the meaning of this document.

ARTICLE 18

CHOICE OF LAW AND VENUE; WAIVER OF JURY TRIAL

This Note shall be governed by and construed in accordance with the law of the State of Delaware. The Issuer and, by accepting this Note, the Holder hereby irrevocably consents to the exclusive jurisdiction of the United States District Court for the Southern District of New York or any New York State court sitting in New York City (and of the appropriate appellate courts therefrom) in any suit, action or proceeding seeking to enforce any provision of, or based on any suit, action or proceeding arising out of or in connection with, this Note or the transactions contemplated hereby and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in this Article 18 shall be deemed effective service of process on such party. EACH OF THE ISSUER AND, BY ACCEPTING THIS NOTE, THE HOLDER HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS NOTE.

²⁷  Holder notice addresses in Notes Register to include counsel copies.

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ARTICLE 19

TAX FORMS

The Holder shall provide the Issuer with such tax forms or certificates reasonably requested by the Issuer for the purpose of establishing any available exemption from withholding taxes in respect of all amounts payable to such Holder hereunder.

[Remainder of this page intentionally left blank]

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IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed by its officer thereunto duly authorized.

Dated: [•], 2021

IFIT HEALTH & FITNESS INC
By:
	Name:
	Title:

ACKNOWLEDGED AND AGREED As of the date first above written:
[•]
By:
By:
	Name:
	Title:

Exhibit A

IFIT HEALTH & FITNESS INC

CONVERSION NOTICE

Reference is made to the note issued by iFIT Health & Fitness Inc, a Delaware corporation, due [•], 2027, in an aggregate principal amount of [•] ($[•]) (the “Convertible Note”). In accordance with and pursuant to the Convertible Note, the undersigned hereby elects to convert the Conversion Amount set forth below into shares of Common Stock of the Issuer (the “Common Stock”), [as of the date specified below][[upon/immediately prior to], and subject to the occurrence of, [•]].

Date of Conversion (if applicable): _______________________________________________________________________

Conversion Amount to be converted: _____________________

Please confirm the following information:

Conversion Price: ________________________________________________________

Number of shares of Common Stock to be issued: _______________________________

Please issue the shares of Common Stock into which the Conversion Amount is being converted in the following name and to the following address:

Issue to: _________________________________________

Address: _________________________________________

Telephone Number: ________________________________

Email: __________________________________________

Authorization: ____________________________________

By: _____________________________________________

Title: ____________________________________________

Dated: ___________________________________________

Account Number (if electronic book entry transfer): _____________________________

Transaction Code Number (if electronic book entry transfer): ______________________

Payment Instructions for cash payment in lieu of fractional shares:

Exhibit B

IFIT HEALTH & FITNESS INC

REGISTRATION OF TRANSFER NOTICE

To the Secretary and General Counsel:

(To be delivered via registered courier to iFIT Health & Fitness Inc, c/o Office of General Counsel, 1500 South 1000 West, Logan UT 84321, with an email copy sent to Everett@ifit.com and SWatterson@iconfitness.com)

Reference is made to the note issued by iFIT Health & Fitness Inc, a Delaware corporation, due [•], 2027, in an aggregate principal amount of                 ($                ) (the “Convertible Note”), registered in the name of the following registered holder (the “Transferor”). Capitalized terms not otherwise defined shall have the meanings set forth in the Convertible Note.

Registered Holder: _________________________________________

Address: _________________________________________

Telephone Number: ________________________________

Email: __________________________________________

The Transferor hereby requests the registration of transfer of the Convertible Note in the following principal amount (must be equal to or less than the amount set forth above):

_______________________________ ($ ___________________)

To be registered to the following person as follows (the “Transferee”):

Name of Transferee to be Registered: _________________________________________

Address: _________________________________________

Telephone Number: _________________________________

Email: __________________________________________

Certification of Transferor

The undersigned Transferor hereby represents, warrants and certifies that: (a) if the date of this Notice is within 6 months of the original issuance of the Convertible Note, the Transferee is a Permitted Transferee of the Transferor, and (b) to the best of its knowledge, the Transferee is not an Affiliate of a Person (or such Person) set forth in the attached Schedule 14.01 of the Convertible Note.

Name or Transferor: ____________________________

By: __________________________________________

Name: ________________________________________

Title: _________________________________________

Date: ________________

Certification of Transferee

The undersigned Transferee hereby represents, warrants and certifies that: (a) if the date of this Notice is within 6 months of the original issuance of the Convertible Note, the Transferee is a Permitted Transferee of the Transferor, and (b) the Transferee is not an Affiliate of a Person (or such Person) set forth in the attached Schedule 14.01. The Transferee further acknowledges and agrees that the Convertible Notes has not been registered under the Securities Act of 1933, as amended (the “Securities Act”), that such Transferee is an accredited investor entitled to purchase the Convertible Note without registration under the Securities Act or any state blue skys law, and that it shall not transfer such Convertible Notes, unless such transfer is pursuant to an effective registration statement under the Securities Act, or pursuant to an available exemption from, or in a transaction not subject to, registration under the Securities Act.

Name or Transferee: ____________________________

By: __________________________________________

Name: ________________________________________

Title: _________________________________________

Date: ________________

EX-5.1

Exhibit 5.1

767 Fifth Avenue

New York, NY 10153-0119

+1 212 310 8000 tel

+1 212 310 8007 fax

September 27, 2021

iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Ladies and Gentlemen:

We have acted as counsel to iFIT Health & Fitness Inc, a Delaware corporation (the “Company”), in connection with the preparation and filing with the Securities and Exchange Commission of the Company’s Registration Statement on Form S-1, File No. 333-259220 (as amended, and including any subsequent registration statement on Form S-1 filed pursuant to Rule 462(b), the “Registration Statement”), under the Securities Act of 1933, as amended (the “Act”), relating to the registration of the offer, issuance and sale by the Company of the number of shares of Class A common stock, par value $0.001 per share (the “Common Stock”), of the Company specified in the Registration Statement (together with any additional shares of Common Stock that may be sold by the Company pursuant to Rule 462(b) under the Act, the “Shares”). The Shares are to be issued and sold by the Company pursuant to an underwriting agreement among the Company and the underwriters named therein (the “Underwriting Agreement”), the form of which has been filed as Exhibit 1.1 to the Registration Statement.

In so acting, we have examined originals or copies (certified or otherwise identified to our satisfaction) of (i) the form of the Amended and Restated Certificate of Incorporation of the Company to be filed with the Secretary of State of the State of Delaware prior to the consummation of the initial public offering contemplated by the Registration Statement, filed as Exhibit 3.4 to the Registration Statement; (ii) the form of the Amended and Restated Bylaws of the Company to be in effect at the time of the consummation of the initial public offering contemplated by the Registration Statement, filed as Exhibit 3.5 to the Registration Statement; (iii) the Registration Statement; (iv) the prospectus contained within the Registration Statement; (v) the form of the Underwriting Agreement; (vi) the form of the Certificate of Common Stock of the Company, filed as Exhibit 4.1 to the Registration Statement; and (vii) such corporate records, agreements, documents and other instruments, and such certificates or comparable documents of public officials and of officers and representatives of the Company, and have made such inquiries of such officers and representatives, as we have deemed relevant and necessary as a basis for the opinion hereinafter set forth.

September 27, 2021 Page 2

In such examination, we have assumed that the Amended and Restated Certificate of Incorporation that will be filed with the Secretary of State of the State of Delaware will be substantially identical to the form of the Amended and Restated Certificate of Incorporation reviewed by us, the form of the Amended and Restated Bylaws that will be in effect at the time of the consummation of the initial public offering contemplated by the Registration Statement will be substantially identical to the form of the Amended and Restated Bylaws reviewed by us, the genuineness of all signatures, the legal capacity of all natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies, and the authenticity of the originals of such latter documents. As to all questions of fact material to this opinion that have not been independently established, we have relied upon certificates or comparable documents of officers and representatives of the Company.

Based on the foregoing, and subject to the qualifications stated herein, we are of the opinion that the Shares, when issued and sold as contemplated in the Registration Statement and the Underwriting Agreement, and upon payment and delivery in accordance with the Underwriting Agreement, will be validly issued, fully paid and non-assessable.

The opinion expressed herein is limited to the corporate laws of the State of Delaware and we express no opinion as to the effect on the matters covered by this letter of the laws of any other jurisdiction.

We hereby consent to the filing of this letter as an exhibit to the Registration Statement, to the incorporation by reference of this letter into any subsequent registration statement on Form S-1 filed by the Company pursuant to Rule 462(b) of the Act with respect to the Shares and to the reference to our firm under the caption “Legal Matters” in the prospectus which is a part of the Registration Statement. In giving such consent we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Securities and Exchange Commission.

Very truly yours,

/s/ Weil, Gotshal & Manges LLP

EX-10.2

Exhibit 10.2

FORM OF DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (the “Agreement”) is made and entered into as of                    , 2021, between iFIT Health & Fitness Inc, a Delaware corporation (the “Company”), and                     (“Indemnitee”). Capitalized terms not defined elsewhere in this Agreement are used as defined in Section 13.

WHEREAS, the Board of Directors of the Company (the “Board”) has determined that it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, hold harmless, exonerate and to advance expenses on behalf of, persons who serve the Company and its direct and indirect subsidiaries to the fullest extent permitted by applicable law in order to, among other things, support the retention of highly competent persons who may be hesitant to serve in such roles without such protections;

WHEREAS, this Agreement is a supplement to and in furtherance of the Company’s Amended and Restated Certificate of Incorporation (the “Charter”) and the Amended and Restated Bylaws (the “Bylaws” and together with the Charter, the “Organizational Documents”), in each case, as may be amended from time to time, and any resolutions adopted pursuant thereto, as well as any rights of Indemnitees under any directors’ and officers’ policies of liability insurance, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder;

WHEREAS, Indemnitee may not be willing to serve as an officer or director without adequate protection, and the Company desires Indemnitee to serve in such capacity, and Indemnitee is willing to serve, continue to serve, and to take on additional service for or on behalf of the Company on the condition that Indemnitee be so indemnified; and

WHEREAS, Indemnitee has certain rights to indemnification and/or insurance provided by [LC9 Connected Holdings, LP,][Catterton IX, L.P.,][Pamplona Capital Management, LLC] and certain of their affiliates (collectively, and including, without limitation, any management company associated with such entities and any affiliates of or funds managed by any such management company, the “Secondary Indemnitor”), which Indemnitee and Secondary Indemnitor intend to be secondary to the primary obligation of the Company to indemnify Indemnitee as provided herein, with the Company’s acknowledgement and agreement to the foregoing being a material condition to Indemnitee’s willingness to serve on the Board.

NOW, THEREFORE, in consideration of the Indemnitee’s agreement to serve as a director or officer of the Company from and after the date hereof, and the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

1. Indemnity of Indemnitee. The Company hereby agrees to hold harmless and indemnify Indemnitee to the fullest extent permitted by law, as such may be amended from time to time. In furtherance of the foregoing indemnification, and without limiting the generality thereof:

(a) Proceedings Other Than Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section l(a) if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding other than a Proceeding by or in the right of the Company. Pursuant to this Section 1(a), Indemnitee shall be indemnified against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and with respect to any criminal Proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful.

(b) Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 1(b) if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding brought by or in the right of the Company. Pursuant to this Section 1(b), Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; provided, however, if applicable law so provides, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company unless and to the extent that the Court of Chancery of the State of Delaware shall determine that such indemnification may be made.

(c) Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Without limiting any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a party to and is successful, on the merits or otherwise, in any Proceeding, he shall be indemnified to the maximum extent permitted by law, as such may be amended from time to time, against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section 1(c) and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, without payment of any judgment, penalty or fine by Indemnitee, or on Indemnitee’s behalf, in connection with such claim issue or matter, shall be deemed to be a successful result as to such claim, issue or matter.

(d)Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

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2. Additional Indemnity. In addition to, and without regard to any limitations on, the indemnification provided for in Section 1 of this Agreement, the Company shall and hereby does indemnify and hold harmless Indemnitee against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf if, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding (including a Proceeding by or in the right of the Company), including, without limitation, all liability arising out of the negligence or active or passive wrongdoing of Indemnitee. The only limitation that shall exist upon the Company’s obligations pursuant to this Agreement shall be that the Company shall not be obligated to make any payment to Indemnitee that is finally determined (under the procedures, and subject to the presumptions, set forth in Sections 6 and 7 hereof) to be unlawful.

3. Contribution.

(a) Whether or not the indemnification provided in Sections 1 and 2 hereof is available, in respect of any threatened, pending or completed action, suit or proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), the Company shall pay, in the first instance, the entire amount of any judgment or settlement of such action, suit or proceeding without requiring Indemnitee to contribute to such payment and the Company hereby waives and relinquishes any right of contribution it may have against Indemnitee.

(b) Without diminishing or impairing the obligations of the Company set forth in the preceding subparagraph, if, for any reason, Indemnitee shall elect or be required to pay all or any portion of any judgment or settlement in any threatened, pending or completed action, suit or proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), the Company shall contribute to the amount of Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred and paid or payable by Indemnitee in proportion to the relative benefits received by the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, from the transaction from which such action, suit or proceeding arose; provided, however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to law, be further adjusted by reference to the relative fault of the Company and all officers, directors or employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, in connection with the events that resulted in such expenses, judgments, fines or settlement amounts, as well as any other equitable considerations which the Law may require to be considered. The relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, shall be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary and the degree to which their conduct is active or passive.

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(c) The Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims of contribution that may be brought by officers, directors or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.

(d) To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

4. Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness, or is made (or asked to) respond to discovery requests, in any Proceeding to which Indemnitee is not a party, he shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.

5. Advancement of Expenses. Notwithstanding any other provision of this Agreement, the Company shall advance all Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding by reason of Indemnitee’s Corporate Status within thirty (30) days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be indemnified against such Expenses. Any advances and undertakings to repay pursuant to this Section 5 shall be unsecured and interest free.

6. Procedures and Presumptions for Determination of Entitlement to Indemnification. It is the intent of this Agreement to secure for Indemnitee rights of indemnity that are as favorable as may be permitted under the DGCL and public policy of the State of Delaware. Accordingly, the parties agree that the following procedures and presumptions shall apply in the event of any question as to whether Indemnitee is entitled to indemnification under this Agreement:

(a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Corporate Secretary of the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. The Corporate Secretary of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification. Notwithstanding the foregoing, any failure of Indemnitee to provide such a request to the Company, or to provide such a request in a timely fashion, shall not relieve the Company of any liability that it may have to Indemnitee unless, and to the extent that, such failure actually and materially prejudices the interests of the Company.

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(b) Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 6(a) hereof, a determination with respect to Indemnitee’s entitlement thereto shall be made in the specific case by one of the following four methods, which shall be at the election of the Board: (1) by a majority vote of the Disinterested Directors, even though less than a quorum, (2) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum, (3) if there are no Disinterested Directors, or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, or (4) if so directed by the Board, by the stockholders of the Company; provided, however, that if a Change in Control has occurred, the determination with respect to Indemnitee’s entitlement to indemnification shall be made by Independent Counsel.

(c) In the event the determination of entitlement to indemnification is to be made by Independent Counsel, the Independent Counsel shall be selected as provided in this Section 6(c). If a Change in Control has not occurred, the Independent Counsel shall be selected by the Board (including a vote of a majority of the Disinterested Directors, if obtainable), and the Company shall give written notice advising the Indemnitee of the identity of the Independent Counsel so selected. Indemnitee may, within 10 days after such written notice of selection shall have been given, deliver to the Company a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 13 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected shall act as Independent Counsel. If a written objection is made, the Independent Counsel selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If a Change in Control has occurred, the Independent Counsel shall be selected by the Indemnitee (unless the Indemnitee shall request that such selection be made by the Board, in which event the preceding sentence shall apply), and approved by the Board (which approval shall not be unreasonably withheld). If (i) an Independent Counsel is to make the determination of entitlement pursuant to this Section 6, and (ii) within 20 days after submission by Indemnitee of a written request for indemnification pursuant to Section 6(a) hereof, no Independent Counsel shall have been selected and not objected to, either the Company or Indemnitee may petition the Court of Chancery of the State of Delaware or other court of competent jurisdiction for resolution of any objection which shall have been made by Indemnitee to the Company’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 6(b) hereof. The Company shall pay any and all reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to Section 6(b) hereof, and the Company shall pay all reasonable fees and expenses incident to the procedures of this Section 6(c), regardless of the manner in which such Independent Counsel was selected or appointed.

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(d) In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence. Neither the failure of the Company (including by its directors or independent legal counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or independent legal counsel) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

(e) Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Enterprise. The provisions of this Section 6(e) shall not be deemed to be exclusive or to limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement. In addition, the knowledge and/or actions, or failure to act, of any director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement. Whether or not the foregoing provisions of this Section 6(e) are satisfied, it shall in any event be presumed that Indemnitee has at all times acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

(f) If the person, persons or entity empowered or selected under this Section 6 to determine whether Indemnitee is entitled to indemnification shall not have made a determination within sixty (60) days after receipt by the Company of the request therefor, the requisite determination of entitlement to indemnification shall be deemed to have been made and Indemnitee shall be entitled to such indemnification absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law; provided, however, that such 60-day period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity making such determination with respect to entitlement to indemnification in good faith requires such additional time to obtain or evaluate documentation and/or information relating thereto; and provided, further, that the foregoing provisions of this Section 6(f) shall not apply if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 6(b) of this Agreement and if (A) within fifteen (15) days after receipt by the Company of the request for such determination, the Board or the Disinterested Directors, if

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appropriate, resolve to submit such determination to the stockholders for their consideration at an annual meeting thereof to be held within seventy-five (75) days after such receipt and such determination is made thereat, or (B) a special meeting of stockholders is called within fifteen (15) days after such receipt for the purpose of making such determination, such meeting is held for such purpose within sixty (60) days after having been so called and such determination is made thereat.

(g) Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information, which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any Independent Counsel, member of the Board or stockholder of the Company shall act reasonably and in good faith in making a determination regarding Indemnitee’s entitlement to indemnification under this Agreement. Any costs or expenses (including attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

(h) The Company acknowledges that a settlement or other disposition short of final judgment may be successful if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any action, claim or proceeding to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such action, claim or proceeding with or without payment of money or other consideration) it shall be presumed that Indemnitee has been successful on the merits or otherwise in such action, suit or proceeding. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

(i) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

7. Remedies of Indemnitee.

(a) In the event that (i) a determination is made pursuant to Section 6 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 5 of this Agreement, (iii) no determination of entitlement to indemnification is made pursuant to Section 6(b) of this Agreement within 90 days after receipt by the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to this Agreement within ten (10) days after receipt by the Company of a written request therefor or (v) payment of indemnification is not

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made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification or such determination is deemed to have been made pursuant to Section 6 of this Agreement, Indemnitee shall be entitled to an adjudication in an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of Indemnitee’s entitlement to such indemnification, contribution or advancement of Expenses. Alternatively, Indemnitee, at such person’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Except as set forth herein, the provisions of Delaware law (without regard to its conflict of law rules) shall apply to any such arbitration. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

(b) In the event that a determination shall have been made pursuant to Section 6(b) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding commenced pursuant to this Section 7 shall be conducted in all respects as a de novo trial, or arbitration, on the merits, and Indemnitee shall not be prejudiced by reason of the adverse determination under Section 6(b). In any judicial proceeding or arbitration commenced pursuant to this Section 7, Indemnitee shall be presumed to be entitled to indemnification under this Agreement and the Company shall have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be, and the Company may not refer to or introduce into evidence any determination pursuant to Section 6(b) of this Agreement adverse to Indemnitee for any purpose. If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 7, Indemnitee shall not be required to reimburse the Company for any advances pursuant to Section 5 until a final determination is made with respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed).

(c) If a determination shall have been made pursuant to Section 6(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding commenced pursuant to this Section 7, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s misstatement not materially misleading in connection with the application for indemnification, or (ii) a prohibition of such indemnification under applicable law.

