Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-40887 | |
Entity Registrant Name | Life Time Group Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-3481985 | |
Entity Address, Address Line One | 2902 Corporate Place | |
Entity Address, City or Town | Chanhassen | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55317 | |
City Area Code | 952 | |
Local Phone Number | 947-0000 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | LTH | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 193,059,950 | |
Entity Central Index Key | 0001869198 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 44,827 | $ 33,195 |
Accounts receivable | 8,326 | 4,805 |
Center operating supplies and inventories | 40,113 | 36,276 |
Prepaid expenses and other current assets | 35,214 | 87,231 |
Income tax receivable | 3,466 | 4,192 |
Total current assets | 131,946 | 165,699 |
Property and equipment, net | 2,699,104 | 2,692,712 |
Goodwill | 1,233,176 | 1,233,176 |
Operating lease right-of-use assets | 1,864,246 | 1,708,597 |
Intangible assets, net | 173,604 | 164,419 |
Other assets | 55,425 | 52,955 |
Total assets | 6,157,501 | 6,017,558 |
Current liabilities | ||
Accounts payable | 71,962 | 54,104 |
Construction accounts payable | 51,946 | 39,936 |
Deferred revenue | 28,190 | 42,274 |
Accrued expenses and other current liabilities | 183,703 | 117,675 |
Current maturities of debt | 31,841 | 139,266 |
Current maturities of operating lease liabilities | 44,137 | 49,877 |
Total current liabilities | 411,779 | 443,132 |
Long-term debt, net of current portion | 2,331,500 | 2,133,330 |
Operating lease liabilities, net of current portion | 1,902,784 | 1,738,393 |
Deferred income taxes | 131,655 | 195,122 |
Other liabilities | 25,027 | 26,168 |
Total liabilities | 4,802,745 | 4,536,145 |
Commitments and contingencies (Note 10) | ||
Mezzanine equity: | ||
Series A convertible participating preferred stock, $0.01 par value per share; 12,000 shares authorized; 5,930 and 0 shares issued and outstanding, respectively | 153,620 | 0 |
Stockholders’ equity: | ||
Common stock, $0.01 par value per share; 200,000 and 170,000 shares authorized, respectively; 145,196 shares issued and outstanding | 1,452 | 1,452 |
Additional paid-in capital | 1,548,904 | 1,569,905 |
Stockholder note receivable | 0 | (15,000) |
Retained deficit | (346,313) | (71,714) |
Accumulated other comprehensive loss | (2,907) | (3,230) |
Total stockholders’ equity | 1,201,136 | 1,481,413 |
Total liabilities, mezzanine equity and stockholders’ equity | $ 6,157,501 | $ 6,017,558 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Series A convertible participating preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Series A convertible participating preferred stock, authorized (in shares) | 12,000,000 | 12,000,000 |
Series A convertible participating preferred stock, issued (in shares) | 5,930,000 | 0 |
Series A convertible participating preferred stock, outstanding (in shares) | 5,930,000 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 200,000,000 | 170,000,000 |
Common stock, issued (in shares) | 145,196,000 | 145,196,000 |
Common stock, outstanding (in shares) | 145,196,000 | 145,196,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue: | ||||
Total revenue | $ 385,040 | $ 231,030 | $ 957,525 | $ 719,910 |
Operating expenses: | ||||
Rent | 52,513 | 47,539 | 154,552 | 138,470 |
General, administrative, and marketing | 45,304 | 32,204 | 126,896 | 119,665 |
Depreciation and amortization | 57,977 | 61,359 | 177,005 | 188,483 |
Other operating | 14,796 | 15,152 | 30,660 | 37,412 |
Total operating expenses | 402,586 | 321,826 | 1,114,435 | 999,380 |
Loss from operations | (17,546) | (90,796) | (156,910) | (279,470) |
Other (expense) income: | ||||
Interest expense, net of interest income | (39,849) | (30,967) | (176,144) | (95,724) |
Equity in earnings of affiliate | (28) | 37 | (412) | (206) |
Total other expense | (39,877) | (30,930) | (176,556) | (95,930) |
Loss before income taxes | (57,423) | (121,726) | (333,466) | (375,400) |
Benefit from income taxes | (11,981) | (28,079) | (58,867) | (99,096) |
Net loss | $ (45,442) | $ (93,647) | $ (274,599) | $ (276,304) |
Loss per common share - basic (in usd per share) | $ (0.36) | $ (0.64) | $ (2) | $ (1.90) |
Loss per common share - diluted (in usd per share) | $ (0.36) | $ (0.64) | $ (2) | $ (1.90) |
Weighted-average common shares outstanding - basic (in shares) | 145,196 | 145,196 | 145,196 | 145,118 |
Weighted-average common shares outstanding - diluted (in shares) | 145,196 | 145,196 | 145,196 | 145,118 |
Center revenue | ||||
Revenue: | ||||
Total revenue | $ 372,000 | $ 228,349 | $ 933,690 | $ 704,919 |
Operating expenses: | ||||
Operations | 231,996 | 165,572 | 625,322 | 515,350 |
Other revenue | ||||
Revenue: | ||||
Total revenue | $ 13,040 | $ 2,681 | $ 23,835 | $ 14,991 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (45,442) | $ (93,647) | $ (274,599) | $ (276,304) |
Foreign currency translation adjustments, net of tax of $0 | (2,404) | 2,436 | 323 | (3,413) |
Comprehensive loss | $ (47,846) | $ (91,211) | $ (274,276) | $ (279,717) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Foreign currency translation adjustments, tax | $ 0 | $ 0 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Stockholder Note Receivable | Retained Deficit | Accumulated Other Comprehensive Loss |
Balance (in shares) at Dec. 31, 2019 | 141,596 | |||||
Balance at Dec. 31, 2019 | $ 1,750,183 | $ 1,416 | $ 1,479,941 | $ (15,000) | $ 288,478 | $ (4,652) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (276,304) | (276,304) | ||||
Other comprehensive income (loss) | (3,413) | (3,413) | ||||
Common stock issuance (in shares) | 3,600 | |||||
Common stock issuance | 90,000 | $ 36 | 89,964 | |||
Balance (in shares) at Sep. 30, 2020 | 145,196 | |||||
Balance at Sep. 30, 2020 | 1,560,466 | $ 1,452 | 1,569,905 | (15,000) | 12,174 | (8,065) |
Balance (in shares) at Jun. 30, 2020 | 145,196 | |||||
Balance at Jun. 30, 2020 | 1,651,677 | $ 1,452 | 1,569,905 | (15,000) | 105,821 | (10,501) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (93,647) | (93,647) | ||||
Other comprehensive income (loss) | 2,436 | 2,436 | ||||
Balance (in shares) at Sep. 30, 2020 | 145,196 | |||||
Balance at Sep. 30, 2020 | $ 1,560,466 | $ 1,452 | 1,569,905 | (15,000) | 12,174 | (8,065) |
Balance (in shares) at Dec. 31, 2020 | 145,196 | 145,196 | ||||
Balance at Dec. 31, 2020 | $ 1,481,413 | $ 1,452 | 1,569,905 | (15,000) | (71,714) | (3,230) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (274,599) | (274,599) | ||||
Other comprehensive income (loss) | 323 | 323 | ||||
Share-based compensation | 2,924 | 2,924 | ||||
Settlement of accrued compensation liabilities through the issuance of share-based compensation awards | 3,844 | 3,844 | ||||
Cancellation of stockholder note receivable | 3,645 | (11,355) | 15,000 | |||
Dividends on preferred stock | $ (16,414) | (16,414) | ||||
Balance (in shares) at Sep. 30, 2021 | 145,196 | 145,196 | ||||
Balance at Sep. 30, 2021 | $ 1,201,136 | $ 1,452 | 1,548,904 | 0 | (346,313) | (2,907) |
Balance (in shares) at Jun. 30, 2021 | 145,196 | |||||
Balance at Jun. 30, 2021 | 1,249,669 | $ 1,452 | 1,564,591 | (15,000) | (300,871) | (503) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (45,442) | (45,442) | ||||
Other comprehensive income (loss) | (2,404) | (2,404) | ||||
Share-based compensation | 1,794 | 1,794 | ||||
Cancellation of stockholder note receivable | 3,645 | (11,355) | 15,000 | |||
Dividends on preferred stock | $ (6,126) | (6,126) | ||||
Balance (in shares) at Sep. 30, 2021 | 145,196 | 145,196 | ||||
Balance at Sep. 30, 2021 | $ 1,201,136 | $ 1,452 | $ 1,548,904 | $ 0 | $ (346,313) | $ (2,907) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (274,599) | $ (276,304) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 177,005 | 188,483 |
Deferred income taxes | (63,467) | (69,229) |
Non-cash rent expense | 11,546 | 34,489 |
Impairment charges associated with long-lived assets | 2,455 | 16,903 |
Loss (gain) on disposal of property and equipment, net | 3,515 | (2,894) |
Loss on debt extinguishment | 40,993 | 0 |
Write-off of discounts and debt issuance costs | 18,325 | 0 |
Amortization of discounts and debt issuance costs | 7,761 | 8,959 |
Share-based compensation | 6,959 | 0 |
Changes in operating assets and liabilities | 57,614 | 45,096 |
Other | (3,429) | (1,668) |
Net cash used in operating activities | (15,322) | (56,165) |
Cash flows from investing activities: | ||
Capital expenditures | (201,741) | (213,876) |
Acquisitions, net of cash acquired | (9,139) | 0 |
Proceeds from sale-leaseback transactions | 73,981 | 122,883 |
Proceeds from the sale of land held for sale | 0 | 22,971 |
Other | (1,291) | 5,360 |
Net cash used in investing activities | (138,190) | (62,662) |