(d) In the event that Indemnitee, pursuant to this Section 7, seeks a judicial adjudication of Indemnitee’s rights under, or to recover damages for breach of, this Agreement, or to recover under any directors’ and officers’ liability insurance policies maintained by the Company, the Company shall pay on Indemnitee’s behalf, in advance, any and all expenses (of the types described in the definition of Expenses in Section 13 of this Agreement) actually and reasonably incurred by Indemnitee in such judicial adjudication, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement of expenses or insurance recovery.

(e) The Company shall be precluded from asserting in any judicial proceeding commenced pursuant to this Section 7 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement. It is the intent of the Company that, to the fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other

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Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Indemnitee hereunder. The Company shall indemnify Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Company of a written request therefore) advance, to the extent not prohibited by law, such expenses to Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advance of Expenses from the Company under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Company, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement of Expenses or insurance recovery, as the case may be.

(f) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding.

8. Non-Exclusivity; Survival of Rights; Insurance; Primacy of Indemnification; Subrogation.

(a) The rights of indemnification and to receive advancement of expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Organizational Documents, any agreement, a vote of stockholders, a resolution of directors or otherwise, of the Company. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in such person’s Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in the DGCL, whether by statute or judicial decision, permits greater indemnification than would be afforded currently under the Organizational Documents and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

(b) The Company shall obtain and maintain in effect during the entire period for which the Company is obligated to indemnify Indemnitee under this Agreement, one or more policies of insurance with one or more reputable insurance companies to provide the directors and officers of the Company with coverage for losses from wrongful acts and omissions and to ensure the Company’s performance of its indemnification obligations under this Agreement. Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director or officer under such policy or policies. In all such insurance policies, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee with the same rights and benefits as are accorded to the most favorably insured of the Company’s directors and officers. At the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company shall give prompt

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notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(c) The Company hereby acknowledges that Indemnitee has certain rights to indemnification, advancement of expenses and/or insurance provided by the Secondary Indemnitor and certain affiliates that, directly or indirectly, (i) are controlled by, (ii) control or (iii) are under common control with, Secondary Indemnitor (collectively, the “Fund Indemnitors”). The Company hereby agrees (i) that it is the indemnitor of first resort (i.e., its obligations to Indemnitee are primary and any obligation of the Fund Indemnitors to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Indemnitee are secondary), (ii) that it shall be required to advance the full amount of expenses incurred by Indemnitee and shall be liable for the full amount of all Expenses, judgments, penalties, fines and amounts paid in settlement to the extent legally permitted and as required by the terms of this Agreement and the Certificate of Incorporation or By-laws of the Company (or any other agreement between the Company and Indemnitee), without regard to any rights Indemnitee may have against the Fund Indemnitors, and, (iii) that it irrevocably waives, relinquishes and releases the Fund Indemnitors from any and all claims against the Fund Indemnitors for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further agrees that no advancement or payment by the Fund Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification from the Company shall affect the foregoing and the Fund Indemnitors shall have a right of contribution and/or be subrogated to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and Indemnitee agree that the Fund Indemnitors are express third party beneficiaries of the terms of this Section 8(d).

(d) [Except as provided in Section 8(c) above, i][I]n the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee [(other than against the Fund Indemnitors)], who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

(e) [Except as provided in Section 8(c) above, t][T]he Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

(f) [Except as provided in Section 8(c) above, t][T]he Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee who is or was serving at the request of the Company as a director, officer, employee or agent of any other corporation, partnership, joint venture, trust, employee benefit plan or other Enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.

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9. Exception to Right of Indemnification. Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to make any indemnity in connection with any claim made against Indemnitee:

(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision[; provided, that the foregoing shall not affect the rights of Indemnitee or the Fund Indemnitors set forth in Section 8(c) above]; or

(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or similar provisions of state statutory law or common law; or

(c) for reimbursement to the Company of any bonus or other incentive-based or equity-based compensation or of any profits realized by Indemnitee from the sale of securities of the Company in each case as required under the Exchange Act; or

(d) in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Company has joined in or the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law, or (iii) the Proceeding is one to enforce Indemnitee’s rights under this Agreement.

10. Non-Disclosure of Payments. Except as expressly required by the securities laws of the United States of America, neither party shall disclose any payments under this Agreement unless prior approval of the other party is obtained. If any payment information must be disclosed, the Company shall afford the Indemnitee an opportunity to review all such disclosures and, if requested, to explain in such statement any mitigating circumstances regarding the events to be reported.

11. Duration of Agreement. All agreements and obligations of the Company contained herein shall continue upon the later of (a) ten (10) years after the date that Indemnitee shall have ceased to serve as a director of the Company or a director, officer, trustee, partner, managing member, fiduciary, employee or agent of any other corporation, partnership, joint venture, trust, employee benefit plan or other Enterprise which Indemnitee served at the request of the Company; or (b) one (1) year after the final termination of any Proceeding (including any rights of appeal thereto) in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any Proceeding commenced by Indemnitee pursuant to Section 7 of this Agreement relating thereto (including any rights of appeal of any Section 7 Proceeding). This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), assigns, spouses, heirs, executors and personal and legal representatives.

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12. Security. To the extent requested by Indemnitee and approved by the Board, the Company may at any time and from time to time provide security to Indemnitee for the Company’s obligations hereunder through an irrevocable bank line of credit, funded trust or other collateral. Any such security, once provided to Indemnitee, may not be revoked or released without the prior written consent of Indemnitee.

13. Definitions. For purposes of this Agreement:

(a) “Change in Control” shall be deemed to occur upon the earliest to occur after the date of this Agreement of any of the following events:

(i) Acquisition of Stock by Third Party. Any Person, other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing fifty (50%) or more of the combined voting power of the Company’s then outstanding securities;

(ii) Change in Board. During any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Section 13(a)(i), 13(a)(iii) or 13(a)(iv)) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a least a majority of the members of the Board;

(iii) Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 51% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity; and

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(iv) Liquidation. The approval by the stockholders of the Company of a complete liquidation of the Company or an agreement or series of agreements for the sale or disposition by the Company of all or substantially all of the Company’s assets, or, if such approval is not required, the decision by the Board to proceed with such a liquidation, sale, or disposition in one transaction or a series of related transactions.

(b) “Beneficial Owner” shall have the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner shall exclude any Person otherwise becoming a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company with another entity.

(c) “Corporate Status” describes the status of a person who is or was a director, officer, employee, agent or fiduciary of the Company, any direct or indirect subsidiary of the Company, or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving at the request of the Company.

(d) “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

(e) “Enterprise” shall mean the Company and any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that Indemnitee is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary.

(f) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

(g) “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in a Proceeding, or responding to, or objecting to, a request to provide discovery in any Proceeding. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding and any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, including without limitation the premium, security for, and other costs relating to any cost bond, supersede as bond, or other appeal bond or its equivalent. Expenses, however, shall not include judgments, penalties, fines or amounts paid in settlement.

(h) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other

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party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. The Company agrees to pay the reasonable fees of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

(i) “Person” shall have the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person shall exclude (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

(j) “Proceeding” includes any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of Indemnitee’s Corporate Status, by reason of any action taken by Indemnitee or of any inaction on Indemnitee’s part while acting pursuant to Indemnitee’s Corporate Status, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust or other Enterprise; in each case whether or not Indemnitee is acting or serving in any such capacity at the time any liability or expense is incurred for which indemnification can be provided under this Agreement; including one pending on or before the date of this Agreement, but excluding one initiated by an Indemnitee pursuant to Section 7 of this Agreement to enforce Indemnitee’s rights under this Agreement.

14. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality, and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the fullest extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby. Without limiting the generality of the foregoing, this Agreement is intended to confer upon Indemnitee indemnification rights to the fullest extent permitted by applicable laws.

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15. Enforcement and Binding Effect.

(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving in such capacity.

(b) Without limiting any of the rights of Indemnitee under the Charter or By-laws of the Company as they may be amended from time to time, this Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof.

(c) The indemnification and advancement of expenses provided by, or granted pursuant to this Agreement shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or of any other Enterprise at the Company’s request, and shall inure to the benefit of Indemnitee and such person’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.

(d) The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part, of the business and/or assets of the Company to expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

(e) The Company and Indemnitee agree herein that a monetary remedy for breach of this Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which he may be entitled. The Company and Indemnitee further agree that Indemnitee shall be entitled to such specific performance and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertaking in connection therewith. The Company acknowledges that in the absence of a waiver, a bond or undertaking may be required of Indemnitee by the Court, and the Company hereby waives any such requirement of such a bond or undertaking.

16. Modification and Waiver. No supplement, modification, termination or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

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17. Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing upon being served with or otherwise receiving any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification covered hereunder. The failure to so notify the Company shall not relieve the Company of any obligation which it may have to Indemnitee under this Agreement or otherwise.

18. Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, and if not so confirmed, then on the next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent:

(a) To Indemnitee at the address set forth below Indemnitee signature hereto.

(b) To the Company at:

General Counsel

iFIT Health & Fitness

1500 South 1000 West

Logan, Utah 84321

With a copy to (which shall not constitute notice):

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Email: corey.chivers@weil.com

Attention: Corey Chivers

or to such other address as may have been furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

19. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement. This Agreement may also be executed and delivered by facsimile signature and in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

20. Headings. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

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21. Usage of Pronouns. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.

22.Governing Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. The Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Chancery Court of the State of Delaware (the “Delaware Court”), and not in any other state or federal court in the United States of America or any court in any other country, (ii) generally and unconditionally consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (iv) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum. The foregoing consent to jurisdiction shall not constitute general consent to service of process in the state for any purpose except as provided above, and shall not be deemed to confer rights on any person other than the parties to this Agreement.

[SIGNATURE PAGE TO FOLLOW]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of the day and year first above written.

iFIT Health & Fitness Inc
By:
	Name:
	Title:
INDEMNITEE
Name:
Address:

[Signature Page to D&O Indemnification Agreement]

EX-10.5

Exhibit 10.5

IFIT HEALTH & FITNESS INC

2021 EQUITY INCENTIVE PLAN

1. Purpose.

The purpose of the iFit Health & Fitness Inc 2021 Equity Incentive Plan is to further align the interests of eligible participants with those of the Company’s stockholders by providing incentive compensation opportunities tied to the performance of the Company and its Common Stock. The Plan is intended to advance the interests of the Company and increase stockholder value by attracting, retaining and motivating key personnel upon whose judgment, initiative and effort the successful conduct of the Company’s business is largely dependent. The Plan includes separate sub-plans (“Sub Plans”) that permit offerings of grants to employees of certain foreign subsidiaries of the Company or to Company’s employees subject to income tax in jurisdictions other than the United States. Offerings under the Sub Plans shall comply with local laws applicable to offerings in such foreign jurisdictions.

2. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth below:

“Affiliate” means any Person directly or indirectly controlling, controlled by, or under common control with such other Person.

“Award” means an award of a Stock Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit, or Stock Award granted under the Plan.

“Award Agreement” means a notice or an agreement entered into between the Company and a Participant, setting forth the terms and conditions of an Award granted to a Participant as provided in Section 15.2 hereof.

“Beneficial Owner” has the meaning ascribed to such term in Rule 13d-3 under the Exchange Act.

“Board” means the Board of Directors of the Company.

“Cause” has the meaning set forth in Section 13.2 hereof.

“Change in Control” has the meaning set forth in Section 11.4 hereof.

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means (i) the Compensation Committee of the Board, (ii) such other committee of no fewer than two members of the Board who are appointed by the Board to administer the Plan or (iii) the Board, as determined by the Board.

“Common Stock” means the Company’s Class A common stock, par value $0.001 per share.

“Company” means iFit Health & Fitness Inc, a Delaware corporation or any successor thereto.

“Date of Grant” means the date on which an Award under the Plan is granted by the Committee or such later date as the Committee may specify to be the effective date of an Award.

“Disability” means, unless otherwise provided in an Award Agreement, with respect to a Participant’s termination of Service, a disability described in Treasury Regulations Section 1.409A-3(i)(4)(i)(A). A Disability shall only be deemed to occur at the time of the determination by the Committee of the Disability.

“Effective Date” has the meaning set forth in Section 16.1 hereof.

“Eligible Person” means any Person who is an officer, employee, Non-Employee Director, or any natural person who is a consultant or other personal service provider of the Company or any of its Subsidiaries.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, as the same may be amended from time to time.

“Fair Market Value” means, as applied to a specific date, the price of a share of Common Stock that is based on the opening, closing, actual, high, low or average selling prices of a share of Common Stock reported on any established stock exchange or national market system including without limitation the New York Stock Exchange on the applicable date, the preceding trading day, the next succeeding trading day, or an average of trading days, as determined by the Committee in its discretion. Unless the Committee determines otherwise or unless otherwise specified in an Award Agreement, Fair Market Value shall be deemed to be equal to the closing price of a share of Common Stock on the date as of which Fair Market Value is to be determined, or if shares of Common Stock are not publicly traded on such date, as of the most recent date on which shares of Common Stock were publicly traded. Notwithstanding the foregoing, if the Common Stock is not traded on any established stock exchange or national market system, the Fair Market Value means the price of a share of Common Stock as established by the Committee acting in good faith based on a reasonable valuation method that is consistent with the requirements of Section 409A of the Code and the regulations thereunder.

“Incentive Stock Option” means a Stock Option granted under Section 6 hereof that is intended to meet the requirements of Section 422 of the Code and the regulations thereunder.

“Non-Employee Director” means a member of the Board who is not an employee of the Company or any of its Subsidiaries.

“Nonqualified Stock Option” means a Stock Option granted under Section 6 hereof that is not an Incentive Stock Option.

“Participant” means any Eligible Person who holds an outstanding Award under the Plan.

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“Person” means an individual, corporation, partnership, association, trust, unincorporated organization, limited liability company or other legal entity. All references to Person shall include an individual Person or a group (as defined in Rule 13d-5 under the Exchange Act) of Persons.

“Plan” means the iFit Health & Fitness Inc 2021 Equity Incentive Plan as set forth herein, effective as of the Effective Date and as may be amended from time to time, as provided herein.

“Restricted Stock Award” means a grant of shares of Common Stock to an Eligible Person under Section 8 hereof that are issued subject to such vesting and transfer restrictions as the Committee shall determine, and such other conditions, as are set forth in the Plan and the applicable Award Agreement.

“Restricted Stock Unit” means a contractual right granted to an Eligible Person under Section 9 hereof representing notional unit interests equal in value to a share of Common Stock to be paid or distributed at such times, and subject to such conditions, as set forth in the Plan and the applicable Award Agreement.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, as the same may be amended from time to time.

“Service” means a Participant’s employment with the Company or any Subsidiary or a Participant’s service as a Non-Employee Director, consultant or other service provider with the Company or any Subsidiary, as applicable.

“Stock Appreciation Right” means a contractual right granted to an Eligible Person under Section 7 hereof entitling such Eligible Person to receive a payment, representing the excess of the Fair Market Value of a share of Common Stock over the base price per share of the right, at such time, and subject to such conditions, as are set forth in the Plan and the applicable Award Agreement.

“Stock Awards” means a grant of shares of Common Stock to an Eligible Person under Section 10 hereof.

“Stock Option” means a contractual right granted to an Eligible Person under Section 6 hereof to purchase shares of Common Stock at such time and price, and subject to such conditions, as are set forth in the Plan and the applicable Award Agreement.

“Subsidiary” means an entity (whether or not a corporation) that is wholly or majority owned or controlled, directly or indirectly, by the Company or any other Affiliate of the Company that is so designated, from time to time, by the Committee, during the period of such Affiliated status; provided, however, that with respect to Incentive Stock Options, the term “Subsidiary” shall include only an entity that qualifies under Section 424(f) of the Code as a “subsidiary corporation” with respect to the Company.

“Treasury Regulations” means regulations promulgated by the United States Treasury Department.

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3. Administration.

3.1 Committee Members. The Plan shall be administered by the Committee. To the extent deemed necessary by the Board, each Committee member shall satisfy the requirements for (i) an “independent director” under rules adopted by the New York Stock Exchange or other principal exchange on which the Common Stock is then listed and (ii) a “nonemployee director” within the meaning of Rule 16b-3 under the Exchange Act. Notwithstanding the foregoing, the mere fact that a Committee member shall fail to qualify under any of the foregoing requirements shall not invalidate any Award made by the Committee which Award is otherwise validly made under the Plan. The Board may exercise all powers of the Committee hereunder and may directly administer the Plan. Neither the Company nor any member of the Board or Committee shall be liable for any action or determination made in good faith by the Board or Committee with respect to the Plan or any Award thereunder.

3.2 Committee Authority. The Committee shall have all powers and discretion necessary or appropriate to administer the Plan and to control its operation, including, but not limited to, the power to (i) determine the Eligible Persons to whom Awards shall be granted under the Plan, (ii) prescribe the restrictions, terms and conditions of all Awards, (iii) interpret the Plan and terms of the Awards, (iv) adopt rules for the administration, interpretation and application of the Plan as are consistent therewith, and interpret, amend or revoke any such rules, (v) make all determinations with respect to a Participant’s Service and the termination of such Service for purposes of any Award, (vi) correct any defect(s) or omission(s) or reconcile any ambiguity(ies) or inconsistency(ies) in the Plan or any Award thereunder, (vii) make all determinations it deems advisable for the administration of the Plan, (viii) decide all disputes arising in connection with the Plan and to otherwise supervise the administration of the Plan, (ix) subject to the terms of the Plan, amend the terms of an Award in any manner that is not inconsistent with the Plan, (x) accelerate the vesting or, to the extent applicable, exercisability of any Award at any time (including, but not limited to, upon a Change in Control or upon termination of Service of a Participant) and (xi) adopt such procedures, modifications or subplans as are necessary or appropriate to permit participation in the Plan by Eligible Persons who are foreign nationals or employed outside of the United States. The Committee’s determinations under the Plan need not be uniform and may be made by the Committee selectively among Participants and Eligible Persons, whether or not such Persons are similarly situated. The Committee shall, in its discretion, consider such factors as it deems relevant in making its interpretations, determinations and actions under the Plan including, without limitation, the recommendations or advice of any officer or employee of the Company or such attorneys, consultants, accountants or other advisors as it may select. All interpretations, determinations, and actions by the Committee shall be final, conclusive, and binding upon all parties.

3.3 Delegation of Authority. The Committee shall have the right, from time to time, to delegate in writing to one or more officers of the Company the authority of the Committee to grant and determine the terms and conditions of Awards granted under the Plan, subject to the requirements of Section 157(c) of the Delaware General Corporation Law (or any successor provision) or such other limitations as the Committee shall determine. In no event shall any such delegation of authority be permitted with respect to Awards granted to any member of the Board or to any Eligible Person who is subject to Rule 16b-3 under the Exchange Act. The Committee shall also be permitted to delegate, to any appropriate officer or employee of the Company,

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responsibility for performing certain ministerial functions under the Plan. In the event that the Committee’s authority is delegated to officers or employees in accordance with the foregoing, all provisions of the Plan relating to the Committee shall be interpreted in a manner consistent with the foregoing by treating any such reference as a reference to such officer or employee for such purpose. Any action undertaken in accordance with the Committee’s delegation of authority hereunder shall have the same force and effect as if such action was undertaken directly by the Committee and shall be deemed for all purposes of the Plan to have been taken by the Committee.

4. Shares Subject to the Plan.

4.1 Number of Shares Reserved. Subject to adjustment as provided in Section 4.3 and Section 4.4 hereof, the total number of shares of Common Stock that are available for issuance under the Plan (the “Share Reserve”) shall equal 45,000,000 shares. Each share of Common Stock subject to an Award shall reduce the Share Reserve by one share; provided, however, that Awards that are required to be paid in cash pursuant to their terms shall not reduce the Share Reserve. Any shares of Common Stock delivered under the Plan shall consist of authorized and unissued shares or treasury shares.

4.2 Share Replenishment. To the extent that an Award granted under this Plan is canceled, expired, forfeited, surrendered, settled by delivery of fewer shares of Common Stock than ¹the number underlying the Award, as applicable, or otherwise terminated without delivery of the shares of Common Stock or payment of consideration to the Participant under the Plan, the shares of Common Stock retained by or returned to the Company will (i) not be deemed to have been delivered under the Plan, as applicable, (ii) be available for future Awards under the Plan, and (iii) increase the Share Reserve by the applicable number of shares set forth in Section 4.1 for each share that is retained by or returned to the Company. Without limiting the generality of the foregoing, shares of Common Stock that are withheld from an Award in payment or net settlement of the exercise, base or purchase price or taxes relating to such an Award, such shares will be deemed not to have been delivered under the Plan and will continue to be available for future Awards.

4.3 Adjustments. If there shall occur any change with respect to the outstanding shares of Common Stock by reason of any recapitalization, reclassification, stock dividend, extraordinary cash dividend, stock split, reverse stock split or other distribution with respect to the shares of Common Stock or any merger, reorganization, consolidation, combination, spin-off or other corporate event or transaction or any other change affecting the Common Stock (other than regular cash dividends to stockholders of the Company), the Committee shall, in the manner and to the extent it considers appropriate and equitable to the Participants and consistent with the terms of the Plan, cause an adjustment to be made to (i) the maximum number and kind of shares of Common Stock provided in Section 4.1 hereof, (ii) the number and kind of shares of Common Stock, units or other securities or rights subject to then outstanding Awards, (iii) the exercise, base or purchase price for each share or unit or other security or right subject to then outstanding Awards, (iv) other value determinations applicable to the Plan and/or outstanding Awards, and/or (v) any other terms of an Award that are affected by the event. Notwithstanding the foregoing, (a)

¹  Fixed number equal to original Share Reserve.

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any such adjustments shall, to the extent necessary, be made in a manner consistent with the requirements of Section 409A of the Code and (b) in the case of Incentive Stock Options, any such adjustments shall, to the extent practicable, be made in a manner consistent with the requirements of Section 424(a) of the Code, unless otherwise determined by the Committee.

5. Eligibility and Awards.

5.1 Designation of Participants. Any Eligible Person may be selected by the Committee to receive an Award and become a Participant. The Committee has the authority, in its discretion, to determine and designate from time to time those Eligible Persons who are to be granted Awards, the types of Awards to be granted, the number of shares of Common Stock or units subject to Awards to be granted and the terms and conditions of such Awards consistent with the terms of the Plan. In selecting Eligible Persons to be Participants, and in determining the type and amount of Awards to be granted under the Plan, the Committee shall consider any and all factors that it deems relevant or appropriate. Designation of a Participant in any year shall not require the Committee to designate such Person to receive an Award in any other year or, once designated, to receive the same type or amount of Award as granted to such Participant in any other year.

5.2 Determination of Awards. The Committee shall determine the terms and conditions of all Awards granted to Participants in accordance with its authority under Section 3.2 hereof. An Award may consist of one type of right or benefit hereunder or of two or more such rights or benefits granted in tandem.

5.3 Award Agreements. Each Award granted to an Eligible Person shall be represented by an Award Agreement. The terms of the Award, as determined by the Committee, will be set forth in the applicable Award Agreements as described in Section 15.2 hereof.

5.4 Minimum Vesting Requirement. Notwithstanding any other provision of the Plan to the contrary, Awards granted under the Plan shall vest no earlier than the first anniversary of the date on which the Award is granted; provided, that the following Awards shall not be subject to the foregoing minimum vesting requirement: any (i) substituted or assumed Awards under Section 15.10, (ii) Awards to Non-Employee Directors that vest on the earlier of the first anniversary of the date of grant and the next annual meeting of stockholders, (iii) shares of Common Stock delivered in lieu of fully vested cash obligations, and (iv) any additional Awards the Committee may grant, up to a maximum of five percent (5%) of the Share Reserve, as adjusted pursuant to Section 4.4; and, provided, further, that the foregoing restriction shall not apply to the Committee’s discretion to provide for accelerated exercisability or vesting of any Award, including, without limitation, in cases of retirement, death, Disability or a Change in Control, under an Award Agreement, or otherwise.

5.5 Non-Employee Director Limitation. No Non-Employee Director may be granted, during any calendar year, Awards having a fair value (determined on the date of grant) that, when added to all cash compensation paid to the Non-Employee Director in respect of the director’s service as a member of the Board for such calendar year, exceeds $500,000. The independent members of the Board may make exceptions to this limit for a non-executive chair of the Board, provided that the Non-Employee Director receiving such additional compensation may not participate in the decision to award such compensation.

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6. Stock Options.

6.1 Grant of Stock Options. A Stock Option may be granted to any Eligible Person selected by the Committee, except that an Incentive Stock Option may only be granted to an Eligible Person satisfying the conditions of Section 6.7(a) hereof. Each Stock Option shall be designated on the Date of Grant, in the discretion of the Committee, as an Incentive Stock Option or as a Nonqualified Stock Option. All Stock Options granted under the Plan are intended to comply with or be exempt from the requirements of Section 409A of the Code, to the extent applicable.

6.2 Exercise Price. The exercise price per share of a Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the Date of Grant. The Committee may in its discretion specify an exercise price per share that is higher than the Fair Market Value of a share of Common Stock on the Date of Grant.

6.3 Vesting of Stock Options. Subject to Section 5.4, the Committee shall, in its discretion, prescribe in an award agreement the time or times at which or the conditions upon which, a Stock Option or portion thereof shall become vested and/or exercisable. The requirements for vesting and exercisability of a Stock Option may be based on the continued Service of the Participant with the Company or a Subsidiary for a specified time period (or periods), on the attainment of a specified performance goal(s) and/or on such other terms and conditions as approved by the Committee in its discretion. If the vesting requirements of a Stock Option are not satisfied, the Award shall be forfeited.

6.4 Term of Stock Options. The Committee shall in its discretion prescribe in an Award Agreement the period during which a vested Stock Option may be exercised; provided, however, that the maximum term of a Stock Option shall be ten (10) years from the Date of Grant. The Committee may provide that a Stock Option will cease to be exercisable upon or at the end of a specified time period following a termination of Service for any reason as set forth in the Award Agreement or otherwise. A Stock Option may be earlier terminated as specified by the Committee and set forth in an Award Agreement upon or following the termination of a Participant’s Service with the Company or any Subsidiary, including by reason of voluntary resignation, death, Disability, termination for Cause or any other reason. Subject to compliance with Section 409A of the Code and the provisions of this Section 6, the Committee may extend at any time the period in which a Stock Option may be exercised, but not beyond ten (10) years from the Date of Grant.

6.5 Stock Option Exercise; Tax Withholding. Subject to such terms and conditions as specified in an Award Agreement (including applicable vesting requirements), a Stock Option may be exercised in whole or in part at any time during the term thereof by notice in the form required by the Company, together with payment of the aggregate exercise price and applicable withholding tax. Payment of the exercise price may be made: (i) in cash or by cash equivalent acceptable to the Committee, or, (ii) to the extent permitted by the Committee in its sole discretion in an Award Agreement or otherwise (A) in shares of Common Stock valued at the Fair Market Value of such shares on the date of exercise, (B) through an open-market, broker-assisted sales transaction

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pursuant to which the Company is promptly delivered the amount of proceeds necessary to satisfy the exercise price, (C) by reducing the number of shares of Common Stock otherwise deliverable upon the exercise of the Stock Option by the number of shares of Common Stock having a Fair Market Value on the date of exercise equal to the exercise price, (D) by a combination of the methods described above or (E) by such other method as may be approved by the Committee. In accordance with Section 15.11 hereof, and in addition to and at the time of payment of the exercise price, the Participant shall pay to the Company the full amount of any and all applicable income tax, employment tax and other amounts required to be withheld in connection with such exercise, payable under such of the methods described above for the payment of the exercise price as may be approved by the Committee and set forth in the Award Agreement.

6.6 Limited Transferability of Nonqualified Stock Options. All Stock Options shall be nontransferable except (i) upon the Participant’s death, in accordance with Section 15.3 hereof or (ii) in the case of Nonqualified Stock Options only, for the transfer of all or part of the Stock Option to a Participant’s “family member” (as defined for purposes of the Form S-8 registration statement under the Securities Act), or as otherwise permitted by the Committee to the extent also permitted by the general instructions of the Form S-8 registration statement, as may be amended from time to time, in each case as may be approved by the Committee in its discretion at the time of proposed transfer; provided, in each case, that any permitted transfer shall be for no consideration. The transfer of a Nonqualified Stock Option may be subject to such terms and conditions as the Committee may in its discretion impose from time to time. Subsequent transfers of a Nonqualified Stock Option shall be prohibited other than in accordance with Section 15.3 hereof.

6.7 Additional Rules for Incentive Stock Options.

(a) Eligibility. An Incentive Stock Option may only be granted to an Eligible Person who is considered an employee for purposes of Treasury Regulation Section 1.421-1(h) with respect to the Company or any Subsidiary that qualifies as a “subsidiary corporation” with respect to the Company for purposes of Section 424(f) of the Code.

(b) Annual Limits. No Incentive Stock Option shall be granted to a Participant as a result of which the aggregate Fair Market Value (determined as of the Date of Grant) of the Common Stock with respect to which incentive stock options under Section 422 of the Code are exercisable for the first time in any calendar year under the Plan and any other stock option plans of the Company or any Subsidiary or parent corporation, would exceed $100,000, determined in accordance with Section 422(d) of the Code. This limitation shall be applied by taking Stock Options into account in the order in which granted. Any Stock Option grant that exceeds such limit shall be treated as a Nonqualified Stock Option.

(c) Additional Limitations. In the case of any Incentive Stock Option granted to an Eligible Person who owns, either directly or indirectly (taking into account the attribution rules contained in Section 424(d) of the Code), stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Subsidiary, the exercise price shall not be less than one hundred ten percent (110%) of the Fair Market Value of a share of Common Stock on the Date of Grant and the maximum term shall be five (5) years.

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(d) Termination of Service. An Award of an Incentive Stock Option may provide that such Stock Option may be exercised not later than (i) three (3) months following termination of Service of the Participant with the Company and all Subsidiaries (other than as set forth in clause (ii) of this Section 6.7(d)) or (ii) one year following termination of Service of the Participant with the Company and all Subsidiaries due to death or permanent and total disability within the meaning of Section 22(e)(3) of the Code, in each case as and to the extent determined by the Committee to comply with the requirements of Section 422 of the Code.

(e) Other Terms and Conditions; Nontransferability. Any Incentive Stock Option granted hereunder shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as are deemed necessary or desirable by the Committee, which terms, together with the terms of the Plan, shall be intended and interpreted to cause such Incentive Stock Option to qualify as an “incentive stock option” under Section 422 of the Code. A Stock Option that is granted as an Incentive Stock Option shall, to the extent it fails to qualify as an “incentive stock option” under the Code, be treated as a Nonqualified Stock Option. An Incentive Stock Option shall by its terms be nontransferable other than by will or by the laws of descent and distribution, and shall be exercisable during the lifetime of a Participant only by such Participant.

(f) Disqualifying Dispositions. If shares of Common Stock acquired by exercise of an Incentive Stock Option are disposed of within two years following the Date of Grant or one year following the transfer of such shares to the Participant upon exercise, the Participant shall, promptly following such disposition, notify the Company in writing of the date and terms of such disposition and provide such other information regarding the disposition as the Company may reasonably require.

6.8 Repricing Prohibited. Subject to the adjustment provisions contained in Section 4.4 hereof, without the prior approval of the Company’s stockholders, neither the Committee nor the Board shall cancel a Stock Option when the exercise price per share exceeds the Fair Market Value of one share of Common Stock in exchange for cash or another Award or cause the cancellation, substitution or amendment of a Stock Option that would have the effect of reducing the exercise price of such a Stock Option previously granted under the Plan or otherwise approve any modification to such a Stock Option, that would be treated as a “repricing” under the then applicable rules, regulations or listing requirements adopted by the New York Stock Exchange or other principal exchange on which the Common Stock is then listed.

6.9 Dividends and Dividend Equivalent Rights. Dividends and dividend equivalent rights shall not be paid or provided with respect to Stock Options.

6.10 No Rights as Stockholder. The Participant shall not have any rights as a stockholder with respect to the shares underlying a Stock Option until such time as shares or Common Stock are delivered to the Participant pursuant to the terms of the Award Agreement.

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7. Stock Appreciation Rights.

7.1 Grant of Stock Appreciation Rights. Stock Appreciation Rights may be granted to any Eligible Person selected by the Committee. Stock Appreciation Rights may be granted on a basis that allows for the exercise of the right by the Participant, or that provides for the automatic exercise or payment of the right upon a specified date or event. Stock Appreciation Rights shall be non-transferable, except as provided in Section 15.3 hereof. All Stock Appreciation Rights granted under the Plan are intended to comply with or otherwise be exempt from the requirements of Section 409A of the Code, to the extent applicable.

7.2 Terms of Share Appreciation Rights. Subject to Section 5.4, the Committee shall in its discretion provide in an Award Agreement the time or times at which or the conditions upon which, a Stock Appreciation Right or portion thereof shall become vested and/or exercisable. The requirements for vesting and exercisability of a Stock Appreciation Right may be based on the continued Service of a Participant with the Company or a Subsidiary for a specified time period (or periods), on the attainment of a specified performance goal(s) and/or on such other terms and conditions as approved by the Committee in its discretion. If the vesting requirements of a Stock Appreciation Right are not satisfied, the Award shall be forfeited. A Stock Appreciation Right will be exercisable or payable at such time or times as determined by the Committee; provided, however, that the maximum term of a Stock Appreciation Right shall be ten (10) years from the Date of Grant. Subject to compliance with Section 409A of the Code and the provisions of this Section 7.2, the Committee may extend at any time the period in which a Stock Appreciation Right may be exercised, but not beyond ten (10) years from the Date of Grant. The Committee may provide that a Stock Appreciation Right will cease to be exercisable upon or at the end of a period following a termination of Service for any reason. The base price of a Stock Appreciation Right shall be determined by the Committee in its discretion; provided, however, that the base price per share shall not be less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the Date of Grant (other than with respect to a Stock Appreciation Right substituted or assumed under Section 15.10).

7.3 Payment of Stock Appreciation Rights. A Stock Appreciation Right will entitle the holder, upon exercise or other payment of the Stock Appreciation Right, as applicable, to receive an amount determined by multiplying: (i) the excess of the Fair Market Value of a share of Common Stock on the date of exercise or payment of the Stock Appreciation Right over the base price of such Stock Appreciation Right, by (ii) the number of shares as to which such Stock Appreciation Right is exercised or paid. Payment of the amount determined under the foregoing may be made, as approved by the Committee and set forth in the Award Agreement, in shares of Common Stock valued at their Fair Market Value on the date of exercise or payment, in cash or in a combination of shares of Common Stock and cash, subject to applicable tax withholding requirements.

7.4 Repricing Prohibited. Subject to the adjustment provisions contained in Section 4.4 hereof, without the prior approval of the Company’s stockholders, neither the Committee nor the Board shall cancel a Stock Appreciation Right when the base price per share exceeds the Fair Market Value of one share of Common Stock in exchange for cash or another Award or cause the cancellation, substitution or amendment of a Stock Appreciation Right that would have the effect of reducing the base price of such a Stock Appreciation Right previously granted under the Plan or otherwise approve any modification to such Stock Appreciation Right that would be treated as a “repricing” under the then applicable rules, regulations or listing requirements adopted by the New York Stock Exchange or other principal exchange on which the Common Stock is then listed.

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7.5 Dividends and Dividend Equivalent Rights. Dividends and dividend equivalent rights shall not be paid or provided with respect to Stock Appreciation Rights.

8. Restricted Stock Awards.

8.1 Grant of Restricted Stock Awards. A Restricted Stock Award may be granted to any Eligible Person selected by the Committee. The Committee may require the payment by the Participant of a specified purchase price in connection with any Restricted Stock Award.

8.2 Vesting Requirements. Subject to Section 5.4, the restrictions imposed on shares granted under a Restricted Stock Award shall lapse in accordance with the vesting requirements specified by the Committee in the Award Agreement. The requirements for vesting of a Restricted Stock Award may be based on the continued Service of the Participant with the Company or a Subsidiary for a specified time period (or periods), on the attainment of a specified performance goal(s) and/or on such other terms and conditions as approved by the Committee in its discretion. If the vesting requirements of a Restricted Stock Award are not satisfied, the Award shall be forfeited and the shares of Common Stock subject to the Award shall be returned to the Company.

8.3 Transfer Restrictions. Shares granted under any Restricted Stock Award may not be transferred, assigned or subject to any encumbrance, pledge or charge until all applicable restrictions are removed or have expired, except as provided in Section 15.3 hereof. Failure to satisfy any applicable restrictions shall result in the subject shares of the Restricted Stock Award being forfeited and returned to the Company. The Committee may require in an Award Agreement that certificates (if any) representing the shares granted under a Restricted Stock Award bear a legend making appropriate reference to the restrictions imposed, and that certificates (if any) representing the shares granted or sold under a Restricted Stock Award will remain in the physical custody of an escrow holder until all restrictions are removed or have expired.

8.4 Rights as Stockholder. Subject to the foregoing provisions of this Section 8 and the applicable Award Agreement, the Participant shall have all rights of a stockholder with respect to the shares granted to the Participant under a Restricted Stock Award, including the right to vote the shares and receive all dividends and other distributions paid or made with respect thereto; provided that if a Participant has the right to receive dividends paid with respect to the Restricted Stock Award, such dividends shall be subject to the same vesting terms as the related Restricted Stock Award.

8.5 Section 83(b) Election. If a Participant makes an election pursuant to Section 83(b) of the Code with respect to a Restricted Stock Award, the Participant shall file, within thirty (30) days following the Date of Grant, a copy of such election with the Company and with the Internal Revenue Service, in accordance with the regulations under Section 83 of the Code. The Committee may provide in an Award Agreement that the Restricted Stock Award is conditioned upon the Participant’s making or refraining from making an election with respect to the Award under Section 83(b) of the Code.

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9. Restricted Stock Units.

9.1 Grant of Restricted Stock Units. A Restricted Stock Unit may be granted to any Eligible Person selected by the Committee. The value of each Restricted Stock Unit is equal to the Fair Market Value of a share of Common Stock on the applicable date or time period of determination, as specified by the Committee. Restricted Stock Units shall be subject to such restrictions and conditions as the Committee shall determine. Restricted Stock Units shall be non-transferable, except as provided in Section 15.3 hereof.

9.2 Vesting of Restricted Stock Units. The Committee shall, in its discretion, determine any vesting requirements with respect to Restricted Stock Units, which shall be set forth in the Award Agreement. The requirements for vesting of a Restricted Stock Unit may be based on the continued Service of the Participant with the Company or a Subsidiary for a specified time period (or periods), on the attainment of a specified performance goal(s) and/or on such other terms and conditions as approved by the Committee in its discretion. If the vesting requirements of a Restricted Stock Unit Award are not satisfied, the Award shall be forfeited.

9.3 Payment of Restricted Stock Units. Restricted Stock Units shall become payable to a Participant at the time or times determined by the Committee and set forth in the Award Agreement, which may be upon or following the vesting of the Award. Payment of a Restricted Stock Unit may be made, as approved by the Committee and set forth in the Award Agreement, in cash or in shares of Common Stock or in a combination thereof, subject to applicable tax withholding requirements. Any cash payment of a Restricted Stock Unit shall be made based upon the Fair Market Value of a share of Common Stock, determined on such date or over such time period as determined by the Committee.

9.4 Dividend Equivalent Rights. Dividends shall not be paid with respect to Restricted Stock Units. Dividend equivalent rights may be granted with respect to the Shares subject to Restricted Stock Units to the extent permitted by the Committee and set forth in the applicable Award Agreement; provided that any dividend equivalent rights granted shall be subject to the same vesting terms as the related Restricted Stock Units.

9.5 No Rights as Stockholder. The Participant shall not have any rights as a stockholder with respect to the shares subject to a Restricted Stock Unit until such time as shares of Common Stock are delivered to the Participant pursuant to the terms of the Award Agreement.