Cash flows from financing activities: | ||
Proceeds from borrowings | 1,907,577 | 116,583 |
Repayments of debt | (1,602,164) | (27,104) |
Proceeds from senior secured credit facility | 134,000 | 506,000 |
Repayments of senior secured credit facility | (228,000) | (587,902) |
Deposit associated with a pending sale-leaseback transaction | 0 | 15,000 |
Repayments of finance lease liabilities | (1,133) | (1,034) |
Increase in debt discounts and issuance costs | (45,151) | (425) |
Proceeds from the issuance of common stock | 0 | 90,000 |
Net cash provided by financing activities | 165,129 | 111,118 |
Effect of exchange rates on cash and cash equivalents | 15 | (185) |
Increase (decrease) in cash and cash equivalents | 11,632 | (7,894) |
Cash and cash equivalents—beginning of period | 33,195 | 47,951 |
Cash and cash equivalents—end of period | $ 44,827 | $ 40,057 |
Nature of Business and Basis of
Nature of Business and Basis of Consolidation and Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Basis of Consolidation and Presentation | Nature of Business and Basis of Consolidation and Presentation Nature of Business Life Time Group Holdings, Inc. (collectively with its direct and indirect subsidiaries, “Life Time,” “we,” “our,” or the “Company”) is a holding company incorporated in the state of Delaware. As a holding company, Life Time Group Holdings, Inc. does not have its own independent assets or business operations, and all of our assets and business operations are through Life Time, Inc. and its direct and indirect subsidiaries. Life Time Group Holdings, Inc. changed its name from LTF Holdings, Inc. effective on June 21, 2021. We are primarily dedicated to providing premium health, fitness and wellness experiences at our athletic resort destinations and via our comprehensive digital platform and portfolio of iconic athletic events – all with the objective of inspiring healthier, happier lives. We design, build and operate our athletic resort destinations that are distinctive and large, multi-use sports and athletic, professional fitness, family recreation and spa centers in a resort-like environment. As of September 30, 2021, we operated 155 centers in 29 states and one Canadian province. COVID-19 Impact On March 11, 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) as a pandemic and recommended containment and mitigation measures worldwide. On March 13, 2020, the United States declared a National Public Health Emergency with respect to COVID-19. On March 16, 2020, we closed all of our centers based on orders and advisories from federal, state and local governmental authorities regarding COVID-19, during which time we did not draft or collect monthly access membership dues or recurring product charges from our members. We re-opened our first center on May 8, 2020 and continued to re-open our centers as state and local governmental authorities permitted. All of our centers are currently open and we are collecting monthly access membership dues and recurring product charges from active members associated with all of our centers. Whether we will need to close any of our centers, and the duration of any such future center closures that may occur, remains uncertain and is dependent on future developments that cannot be accurately predicted at this time. Initial Public Offering On October 12, 2021, Life Time Group Holdings, Inc. consummated its initial public offering (“IPO”) of 39.0 million shares of its common stock at a public offering price of $18.00 per share, resulting in total gross proceeds of $702.0 million, which was r educed by underwriting discounts and other offering expenses of $22.9 million, for net proceeds of $679.1 million. The shares of the Company's common stock began trading on The New York Stock Exchange under the symbol “LTH” on October 7, 2021. A registration statement on Form S-1 relating to the offering of these securities was declared effective by the Securities and Exchange Commission (the “SEC”) on October 6, 2021. Upon consummation of the IPO, the 5.4 million shares of Series A Preferred Stock (as defined in Note 2, Summary of Significant Accounting Policies) then outstanding automatically converted into approximately 6.7 million shares of common stock of Life Time Group Holdings, Inc. Also upon consummation of the IPO, the 0.5 million shares of restricted Series A Preferred Stock then outstanding converted into approximately 0.6 million restricted shares of common stock of Life Time Group Holdings, Inc. For more information regarding the Series A Preferred Stock, see Note 8, Mezzanine Equity. Additionally, on October 12, 2021, in connection with the consummation of the IPO, we adopted an amended and restated Certificate of Incorporation under which the Company’s authorized share total was increased to 500.0 million shares of common stock, par value $0.01 per share, and 10.0 million shares of preferred stock, par value $0.01 per share, and the Series A Preferred Stock became no longer authorized. On October 13, 2021, we used a portion of the $679.1 million of net proceeds we received in connection with the IPO to pay down $575.7 million (including a $5.7 million prepayment penalty) of our Term Loan Facility (as defined in Note 6, Debt). For more information regarding our Term Loan Facility, see Note 6, Debt. On November 1, 2021, Life Time Group Holdings, Inc. consummated the sale of nearly 1.6 million additional shares of its common stock at the IPO price of $18.00 per share pursuant to the partial exercise by the underwriters of their over-allotment option, resulting in total gross proceeds of approximately $28.4 million, which was reduced by underwriting discounts and other offering expenses of $1.3 million, for net proceeds of $27.1 million . We intend to use these net proceeds, as well as the remaining portion of the net proceeds we received in connection with the IPO after the partial pay down of our Term Loan Facility, for general corporate purposes. As of September 30, 2021, total unrecognized share-based compensation expense associated with stock options, restricted Series A Preferred Stock and restricted stock units was $362.5 million. As a result of the consummation of the IPO, a significant portion of this total unrecognized share-based compensation expense amount will be recognized during the fourth quarter of 2021. For more information regarding share-based compensation expense, see Note 8, Mezzanine Equity and Note 9, Stockholders' Equity. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements include the accounts of Life Time Group Holdings, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (‘‘GAAP’’), which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In recording transactions and balances resulting from business operations, we use estimates based on the best information available. We revise the recorded estimates when better information is available, facts change or we can determine actual amounts. These revisions can affect our consolidated operating results. All adjustments (consisting of normal recurring adjustments) considered necessary to fairly present our consolidated financial position, results of operations and cash flows for the periods have been included. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. A summary of our significant accounting policies is included in Note 2 to our annual consolidated financial statements. Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 also amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. We adopted ASU 2020-06 effective January 1, 2021. The adoption of ASU 2020-06 did not have an impact on our condensed consolidated financial statements. Segment Reporting Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is our Founder, Chairman and Chief Executive Officer (“CEO”). Our CODM assesses financial performance and allocates resources based on the consolidated financial results at the total entity level. Accordingly, we have determined that we have one operating segment and one reportable segment. Fair Value Measurements The accounting guidance establishes a framework for measuring fair value and expanded disclosures about fair value measurements. The guidance applies to all assets and liabilities that are measured and reported on a fair value basis. This enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The guidance requires that each asset and liability carried at fair value be classified into one of the following categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts related to cash and cash equivalents, accounts receivable, income tax receivable, accounts payable and accrued liabilities approximate fair value. Fair Value Measurements on a Recurring Basis. We had no remeasurements of such assets or liabilities to fair value during either of the three or nine months ended September 30, 2021 and 2020. Financial Assets and Liabilities. At both September 30, 2021 and December 31, 2020, the gross carrying amount of our outstanding debt approximates fair value. The fair value of our debt is based on the amount of future cash flows discounted using rates we would currently be able to realize for similar instruments of comparable maturity. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. For more information regarding our debt, see Note 6, Debt. Fair Value Measurements on a Nonrecurring Basis. Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to our long-lived assets, goodwill, and intangible assets, which are remeasured when the derived fair value is below carrying value on our condensed consolidated balance sheets. For these assets, we do not periodically adjust carrying value to fair value except in the event of impairment. If we determine that impairment has occurred, the carrying value of the asset would be reduced to fair value and the difference would be recorded as a loss within operating income in our condensed consolidated statements of operations. During both the three and nine months ended September 30, 2021 and 2020, we determined that certain projects were no longer deemed viable for construction, and that the previously capitalized site development costs associated with these projects were impaired. Accordingly, as it relates to these long-lived assets, we recognized impairment charges of $0.7 million and $9.9 million for the three months ended September 30, 2021 and 2020, respectively, and we recognized impairment charges of $2.5 million and $16.9 million for the nine months ended September 30, 2021 and 2020, respectively. Fair value remeasurements are based on significant unobservable inputs (Level 3). Fixed asset fair values are primarily derived using a discounted cash flow (“DCF”) model to estimate the present value of net cash flows that the asset or asset group was expected to generate. The key inputs to the DCF model generally include our forecasts of net cash generated from revenue, expenses and other significant cash outflows, such as capital expenditures, as well as an appropriate discount rate. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: September 30, December 31, Property held for sale $ — $ 49,686 Construction contract receivables 5,645 12,398 Deferred membership origination costs 4,177 7,212 Prepaid expenses 25,392 17,935 Prepaid expenses and other current assets $ 35,214 $ 87,231 Deferred IPO Costs. Prepaid expenses and other current assets at September 30, 2021 include deferred IPO costs totaling approximately $2.2 million. These deferred costs primarily consist of legal, accounting, and other fees relating to the Company’s IPO. With the consummation of the IPO in October 2021, these deferred offering costs will be netted against the related IPO proceeds and recognized during the fourth quarter as a reduction in Additional paid-in capital on our consolidated balance sheet. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: September 30, December 31, Real estate taxes $ 33,814 $ 31,015 Accrued interest 41,673 15,010 Payroll liabilities 29,146 17,136 Utilities 7,774 5,379 Self-insurance accruals 24,963 22,444 Corporate accruals 24,711 24,123 Dividends payable 16,414 — Current maturities of finance lease liabilities 1,383 1,171 Other 3,825 1,397 Accrued expenses and other current liabilities $ 183,703 $ 117,675 Loss per Share Basic loss per share is computed by dividing loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. The numerator in the diluted loss per share calculation is derived by adding the effect of assumed common stock conversions to loss available to common stockholders. The denominator in the diluted loss per share calculation is derived by adding shares of common stock deemed to be potentially dilutive to the weighted average number of shares of common stock outstanding during the period. Potentially dilutive securities that are subject to performance or market conditions are considered contingently issuable shares for purposes of calculating diluted loss per share. Accordingly, these contingently issuable shares are excluded from the computation of diluted loss per share until the performance or market conditions have been met. Other potentially dilutive securities that do not involve contingently issuable shares are also excluded from the computation of diluted loss per share if their effect is antidilutive. For both the three and nine months ended September 30, 2021 and 2020, our potentially dilutive securities include stock options, all of which are subject to performance conditions that were not met as of the end of each respective period. Accordingly, the contingently issuable shares associated with our stock options are excluded from the computation of diluted loss per share for both the three and nine months ended September 30, 2021 and 2020. For both the three and nine months ended September 30, 2021, our potentially dilutive securities also include unvested restricted stock units, outstanding shares of Series A convertible participating preferred stock (“Series A Preferred Stock”) and unvested restricted Series A Preferred Stock. Due to the net loss that we recognized during both the three and nine months ended September 30, 2021, the potentially dilutive shares of common stock associated with our unvested restricted stock units, outstanding shares of Series A Preferred Stock and unvested restricted Series A Preferred Stock were determined to be antidilutive and, therefore, are excluded from the computation of diluted loss per share for both the three and nine months ended September 30, 2021. The following table sets forth the calculation of basic and diluted loss per share for both the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Net loss $ (45,442) $ (93,647) $ (274,599) $ (276,304) Dividends accrued on Series A Preferred Stock (6,126) — (16,414) — Loss available to common stockholders $ (51,568) $ (93,647) $ (291,013) $ (276,304) Weighted average common shares outstanding—basic and diluted 145,196 145,196 145,196 145,118 Loss per share—basic and diluted $ (0.36) $ (0.64) $ (2.00) $ (1.90) The following is a summary of potential shares of common stock that were excluded from the computation of diluted loss per share for both the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Stock options 24,118 21,252 24,118 21,252 Unvested restricted stock units 610 — 610 — Outstanding shares of Series A Preferred Stock 5,430 — 5,430 — Unvested restricted Series A Preferred Stock 500 — 500 — Potential common shares excluded from diluted loss per share 30,658 21,252 30,658 21,252 For more information regarding our Series A Preferred Stock and unvested restricted Series A Preferred Stock, see Note 8, Mezzanine Equity and Note 9, Stockholders’ Equity. For more information regarding our stock options and unvested restricted stock units, see Note 9, Stockholders’ Equity. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information Decreases (increases) in operating assets and increases (decreases) in operating liabilities are as follows: Nine Months Ended 2021 2020 Accounts receivable $ (3,604) $ 6,149 Center operating supplies and inventories (3,836) 6,063 Prepaid expenses and other current assets (3,243) 9,965 Income tax receivable 4,372 2,348 Other assets 1,950 4,491 Accounts payable 17,709 10,890 Accrued expenses and other current liabilities 60,270 (3,636) Deferred revenue (16,777) (3,776) Other liabilities 773 12,602 Changes in operating assets and liabilities $ 57,614 $ 45,096 Additional supplemental cash flow information is as follows: Nine Months Ended 2021 2020 Net cash paid for income taxes, net of refunds received (received from income tax refunds, net of taxes paid) $ 221 $ (32,510) Cash payments for interest, net of capitalized interest 82,228 76,213 Capitalized interest 2,476 3,719 |
Goodwill and Intangibles
Goodwill and Intangibles | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Goodwill and Intangibles The goodwill balance was $1,233.2 million at both September 30, 2021 and December 31, 2020. Intangible assets consisted of the following: September 30, 2021 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — 163,000 Member relationships 62,100 (62,100) — Other 15,029 (4,425) 10,604 Total intangible assets $ 240,129 $ (66,525) $ 173,604 December 31, 2020 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — $ 163,000 Member relationships 62,100 (62,100) — Other 5,252 (3,833) 1,419 Total intangible assets $ 230,352 $ (65,933) $ 164,419 During the nine months ended September 30, 2021, we acquired the assets associated with an outdoor bicycling event for approximately $10.2 million, of which approximately $1.1 million had yet to be paid as of September 30, 2021. The transaction was accounted for as an asset acquisition and the entire purchase price was allocated to an intangible asset associated with a license to use a recreation area for the staging of the event, which expires in April 2031. Other intangible assets at September 30, 2021 includes this facility license as well as trade names and customer relationships associated with our race registration and timing businesses. Other intangible assets at December 31, 2020 consists solely of the trade names and customer relationships associated with our race registration and timing businesses. Amortization expense associated with intangible assets for both the three months ended September 30, 2021 and 2020 was $0.2 million, and was $0.6 million and $3.6 million for the nine months ended September 30, 2021 and 2020, respectively. Amortization expense associated with intangible assets is included in Depreciation and amortization in our condensed consolidated statements of operations. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue associated with our membership dues, enrollment fees, and certain services from our in-center businesses is recognized over time as earned. Revenue associated with products and services offered in our cafes and spas, as well as through e-commerce, is recognized at a point in time. The following is a summary of revenue, by major revenue stream, that we recognized during the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Membership dues and enrollment fees $ 261,033 $ 169,612 $ 653,584 $ 490,151 In-center revenue 110,967 58,737 280,106 214,768 Total center revenue 372,000 228,349 933,690 704,919 Other revenue 13,040 2,681 23,835 14,991 Total revenue $ 385,040 $ 231,030 $ 957,525 $ 719,910 The timing associated with the revenue we recognized during the three months ended September 30, 2021 and 2020 is as follows: Three Months Ended September 30, 2021 Three Months Ended September 30, 2020 Center Other Total Center Other Total Goods and services transferred over time $ 324,350 $ 13,040 $ 337,390 $ 201,174 $ 2,681 $ 203,855 Goods and services transferred at a point in time 47,650 — 47,650 27,175 — 27,175 Total Revenue $ 372,000 $ 13,040 $ 385,040 $ 228,349 $ 2,681 $ 231,030 The timing associated with the revenue we recognized during the nine months ended September 30, 2021 and 2020 is as follows: Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Center Other Total Center Other Total Goods and services transferred over time $ 813,425 $ 23,835 $ 837,260 $ 618,003 $ 14,991 $ 632,994 Goods and services transferred at a point in time 120,265 — 120,265 86,916 — 86,916 Total Revenue $ 933,690 $ 23,835 $ 957,525 $ 704,919 $ 14,991 $ 719,910 Contract liabilities represent payments or consideration received in advance for goods or services that the Company has not yet transferred to the customer. Contract liabilities consist primarily of deferred revenue as a result of fees collected in advance for membership dues, enrollment fees, personal training, and other center services offerings, as well as our media and athletic events. Total contract liabilities at September 30, 2021 and 2020 were $30.8 million and $50.3 million, respectively. Contract liabilities that will be recognized within one year are classified as current liabilities and are included in Deferred revenue in our condensed consolidated balance sheets, the balance of which was $28.2 million and $45.8 million at September 30, 2021 and 2020, respectively. These balances primarily consist of prepaid membership dues, personal training and other in-center services, and enrollment fees. The $17.6 million decrease in these contract liabilities was primarily driven by the usage of membership dues credits that we gave to members during 2020 as a result of center closures. Also, deferred revenue associated with enrollment fees and center services offerings decreased as a result of our center closures in 2020. Contract liabilities that will be recognized in a future period greater than one year are classified as long-term liabilities and are included in Other liabilities in our condensed consolidated balance sheets, the balance of which was $2.6 million and $4.5 million at September 30, 2021 and 2020, respectively. These balances primarily consist of deferred enrollment fees. The $1.9 million decrease in these contract liabilities was primarily driven by our center closures during 2020. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consisted of the following: September 30, 2021 December 31, 2020 Term Loan Facility, maturing December 2024 $ 843,625 $ — Prior Term Loan Facility, retired January 2021 — 1,471,584 Prior Revolving Credit Facility, retired January 2021 — 94,000 Secured Notes, maturing January 2026 925,000 — Unsecured Notes, maturing April 2026 475,000 — 2023 Notes, retired February 2021 — 450,000 Secured loan—related parties, retired January 2021 — 101,503 Mortgage notes, various maturities (1) 151,244 167,872 Other debt 4,289 4,289 Fair value adjustment 1,981 2,469 Total debt 2,401,139 2,291,717 Less unamortized debt discounts and issuance costs (37,798) (19,121) Total debt less unamortized issuance costs 2,363,341 2,272,596 Less current maturities (31,841) (139,266) Long-term debt, less current maturities $ 2,331,500 $ 2,133,330 (1) Mortgage notes collateralized by certain related real estate and buildings, due through 2027 at a weighted average interest rate of 4.69% and 4.68% at September 30, 2021 and December 31, 2020, respecti vely. Refinancing Transactions During the nine months ended September 30, 2021, Life Time, Inc., an indirect, wholly-owned subsidiary of Life Time Group Holdings, Inc., as the borrower and issuer, as applicable, together with certain other wholly-owned subsidiaries: (i) refinanced in full the then outstanding balances associated with our previous term loan facility (the “Prior Term Loan Facility”) and our prior revolving credit facility (the “Prior Revolving Credit Facility”) through net cash proceeds Life Time, Inc. received from a new term loan facility (the “Term Loan Facility”) that matures in December 2024 as well as the issuance of senior secured notes (the “Secured Notes”) that mature in January 2026; (ii) refinanced in full our previous senior unsecured notes (the “2023 Notes”) through proceeds Life Time, Inc. received from the issuance of new senior unsecured notes (the “Unsecured Notes”) that mature in April 2026; and (iii) converted our then existing related party secured loan into Series A Preferred Stock. Senior Secured Credit Facility In June 2015, Life Time, Inc. and certain of our other wholly-owned subsidiaries entered into a senior secured credit facility with a group of lenders led by Deutsche Bank AG as the administrative agent. On January 22, 2021, Life Time, Inc. and certain of our other wholly-owned subsidiaries entered into an eighth amendment to the credit agreement governing our senior secured credit agreement (the “Amended Senior Secured Credit Facility”). Pursuant to the Amended Senior Secured Credit Facility, Life Time, Inc. and such other subsidiaries: (i) entered into the Term Loan Facility and incurred new term loans in an aggregate principal amount of $850.0 million; (ii) paid off the then outstanding balances associated with the Prior Term Loan Facility and the Prior Revolving Credit Facility; and (iii) extended the maturity of $325.2 million of the $357.9 million Prior Revolving Credit Facility to September 2024 (the “Revolving Credit Facility”). Upon the exercise of an accordion feature and subject to certain conditions, borrowings under the Amended Senior Secured Credit Facility may be increased up to an additional $400.0 million (plus additional amounts that may be added upon the satisfaction of certain financial tests) subject, in certain cases, to meeting a first lien net leverage ratio. Our ability to increase our borrowings under the Amended Senior Secured Credit Facility using this accordion feature is restricted during the Covenant Modification Period (as defined in “—Debt Covenants” below). The Amended Senior Secured Credit Facility is secured by a first priority lien (on a pari-passu basis with the Secured Notes described below) on substantially all of our assets. The net cash proceeds Life Time, Inc. received under the Term Loan Facility, as well as from the Secured Notes, were used to: (i) refinance in full the then outstanding balances associated with the Prior Term Loan Facility and the Prior Revolving Credit Facility (details of which are described under “—Term Loan Facility” and “—Revolving Credit Facility,” respectively); (ii) pay debt issuance and original issue discount costs associated with each of these financing transactions (details