10. Stock Awards.

10.1 Grant of Stock Awards. A Stock Award may be granted to any Eligible Person selected by the Committee. A Stock Award may be granted for past Services, in lieu of bonus or other cash compensation, as directors’ compensation or for any other valid purpose as determined by the Committee. The Committee shall determine the terms and conditions of such Awards, and, subject to Section 5.4, such Awards may be made without vesting requirements. In addition, the Committee may, in connection with any Stock Award, require the payment of a specified purchase price.

10.2 Rights as Stockholder. Subject to the foregoing provisions of this Section 10 and the applicable Award Agreement, upon the issuance of shares of Common Stock under a Stock Award the Participant shall have all rights of a stockholder with respect to the shares of Common Stock, including the right to vote the shares and receive all dividends and other distributions paid or made with respect thereto. If a Participant has the right to receive dividends paid with respect to the Stock Award, such dividends shall be subject to the same vesting terms as the related Stock Award, if applicable.

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11. Change in Control.

11.1 Effect on Awards. Upon the occurrence of a Change in Control, all outstanding Awards shall either (a) be continued or assumed by the Company (if it is the surviving company or corporation) or by the surviving company or corporation or its parent (with such continuation or assumption including conversion into the right to receive securities, cash or a combination of both), or (b) substituted by the surviving company or corporation or its parent of awards (with such substitution including conversion into the right to receive securities, cash or a combination of both), with substantially similar terms for outstanding Awards (with appropriate adjustments to the type of consideration payable upon settlement of the Awards).

11.2 Certain Adjustments. To the extent that outstanding Awards are not continued, assumed or substituted pursuant to Section 11.1 upon or following a Change in Control, the Committee is authorized (but not obligated) to make adjustments in the terms and conditions of outstanding Awards, including without limitation the following (or any combination thereof):

(a) acceleration of exercisability, vesting and/or payment of outstanding Awards immediately prior to the occurrence of such event or upon or following such event;

(b) upon written notice, providing that any outstanding Stock Options and Stock Appreciation Rights are exercisable during a period of time immediately prior to the scheduled consummation of the event or such other period as determined by the Committee (contingent upon the consummation of the event), and at the end of such period, such Stock Options and Stock Appreciation Rights shall terminate to the extent not so exercised within the relevant period; and

(c) cancellation of all or any portion of outstanding Awards for fair value (in the form of cash, Common Shares, other property or any combination thereof) as determined in the sole discretion of the Committee; provided, however, that, in the case of Stock Options and Stock Appreciation Rights or similar Awards, the fair value may equal the excess, if any, of the value or amount of the consideration to be paid in the Change in Control transaction to holders of shares of Common Stock (or, if no such consideration is paid, Fair Market Value of the shares of Common Stock) over the aggregate exercise or base price, as applicable, with respect to such Awards or portion thereof being canceled, or if there is no such excess, zero; provided, further, that if any payments or other consideration are deferred and/or contingent as a result of escrows, earn outs, holdbacks or any other contingencies, payments under this provision may be made on substantially the same terms and conditions applicable to, and only to the extent actually paid to, the holders of Common Shares in connection with the Change in Control.

11.3 Definition of Change in Control. Unless otherwise defined in an Award Agreement or other written agreement approved by the Committee, “Change in Control” means, and shall occur, if:

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(a) any Person (other than the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company, or any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of shares of Common Stock), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 35% or more of the combined voting power of the Company’s then outstanding securities;

(b) during any twelve-month period, individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in paragraph (a), (c), or (d) of this section, or a director initially elected or nominated as a result of an actual or threatened election contest with respect to directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any Person other than the Board) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the Board;

(c) a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; provided, however, that a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person (other than those covered by the exceptions in (i) above) acquires more than 50% of the combined voting power of the Company’s then outstanding securities shall not constitute a Change in Control of the Company; or

(d) the stockholders of the Company approve a plan of complete liquidation of the Company or the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets other than (i) the sale or disposition of all or substantially all of the assets of the Company to a Person or Persons who beneficially own, directly or indirectly, at least 35% or more of the combined voting power of the outstanding voting securities of the Company at the time of the sale or (ii) pursuant to a spinoff type transaction, directly or indirectly, of such assets to the stockholders of the Company.

Notwithstanding the foregoing, to the extent necessary to comply with Section 409A of the Code with respect to the payment of “nonqualified deferred compensation,” “Change in Control” shall be limited to a “change in control event” as defined under Section 409A of the Code.

12. Performance Goals; Adjustment.

12.1 The Committee may provide for the performance goals to which an Award is subject in its sole discretion.

12.2 The Committee may provide for the adjustment of the performance goals in respect of a Participant’s Awards in such manner as it deems appropriate, including, without limitation, adjustments to reflect charges for restructurings, non-operating income, the impact of corporate

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transactions or discontinued operations, events that are unusual in nature or infrequent in occurrence and other non-recurring items, currency fluctuations, litigation or claim judgements, settlements, and the effects of accounting or tax law changes. In addition, with respect to a Participant hired or promoted following the beginning of a performance period, the Committee may determine to prorate the performance goals in respect of such Participant’s Awards for the partial performance period.

13. Forfeiture Events.

13.1 General. The Committee may specify in an Award Agreement at the time of the Award that the Participant’s rights, payments and benefits with respect to an Award are subject to reduction, cancellation, forfeiture or recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, without limitation, termination of Service for Cause, violation of laws, regulations or material Company policies, breach of noncompetition, non-solicitation, confidentiality or other restrictive covenants that may apply to the Participant or other conduct by the Participant that is detrimental to the business or reputation of the Company.

13.2 Termination for Cause.

(a) Treatment of Awards. Unless otherwise provided by the Committee and set forth in an Award Agreement, if (i) a Participant’s Service with the Company or any Subsidiary shall be terminated for Cause or (ii) after termination of Service for any other reason, the Committee determines in its discretion either that, (1) during the Participant’s period of Service, the Participant engaged in an act or omission which would have warranted termination of Service for Cause or (2) after termination, the Participant engages in conduct that violates any continuing obligation or duty of the Participant in respect of the Company or any Subsidiary, such Participant’s rights, payments and benefits with respect to an Award shall be subject to cancellation, forfeiture and/or recoupment, as provided in Section 13.3 below. The Company shall have the power to determine whether the Participant has been terminated for Cause, the date upon which such termination for Cause occurs, whether the Participant engaged in an act or omission which would have warranted termination of Service for Cause or engaged in conduct that violated any continuing obligation or duty of the Participant in respect of the Company or any Subsidiary. Any such determination shall be final, conclusive and binding upon all Persons. In addition, if the Company shall reasonably determine that a Participant has committed or may have committed any act which could constitute the basis for a termination of such Participant’s Service for Cause or violates any continuing obligation or duty of the Participant in respect of the Company or any Subsidiary, the Company may suspend the Participant’s rights to exercise any Stock Option or Stock Appreciation Right, receive any payment or vest in any right with respect to any Award pending a determination by the Company of whether an act or omission could constitute the basis for a termination for Cause as provided in this Section 13.2.

(b) Definition of Cause. “Cause” means with respect to a Participant’s termination of Service, the following: (a) in the case where there is no employment agreement, consulting agreement, change in control agreement or similar agreement in effect between the Company or an Affiliate and the Participant (or where there is such an agreement but it does not define “cause” (or words of like import, which shall include but not be limited to “gross

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misconduct”)), termination due to a Participant’s (1) failure to perform Participant’s duties or obey directives that continues after receipt of written notice from the Company and a ten (10)-day opportunity to cure; (2) gross misconduct or gross negligence in the performance of Participant’s duties; (3) commission of any act of fraud, embezzlement, theft, or other act of material dishonesty or misconduct; (4) conviction of, indictment for, or plea of guilty or nolo contendere to, a felony or any crime involving moral turpitude; (5) material breach or violation of any agreement with the Company or its Affiliates, any restrictive covenant applicable to Participant, or any Company policy (including, without limitation, with respect to harassment); or (6) other conduct, acts or omissions that, in the good faith judgment of the Company, are likely to materially injure the reputation, business or a business relationship of the Company or any of its Affiliates; or (b) in the case where there is an employment agreement, consulting agreement, change in control agreement or similar agreement in effect between the Company or an Affiliate and the Participant that defines “cause” (or words of like import, which shall include but not be limited to “gross misconduct”), “cause” as defined under such agreement; provided, however, that with regard to any agreement under which the definition of “cause” only applies on occurrence of a change in control, such definition of “cause” shall not apply until a change in control occurs under such agreement and then only with regard to a termination thereafter. With respect to a termination of Service for a non-employee director, Cause means an act or failure to act that constitutes cause for removal of a director under applicable Delaware law. Any voluntary termination of Service by the Participant in anticipation of an involuntary termination of the Participant’s Service for Cause shall be deemed to be a termination for Cause.

13.3 Right of Recapture.

(a) General. If at any time within one (1) year (or such longer time specified in an Award Agreement or other agreement with a Participant or policy applicable to the Participant) after the date on which a Participant exercises a Stock Option or Stock Appreciation Right or on which a Stock Award, Restricted Stock Award or Restricted Stock Unit vests, is settled in shares or otherwise becomes payable, or on which income otherwise is realized or property is received by a Participant in connection with an Award, (i) a Participant’s Service is terminated for Cause, (ii) the Committee determines in its discretion that the Participant is subject to any recoupment of benefits pursuant to the Company’s compensation recovery, “clawback” or similar policy, as may be in effect from time to time, or (iii) after a Participant’s Service terminates for any other reason, the Committee determines in its discretion either that, (1) during the Participant’s period of Service, the Participant engaged in an act or omission which would have warranted termination of the Participant’s Service for Cause or (2) after a Participant’s termination of Service, the Participant engaged in conduct that violated any continuing obligation or duty of the Participant in respect of the Company or any Subsidiary, then, at the sole discretion of the Committee, any gain realized by the Participant from the exercise, vesting, payment, settlement or other realization of income or receipt of property by the Participant in connection with an Award, shall be repaid by the Participant to the Company upon notice from the Company, subject to applicable law. Such gain shall be determined as of the date or dates on which the gain is realized by the Participant, without regard to any subsequent change in the Fair Market Value of a share of Common Stock. To the extent not otherwise prohibited by law, the Company shall have the right to offset the amount of such repayment obligation against any amounts otherwise owed to the Participant by the Company (whether as wages, vacation pay or pursuant to any benefit plan or other compensatory arrangement).

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(b) Accounting Restatement. If a Participant receives compensation pursuant to an Award under the Plan based on financial statements that are subsequently restated in a way that would decrease the value of such compensation, the Participant will, to the extent not otherwise prohibited by law, upon the written request of the Company, forfeit and repay to the Company the difference between what the Participant received and what the Participant should have received based on the accounting restatement, in accordance with (i) any compensation recovery, “clawback” or similar policy, as may be in effect from time to time to which such Participant is subject and (ii) any compensation recovery, “clawback” or similar policy made applicable by law including the provisions of Section 945 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules, regulations and requirements adopted thereunder by the Securities and Exchange Commission and/or any national securities exchange on which the Company’s equity securities may be listed (the “Policy”). By accepting an Award hereunder, the Participant acknowledges and agrees that the Policy, whenever adopted, shall apply to such Award, and all incentive-based compensation payable pursuant to such Award shall be subject to forfeiture and repayment pursuant to the terms of the Policy.

14. Transfer, Leave of Absence, Etc. For purposes of the Plan, except as otherwise determined by the Committee, the following events shall not be deemed a termination of Service: (a) a transfer to the service of the Company from a Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to another; or (b) an approved leave of absence for military service or sickness, a leave of absence where the employee’s right to re-employment is protected either by a statute or by contract or under the policy pursuant to which the leave of absence was granted, a leave of absence for any other purpose approved by the Company or if the Committee otherwise so provides in writing.

15. General Provisions.

15.1 Status of Plan. The Committee may authorize the creation of trusts or other arrangements to meet the Company’s obligations to deliver shares of Common Stock or make payments with respect to Awards.

15.2 Award Agreement. An Award under the Plan shall be evidenced by an Award Agreement in a written or electronic form approved by the Committee setting forth the number of shares of Common Stock or other amounts or securities subject to the Award, the exercise price, base price or purchase price of the Award, the time or times at which an Award will become vested, exercisable or payable and the term of the Award. The Award Agreement also may set forth the effect on an Award of a Change in Control and/or a termination of Service under certain circumstances. The Award Agreement shall be subject to and incorporate, by reference or otherwise, all of the applicable terms and conditions of the Plan, and also may set forth other terms and conditions applicable to the Award as determined by the Committee consistent with the limitations of the Plan. The grant of an Award under the Plan shall not confer any rights upon the Participant holding such Award other than such terms, and subject to such conditions, as are specified in the Plan as being applicable to such type of Award (or to all Awards) or as are expressly set forth in the Award Agreement. The Committee need not require the execution of an Award Agreement by a Participant, in which case, acceptance of the Award by the Participant shall constitute agreement by the Participant to the terms, conditions, restrictions and limitations set forth in the Plan and the Award Agreement as well as the administrative guidelines of the Company in effect from time to time. In the event of any conflict between the provisions of the Plan and any Award Agreement, the provisions of the Plan shall prevail.

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15.3 No Assignment or Transfer; Beneficiaries. Except as provided in Section 6.6 hereof or as otherwise provided by the Committee to the extent not prohibited under Section A.1.(5) of the general instructions of Form S-8, as may be amended from time to time, Awards under the Plan shall not be assignable or transferable by the Participant, and shall not be subject in any manner to assignment, alienation, pledge, encumbrance or charge. Notwithstanding the foregoing, in the event of the death of a Participant, except as otherwise provided by the Committee, an outstanding Award may be exercised by or shall become payable to the Participant’s beneficiary as determined under the Company 401(k) retirement plan or other applicable retirement or pension plan. In lieu of such determination, a Participant may, from time to time, name any beneficiary or beneficiaries to receive any benefit in case of the Participant’s death before the Participant receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Participant and will be effective only when filed by the Participant in writing (in such form or manner as may be prescribed by the Committee) with the Company during the Participant’s lifetime. In the absence of a valid designation as provided above, if no validly designated beneficiary survives the Participant or if each surviving validly designated beneficiary is legally impaired or prohibited from receiving the benefits under an Award, the Participant’s beneficiary shall be the legatee or legatees of such Award designated under the Participant’s last will or by such Participant’s executors, personal representatives or distributees of such Award in accordance with the Participant’s will or the laws of descent and distribution. The Committee may provide in the terms of an Award Agreement or in any other manner prescribed by the Committee that the Participant shall have the right to designate a beneficiary or beneficiaries who shall be entitled to any rights, payments or other benefits specified under an Award following the Participant’s death. Any transfer permitted under this Section 15.3 shall be for no consideration.

15.4 No Right to Employment or Continued Service. Nothing in the Plan, in the grant of any Award or in any Award Agreement shall confer upon any Eligible Person or any Participant any right to continue in the Service of the Company or any of its Subsidiaries or interfere in any way with the right of the Company or any of its Subsidiaries to terminate the employment or other service relationship of an Eligible Person or a Participant for any reason or no reason at any time.

15.5 Rights as Stockholder. A Participant shall have no rights as a holder of shares of Common Stock with respect to any unissued securities covered by an Award until the date the Participant becomes the holder of record of such securities. Except as provided in Section 4.4 hereof, no adjustment or other provision shall be made for dividends or other stockholder rights, except to the extent that the Award Agreement provides for dividend payments or dividend equivalent rights. The Committee may determine in its discretion the manner of delivery of Common Stock to be issued under the Plan, which may be by delivery of stock certificates, electronic account entry into new or existing accounts or any other means as the Committee, in its discretion, deems appropriate. The Committee may require that the stock certificates (if any) be held in escrow by the Company for any shares of Common Stock or cause the shares to be legended in order to comply with the securities laws or other applicable restrictions. Should the shares of Common Stock be represented by book or electronic account entry rather than a certificate, the Committee may take such steps to restrict transfer of the shares of Common Stock as the Committee considers necessary or advisable.

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15.6 Trading Policy and Other Restrictions. Transactions involving Awards under the Plan shall be subject to the Company’s insider trading and Regulation FD policy and other restrictions, terms and conditions, to the extent established by the Committee or by applicable law, including any other applicable policies set by the Committee, from time to time.

15.7 Section 409A Compliance. To the extent applicable, it is intended that the Plan and all Awards hereunder comply with, or be exempt from, the requirements of Section 409A of the Code and the Treasury Regulations and other guidance issued thereunder, and that the Plan and all Award Agreements shall be interpreted and applied by the Committee in a manner consistent with this intent in order to avoid the imposition of any additional tax under Section 409A of the Code. In the event that any (i) provision of the Plan or an Award Agreement, (ii) Award, payment, transaction or (iii) other action or arrangement contemplated by the provisions of the Plan is determined by the Committee to not comply with the applicable requirements of Section 409A of the Code and the Treasury Regulations and other guidance issued thereunder, the Committee shall have the authority to take such actions and to make such changes to the Plan or an Award Agreement as the Committee deems necessary to comply with such requirements; provided, however, that no such action shall adversely affect any outstanding Award without the consent of the affected Participant. No payment that constitutes deferred compensation under Section 409A of the Code that would otherwise be made under the Plan or an Award Agreement upon a termination of Service will be made or provided unless and until such termination is also a “separation from service,” as determined in accordance with Section 409A of the Code. Notwithstanding the foregoing or anything elsewhere in the Plan or an Award Agreement to the contrary, if a Participant is a “specified employee” as defined in Section 409A of the Code at the time of termination of Service with respect to an Award, then solely to the extent necessary to avoid the imposition of any additional tax under Section 409A of the Code, the commencement of any payments or benefits under the Award shall be deferred until the date that is six (6) months plus one (1) day following the date of the Participant’s termination of Service or, if earlier, the Participant’s death (or such other period as required to comply with Section 409A). For purposes of Section 409A of the Code, a Participant’s right to receive any installment payments pursuant to this Plan or any Award granted hereunder shall be treated as a right to receive a series of separate and distinct payments. For the avoidance of doubt, each applicable tranche of Common Shares subject to vesting under any Award shall be considered a right to receive a series of separate and distinct payments. In no event whatsoever shall the Company be liable for any additional tax, interest or penalties that may be imposed on a Participant by Section 409A of the Code or any damages for failing to comply with Section 409A of the Code.

15.8 Securities Law Compliance. No shares of Common Stock will be issued or transferred pursuant to an Award unless and until all then applicable requirements imposed by Federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the shares of Common Stock may be listed, have been fully met. As a condition precedent to the issuance of shares of Common Stock pursuant to the grant or exercise of an Award, the Company may require the Participant to take any action that the Company determines is necessary or advisable to meet such requirements. The Committee may impose such conditions on any shares of Common Stock issuable under the Plan as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which such shares of the same class are then listed, and under any blue sky or other securities laws applicable to such shares. The Committee may also require the Participant to represent and warrant at the time of issuance or transfer that the shares of Common Stock are being acquired solely for investment purposes and without any current intention to sell or distribute such shares.

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15.9 Substitution or Assumption of Awards in Corporate Transactions. The Committee may grant Awards under the Plan in connection with the acquisition, whether by purchase, merger, consolidation or other corporate transaction, of the business or assets of any corporation or other entity, in substitution for awards previously granted by such corporation or other entity or otherwise. The Committee may also assume any previously granted awards of an employee, director, consultant or other service provider of another corporation or entity that becomes an Eligible Person by reason of such corporation transaction. The terms and conditions of the substituted or assumed awards may vary from the terms and conditions that would otherwise be required by the Plan solely to the extent the Committee deems necessary for such purpose. To the extent permitted by applicable law and the listing requirements of the New York Stock Exchange or other exchange or securities market on which the Common Shares are listed, any such substituted or assumed awards shall not reduce the Share Reserve.