of which are described in “—Debt Discounts and Issuance Costs” below); and (iii) strengthen our balance sheet by adding to our cash position. Term Loan Facility At both December 31, 2020 and January 22, 2021 (the effective date of the refinancing), the Prior Term Loan Facility balance was $1,471.6 million . Under the Term Loan Facility, Life Time, Inc. incurred new term loans in an aggregate principal amount of $850.0 million , of which $507.6 million represents cash proceeds received and $342.4 million represents the cashless portion of the Prior Term Loan Facility that was rolled over into the Term Loan Facility. On January 22, 2021, we used the net cash proceeds received from the Term Loan Facility, as well as a portion of the net proceeds received from the Secured Notes, to pay off the remaining $1,129.2 million Prior Term Loan Facility balance. The $850.0 million Term Loan Facility amortizes at 0.25% quarterly, resulting in mandatory quarterly principal repayments of approximately $2.1 million, and matures in December 2024. At September 30, 2021, the Term Loan Facility loan balance was $843.6 million, with interest due at intervals ranging from 30 to 180 days at interest rates ranging from the London Interbank Offered Rate (“LIBOR”) plus 4.75% or base rate plus 3.75%, in either case subject to a 1.00% rate floor. Revolving Credit Facility The Prior Revolving Credit Facility provided for a $357.9 million revolver. At December 31, 2020 and January 22, 2021 (the effective date of the refinancing), the Revolving Credit Facility balance was $94.0 million and $109.0 million, respectively. Under the Revolving Credit Facility, we extended the maturity of $325.2 million of the $357.9 million revolver to September 2024. The remaining $32.7 million non-extended portion of our Revolving Credit Facility matures in August 2022. On January 22, 2021, we used a portion of the net proceeds we received from the Secured Notes to pay off the then outstanding $109.0 million Prior Revolving Credit Facility balance. At September 30, 2021, there were no outstanding borrowings on the Revolving Credit Facility and there were $40.1 million of outstanding letters of credit, resulting in total revolver availability, subject to a $100.0 million minimum liquidity requirement (see “—Debt Covenants” below), of $217.8 million, of which $185.1 million was available at intervals ranging from 30 to 180 days at interest rates ranging from LIBOR plus 4.25% or base rate plus 3.25%, while interest on the remaining $32.7 million was available at intervals ranging from 30 to 180 days at LIBOR plus 3.00% or base rate plus 2.00%. The weighted average interest rate and debt outstanding under the Revolving Credit Facility for the nine months ended September 30, 2021 wa s 3.83% and $12.1 million, respectively. The highest month-end balance during that same period was $40.0 million. Secured Notes On January 22, 2021, Life Time, Inc. issued Secured Notes in an aggregate principal amount of $925.0 million. These notes mature in January 2026 and interest only payments are due semi-annually in arrears at 5.75%. Life Time, Inc. has the option to call the Secured Notes, in whole or in part, on one or more occasions, beginning on January 15, 2023, subject to the payment of a redemption price that includes a call premium that varies depending on the year of redemption. In addition, at any time prior to January 15, 2023, Life Time, Inc. may redeem up to 40.00% of the aggregate principal amount of the Secured Notes outstanding with the net proceeds of certain equity offerings by us at a redemption price equal to 105.75% of the principal amount of the Secured Notes, plus accrued and unpaid interest, if any, to, but not including, the redemption date. The Secured Notes and the related guarantees are our senior secured obligations and are secured on a first-priority basis by security interests in substantially all of our assets. As of September 30, 2021, $925.0 million remained outstanding on the Secured Notes. Unsecured Notes In June 2015, Life Time, Inc. issued the 2023 Notes in the original principal amount of $450.0 million, which were scheduled to mature in June 2023. At both December 31, 2020 and February 5, 2021, $450.0 million remained outstanding on the notes. On February 5, 2021, Life Time, Inc. refinanced the 2023 Notes through the issuance by Life Time, Inc. of the Unsecured Notes in the original principal amount of $475.0 million. The Unsecured Notes mature in April 2026 and interest only payments are due semi-annually in arrears at 8.00%. The proceeds from the Unsecured Notes were used to: (i) redeem in full the then outstanding 2023 Notes balance of $450.0 million and satisfy and discharge our obligations thereunder; (ii) pay debt issuance costs associated with the issuance of the Unsecured Notes (details of which are described in “—Debt Discounts and Issuance Costs” below); and (iii) strengthen our balance sheet by adding to our cash position. Life Time, Inc. has the option to redeem the Unsecured Notes, in whole or in part, on one or more occasions, beginning on February 1, 2023, subject to the payment of a redemption price that includes a call premium that varies depending on the year of redemption. In addition, at any time prior to February 1, 2023, Life Time, Inc. may redeem up to 40.00% of the aggregate principal amount of the Unsecured Notes outstanding with the net proceeds of certain equity offerings by us at a redemption price equal to 108.00% of the principal amount of the Unsecured Notes, plus accrued and unpaid interest, if any, to, but not including, the redemption date. The Unsecured Notes and the related guarantees are our general senior unsecured obligations and will rank equally in right of payment with all of our existing and future senior indebtedness without giving effect to collateral arrangements. As of September 30, 2021, $475.0 million remained outstanding on the Unsecured Notes. Secured Loan—Related Parties On June 24, 2020, we closed on an approximate $101.5 million secured loan (the “Related Party Secured Loan”) from an investor group that was comprised solely of our stockholders or their affiliates. The Related Party Secured Loan was scheduled to mature in June 2021. During the nine months ended September 30, 2021, interest expense of approximately $0.7 million was recognized on this secured loan. On January 11, 2021, Life Time Group Holdings, Inc. and certain of its subsidiaries and the investor group associated with the Related Party Secured Loan (or their assignees) entered into a contribution agreement (the “Contribution Agreement”) pursuant to which we converted the total amount of outstanding principal and accrued interest (up though and including January 22, 2021) under the Related Party Secured Loan into Series A Preferred Stock. Effective January 22, 2021, the total outstanding principal and accrued interest balance of approximately $108.6 million was conveyed by the investor group to us and we issued, on a dollar-for-dollar basis, to the investor group approximately 5.4 million shares of Series A Preferred Stock with an estimated fair value of $149.6 million. For accounting purposes, because the fair value of the Series A Preferred Stock that was issued exceeded the carrying value of the outstanding principal and accrued interest balance associated with the Related Party Secured Loan that was extinguished, we recognized a $41.0 million debt extinguishment loss, which is included in Interest expense, net of interest income in our condensed consolidated statement of operations for the nine months ended September 30, 2021. For more information regarding the Series A Preferred Stock that was issued in connection with this transaction, see Note 8, Mezzanine Equity. Debt Discounts and Issuance Costs In connection with the Term Loan Facility, Secured Notes and Unsecured Notes, we incurred debt discounts and issuance costs totaling approximately $44.4 million during the nine months ended September 30, 2021. In our condensed consolidated balance sheets, we recognize, and present unamortized debt discounts and issuance costs associated with non-revolving debt as a deduction from the face amount of related indebtedness. Accordingly, as it relates to these debt instruments, unamortized debt discounts and issuance costs of $37.8 million are included in Long-term debt, net of current portion on our September 30, 2021 condensed consolidated balance sheet. In connection with the Prior Term Loan Facility, the 2023 Notes and the Related Party Secured Loan, we had incurred debt discounts and issuance costs totaling $78.6 million. At December 31, 2020, unamortized debt discounts and issuance costs of $19.1 million are included in Long-term debt, net of current portion on our December 31, 2020 