15.10 Tax Withholding. The Participant shall be responsible for payment of any taxes or similar charges required by law to be paid or withheld from an Award or an amount paid in satisfaction of an Award. Any required withholdings shall be paid by the Participant on or prior to the payment or other event that results in taxable income in respect of an Award. The Award Agreement may specify the manner in which the withholding obligation shall be satisfied with respect to the particular type of Award, which may include permitting the Participant to elect to satisfy the withholding obligation by tendering shares of Common Stock to the Company or having the Company withhold a number of shares of Common Stock having a value in each case up to the maximum statutory tax rates in the applicable jurisdiction or as the Committee may approve in its discretion (provided that such withholding does not result in adverse tax or accounting consequences to the Company), or similar charge required to be paid or withheld. The Company shall have the power and the right to require a Participant to remit to the Company the amount necessary to satisfy federal, state, provincial and local taxes, domestic or foreign, required by law or regulation to be withheld, and to deduct or withhold from any shares of Common Stock deliverable under an Award to satisfy such withholding obligation.

15.11 Unfunded Plan. The adoption of the Plan and any reservation of shares of Common Stock or cash amounts by the Company to discharge its obligations hereunder shall not be deemed to create a trust or other funded arrangement. Except upon the issuance of shares of Common Stock pursuant to an Award, any rights of a Participant under the Plan shall be those of a general unsecured creditor of the Company, and neither a Participant nor the Participant’s permitted transferees or estate shall have any other interest in any assets of the Company by virtue of the Plan. Notwithstanding the foregoing, the Company shall have the right to implement or set aside funds in a grantor trust, subject to the claims of the Company’s creditors or otherwise, to discharge its obligations under the Plan.

15.12 Other Compensation and Benefit Plans. The adoption of the Plan shall not affect any other share incentive or other compensation plans in effect for the Company or any Subsidiary, nor shall the Plan preclude the Company from establishing any other forms of share incentive or other compensation or benefit program for employees of the Company or any Subsidiary. The

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amount of any compensation deemed to be received by a Participant pursuant to an Award shall not constitute includable compensation for purposes of determining the amount of benefits to which a Participant is entitled under any other compensation or benefit plan or program of the Company or a Subsidiary, including, without limitation, under any pension or severance benefits plan, except to the extent specifically provided by the terms of any such plan.

15.13 Plan Binding on Transferees. The Plan shall be binding upon the Company, its transferees and assigns, and the Participant, the Participant’s executor, administrator and permitted transferees and beneficiaries.

15.14 Severability. If any provision of the Plan or any Award Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction.

15.15 Governing Law. The Plan, all Awards and all Award Agreements, and all claims or causes of action (whether in contract, tort or statute) that may be based upon, arise out of or relate to the Plan, any Award or Award Agreement, or the negotiation, execution or performance of any such documents or matter related thereto (including any claim or cause of action based upon, arising out of or related to any representation or warranty made in or in connection with the Plan, any Award or Award Agreement, or as an inducement to enter into any Award Agreement), shall be governed by, and enforced in accordance with, the internal laws of the State of Delaware, including its statutes of limitations and repose, but without regard to any borrowing statute that would result in the application of the statute of limitations or repose of any other jurisdiction.

15.16 No Fractional Shares. No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred in lieu of any fractional shares of Common Stock or whether such fractional shares or any rights thereto shall be canceled, terminated or otherwise eliminated.

15.17 No Guarantees Regarding Tax Treatment. Neither the Company nor the Committee make any guarantees to any Person regarding the tax treatment of Awards or payments made under the Plan. Neither the Company nor the Committee has any obligation to take any action to prevent the assessment of any tax on any Person with respect to any Award under Section 409A of the Code, Section 4999 of the Code or otherwise and neither the Company nor the Committee shall have any liability to a Person with respect thereto.

15.18 Data Protection. By participating in the Plan, each Participant consents to the collection, processing, transmission and storage by the Company, its Subsidiaries and any third party administrators of any data of a professional or personal nature for the purposes of administering the Plan.

16. Term; Amendment and Termination; Stockholder Approval.

16.1 Term. The Plan shall be effective as of the date of its approval by the Board (the “Effective Date”). Subject to Section 16.2 hereof, the Plan shall terminate on the tenth anniversary of the Effective Date.

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16.2 Amendment and Termination. The Board may from time to time and in any respect, amend, modify, suspend or terminate the Plan; provided, however, that no amendment, modification, suspension or termination of the Plan shall materially and adversely affect any Award theretofore granted without the consent of the Participant or the permitted transferee of the Award. The Board may seek the approval of any amendment, modification, suspension or termination by the Company’s stockholders to the extent it deems necessary in its discretion for purposes of compliance with Section 422 of the Code or for any other purpose, and shall seek such approval to the extent it deems necessary in its discretion to comply with applicable law or listing requirements of the New York Stock Exchange or other exchange or securities market. Notwithstanding the foregoing, the Board shall have broad authority to amend the Plan or any Award under the Plan without the consent of a Participant to the extent it deems necessary or desirable in its discretion to comply with, take into account changes in, or interpretations of, applicable tax laws, securities laws, employment laws, accounting rules and other applicable laws, rules and regulations.

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EX-10.6

Exhibit 10.6

iFit Health & Fitness Inc

2021 Equity Incentive Plan

Stock Option Award Agreement

This Stock Option Award Agreement (this “Agreement”) is made by and between iFit Health & Fitness Inc, a Delaware corporation (the “Company”), and              (the “Participant”), effective as of              (the “Date of Grant”).

RECITALS

WHEREAS, the Company has adopted the iFit Health & Fitness 2021 Equity Incentive Plan (as the same may be amended and/or amended and restated from time to time, the “Plan”), which Plan is incorporated herein by reference and made a part of this Agreement, and capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Plan; and

WHEREAS, the Committee has authorized and approved the grant to the Participant of Stock Options to purchase shares of Common Stock (“Shares”) on the terms and conditions set forth in the Plan and this Agreement.

NOW THEREFORE, in consideration of the premises and mutual covenants set forth in this Agreement, the parties agree as follows:

1. Grant of Stock Options. The Company has granted to the Participant, effective as of the Date of Grant, the right and option to purchase, on the terms and conditions set forth in the Plan and this Agreement, all or any part of an aggregate of              Shares, subject to adjustment as set forth in the Plan (the “Options”). The Options are intended to be Nonqualified Stock Options.

2. Exercise Price. The exercise price of each Option is $             per Share, subject to adjustment as set forth in the Plan (the “Exercise Price”).

3. Vesting of Options. The Options shall be eligible to vest, if at all, on the basis of the time-vesting criteria set forth on Schedule A attached hereto

4. Expiration.

(a) Termination of Service. Any unvested Options will be forfeited immediately, automatically and without consideration upon a termination of the Participant’s Service for any reason. In the event the Participant’s Service is terminated for Cause, all vested Options will also be forfeited immediately, automatically and without consideration upon such termination for Cause. Without limiting the generality of the foregoing, the Options and the Shares (and any resulting proceeds) will continue to be subject to the Plan.

(b) Any unexercised Options will expire on the tenth (10th) anniversary of the Date of Grant (the “Expiration Date”), or earlier as provided in Section 5 of this Agreement or in the Plan.

5. Period of Exercise. Subject to the provisions of the Plan and this Agreement, the Participant may exercise all or any part of the vested Options at any time prior to the earliest to occur of:

(a) the Expiration Date;

(b) the date that is twelve (12) months following termination of the Participant’s Service due to death or Disability;

(c) the date that is ninety (90) days following an involuntary termination of the Participant’s Service without Cause;

(d) the date that is thirty (30) days following termination of the Participant’s Service other than for death, Disability or with or without Cause; or

(e) the date of termination of the Participant’s Service for Cause.

6. Exercise of Options

(a) Notice of Exercise. Subject to Sections 4 and 5, the Participant or, in the case of the Participant’s death or Disability, the Participant’s representative may exercise all or any part of the vested Options (covering whole Shares) through a written election in a form provided by the Company (a “Notice of Exercise”). The Notice of Exercise will be executed by the person exercising the Options. In the event that the Options are being exercised by the Participant’s representative, the Notice of Exercise will be accompanied by proof (satisfactory to the Committee) of the representative’s right to exercise the Options. The Participant or the Participant’s representative will deliver to the Committee, at the time of giving the Notice of Exercise, payment in a form permissible under Section 7 for the full amount of the Purchase Price (as defined below) and applicable withholding taxes as provided below.

(b) Issuance of Shares. After all requirements with respect to the exercise of the Options have been satisfied, the Committee will cause the Shares as to which the Options have been exercised to be issued (or, in the Committee’s discretion, in un-certificated form, upon the books of the Company’s transfer agent), registered in the name of the person exercising the Options (or in the names of such person and his or her spouse as community property or as joint tenants with right of survivorship). Neither the Company nor the Committee will be liable to the Participant or any other Person for damages relating to any delays in issuing the Shares or any mistakes or errors in the issuance of the Shares.

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(c) Withholding Requirements. The Company shall have the power and the right to deduct or withhold automatically from any Shares deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Company, the minimum statutory amount necessary to satisfy federal, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement, or in the sole discretion of the Committee, such greater amount necessary to satisfy the Participant’s expected tax liability, provided that, the withholding of such greater amount does not result in adverse tax or accounting consequences to the Company (collectively, “Withheld Taxes”); provided further, that any obligations to pay Withheld Taxes may be satisfied in the manner in which the Purchase Price is permitted to be paid under Section 7 or any other manner permitted by the Plan.

7. Payment for Shares. The “Purchase Price” will be the Exercise Price multiplied by the number of Shares with respect to which Options are being exercised. All or part of the Purchase Price and any Withheld Taxes may be paid as follows:

(a) Cash or Check. In cash or by bank certified check.

(b) Brokered Cashless Exercise. To the extent permitted by the Committee, from the proceeds of a sale through a broker on the date of exercise of some or all of the Shares to which the exercise relates. In that case, the Participant will execute a Notice of Exercise and provide the Company’s third-party Plan administrator with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale proceeds to pay the aggregate purchase price and/or Withheld Taxes, as applicable. To facilitate the foregoing, the Company may, to the extent permitted by applicable law, enter into agreements or coordinate procedures with one or more brokerage firms.

(c) Net Exercise. To the extent permitted by the Committee, by reducing the number of Shares otherwise deliverable upon the exercise of the Options by the number of Shares having a Fair Market Value equal to the amount of the Purchase Price and, at the sole discretion of the Committee, Withheld Taxes, as applicable.

(d) Surrender of Stock. In each instance, at the sole discretion of the Committee, by surrendering, or attesting to the ownership of, Shares that are already owned by the Participant free and clear of any restriction or limitation, unless the Committee specifically agrees in writing to accept such Shares subject to such restriction or limitation. Such Shares will be surrendered to the Company in good form for transfer and will be valued by the Company at their Fair Market Value on the date of the applicable exercise of the Options, or to the extent applicable, on the date the Withheld Taxes are to be determined. The Participant will not surrender, or attest to the ownership of, Shares in payment of the Purchase Price (or Withheld Taxes) if such action would cause the Company to recognize compensation expense (or additional compensation expense) with respect to the Options for financial reporting purposes that otherwise would not have been recognized.

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8. Adjustment to Options. In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 4.3of the Plan, the Options may be adjusted in accordance with Section 4.3 of the Plan.

9. [Reserved.]

10. Miscellaneous Provisions

(a) Securities Laws Requirements. No Shares will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the Shares may be listed, have been fully met. As a condition precedent to the issuance of Shares pursuant to this Agreement, the Company may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any Shares issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, as amended, under the requirements of any exchange upon which shares of the same class are then listed and under any blue sky or other securities laws applicable to those Shares.

(b) Rights of a Shareholder of the Company. Neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Company with respect to any Shares subject to the Options until the Participant or the Participant’s representative becomes entitled to receive those Shares by (i) executing a Notice of Exercise, (ii) paying the Purchase Price and Withheld Taxes as provided in this Agreement, and the Company actually receiving those amounts, (iii) the Company issuing those Shares and entering the name of the Participant in the register of shareholders of the Company as the registered holder of those Shares and (iv) satisfying any other conditions as the Committee reasonably requires.

(c) Transfer Restrictions. The Shares purchased by exercise of the Options will be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Company or the Committee to which the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Company’s transfer agent to make appropriate reference to such restrictions.

(d) No Right to Continued Service. Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate his or her Service at any time and for any reason, with or without Cause.

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(e) Notification. Any notification required by the terms of this Agreement will be given by the Participant (i) in a writing addressed to the Company at its principal executive office and will be deemed effective upon actual receipt when delivered by personal delivery or by registered or certified mail, with postage and fees prepaid, or (ii) by electronic transmission to the Company’s e-mail address of the Company’s General Counsel and will be deemed effective upon actual receipt. Any notification required by the terms of this Agreement will be given by the Company (x) in a writing addressed to the address that the Participant most recently provided to the Company and will be deemed effective upon personal delivery or within three (3) days of deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable) and will be deemed effective upon confirmation of receipt by the sender of such transmission.

(f) Entire Agreement. This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.

(g) Waiver. No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.

(h) Successors and Assigns. The provisions of this Agreement will inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person will have become a party to this Agreement and have agreed in writing to be joined herein and be bound by the terms hereof.

(i) Severability. The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then the remaining provisions will nevertheless be binding and enforceable.

(j) Amendment. Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Company.

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(k) Choice of Law; Jurisdiction. This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Delaware, excluding any conflicts or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.

(l) Signature in Counterparts. This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.

(m) Acceptance. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Options subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.

[Signature page follows.]

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IN WITNESS WHEREOF, the Company and the Participant have executed this Stock Option Award Agreement as of the dates set forth below.

Participant	iFit Health & Fitness Inc
	By:
Date:	Date:

Schedule A

Time-Based Options Vesting Schedule

[Unless earlier terminated or forfeited in accordance with the terms of this Agreement and the Plan, the Option will vest, if at all, in accordance with the provisions of this Schedule A:

The Option shall vest as to 25% on the first anniversary of the date of grant and in equal quarterly installments over the 36 months following the first anniversary. ]¹

¹  With respect to the stock options granted to Steve Barr in connection with our offering (the “IPO Grant”), 25% of the options underlying the IPO grant are fully vested as of the date of grant, with the remaining 75% of the options underlying the IPO Grant vesting quarterly over the subsequent 36 months.

EX-10.7

Exhibit 10.7

RESTRICTED PROPERTY AWARD AGREEMENT

This RESTRICTED PROPERTY AWARD AGREEMENT (this “Agreement”) is dated as of [Date] (the “Effective Date”), by and among Scott Watterson (“Executive”), and IFIT HEALTH & FITNESS INC (the “Issuer”). Capitalized terms used in this Agreement but not defined in the body hereof have the meanings assigned to them in the IFIT HEALTH & FITNESS INC. 7.0% Notes, Due [DATE], 2027 attached hereto (the “Convertible Note”).

WHEREAS, in connection with the initial public offering of the Issuer and pursuant to the Omnibus Investors Agreement dated as of [the date hereof], the Issuer has determined to issue the Convertible Note; and

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to applicable securities laws, the Issuer desires to grant to Executive and Executive desires to accept from the Issuer, a forfeitable interest in the Convertible Note subject to the terms hereof.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Grant of Restricted Property. The Issuer hereby grants to Executive a restricted interest in the Convertible Note (the “Restricted Property”) subject to the terms of the Convertible Note and the terms hereof. In the event of any conflict between the terms of the Convertible Note and the terms hereof, the terms hereof shall control.

2. Forfeiture Restrictions; Definitions.

(a) The Restricted Property is restricted in the sense that (a) Executive may not sell, assign, pledge, exchange, hypothecate or otherwise transfer or dispose of the Restricted Property pursuant to Section 14.01 of the Convertible Note or otherwise, and (b) Executive’s right to retain the Restricted Property is subject to forfeiture (collectively, the “Forfeiture Restrictions”). Subject to Section 2(c) hereof, in the event Executive’s employment or service with the Issuer or a subsidiary in every employment and service provider capacity is terminated for any reason prior to the lapse of the Forfeiture Restrictions, whether by the Issuer or a subsidiary or by himself, Executive shall, for no consideration, forfeit to the Issuer the Restricted Property, The Forfeiture Restrictions shall lapse on the earlier of (i) the date of a Liquidity Event; and (ii) the six (6) year anniversary of the date hereof; provided, however, that the Restricted Property will remain subject to any restrictions in the Convertible Note notwithstanding any lapse of the Forfeiture Restrictions. During the period of applicability of the Forfeiture Restrictions, Executive shall have no rights of a Holder under the Convertible Note, including rights under Section 4.01 (Conversion by the Holder) (except as expressly provided herein) and rights under Section 11.02 (Acceleration) of the Convertible Note.

(b) “Liquidity Event” shall mean the date of:

(i) Mandatory Conversion by the Issuer;

(ii) Conversion or transfer of all Notes held by Pamplona, L Catterton and their respective Permitted Transferees;

(iii) Notice by the Issuer of an optional prepayment of the Notes in full pursuant to Section 5.01 of the Convertible Note;

(iv) The occurrence of a Mandatory Prepayment Event;

(v) Closing of Sale by all Tag-Along Offerees of all Notes pursuant to Section 14.02 of the Convertible Note; or

(vi) Acceleration (that is not rescinded) by the Required Noteholders pursuant to Section 11.02 of the Convertible Note.

Provided, however, that with respect to the events listed in Sections 2(b)(i), (iii) and (iv), such events shall only be treated as Liquidity Events if all actions underlying the event are approved by an independent committee of the board of directors of the Issuer.

(c) Notwithstanding the foregoing, in the event Executive’s employment or service with the Issuer or a subsidiary is terminated (i) by the Issuer or a subsidiary without Cause, or (ii) by reason of Executive’s death, the Forfeiture Restrictions shall lapse and the Restricted Property shall transfer to Executive (or his estate, as applicable) on the date of termination but in any event no later than March 15 of the year following the date of termination. For purposes of this Agreement, “Cause” shall mean one of the following events: (A) Executive’s willful misconduct or gross negligence; (B) the commission of a criminal act by Executive against the Issuer or a subsidiary involving material harm (whether or not charges are filed); (C) the commission by Executive of a criminal act of moral turpitude bringing the Issuer or a subsidiary into disrepute (whether or not charges are filed); (D) willful insubordination to any directive of the board of directors of Issuer provided reasonable prior notice of such directive is given; or (E) actions by Executive constituting material breach of any employment agreement or similar service agreement between Executive and the Issuer or a subsidiary.

3. Impact of Other Events.

(a) Reorganization Event. A Reorganization Event shall have no impact on the Forfeiture Restrictions and such restrictions shall continue to apply to the Restricted Property as it may be converted into Exchange Property consistent with the terms of the Convertible Note.

(b) Interest or Distributions. Interest Payments made in respect of the Restricted Property pursuant to the Convertible Note shall be deemed to be paid in the form of Common Stock (or Exchange Property, as the case may be), and any such Interest Payments or any other dividend or distribution on the Convertible Note shall accrete to the Restricted Property and be subject to the Forfeiture Restrictions while such restrictions remain in effect. Upon any notice by the Issuer of an optional prepayment of the Notes in part pursuant to Section 5.01 of the Convertible Note, or upon a payment of the Convertible Notes at maturity, if in each case there has been no prior Liquidity Event, the Executive shall be required to take such payment in Common Stock if the 10-day VWAP is equal to or greater than the Conversion Price at such time (and the Executive shall be treated as having given an applicable notice), and any such Common Stock (or cash if such condition is not satisfied) shall constitute part of the Restricted Property

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and be subject to the Forfeiture Restrictions, if and to the extent such restrictions remain in effect. For the avoidance of doubt, if the Forfeiture Restrictions lapse on the six (6) year anniversary of the date hereof and therefore coincide with the maturity of the Convertible Note, the Executive shall be entitled to convert the Convertible Note pursuant to Section 4.01 thereof on such date prior to a repayment at maturity.

4. Representations and Warranties. Executive has the legal capacity to enter into this Agreement, this Agreement constitutes a valid and binding obligation of Executive and the execution, delivery and performance of this Agreement by Executive does not and will not conflict with, violate or cause a breach of any agreement, contract, judgment, order, decree or other instrument to which Executive is a party or is otherwise bound.

5. Taxation and Tax Withholding.

(a) No Section 83(b) Election. Executive agrees not to file an election under Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”), to be taxed with respect to the Restricted Property as of the date of transfer of the Restricted Property rather than as of the date upon which the Executive would otherwise be taxed under Section 83(a) of the Code.

(b) Tax Withholding. Notwithstanding any other provision of this Agreement, the Issuer has the authority to deduct or withhold, or require Executive to remit to the Issuer, an amount sufficient to satisfy applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by law to be withheld with respect to any taxable event arising pursuant to this Agreement.

6. Miscellaneous Provisions.

(a) No Guarantee of Employment. Executive agrees that no provision contained in this Agreement shall entitle the Executive to remain an employee or service provider of, or otherwise be affiliated with, the Issuer for any particular period of time or affect in any way the right of the Issuer to terminate any such employment, service relationship or affiliation at any time. Any question as to whether and when there has been a termination of any such employment, and the cause of such termination, shall be determined by the Compensation Committee of the board of directors of the Issuer (or another independent committee of the board of directors, if so determined by the board of directors of the Issuer) in its sole discretion and such determination shall be final, conclusive and binding on all Persons.

(b) Notices. For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed to have been duly given when personally delivered, telecopied and confirmed, or when mailed by certified mail, return receipt requested, or by nationally recognized overnight delivery service with proof of receipt maintained, at the following addresses (or any other address that any party may designate by written notice to the other party, in accordance herewith, except that such notice shall be effective only upon receipt):

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If to the Issuer, to:             c/o iFIT Health & Fitness Inc

1500 South 1000 West

Logan, Utah 84321

Email: everett@ifit.com

Attention: General Counsel

with a copy to:

Weil, Gotshal & Manges, LLP

767 5th Ave.

New York, New York 10153

Email: Corey.Chivers@weil.com

Attention: Corey Chivers

If to the Executive, to:      Scott Watterson

Email: swatterson@iconfitness.com    

Any such notice shall, if delivered personally, be deemed received upon delivery; shall, if delivered by telecopy, be deemed received on the first business day following confirmation; shall, if delivered by nationally recognized overnight delivery service, be deemed received the first business day after being sent; and shall, if delivered by mail, be deemed received upon the earlier of actual receipt thereof or five business days after the date of deposit in the United States mail.

(c) Governing Law; Waiver of Jury Trial. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES OF SUCH STATE. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(d) Amendment and Waiver. The provisions of this Agreement may be amended, modified or waived only with the prior written consent of the Issuer and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall be construed as a waiver of such provisions or affect the validity, binding effect or enforceability of this Agreement or any provision hereof. Any amendment, modification or waiver, or the resolution of any dispute or question arising under this Agreement must be approved on behalf of the Issuer by the Compensation Committee of the board of directors of the Issuer (or another independent committee of the board of directors, if so determined by the board of directors of the Issuer).

(e) Severability. If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

(f) Entire Agreement. This Agreement and the Convertible Note embody the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

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(g) Counterparts; Construction. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same Agreement. The paragraph headings have been inserted for purposes of convenience and shall not be used for interpretive purposes. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. The language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction shall be applied against any party.

(h) Successors and Assigns. Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by and against the Issuer, Executive and their respective successors, assigns, heirs, representatives and estates, as the case may be; provided, that the rights and obligations of Executive under this Agreement shall not be assignable except in connection with a transfer of the Restricted Property following the lapse of the Forfeiture Restrictions, but only to the extent permitted under the Convertible Note.

(i) Rights of Third Parties. Nothing expressed or implied in this Agreement is intended or shall be construed to confer upon or give any Person, other than the parties hereto, any rights or remedies under or by reason of this Agreement.

(j) Survival of Representations, Warranties and Agreements. All representations, warranties and agreements contained herein shall survive the consummation of the transactions contemplated hereby and the termination of this Agreement.

(k) Waiver of Punitive and Exemplary Damage Claims. EACH PARTY, BY EXECUTING THIS AGREEMENT, WAIVES, TO THE FULLEST EXTENT ALLOWED BY LAW, ANY CLAIMS TO RECOVER PUNITIVE, EXEMPLARY OR SIMILAR DAMAGES NOT MEASURED BY THE PREVAILING PARTY’S ACTUAL DAMAGES IN ANY DISPUTE OR CONTROVERSY ARISING UNDER, RELATING TO OR IN CONNECTION WITH THIS AGREEMENT.

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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of Effective Date.

IFIT HEALTH & FITNESS INC

Name:

Title:

EXECUTIVE

Scott Watterson

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EX-10.8

Exhibit 10.8

SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT entered as of the 1st day of July, 2008.

AMONG:	HF HOLDINGS, INC., a Delaware corporation.
	(“COMPANY”)
	ICON HEALTH & FITNESS, INC., a Delaware corporation.
	(“SUBSIDIARY”)
	SCOTT R. WATTERSON, acting in his personal capacity, of the City of LOGAN, State of UTAH.
	(“EMPLOYEE”)

THE PARTIES AGREE AS FOLLOWS:

1 PREAMBLE

1.1 The COMPANY and the SUBSIDIARY made and entered into an agreement for the employment of the EMPLOYEE as Chairman and Chief Executive Officer of the COMPANY, according to the terms and conditions set forth in such agreement, dated September 27, 1999.

1.2 That agreement was amended by a First Amendment to Employment Agreement, dated April 29, 2002, a Second Amendment to Employment Agreement, dated May 17, 2003 and was amended and restated as of February 27, 2004 (as amended from time to time and restated, the “Original Agreement”).

1.3 In this Agreement, “BUSINESS” means the manufacture, sale and distribution of SPORTING GOODS as carried on by the COMPANY, the SUBSIDIARY, and their respective various divisions and subsidiaries, from time to time. “SPORTING GOODS” means fitness equipment and accessories, which presently involve treadmills, home gyms, aerobic exercises, trampolines, weights and benches and exercise accessories, but the content of such product lines may vary from time to time.

1.4 In this Agreement, AFFILIATES means any entity in which the COMPANY or the SUBSIDIARY holds more than a twenty percent (20%) voting interest direct or indirect.

1.5 The parties hereto desire to again amend and restate that Agreement (hereinafter the “Second Amended and Restated Employment Agreement”) and as of July 1, 2008 do hereby so amend and restate that Agreement as follows:

2 EMPLOYMENT

2.1 The Original Agreement came into effect on September 27, 1999 (the “INITIAL EFFECTIVE DATE”) and this Second Amended Employment Agreement was made effective as of July 1, 2008 (herein the “Effective Date”).

2.2 Subject to earlier termination as hereinafter provided, the COMPANY hereby employs the EMPLOYEE and the EMPLOYEE agrees to serve the COMPANY in the positions of Chairman and Chief Executive Officer from the Effective Date until May 31, 2010, (the “TERM”).

2.3 Although this agreement is concluded between the COMPANY and the EMPLOYEE, it is agreed that the duties and obligations of the EMPLOYEE hereunder extend to the SUBSIDIARY and to all of the COMPANY’S other subsidiaries, present and future, although the EMPLOYEE will not necessarily be an employee of such entities. The EMPLOYEE agrees to serve, if requested by the COMPANY, as an officer or director of the SUBSIDIARY and any other subsidiaries, in each case without additional consideration.

3 BASE SALARY, EXPENSES AND BENEFITS

3.1 In consideration for (i) the faithful performance of services and the other obligations of the EMPLOYEE hereunder by the EMPLOYEE to the COMPANY (ii) the EMPLOYEE’S execution of this amended and restated Agreement and (iii) the EMPLOYEE’S agreement to perform future services to the COMPANY as herein provided during the TERM, the COMPANY shall pay to the EMPLOYEE during the TERM an annual base salary of SIX HUNDRED TWENTY-FIVE THOUSAND DOLLARS ($625,000) payable in semi-monthly installments or in accordance with the general policy of the COMPANY which may change from time to time but in no event less frequently than monthly.

3.2 The annual base salary mentioned in Section 3.1 above shall be reviewed by the Board of Directors of the COMPANY and may be adjusted upwards in the Board’s discretion, annually for each year of the TERM, taking into account, among other things:

(a) the performance by the EMPLOYEE of his duties and functions pursuant to this Agreement,

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(b) the general economic situation,

(c) the development and performance of the BUSINESS, and

(d) other matters deemed relevant by the Board of Directors such as an increase in shareholder equity and the rate on return on investment.

3.3 The COMPANY shall reimburse the EMPLOYEE for all reasonable expenses which are incurred during the TERM by the EMPLOYEE in the performance of his duties hereunder which was (i) subject to the COMPANY’s annual budget or (ii) as authorized by the Board of Directors of the COMPANY and (iii) in accordance with the policies and procedures established from time to time by the Board of Directors of the COMPANY or a committee delegated for such purpose.

3.4 During the TERM the COMPANY shall provide the EMPLOYEE with the use of a new automobile of his choice, acting reasonably (and consistently with his past practice) every three (3) years for the purposes of his employment commensurate with the position of the EMPLOYEE and having regard to COMPANY policy in force from time to time.

The COMPANY shall pay all costs and expenses of said automobile and its operation, including, without limitation, insurance, maintenance, gas and use of such automobile. Upon the expiry of the TERM, the EMPLOYEE shall deliver such automobile to the COMPANY.

3.5 During the TERM the EMPLOYEE shall be entitled to participate in the COMPANY’s life, welfare, and health insurance plans for senior executives on the same terms as those of other senior executives.

3.6 During the TERM, the EMPLOYEE shall be entitled to participate in fringe benefit programs and general salary adjustment increases which are not less favorable than those extended by the COMPANY to its senior executives, including without limitation the deferred compensation plan previously established by the Board of Directors, but excluding for this purpose any such plan or program adopted exclusively for the benefit of junior management.

4 ANNUAL BONUS

4.1 The EMPLOYEE shall receive with respect to (i) each fiscal year ending during the TERM, and (ii) that portion of any fiscal year ending after TERM, during which he is employed hereunder, a bonus equal to one and one-half percent (1.50%) or one and one-quarter percent (1.25%) in the event of the application of Section 9.8 hereof, of the consolidated EBITDA (as the term EBITDA is defined in the Credit Agreement, dated

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September 6, 2007, among the SUBSIDIARY, Bank of America, NA and the other lenders thereunder, without regard to amendments thereto) of the COMPANY and the SUBSIDIARY, provided however, that for each Company fiscal year after the INITIAL EFFECTIVE DATE, and prior to September 6, 2007, a bonus equal to one and one quarter percent (1.25%) of the consolidated EBITDA (as defined in the Credit Agreement dated April 9, 2002 among the SUBSIDIARY, General Electric Corporation and other lenders there under) calculated using the Company’s fiscal year ending May 31, 2003; provided, further however, that such bonus payments (i) shall, in the event of a Material Acquisition (as reasonably determined in good faith by the Board of Directors) by the COMPANY or the SUBSIDIARY and absent an agreement to the contrary between the COMPANY and the EMPLOYEE, be calculated without taking account of any EBITDA (as defined above) properly attributable to such Material Acquisition, and (ii) shall not be payable with respect to any such fiscal year unless such EBITDA for such fiscal year exceeds five and one-half percent (5.5%) of the consolidated net sales of the SUBSIDIARY and its subsidiaries (but not including the COMPANY) determined in accordance with generally accepted accounting principles and provided, further, that for purposes of this Agreement, EBITDA shall be calculated without regard to any bonuses payable hereunder.

4.2 The sole basis for the bonus calculation shall be the audited financial statements of the SUBSIDIARY and its subsidiaries for the fiscal year in question.

4.3 Any bonus to which EMPLOYEE is entitled under the provisions of this Agreement for any fiscal year shall be paid to him (regardless of whether the TERM has terminated) in accordance with the COMPANY’s previous practice, with a first installment equal to forty percent (40%) of a good faith estimate of the bonus for such year, to be paid during the month of December of such year and a final installment to be paid as promptly as reasonably practicable after the end of, but not later than the 75th day after the end of each such fiscal year.

5 DUTIES

5.1 During the TERM the EMPLOYEE shall perform those functions which are normally the functions of the Chairman and Chief Executive Officer of the COMPANY and such other offices as he may hold pursuant to Section 2.3, and shall further perform those functions which shall be reasonably determined from time to time by the Board of Directors of the COMPANY, such functions not to be inconsistent with those herein set forth. The EMPLOYEE shall report to, and be subject to the authority of, the Board of Directors of the COMPANY.

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5.2 During the TERM the COMPANY shall give the EMPLOYEE a notice of six (6) months prior to any relocation of the EMPLOYEE.

5.3 During the TERM it is the specific responsibility of the EMPLOYEE, between regular meetings of the Board, to apprise Board Members of significant business matters.

5.4 During the TERM EMPLOYEE shall devote his entire working time, attention and energies to the business of the COMPANY, the SUBSIDIARY, and their respective AFFILIATES.

5.5 During the TERM the EMPLOYEE shall not, except under Section 5.6, be engaged in any other business activity, whether or not such business activity is pursued for gain, profit or other pecuniary advantage. Notwithstanding the prohibition contained in the present clause, the EMPLOYEE shall be entitled to continue to sit on the boards of directors of the companies listed on Schedule I hereto, and on the boards of directors of other companies if such activity is approved in writing by the Board of Directors of the COMPANY. In the case of non-profit corporations or charities, such approval shall not be unreasonably withheld, but, in all other cases, the Board of Directors shall have sole discretion to grant, delay or withhold approval, with or without conditions.

5.6 During the Term the EMPLOYEE shall not invest his personal assets in any business other than NON-COMPETING BUSINESSES, and even in the case of such investments:

(a) No services are required or furnished on the part of the EMPLOYEE in the operations of the companies in which such investments are made and in which his participation is solely that of an investor provided that this subsection is not infringed by the EMPLOYEE’s providing counseling (and not acting in a “line” capacity) on a non-remunerative basis to all such companies for a maximum of 5 hours per week and 200 hours per year; and

(b) If the EMPLOYEE purchases securities in any corporation whose securities are regularly traded in a recognized securities market, such purchases shall not result in his collectively owning beneficially at any time five percent (5%) or more of the equity securities of any corporation engaged in a business other than a NON-COMPETING BUSINESS.

The foregoing restrictions shall not apply to any investment of whatever extent the EMPLOYEE may take in the shares of the COMPANY or of any successor company.

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For the purposes of this subsection, NON-COMPETING BUSINESSES are all businesses other than those which compete with:

(a) the BUSINESS; or

(b) any other business carried on in the future by the COMPANY, the SUBSIDIARY or any AFFILIATES, provided that the EMPLOYEE has access to confidential information concerning such business.

Moreover, the EMPLOYEE shall not knowingly assist any RELATIVE to make any investment which the EMPLOYEE is not permitted to make by this section.

5.7 The EMPLOYEE is Chairman of the Board of Directors and acknowledges that he has a significant interest in this Agreement and undertakes during the Term, the following:

5.7.1 To seek independent legal counsel at the COMPANY’s expense to negotiate and review this Agreement on the EMPLOYEE’s behalf;

5.7.2 To disclose his interest in this Agreement to the other members of the Board of Directors; and

5.7.3 To retire from and abstain from the discussion and vote at any meeting of the Board of Directors at which this Agreement or any default by EMPLOYEE or matter arising therefrom is the subject of a discussion or a vote.

5.8 The EMPLOYEE also undertakes during the Term, the following:

5.8.1 To use every best effort (including the establishment of written procedures known to operation personnel) to promptly bring to the attention of the Board of Directors of the COMPANY any matter requiring the COMPANY’s decision or action where his own interests or those of a RELATIVE are involved and to abstain from taking such decision or action until the Board of Directors decides.

5.8.2 If requested, to be absent from and abstain from the discussion and vote at any meeting of the aforementioned Board of Directors where the subject matter being discussed and voted upon is any matter covered by Section 5.8.1.

5.8.3 For the purposes of this Agreement, RELATIVE means the EMPLOYEE’s spouse, parent, sibling, child or sibling’s children, the spouses of the foregoing and any other person who could be claimed as a dependent on the EMPLOYEE’s or RELATIVE’s federal income tax return, any corporation or partnership in which a RELATIVE or the EMPLOYEE holds a five percent (5%) interest or of which a RELATIVE or the EMPLOYEE is an officer or director, and any trust of which any of the foregoing is a beneficiary.

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6 [INTENTIONALLY OMMITTED]

7 CONFIDENTIALITY, ETC.

7.1 The EMPLOYEE recognizes and acknowledges that the confidential information, trade secrets and proprietary processes of the COMPANY, its AFFILIATES and subsidiaries as they may exist from time to time are valuable, special and unique assets of the BUSINESS of the COMPANY, its AFFILIATES and subsidiaries, access to and knowledge of which are essential to the performance of the EMPLOYEE’s duties hereunder. The EMPLOYEE will not, during the TERM or at any time within five (5) years following its termination, for any reason whatsoever, in whole or in part, disclose such confidential information, secrets or processes to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, nor shall the EMPLOYEE make use of such property for his own purposes or for the benefit of any person, firm, corporation or other entity (except the COMPANY, its AFFILIATES and subsidiaries) under any circumstances whatsoever, except as may be required in the fulfillment of his function with the COMPANY within the terms of this Agreement or except as provided by law, provided however, these restrictions shall not apply to such information, secrets and processes which are then in the public domain (provided that the EMPLOYEE was not responsible, directly or indirectly, for permitting such secrets or process to enter the public domain without the COMPANY’s consent).

7.2 The EMPLOYEE furthermore agrees that upon termination of the TERM he will remit to the COMPANY all writings and materials, in his possession or under his control, which either belong to the COMPANY and AFFILIATES or which may contain confidential information concerning the COMPANY and AFFILIATES. The EMPLOYEE may, however, retain his personal diary/agenda after removing or destroying all confidential COMPANY or AFFILIATES material therein.

7.3 Any and all inventions, discoveries, development, methods, processes, compositions, works, concepts and ideas (whether or not patentable or copyrightable) conceived, made, developed, created or reduced to practice by the EMPLOYEE (whether at the request or suggestion of the COMPANY or otherwise, whether alone or in conjunction with others, and whether during regular hours of work or otherwise) during the TERM which may relate to the business, ventures or

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other activities of or products manufactured or sold by the COMPANY or any of its subsidiaries (collectively, “Proprietary Rights”), shall be promptly and fully disclosed by the EMPLOYEE to an appropriate executive officer of the COMPANY and shall be the COMPANY’s exclusive property as against the EMPLOYEE and his heirs and personal representatives, and the EMPLOYEE hereby assigns to the COMPANY his entire right, title and interest therein and shall promptly deliver to an appropriate executive officer of the COMPANY all papers, drawings models, data and other material relating to any of the foregoing Proprietary Rights, conceived, made, developed, created or reduced to practice by him as aforesaid. All copyrightable Proprietary Rights shall be considered “works made for hire.”

The EMPLOYEE shall, upon the COMPANY’s request and without any payment therefor, execute any documents reasonably necessary or advisable in the opinion of the COMPANY’s counsel to assign, and confirm the COMPANY’s title in, his entire right, title and interest in the foregoing Proprietary Rights and to direct issuance of patents or copyrights to the COMPANY with respect to such Proprietary Rights as are the COMPANY’s exclusive property as against the EMPLOYEE and his heirs and personal representatives under this Section 7.3 or to vest in the COMPANY title to such Proprietary Rights as against the EMPLOYEE and his heirs and personal representatives, the expense of securing any such patent or copyright, however, to be borne by the COMPANY. In addition, the Company shall reimburse the EMPLOYEE for any reasonable expenses incurred in having such documents reviewed by EMPLOYEE’s counsel.

8 VACATION

8.1 During the TERM the EMPLOYEE shall have the right to an annual paid vacation of no less duration than four (4) weeks.