condensed consolidated balance sheet. In connection with the extinguishment of these debt instruments during the nine months ended September 30, 2021, previously unamortized debt discounts and issuance costs were written off. Accordingly, as it relates to these extinguished debt instruments, we recognized $18.3 million of debt discount and issuance cost write-offs during the nine months ended September 30, 2021, which are included in Interest expense, net of interest income in our condensed consolidated statement of operations for the nine months ended September 30, 2021. In connection with both the Revolving Credit Facility and the Prior Revolving Credit Facility, we have incurred total debt issuance costs of $7.4 million, of which $0.8 million were incurred during the nine months ended September 30, 2021. As of the January 22, 2021 effective date associated with the Amended Senior Secured Credit Facility, the borrowing capacity (i.e., the product of the remaining term and the maximum available credit) associated with the Revolving Credit Facility was greater than the borrowing capacity associated with the Prior Revolving Credit Facility. Accordingly, the debt issuance costs incurred in connection with the Revolving Credit Facility, as well as the unamortized portion of the debt issuance costs associated with the Prior Revolving Credit Facility, will be amortized over the term of the Revolving Credit Facility. We recognize and present unamortized issuance costs associated with revolving debt arrangements as an asset. Accordingly, unamortized revolver-related debt issuance costs of $1.7 million and $1.3 million, respectively, are included in Other assets on our condensed consolidated balance sheets at September 30, 2021 and December 31, 2020, respectively. Debt Covenants We are required to comply with certain affirmative and restrictive covenants under our Amended Senior Secured Credit Facility, Secured Notes and Unsecured Notes. We are also required to comply with a first lien net leverage ratio covenant under the revolving portion of our Amended Senior Secured Credit Facility. However, our Amended Senior Secured Credit Facility includes a covenant modification period (the “Covenant Modification Period”) ending on the earlier of (i) January 1, 2022 or (ii) the date we provide notice of our intention to terminate the Covenant Modification Period. During the Covenant Modification Period, we are not obligated to comply with the first lien net leverage ratio covenant; however, we are required to maintain a minimum liquidity balance of $100.0 million, which is tested monthly. Effective as of the end of the first fiscal quarter following the Covenant Modification Period and continuing throughout the remaining term of our Amended Senior Secured Credit Facility, we will be required to maintain a first lien net leverage ratio, if 30% or more of the Revolving Credit Facility commitments are outstanding shortly after the end of any fiscal quarter (excluding all cash collateralized undrawn letters of credit and other undrawn letters of credit up to $20.0 million). During the first three quarterly test periods following the Covenant Modification Period, certain financial measures used in the calculation of the first lien net leverage ratio will be calculated on a pro forma basis by annualizing the respective financial measures recognized during those test periods. Future Maturities of Long-Term Debt Aggregate annual future maturities of long-term debt, excluding unamortized discounts, issuance costs and fair value adjustments, at September 30, 2021 were as follows: October 2021 through September 2022 $ 31,841 October 2022 through September 2023 28,252 October 2023 through September 2024 72,682 October 2024 through September 2025 830,825 October 2025 through September 2026 1,413,281 Thereafter 22,277 Total future maturities of long-term debt $ 2,399,158 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases Lease Cost Lease cost included in our condensed consolidated statements of operations for the three months ended September 30, 2021 and 2020 consisted of the following: Three Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 50,987 46,644 Rent Short-term lease cost 281 338 Rent Variable lease cost 1,245 557 Rent Finance lease cost: Amortization of right-of-use assets 380 652 Depreciation and amortization Interest on lease liabilities 42 43 Interest expense, net of interest income Total lease cost $ 52,935 $ 48,234 Lease cost included in our condensed consolidated statements of operations for the nine months ended September 30, 2021 and 2020 consisted of the following: Nine Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 150,475 136,760 Rent Short-term lease cost 747 928 Rent Variable lease cost 3,330 782 Rent Finance lease cost: Amortization of right-of-use assets 1,119 1,925 Depreciation and amortization Interest on lease liabilities 140 143 Interest expense, net of interest income Total lease cost $ 155,811 $ 140,538 Operating and Finance Lease Right-of-Use Assets and Lease Liabilities Operating and finance lease right-of-use assets and lease liabilities were as follows: September 30, 2021 December 31, 2020 Classification on Condensed Lease right-of-use assets: Operating leases 1,864,246 1,708,597 Operating lease right-of-use assets Finance leases (1) 2,325 2,295 Other assets Total lease right-of-use assets $ 1,866,571 $ 1,710,892 Lease liabilities: Current Operating leases 44,137 49,877 Current maturities of operating lease liabilities Finance leases 1,383 1,171 Accrued expenses and other current liabilities Non-Current Operating leases 1,902,784 1,738,393 Operating lease liabilities, net of current portion Finance leases 1,007 1,202 Other liabilities Total Lease liabilities $ 1,949,311 $ 1,790,643 (1) Finance lease right-of-use assets were reported net of accumulated amortization of $2.1 million and $1.2 million at September 30, 2021 and December 31, 2020, respectively. Operating Lease Right-of-Use Assets and Liabilities Associated with Unrelated Third Party Leases In connection with leases with unrelated third parties that commenced during the nine months ended September 30, 2021, we recognized operating lease right-of-use assets and lease liabilities of $203.7 million and $194.0 million, respectively, on our condensed consolidated balance sheet. In connection with modified leases that were remeasured during the nine months ended September 30, 2021, we recognized a net decrease in operating lease right-of-use assets and lease liabilities, each of which totaled $5.4 million, on our condensed consolidated balance sheet. Finance Lease Right-of-Use Assets and Liabilities Associated with Unrelated Third Party Leases In connection with leases with unrelated third parties that commenced during the nine months ended September 30, 2021, we recognized finance lease right-of-use assets and lease liabilities, each of which totaled $1.2 million, on our condensed consolidated balance sheet. Remaining Lease Terms and Discount Rates The weighted-average remaining lease terms and discount rates associated with our operating and finance lease liabilities at September 30, 2021 were as follows: September 30, 2021 Weighted-average remaining lease term (1) Operating leases 18.0 years Finance leases 2.2 years Weighted-average discount rate Operating leases 7.98% Finance leases 6.42% (1) The weighted-average remaining lease term associated with our operating and finance lease liabilities does not include all of the optional renewal periods available to us under our current lease arrangements. Rather, the weighted-average remaining lease term only includes periods covered by an option to extend a lease if we are reasonably certain to exercise that option. Sale-Leaseback Transactions Sale-Leaseback Transactions with Unrelated Third Parties Duri ng the nine months ended September 30, 2021, we entered into two sale-leaseback transactions, involving two properties, with unrelated third parties. Under these transactions, we sold property with a net book value of $86.1 million for $76.0 million, which was reduced by transaction costs of $2.0 million, for net cash proceeds of $74.0 million. The estimated fair value of the properties sold was $85.5 million. Sale-leaseback transactions with unrelated third parties are accounted for at fair value. Accordingly, the aggregate sales price associated with these arrangements was increased, for accounting purposes, by a total of $9.5 million, which resulted in the recognition of an aggregate loss of $2.6 million on these transactions. This net loss is included in Other operating in our condensed consolidated statement of operations for the nine months ended September 30, 2021. The leases, each of which has been classified as an operating lease, each