9 TERMINATION OF EMPLOYMENT.

9.1 Notwithstanding any other provision contained herein, the COMPANY may on or after the Effective Date send to the EMPLOYEE notice of one of the following events and should the EMPLOYEE fail to cure the matter giving rise to the notice within thirty (30) days after receipt of such notice, the TERM shall terminate without any delay stipulated therein or any indemnity payable in lieu thereof:

(a) EMPLOYEE’s willful misconduct or gross negligence;

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(b) The commission of a criminal act by the EMPLOYEE against the COMPANY involving material harm to the Company (whether nor not charges are filed);

(c) The commission by the EMPLOYEE of a criminal act of moral turpitude bringing the COMPANY into disrepute (whether or not charges are filed);

(d) Willful insubordination to any directive of the Board of Directors provided reasonable prior notice of such directive is given; or

(e) Actions contrary to Sections 5.4, 5.5, 5.6, 5.8, 7 or 10 causing COMPANY or AFFILIATES material harm.

9.2 Notwithstanding any other provision contained herein (in which case the provisions of Section 9.9(d) shall apply), the TERM shall terminate automatically, without notice or indemnity in lieu thereof, upon the occurrence of one of the following events;

(a) The bankruptcy or voluntary state insolvency filing of the EMPLOYEE; or

(b) The death of the EMPLOYEE.

9.3 The EMPLOYEE may at any time during the TERM immediately terminate the TERM by sending his resignation in writing to the Board of Directors not less than six (6) months prior to the effective date of such resignation, failing which notice the EMPLOYEE may be subject to any and all damages incurred as a result of such failure.

9.4 Except under the circumstances described in Section 9.6, the COMPANY may for any other reason immediately terminate the TERM by sending a notice in writing to the EMPLOYEE.

9.5 The EMPLOYEE may immediately terminate the TERM by sending a notice of termination to the Board of Directors with immediate effect following any material diminution of the EMPLOYEE’s responsibilities or in the event that the EMPLOYEE is asked by the Board of Directors to perform any act which a reasonable person would consider illegal or unethical and the COMPANY has not withdrawn its request to the EMPLOYEE to perform such act within five (5) days of receiving a written notice from the EMPLOYEE to withdraw such a request. In addition, the EMPLOYEE may at any time following an occurrence of a “Change of Control” as defined in the Stockholders Agreement of HF Holdings, Inc. dated September 27, 1999, as amended and restated effective September 26, 2006, immediately terminate the TERM by sending notice in writing to COMPANY.

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9.6 The COMPANY may immediately terminate the TERM by sending a notice in writing to the EMPLOYEE with immediate effect:

9.6.1 after a period of six (6) consecutive months (or aggregating six (6) months in any twelve (12) month period) of absence by the EMPLOYEE from his employment as a result of sickness or disability, or

9.6.2 after sixty (60) days of absence by the EMPLOYEE from his employment as a result of sickness or disability and a certification by three (3) physicians that the EMPLOYEE is likely to be disabled for a period of at least six (6) months from the initial date of sickness or disability. One (1) such physician shall be chosen by the EMPLOYEE, one (1) shall be chosen by the COMPANY and the third shall be chosen by the other two (2) selected physicians. The EMPLOYEE agrees that in the event of his sickness, he shall submit himself for examination by such physicians if reasonably requested to do so by the COMPANY. For the purposes of this section, “disabled” or “disability” shall mean a temporary or permanent substantial inability because of a physical or mental illness to continue to discharge the EMPLOYEE’s duties hereunder.

Notwithstanding any other provision hereof, the EMPLOYEE’s compensation during any period of the EMPLOYEE’s disability shall be reduced to the extent of any payments to the EMPLOYEE for such period under any disability plan or program maintained for the EMPLOYEE by the COMPANY for his benefit.

9.7 In the event of the termination of the TERM by virtue of section 9.6 in addition to the payments described therein, the COMPANY shall pay to the EMPLOYEE a disability severance payment equal to one (1) month’s base salary in effect at termination multiplied by the number of each calendar year, or part thereof, of the EMPLOYEE’s employment with the COMPANY, the SUBSIDIARY, IHF Capital, Inc. or IHF Holdings, Inc. (or any predecessor companies of the COMPANY, the SUBSIDIARY, IHF Capital, Inc., or IHF Holdings, Inc.) after January 1, 1988. Such disability severance payment shall be made in two equal installments, one within thirty (30) days of a determination that such disability payment is due to the EMPLOYEE and the second, on the six month’s anniversary of the first payment.

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9.8 In the event of the termination of the TERM by virtue of Section 9.4 or 9.5, and if at the end of the TERM the COMPANY shall fail to agree to renew this Agreement on substantially the same terms, the COMPANY shall pay to the EMPLOYEE a severance payment equal to the EMPLOYEE’s annual base salary then in effect and the bonus referred to in Section 4 hereof. In the event that the TERM is terminated prior to the end of a fiscal year (the annual anniversary of the EFFECTIVE DATE of this AGREEMENT) the bonus for the portion of TERM that is less than 12 months will nonetheless be the full amount of the bonus for that fiscal year, and the bonus for the following 12 month period will be the same dollar amount prorated by the fraction the numerator is 12 less the number of months prior to the end of the TERM in which termination occurs and the denominator of which is 12. By way of example, if the TERM were terminated at the end of February, the bonus for the year of termination would be the full calculated amount, even though the TERM was less than twelve (12) months. For the remaining 12 bonus obligation, the bonus would be the same dollar calculation, prorated by a fraction of 9/12th (12 - 3 = 9 ÷ 12). Payment would be made as provided in Section 4.3 for the succeeding fiscal year. For the purposes of this Section 9.8, the bonus referred to in Section 4.1 hereof shall be determined using EBITDA (as defined in Section 4.1 hereof) for the fiscal year immediately preceding termination and shall be paid to the EMPLOYEE within ninety (90) days from the end of the COMPANY’s applicable fiscal year, and the base salary shall be paid to the EMPLOYEE on the same payment schedule as was applicable to the EMPLOYEE during his employment.

10 RESTRICTIVE COVENANT

10.1 EMPLOYEE shall not, during the TERM and for a period of one (1) year from its termination, either directly or indirectly, individually or in partnership, carry on or be engaged in, or concerned with or interested in, in any capacity whatsoever (including that of principal, agent, shareholder (subject to section 5.6(b)), consultant, employee, lender or surety), any person, firm, association, syndicate or company engaged in or concerned with or interested in the conception, development, fabrication, transformation, marketing, distribution, advertising, franchising or sale in Canada, the United States or the European Economic Community, or any of them, of any products or services similar or identical to any of those manufactured, distributed, or sold by the COMPANY or any of its subsidiaries in the course of his employment with the COMPANY, its AFFILIATES and subsidiaries.

10.2 (a) EMPLOYEE shall not, during the TERM hereunder and for a period of twelve (12) months from its termination, directly or indirectly, hire any Designated Employee.

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(b) EMPLOYEE shall not, during the TERM hereunder and for a period of eighteen (18) months from its termination, directly or indirectly, solicit, interfere with or endeavor to entice away, any Designated Employee.

(c) For purposes of this Section 10.2, the term “Designated Employee” shall mean any person if that person is or was a Senior Employee of the COMPANY or any of its AFFILIATES or subsidiaries during the period beginning six (6) months prior to the termination of the TERM and ending (i) in the case of clause (a), twelve (12) months thereafter and (ii) in the case of clause (b), eighteen (18) months thereafter, but shall exclude Gary E. Stevenson or any RELATIVE. For purposes of this Section 10.2 “Senior Employee” shall mean each of the two hundred (200) most highly compensated employees of the COMPANY or any of its subsidiaries or AFFILIATES.

10.3 With respect to any termination, such period shall be extended by written notice to the EMPLOYEE within thirty (30) days of such termination by an additional two (2) years (i.e., for a total of three (3) years from the termination of EMPLOYEE’s employment) if and to the extent that the COMPANY, at its option, pays to the EMPLOYEE additional severance pay equal to the EMPLOYEE’s base salary then in effect and the bonus referred to in Section 4 hereof, pro-rated (meaning paid in equal monthly installments each year over the period of the payment) for the period of the payment, for an additional two (2) years beyond that required to be paid by the COMPANY to the EMPLOYEE under Section 9.8. If paid at the COMPANY’s option, such bonuses, which shall be determined using EBITDA (as defined in Section 4.1 hereof) for the fiscal year immediately preceding termination, are to be paid within ninety (90) days from the end of the COMPANY’s applicable fiscal year, and the base salary shall be paid to the EMPLOYEE on the same payment schedule as was applicable to the EMPLOYEE during his employment.

11 REASONABLENESS AND REMEDIES

11.1 The EMPLOYEE agrees that all the conditions and restrictions established in this Agreement are reasonable taking into account the circumstances surrounding this Agreement.

11.2 The EMPLOYEE recognizes that in the view of the serious and irreparable harm which a violation hereof would have on the COMPANY, and without prejudice to the COMPANY’s other remedies, injunctive relief would constitute an available and appropriate remedy and, to the extent permitted by law, the COMPANY shall not be required to furnish any security or bond in respect thereof.

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12 [INTENTIONALLY OMITTED]

13 GENERAL LIMIT ON EMPLOYEE’S LIABILITY

13.1 As a general and overall limitation of the EMPLOYEE’S liability to the COMPANY and AFFILIATES, the COMPANY agrees that the EMPLOYEE shall not be liable, for any reason except as set forth below, to the COMPANY or any of its AFFILIATES for an amount in excess of the amount provided in the next sentence hereof. Accordingly, as and for their sole remedy against the EMPLOYEE, the COMPANY agrees that for any claim or cause of action that the COMPANY or any of its AFFILIATES may have against the EMPLOYEE, whether past or future, their sole remedy shall be the forfeiture of the EMPLOYEE’s salary, bonus and other compensation (but not the equity grant under Section 6.1 hereof, which shall not be subject to forfeiture) received by the EMPLOYEE during the COMPANY’s fiscal year in which the EMPLOYEE’s termination occurred plus subsequently accruing compensation. In this regard, the COMPANY agrees, to the extent permitted by applicable law, to indemnify the EMPLOYEE from and against any liability the EMPLOYEE may have in excess of that provided in the immediately preceding sentence (i) hereunder or (ii) for any other claim the COMPANY or any of its AFFILIATES may have against the EMPLOYEE. However, nothing in this Section 13 shall limit the EMPLOYEE’s liability to the COMPANY or any of its AFFILIATES or provide the EMPLOYEE any indemnity (i) for any act by the EMPLOYEE involving theft, fraud or embezzlement against the COMPANY or any of its AFFILIATES, (ii) in respect of any equitable remedy against the EMPLOYEE, (iii) in respect of any agreement listed on Schedule I of the Old Employment Agreement (as defined in that separate Termination Agreement among IHF Capital, Inc., IHF Holdings, Inc., SUBSIDIARY and EMPLOYEE, dated September 27, 1999 (the “Termination Agreement”)) or any agreement heretofore or hereafter entered into by the EMPLOYEE after the date of the Old Employment Agreement, (iv) in respect of any claim or cause of action asserted by the COMPANY or any of its AFFILIATES as a counterclaim (to the extent of any liability the COMPANY or any of its AFFILIATES may have by reason of the EMPLOYEE claim in question) or as a set off, or (v) under Section 7, 9.3 or 10 of this Agreement or under the Non-Competition Agreement (as defined in the First Amended and Restated Master Transaction Agreement dated as of October 12, 1994 among ICON Health & Fitness, Inc. and the other parties thereto (the “Master Transaction Agreement”)); provided, however, that the aggregate of the liability of the EMPLOYEE to the COMPANY or any of its AFFILIATES, under Section 7, 9.3 or 10 of this Agreement or to the COMPANY, any of its AFFILIATES, IHF Capital, Inc. or any of its AFFILIATES (as defined in the Old Employment Agreement) under the Non-Competition Agreement and of the liability of the EMPLOYEE to IHF Capital, Inc. or any of its AFFILIATES (as so defined) in respect of claims subject to the $18,000,000 limits set forth in the third to last sentence of Section 10.3.1.1 of the Master Transaction Agreement, shall not exceed $1,240,000.

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14 AMENDMENTS

14.1 This Agreement may be amended only by written instrument duly executed by all the parties hereby and approved by the Board of Directors of the COMPANY.

15 NO ASSIGNMENT

15.1 No party hereto shall assign, in whole or in part, this agreement or any of its or his respective rights and obligations hereunder without the express prior written consent of the other parties hereto; for this purpose the merger or reorganization of the COMPANY or the SUBSIDIARY or any AFFILIATES shall not be considered an assignment.

16 NO WAIVER

16.1 No waiver by any party of any breach of the obligations of any other party hereunder shall be a waiver of any subsequent breach or of any other obligation, nor shall any forbearance to seek a remedy for any breach be a waiver of any rights and remedies with respect to any subsequent breach.

17 SEVERABILITY

17.1 The invalidity of one of the provisions of this Agreement shall not invalidate or otherwise affect any of the other provisions of this Agreement, which shall remain in full force and effect, and each such invalid provision shall be construed by limiting it so as to be valid for the maximum extent permitted by law.

18 CURRENCY, ETC.

18.1 All references in this Agreement to dollar or $ mean lawful currency of the United States of America.

18.2 The COMPANY shall have the right to withhold, from or in respect of any payment, benefit or other item of compensation due to the EMPLOYEE hereunder, any federal, state or local taxes of any kind required by law to be withheld with respect thereto. In the event that at the time any withholding is required hereunder, the amount of cash payments from which the applicable withholding taxes may be deducted is less than the withholding taxes due, the EMPLOYEE shall pay to the COMPANY, in immediately available funds, an amount equal to such shortfall.

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19 GOVERNING LAW; ARBITRATION

19.1 This Agreement shall be governed by and construed in accordance with the domestic substantive laws of the State of Utah, without giving effect to any choice or conflict of law provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction; provided, however, that any dispute relating to the provisions of Section 19.2 shall be governed by the United States Arbitration Act as then in force.

19.2 Except solely as set forth in Section 19.4, each dispute, difference, controversy or claim arising in connection with or related or incidental to, or question occurring under, this Agreement or the subject matter hereof shall be finally settled under the Commercial Arbitration Rules of the American Arbitration Association (the “AAA”) by an arbitral tribunal composed of three (3) arbitrators, at least one (1) of whom shall be an attorney experienced in corporate transactions, appointed by agreement of the parties in accordance with said Rules. In the event the parties fail to agree upon a panel of arbitrators from the first list of potential arbitrators proposed by the AAA, the AAA will submit a second list in accordance with said Rules. In the event the parties shall have failed to agree upon a full panel of arbitrators from the second list, any remaining arbitrators to be selected shall be appointed by the AAA in accordance with said Rules. If, at the time of the arbitration, the parties agree in writing to submit the dispute to a single arbitrator, said single arbitrator shall be appointed by agreement of the parties in accordance with the foregoing procedure, or, failing such agreement, by the AAA in accordance with said Rules. The foregoing arbitration proceedings may be commenced by any party by notice to all other parties.

19.3 The place of arbitration shall be Salt Lake City, Utah.

19.4 The parties hereto exclude any right of appeal to any court on the merits of the dispute. The provisions of this Section 19 may be enforced in any court having jurisdiction over the award of any of the parties or any of their respective assets and judgment on the award (including without limitation equitable remedies) granted in any arbitration hereunder may be entered in any such court. Nothing contained in this Section 19 shall prevent any party from seeking interim measures of protection in the form of pre-award attachment of assets or preliminary or temporary equitable relief.

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19.5 To the extent not prohibited by applicable law which cannot be waived, each of the parties hereto hereby waives, and covenants that he or it will not assert (whether as plaintiff, defendant, or otherwise), any right to trial by jury in any forum in respect of any issue, claim, demand, cause of action, action, suit or proceeding arising out of or based upon this Agreement or the subject matter hereof, in each case whether now existing or hereafter arising and whether in contract or tort or otherwise. Any of the parties hereto may file an original counterpart or a copy of this Section 19.5 with any court as written evidence of the consent of each of the parties hereto to the waiver of his or its right to trial by jury.

19.6 Each of the parties hereto acknowledges that he or it has been informed by each other party that the provisions of Section 19 constitute a material inducement upon which such party is relying and will rely in entering into this Agreement and the transactions contemplated hereby.

20 BINDING ON HEIRS

20.1 This Agreement binds and inures to the benefit of the parties, their heirs, executors, administrators, successors and permitted assigns (subject to Section 9.2(b)).

21 ENTIRE AGREEMENT

21.1 This Agreement embodies the entire Agreement between the parties hereto concerning the subject matters mentioned herein and supersedes all previous discussions, correspondence, understandings or agreements, whether written or oral, with respect to such matters, except as provided in the Termination Agreement. For purposes of clarity and for the avoidance of doubt, the Original Agreement, (including as applicable, the First Amendment to the Employment Agreement, the Second Amendment to the Employment Agreement and the Amended and Restated Agreement) will apply as respectively in effect during the applicable periods of the EMPLOYEE’S employment with the COMPANY to the rights and obligations of the EMPLOYEE and the COMPANY during each of such times. This Agreement shall constitute an agreement between employer and employee of the type referred to in Section 1, Chapter 28, Title 34 of the Utah Code, Annotated.

22 ATTORNEY’S FEES

22.1 In the event that any party hereto shall be found in default or in breach of this Agreement pursuant to arbitral or judicial proceedings, such party shall be liable to pay all reasonable attorney’s fees, court costs and other related collection costs and expenses incurred by the non-defaulting or non-breaching party in pursuing its rights hereunder.

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23 NOTICES

23.1 All notices and other communications necessary or contemplated under this Agreement shall be in writing and shall be delivered in the manner specified herein or, in the absence of such specification, shall be deemed to have been duly given three (3) business days after mailing by certified mail, when delivered by hand, or when delivered by facsimile upon confirmation of receipt, or one (1) day after sending by overnight delivery service, to the respective addresses of the parties set forth below:

(a) for notices and communications to the COMPANY or the SUBSIDIARY:

HF HOLDINGS, INC.

ICON HEALTH & FITNESS, INC.

1500 South 1000 East

Logan, Utah 84321

Fax: 435-750-5238

Attn: Board of Directors

(b) For notices and communications to the EMPLOYEE:

Scott R. Watterson

560 South 1000 East

Logan, Utah 84321

(c) With a copy in each case to:

Weil, Gotshal & Manges LLP

100 Federal Street

34^th Floor

Boston, MA 02110

Fax: 617-772-8333

Attn: Charles W. Robins, Esq.

and

ICON HEALTH & FITNESS, INC.

1500 South 1000 East

Logan, Utah 84321

Fax: 435-750-5238

Attn: Everett Smith, General Counsel

24 JOINT AND SEVERAL LIABILITY

24.1 The COMPANY and the SUBSIDIARY shall be jointly and severally liable in respect of all payment obligations of the COMPANY hereunder.

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[Remainder of Page Intentionally Left blank]

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IN WITNESS WHEREOF the parties have hereto signed this Agreement as of the date first written above.

		HF HOLDINGS, INC.
	By:	/s/ S. Fred Beck
Witness		Name: S. Fred Beck
		Title: Chief Financial Officer
		ICON HEALTH & FITNESS, INC.
	By:	/s/ S. Fred Beck
Witness		Name: S. Fred Beck
		Title: Chief Financial Officer
	By:	/s/ SCOTT R. WATTERSON
Witness		SCOTT R. WATTERSON

19

SCHEDULE I

To

EMPLOYMENT AGREEMENT

Among

HF HOLDINGS INC.

ICON HEALTH & FITNESS, INC.

And

SCOTT R. WATTERSON

Board Seats

Ampad

Make-a-Wish Foundation of Utah

Utah Foundation

Utah State Foundation Board

Patient Link.com

Cornerstone Capital

20

EX-10.9

Exhibit 10.9

AGREEMENT

AGREEMENT made as of the 31st day of May, 2020

BY AND AMONG: HF HOLDINGS, INC., a Delaware corporation.   (“COMPANY”)   ICON HEALTH & FITNESS, INC., a Delaware corporation.   (“SUBSIDIARY”)   SCOTT R. WATTERSON, acting in his personal capacity, of the City of Logan, State of UTAH.   (“EMPLOYEE”)

WHEREAS, the parties are party to a Second amended and Restated Employment Agreement entered into as of July 1, 2008 (“EMPLOYMENT AGREEMENT”).