has an initial term of 25 years and includes six renewal options of five years each. The $9.5 million increase in the aggregate sales price associated with these sale-leaseback transactions was accounted for as prepaid rent, which was recognized as a non-cash increase in the aggregate operating lease right-of-use asset balance associated with these properties. Supplemental Cash Flow Information Supplemental cash flow information associated with our operating and finance leases is as follows: Nine Months Ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 137,942 $ 87,924 Operating cash flows from finance leases 140 143 Financing cash flows from finance leases 1,133 1,034 Non-cash information: Right-of-use assets obtained in exchange for initial lease liabilities: Operating leases 194,021 145,384 Finance leases 1,150 2,021 Right-of-use asset adjustments recognized as a result of the remeasurement of existing lease liabilities: Operating leases (5,357) 36,865 Non-cash increase in operating lease right-of-use assets associated with below-market sale-leaseback transactions 9,500 19,310 Maturities of Operating and Finance Lease Liabilities The maturities associated with our operating and finance lease liabilities at September 30, 2021 are as follows: Operating leases Finance leases Total October 2021 through September 2022 $ 184,947 1,493 186,440 October 2022 through September 2023 195,386 874 196,260 October 2023 through September 2024 203,040 167 203,207 October 2024 through September 2025 205,024 — 205,024 October 2025 through September 2026 208,241 — 208,241 Thereafter 2,803,049 — 2,803,049 Total lease payments 3,799,687 2,534 3,802,221 Less: Imputed interest 1,852,766 144 1,852,910 Present value of lease liabilities $ 1,946,921 $ 2,390 $ 1,949,311 |
Leases | Leases Lease Cost Lease cost included in our condensed consolidated statements of operations for the three months ended September 30, 2021 and 2020 consisted of the following: Three Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 50,987 46,644 Rent Short-term lease cost 281 338 Rent Variable lease cost 1,245 557 Rent Finance lease cost: Amortization of right-of-use assets 380 652 Depreciation and amortization Interest on lease liabilities 42 43 Interest expense, net of interest income Total lease cost $ 52,935 $ 48,234 Lease cost included in our condensed consolidated statements of operations for the nine months ended September 30, 2021 and 2020 consisted of the following: Nine Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 150,475 136,760 Rent Short-term lease cost 747 928 Rent Variable lease cost 3,330 782 Rent Finance lease cost: Amortization of right-of-use assets 1,119 1,925 Depreciation and amortization Interest on lease liabilities 140 143 Interest expense, net of interest income Total lease cost $ 155,811 $ 140,538 Operating and Finance Lease Right-of-Use Assets and Lease Liabilities Operating and finance lease right-of-use assets and lease liabilities were as follows: September 30, 2021 December 31, 2020 Classification on Condensed Lease right-of-use assets: Operating leases 1,864,246 1,708,597 Operating lease right-of-use assets Finance leases (1) 2,325 2,295 Other assets Total lease right-of-use assets $ 1,866,571 $ 1,710,892 Lease liabilities: Current Operating leases 44,137 49,877 Current maturities of operating lease liabilities Finance leases 1,383 1,171 Accrued expenses and other current liabilities Non-Current Operating leases 1,902,784 1,738,393 Operating lease liabilities, net of current portion Finance leases 1,007 1,202 Other liabilities Total Lease liabilities $ 1,949,311 $ 1,790,643 (1) Finance lease right-of-use assets were reported net of accumulated amortization of $2.1 million and $1.2 million at September 30, 2021 and December 31, 2020, respectively. Operating Lease Right-of-Use Assets and Liabilities Associated with Unrelated Third Party Leases In connection with leases with unrelated third parties that commenced during the nine months ended September 30, 2021, we recognized operating lease right-of-use assets and lease liabilities of $203.7 million and $194.0 million, respectively, on our condensed consolidated balance sheet. In connection with modified leases that were remeasured during the nine months ended September 30, 2021, we recognized a net decrease in operating lease right-of-use assets and lease liabilities, each of which totaled $5.4 million, on our condensed consolidated balance sheet. Finance Lease Right-of-Use Assets and Liabilities Associated with Unrelated Third Party Leases In connection with leases with unrelated third parties that commenced during the nine months ended September 30, 2021, we recognized finance lease right-of-use assets and lease liabilities, each of which totaled $1.2 million, on our condensed consolidated balance sheet. Remaining Lease Terms and Discount Rates The weighted-average remaining lease terms and discount rates associated with our operating and finance lease liabilities at September 30, 2021 were as follows: September 30, 2021 Weighted-average remaining lease term (1) Operating leases 18.0 years Finance leases 2.2 years Weighted-average discount rate Operating leases 7.98% Finance leases 6.42% (1) The weighted-average remaining lease term associated with our operating and finance lease liabilities does not include all of the optional renewal periods available to us under our current lease arrangements. Rather, the weighted-average remaining lease term only includes periods covered by an option to extend a lease if we are reasonably certain to exercise that option. Sale-Leaseback Transactions Sale-Leaseback Transactions with Unrelated Third Parties Duri ng the nine months ended September 30, 2021, we entered into two sale-leaseback transactions, involving two properties, with unrelated third parties. Under these transactions, we sold property with a net book value of $86.1 million for $76.0 million, which was reduced by transaction costs of $2.0 million, for net cash proceeds of $74.0 million. The estimated fair value of the properties sold was $85.5 million. Sale-leaseback transactions with unrelated third parties are accounted for at fair value. Accordingly, the aggregate sales price associated with these arrangements was increased, for accounting purposes, by a total of $9.5 million, which resulted in the recognition of an aggregate loss of $2.6 million on these transactions. This net loss is included in Other operating in our condensed consolidated statement of operations for the nine months ended September 30, 2021. The leases, each of which has been classified as an operating lease, each has an initial term of 25 years and includes six renewal options of five years each. The $9.5 million increase in the aggregate sales price associated with these sale-leaseback transactions was accounted for as prepaid rent, which was recognized as a non-cash increase in the aggregate operating lease right-of-use asset balance associated with these properties. Supplemental Cash Flow Information Supplemental cash flow information associated with our operating and finance leases is as follows: Nine Months Ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 137,942 $ 87,924 Operating cash flows from finance leases 140 143 Financing cash flows from finance leases 1,133 1,034 Non-cash information: Right-of-use assets obtained in exchange for initial lease liabilities: Operating leases 194,021 145,384 Finance leases 1,150 2,021 Right-of-use asset adjustments recognized as a result of the remeasurement of existing lease liabilities: Operating leases (5,357) 36,865 Non-cash increase in operating lease right-of-use assets associated with below-market sale-leaseback transactions 9,500 19,310 Maturities of Operating and Finance Lease Liabilities The maturities associated with our operating and finance lease liabilities at September 30, 2021 are as follows: Operating leases Finance leases Total October 2021 through September 2022 $ 184,947 1,493 186,440 October 2022 through September 2023 195,386 874 196,260 October 2023 through September 2024 203,040 167 203,207 October 2024 through September 2025 205,024 — 205,024 October 2025 through September 2026 208,241 — 208,241 Thereafter 2,803,049 — 2,803,049 Total lease payments 3,799,687 2,534 3,802,221 Less: Imputed interest 1,852,766 144 1,852,910 Present value of lease liabilities $ 1,946,921 $ 2,390 $ 1,949,311 |
Mezzanine Equity
Mezzanine Equity | 9 Months Ended |
Sep. 30, 2021 | |
Temporary Equity Disclosure [Abstract] | |