WHEREAS, the EMPLOYMENT AGREEMENT was amended as of May 31, 2010, extending the expiration date to May 31, 2012, was again amended as of May 31, 2012, extending the expiration date to May 31, 2014, was again amended as of May 31, 2104, extending the expiration date to May 31, 2016 and was again amended as of May 31, 2016 extending the expiration date to May 31, 2018, and was further amended as of May 31, 2018 extending the expiration date to May 31, 2020.

WHEREAS, the COMPANY, the SUBSIDIARY, and the EMPLOYEE wish to renew and extend the EMPLOYMENT AGREEMENT on substantially the same terms with a new expiration date of May 31, 2022.

NOW THEREFORE, the parties hereto agree as follows:

1. The EMPLOYMENT AGREEMENT, as most recently amended, is hereby amended by striking out the date of May 31, 2020 appearing in Section 2.2 of the EMPLOYMENT AGREEMENT, as amended, and inserting in place thereof the date of May 31, 2022.

2. In all other respects the EMPLOYMENT AGREEMENT is hereby ratified, confirmed and approved by the parties.

IN WITNESS WHEREOF, the parties hereto have signed this as of the date first above written.

	HF HOLDINGS, INC.
	By:	/s/ Everett Smith
Witness		Name: Everett Smith
		Title: Secretary
	ICON HEALTH & FITNESS, INC.
	By:	/s/ Everett Smith
Witness		Name: Everett Smith
		Title: Secretary
	By:	/s/ SCOTT WATTERSON
Witness		SCOTT WATTERSON

2

EX-10.10

Exhibit 10.10

September 27, 2021

Steven J. Barr

Dear Steve:

iFit Health & Fitness Inc (together with its successors and assigns, the “Company”) is pleased to offer to continue your employment on the following terms as of the date hereof (the “Effective Date”):

1. Position. Your title will be Executive Vice President and Chief Financial Officer, and you will report to the Company’s Chief Executive Officer. This is a full-time position. While you render services to the Company, you will not engage in any other employment, consulting or other business activity (whether full-time or part-time) that would create a conflict of interest with the Company. By signing this letter agreement, you confirm to the Company that you have no contractual commitments or other legal obligations that would prohibit you from performing your duties for the Company.

2. Cash Compensation. The Company will pay you a starting salary at the rate of $750,000 per year, payable in accordance with the Company’s standard payroll schedule. This salary will be subject to upward (but not downward) adjustment pursuant to the Company’s employee compensation policies in effect from time to time. You will also be eligible for an Annual Bonus target equal to 100% of your Base Salary (“Target Bonus”), with a maximum opportunity equal to 2 times your Base Salary. The actual Annual Bonus payout will be based on achievement of performance goals to be determined by the Company’s Board of Directors or its Compensation Committee. The Annual Bonus, if any, will be payable: with a first installment equal to forty percent (40%) of a good faith estimate of the bonus for such year, to be paid during the month of December of such year and a final installment to be paid as promptly as reasonably practicable after the end of, but not later than the 75th day after the end of each such fiscal year.

3. Employee Benefits. As a regular employee of the Company, you will be eligible to participate in a number of Company-sponsored benefits. In addition, you will be entitled to paid vacation in accordance with the Company’s vacation policy, as in effect from time to time.

4. Stock Options. Subject to the approval of the Company’s Board of Directors or its Compensation Committee and contingent upon the effectiveness of the Company’s initial public offering (IPO), on the IPO Date you will be granted an option to purchase 18,800 shares of the Company’s Common Stock (the “Option”). The exercise price per share of the Option will be at Fair Market Value (as defined in the Plan) as determined by the Board of Directors or the Compensation Committee on the date the Option is granted. The Option will be subject to the terms and conditions applicable to options granted under the Company’s then current Stock Plan (the “Plan”), as described in the Plan and your individual Stock Option Agreement consistent with this Agreement. The Option is subject to the following vesting schedule: 25% of the Option shares shall vest on the anniversary of the grant date and the balance will vest in equal quarterly installments over the following 36 months of continuous service. Notwithstanding the foregoing, in recognition of your prior service to the Company, the first 25% of the Option shares shall be fully vested upon the grant date, and the balance will vest in equal quarterly installments over the next 36 months of continuous service thereafter, as described in your individual Stock Option Agreement. “IPO Date” shall mean the date of the underwriting agreement between the Company and the underwriters managing the initial public offering of the Company’s Common Stock, pursuant to which the Common Stock is priced for the initial public offering. Subject to approval by the Company’s Board of Directors, if the Company is subject to a Change in Control (as defined below) before your service terminates and your employment is terminated without Cause or you resign for Good Reason within 12 months following such Change in Control or in the period after a definitive agreement is executed which results in a Change in Control, 100% of the Option shares will vest (the “Change in Control Acceleration”). For purposes of this Agreement, “Change in Control” is defined as (i) the consummation of a merger or consolidation of the Company with or into another entity; (ii) the sale of all or substantially all of the assets of the Company; (iii) the dissolution, liquidation or winding up of the Company; or (iv) sale or other transfer of 50% or more of the combined voting power of the Company’s then outstanding voting securities to “any one person or more than one person acting as a group” (within the meaning of Treasury Regulation Section 1.409A-3(i)(5)) other than a person that is a stockholder of the Company (or affiliate of a stockholder of the Company) as of your first day of employment, which sale or transfer results in the transfer of the power to elect a majority of the members of the Company’s Board

of Directors (any of the events in (i) through (iv) a “Transaction”). The foregoing notwithstanding, a Transaction does not constitute a “Change in Control” if immediately after the Transaction, a majority of the voting power of the capital stock of the continuing or surviving entity, or any direct or indirect parent corporation of the continuing or surviving entity, will be owned by the persons who were the Company’s stockholders immediately prior to such Transaction, in substantially the same proportions as their ownership of the voting power of the Company’s capital stock immediately prior to the Transaction.

5. Termination Without Cause or Resignation for Good Reason. If your employment with the Company is terminated by the Company without Cause, or in the event of your resignation for Good Reason, then, subject to the conditions set forth in this Section 5, you will become eligible to receive

(a) severance pay in an aggregate amount equal to twelve (12) months of your Base Salary, to be paid in equal installments at your then Base Salary rate (determined without regard to any reduction giving rise to your right to resign for Good Reason) in accordance with the Company’s regular payroll cycle for 12 months following the date of your termination of employment. The severance payments will commence within 60 days after your termination date and, once they commence, will include any unpaid amounts accrued from the termination date; however, if the 60 day-period described in the preceding clause spans two calendar years, then the payments will in any event begin in the second calendar year;

(b) if you timely elect to continue your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following your termination of employment, then the Company will pay the same portion of your monthly premium under COBRA as it pays for active employees and their eligible dependents until the earliest of (i) the close of the twelve-month period following your termination of employment, (ii) the expiration of your continuation coverage under COBRA or (iii) the date when you become eligible for substantially equivalent health insurance coverage in connection with new employment or self-employment (provided that, to the extent the Company or you would otherwise be subject to penalty under applicable law or regulation due to this clause (B), the Company may instead pay you a monthly payment equal to the monthly premium for you and your dependents under the Company’s health insurance plans); and

(c) continued vesting (or accelerated vesting if so determined by the Company) to the next vesting period that occurs after the effective date of your termination for each option award outstanding unless the Change in Control Vesting applies (collectively, “Severance Pay”).

For purposes of this Agreement, “Cause” is defined as any of the following:

(i) any act or omission that constitutes a material breach by you of your obligations under this Agreement or any other material agreement between you and the Company;

(ii) your willful failure or willful refusal to perform the lawful duties required of you as an employee of the Company (and consistent with your position as Chief Financial Officer) to the reasonable satisfaction of the Company, other than any such failure resulting from incapacity due to physical or mental illness;

(iii) any material violation by you of any:

(x) material written policy, rule or regulation of the Company or

(y) any law or regulation applicable to the business of the Company of which you have knowledge, or should have knowledge based on your position as Chief Financial Officer;

(iv) your act or omission constituting fraud, material dishonesty, breach of fiduciary duty, gross negligence, willful misconduct or intentional misrepresentation in relation to your duties to the Company; and/or

(v) your conviction of, or plea of guilty or nolo contendere to, any crime which constitutes a felony or crime of moral turpitude.

Except for a failure, breach or refusal which, by its nature, cannot reasonably be expected to be cured (including an event described in clause (v) above) you will have 10 days from the delivery of written notice by the Company within which to cure any acts constituting Cause prior to any termination by the Company for Cause.

All Severance Pay or other post-termination compensation is, in each case, subject to required withholding.

For purposes of this Agreement, “Good Reason” is defined as any of the following occurring without your prior written consent:

(i) a subsequent relocation of your position to a location that is outside of the state of Utah;

(ii) significant diminution of job function, reporting relationship or scope, including, without limitation:

(A) removal of you from the position of the Chief Financial Officer of the Company, provided that, following a Change in Control (as defined in the Plan), it shall not be Good Reason pursuant to this clause (ii)(A) as long as you remain Chief Financial Officer of the business line, subsidiary or division represented by the Company’s business or

(B) your failure to report directly to the Chief Executive Officer (or principal executive officer, regardless of title) of the Company, provided that, following a Change in Control, it shall not be Good Reason pursuant to this clause (ii)(B) as long as you report directly to the Chief Executive Officer (or principal executive officer, regardless of title) of the business line, subsidiary or division represented by the Company’s business; and/or

(iii) a decrease in base salary compensation (other than a general reduction in base salary that affects all similarly situated executives in substantially the same proportions, up to a maximum reduction of 10%) or your Target Bonus opportunity as a percentage of your base salary (or your maximum annual bonus opportunity), in each case, provided that you provide notice of such circumstances to the Company’s Chief Executive Officer (or principal executive officer, regardless of title) within 120 days of such circumstances’ occurrence, the Company fails to cure such circumstances within 30 days of receipt of such notice and you resign within 180 days of such circumstances coming into existence.

Severance Pay does not entitle you to any other ongoing benefits from the Company (except as outlined above or as otherwise provided herein) and you will not be an employee of the Company for any purpose during any period that you are receiving Severance Pay. In order to receive Severance Pay, you must:

(iv) sign and deliver to the Company a full general release of all claims in substantially the form to be provided by the Company (the “General Release”), and any revocation period, if any, applicable to the General Release must have expired) within the time period specified by the Company;

(v) cooperate with the orderly transfer of your duties as reasonably requested by the Company for a period not to exceed three months, and;

(vi) return all Company property by a date specified by the Company.

For the avoidance of doubt, upon any termination of your employment you shall be entitled to payment of your Base Salary through your termination date, payment of any accrued but unused vacation days (if and to the extent you have any vacation days accrued in accordance with the Company’s then-current vacation policy), reimbursement of any unreimbursed business expenses, and any vested benefits or entitlements pursuant to any applicable Company plan, policy or other agreement.

6. Restrictive Covenants.

(a) Confidentiality: You agree and understand that in your position with the Company, you have been and will be exposed to and has and will receive information relating to the confidential affairs of the Company, including, without limitation, technical information, intellectual property, business and marketing plans, strategies, customer information, software, other information concerning the products, promotions, development, financing, expansion plans, business policies and practices of the Company and other forms of information considering by the Company to be confidential or in the nature of trade secrets (including, without limitations, ideas, research and development, know-how, formulas, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information and business and markets plans and proposals) (collectively, the “Confidential Information”). Confidential Information shall not include information that (i) is generally known to the public or within the relevant trade or industry other than due to your violation of this Section 6(a) or disclosure by a third party who is known by you to owe the Company an obligation of confidentiality with respect to such information, (ii) was known by or in the possession of you prior to disclosure by the Company or (iii) was or is independently developed by you, without reference to or use of any of the Company’s Confidential Information. You agree that at all times during your employment with the Company and thereafter, you shall not disclose such Confidential Information, either directly or indirectly, to any individual, corporation, partnership, limited liability

company, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof (each a “Person”) without the prior written consent of the Company and shall not use or attempt to use any such information in any manner other than in connection with your employment with the Company, unless required by law to disclosure such information, in which case you shall provide the Company with written notice of such requirement as far in advance of such anticipated disclosure as possible. This confidentiality covenant has no temporal, geographic or territorial restriction. Upon termination of your employment with the Company, you shall promptly supply to the Company all property, keys, notes, memoranda, writings, lists, files, reports, customer lists, correspondence, tapes, discs, cards, surveys, maps, logs, machines, technical data and any other tangible product or document which has been produced by, received by or otherwise submitted to you during or prior to your employment with the Company, and any copies there in your (or reasonably capable of being reduced to your) possession; provided, that nothing herein or otherwise shall prevent you from retaining and utilizing: documents relating to your personal benefits, entitlements and obligations; documents relating to your personal tax obligations; your desk calendar, rolodex and the like; and such other records and documents as may reasonably be approved by the Company. Notwithstanding the foregoing, nothing herein shall prevent you from disclosing Confidential Information to the extent required by law. Additionally, nothing herein shall preclude your right to communicate, cooperate or file a complaint with any U.S. federal, state or local government or law enforcement branch, agency or entity (collectively, a “Governmental Entity”) with respect to possible violations of any U.S. federal, state or local law or regulations, or otherwise make disclosure to any Governmental Entity, in each case, that are protected under the whistleblower or similar provisions of any such law or regulation; provided that in each case such communications and disclosures are consistent with applicable law. Nothing herein shall preclude your right to receive an award from a Governmental Entity for information provided under any whistleblower or similar program, You shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made in confidence to a federal, state or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law. You shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made in a complaint or other document filed in a lawsuit or other proceeding, provided that such filing is made under seal. If you file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in any related court proceeding, provided that you file any document containing the trade secret under seal and do not disclose the trade secret except pursuant to court order.

(b) Non-Competition: By and in consideration of the Company entering into this Agreement, and in further consideration of your exposure to the Confidential Information, you agree that you shall not, during the term of employment and for a period of twenty-four (24) months after your termination of employment for any reason, (the “Restricted Period”), directly or indirectly, own, manage, operate, join, control, be employed by, or participate in the ownership, management, operation or control of, or be connected in any manner with, including, without limitation, holding any position as a stockholder, director, officer, consultant, independent contractors, employee, partner, or investor in, any Restricted Enterprise (as defined below); provided, that, in no event shall (i) ownership by you of two percent or less the outstanding securities of any class of any issuer whose securities are registered under the Securities Exchange Act of 1934, as amended, standing alone, be prohibited by this Section 6(b), so long as you do not have, or exercise, any rights to manage or operate the business of such issuer other than rights as a shareholder thereof or (ii) being employed by an entity, standing alone, be prohibited by this Section 6(b), so long as the entity has more than one discrete and readily distinguishable part of its business and your duties are not at or involving the part of the entity’s business that is actively engaged in a Restricted Enterprise. For purposes of this Agreement, “Restricted Enterprise” shall mean any Person that is engaged, directly or indirectly, in (or has taken material steps to engage in) a business which is in competition with a business of the Company or any of its affiliates in any country or territory in which the Company or any of its affiliates markets any of its services or products or has taken material steps to market any of its services or products in such country or territory. During the Restricted Period, upon request of the company, you shall notify the Company of your then-current employment status. The Restricted Period shall be tolled for any period during which you are in breach of this Section 6(b).

(c) Remedies: You agree that any breach of the terms of this Section 6 would result in irreparable injury and damage to the Company for which the Company would have no adequate remedy at law; you therefore also agree that in the event of said breach or any threat of breach, the Company shall be entitled to seek an immediate injunction and restraining order to prevent such breach and/or threatened breach and/or continued breach by you and/or any and all Persons acting for and/or with you, without having to prove damages, in addition to any other remedies to which the Company may be entitled at law or in equity. The terms of this paragraph shall not prevent

the Company from pursuing any other available remedies for any breach or threatened breach hereof, including, without limitation, the recovery of damages from you. You and the Company further agree that the provisions of the covenants contained in this Section 6 are reasonable and necessary to protect the businesses of the Company because of your access to the Confidential Information and your material participation in the operation of such businesses.

7. Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be “at will,” meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations that may have been made to you are superseded by this letter agreement. This is the full and complete agreement between you and the Company on this term. Although the Company’s personnel policies and procedures to the extent not inconsistent herewith, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by you and a duly authorized officer of the Company (other than you).

8. Tax Matters.

(a) Withholding. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable withholding and payroll taxes and other deductions required by law.

(b) Tax Advice. You are encouraged to obtain your own tax advice regarding your compensation from the Company. You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company or its Board of Directors related to tax liabilities arising from your compensation.

(c) Section 409A. It is the intent of the parties that this Agreement is interpreted such that it is either exempt from or complies with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) in a manner which does not impose any additional taxes, interest or penalties on you pursuant to Section 409A of the Code and its implementing notices and regulations and it shall be interpreted consistent with this intent. Each salary continuation payment under Section 5 is hereby designated as a separate payment. Notwithstanding any other provision of this Agreement to the contrary, any payment or benefit described herein which represents a “deferral of compensation” within the meaning of Section 409A of the Code shall only be paid or provided to you if you have incurred a “separation from service” in accordance with Section 409A of the Code. If the Company determines that you are a “specified employee” under Section 409A(a)(2)(B)(i) of the Code at the time of your termination, then (i) the salary continuation payments under Section 5, to the extent that they are subject to Section 409A of the Code, will commence on the first business day following (A) expiration of the six-month period measured from your “separation from service” date or (B) the date of your death and (ii) the installments that otherwise would have been paid prior to such date will be paid in a lump sum when the salary continuation payments commence.

9. Interpretation, Amendment and Enforcement. This letter agreement and the Proprietary Information and Inventions Agreement constitute the complete agreement between you and the Company, contain all of the terms of your employment with the Company and supersede any prior agreements, representations or understandings (whether written, oral or implied) between you and the Company. This letter agreement may not be amended or modified, except by an express written agreement signed by both you and a duly authorized officer of the Company. The terms of this letter agreement and the resolution of any disputes as to the meaning, effect, performance or validity of this letter agreement or arising out of, related to, or in any way connected with, this letter agreement, your employment with the Company or any other relationship between you and the Company (the “Disputes”) will be governed by Utah law, excluding laws relating to conflicts or choice of law. You and the Company submit to the exclusive personal jurisdiction of the federal and state courts located in Utah in connection with any Dispute or any claim related to any Dispute. In the event of a conflict between any provision of this Agreement and the provision of any Company policy, plan, arrangement or other agreement, the provisions of this Agreement shall control. This Agreement shall be binding upon and inure to the benefit of the Company and you and your respective successors and assigns.

10. Coverage Under Directors’ and Officers’ Liability Insurance Policies. The Company agrees to maintain directors’ and officers’ liability insurance policies covering you on a basis no less favorable than provided to other senior executives, which coverage shall continue as to you event if you have ceased to be an officer or employee of the Company with respect to acts or omissions which occurred prior to such cessation.

* * * *

If you have any questions, please feel free to reach out.

Kind Regards,

/s/ [•]

iFit Health & Fitness Inc

By:

Title:

I have read and accept this employment offer:

Signature of Employee

Dated:                                    

EX-23.1

Exhibit 23.1

The accompanying consolidated financial statements give effect to a 37.8-for-1 stock split of the common stock of iFIT Health & Fitness Inc that will be effected immediately prior to the effective date of the registration statement. The following consent is in the form which will be furnished by Deloitte & Touche LLP, an independent registered public accounting firm, upon the effective date of the 37.8-for-1 stock split of the common stock of iFIT Health & Fitness Inc as described in the last paragraph of Note 25 to the consolidated financial statements and assuming that from August 18, 2021, to the date of such effective date no other material events have occurred that would affect the consolidated financial statements or the required disclosures therein.

/s/ Deloitte & Touche LLP

Salt Lake City, Utah

September 27, 2021

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement No. 333-259220 on Form S-1 of our report dated August 18, 2021, (September ___, 2021, as to the effects of the stock split described in Note 25), relating to the financial statements of iFIT Health & Fitness Inc. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

Salt Lake City, Utah

September ___, 2021