Mezzanine Equity | Mezzanine Equity Mezzanine equity consists of Series A Preferred Stock. The following table summarizes the changes in mezzanine equity for the nine months ended September 30, 2021: Preferred Stock Shares Amount Balance at January 1, 2021 — $ — Issuance of Series A Preferred Stock 5,430 149,585 Issuance of restricted Series A Preferred Stock (1) 500 — Share-based compensation associated with restricted Series A Preferred Stock (1) — 4,035 Balance at September 30, 2021 5,930 $ 153,620 (1) During the nine months ended September 30, 2021, the Company granted 0.5 million shares of restricted Series A Preferred Stock to our CEO. At September 30, 2021, th e 0.5 million shares of restricted Series A Preferred Stock associated with this award were issued and outstanding however, all of the shares remained unvested. During the three and nine months ended September 30, 2021, we recognized share-based compensation expense associated with this restricted Series A Preferred Stock award of $2.3 million and $4.0 million, respectively, the offset for which was recognized as an increase in mezzanine equity. Share-based compensation expense associated with this restricted Series A Preferred Stock award is included in General, administrative and marketing in our condensed consolidated statements of operations. Share-based compensation expense associated with this award is recognized over the vesting period based on the grant date fair value per share. For more information regarding this restricted Series A Preferred Stock award, see “—Restricted Series A Preferred Stock” below. Series A Preferred Stock Authorization and Designation On January 11, 2021, our board of directors adopted and approved an amendment to the Certificate of Incorporation for Life Time Group Holdings, Inc., which (i) increased the amount of authorized shares of common stock, $0.01 par value per share, from 170.0 million to 200.0 million; and (ii) authorized 25.0 million shares of preferred stock, $0.01 par value per share. Also on January 11, 2021, our board of directors authorized 12.0 million shares of Series A Preferred Stock of Life Time Group Holdings, Inc., $0.01 par value per share. The rights, preferences, privileges, qualifications, restrictions and limitations relating to the Series A Preferred Stock were set forth in the Certificate of Designations (“COD”), which the Company filed with the Secretary of State of the State of Delaware on January 22, 2021. Voting Rights Holders of Series A Preferred Stock were only entitled to vote on matters specifically related to the Series A Preferred Stock. Dividend Rights From and after the issue date, on each anniversary of the issue date, each share of Series A Preferred Stock was to accrue additional shares of Series A Preferred Stock as a paid-in-kind (“PIK”) dividend on the Liquidation Preference (defined in “—Liquidation Rights” below) in effect at the anniversary date at rate of 15.0% per annum. The PIK dividends were cumulative and compounded annually to the extent that they had not been paid by the Company. Accrued PIK dividends were payable, at the option of the Company, in either cash from any source of funds legally available or additional shares of Series A Preferred Stock. The holders of Series A Preferred Stock were entitled to participate in any dividends or distributions on our common stock or other junior stock of the Company on an as-if-converted basis (assuming full conversion of all outstanding shares of Series A Preferred Stock). Liquidation Rights The Series A Preferred Stock ranked senior to the Company’s common stock or other junior capital stock, with respect to dividend rights and rights on the distribution of assets, in the event of a change of control (“COC”) or any liquidation, winding up of dissolution of the business of the Company, whether voluntary or involuntary (a “Deemed Liquidation Event”). Upon the occurrence of a Deemed Liquidation Event, each holder of shares of Series A Preferred Stock was entitled to receive, for each share, out of assets of the Company legally available for distribution to stockholders or, in the case of a COC, out of the consideration payable to stockholders or the Company in such COC, a preferential amount equal to the greater of (i) the $20.00 per share issue price plus the amount of any accrued dividends (including accrued PIK shares) on such shares of Series A Preferred Stock (“Liquidation Preference”) and (ii) the per share amount of all cash, securities or other property to be distributed in respect of the common stock of the Company that such holder of Series A Preferred Stock would have been entitled to receive had the holder converted such Series A Preferred Stock into shares of common stock of the Company (“Deemed Conversion”), subject to certain adjustments set forth in the COD (details of which are described in “—Conversion Price Adjustments” below). All preferential amounts to be paid to the holders of Series A Preferred Stock in connection with a Deemed Liquidation Event would be paid before the payment or setting apart for payment of any amount for, or the distribution of any assets of the Company to the holders of the Company’s common stock or any other junior stock. Conversion Rights Upon the (i) consummation of an initial public offering, (ii) consummation of a Qualifying Private Sale (“QPS”) or (iii) election of holders of at least 75% of the then outstanding shares of Series A Preferred Stock, each of the outstanding shares of Series A Preferred was to automatically convert (“Automatic Conversion”) into a number of shares of common stock of the Company equal to the Liquidation Preference, subject to certain adjustments set forth in the COD (details of which are described in “—Liquidation Preference Adjustments” below), divided by the $20.00 issue price, subject to certain adjustments set forth in the COD (“Conversion Price”) (details of which are described in “—Conversion Price Adjustments” below). Liquidation Preference Adjustments In the event of an Automatic Conversion or a Deemed Conversion of shares of Series A Preferred Stock into common shares of the Company, the accrued dividends on such shares of Series A Preferred Stock were to be (a) reduced to zero, in the event that the fair value of each share of the Company’s common stock into which such share of Series A Preferred Stock is convertible would equal or exceed the sum of (i) the Liquidation Preference (assuming, for this purpose, that the accrued dividends included in this amount shall not have been reduced to zero) and (ii) any cash dividends paid in respect of such share of Series A Preferred Stock, or (b) reduced to such amount as would provide each holder of such shares of Series A Preferred Stock the 15.0% annual dividend rate from the issue date to the conversion date, in the event that the fair value of each share of the Company’s common stock into which such share of Series A Preferred Stock is convertible exceeds the $20.00 initial price per share but is less than the sum of (i) the Liquidation Preference (assuming, for this purpose, that the accrued dividends included in this amount shall not have been reduced) and (ii) any cash dividends paid in respect of such share of Series A Preferred Stock. Conversion Price Adjustments The Conversion Price, as defined in the COD, means the $20.00 issue price, subject to anti-dilution adjustments; provided, however, that (i) with respect to any shares of Series A Preferred Stock that are converted into the Company’s common stock upon the consummation of an initial public offering, the Conversion Price shall equal the lesser of (a) the $20.00 issue price and (b) the initial public offering price, as applicable, and (ii) with respect to any shares of Series A Preferred Stock that are converted into the Company’s common stock upon the consummation of a QPS, the Conversion Price share equal the lesser of (a) the $20.00 issue price and (b) the price per share paid by the third party purchased in such transaction, as applicable. Mandatory Redemption On July 22, 2026 (the “Redemption Date”), the Company would be required to redeem any and all outstanding shares of Series A Preferred stock, from any source of funds legally available for such purpose at a price per share equal to the Liquidation Preference in respect of the redeemed shares. Series A Preferred Stock Issuance The fair value of the 5.4 million shares of Series A Preferred Stock that the Company issued, as well as the 0.5 million shares associated with the restricted Series A Preferred Stock award that the Company granted to our CEO, during the nine months ended September 30, 2021 was estimated using an as-converted value plus risky put option model. The put option value was estimated using the Black-Scholes option pricing model. Primary assumptions used in determining the estimated issuance date fair value of the Series A Preferred Stock include: the estimated equity value associated with the then outstanding common stock of Life Time Group Holdings, Inc., a strike price of $20.00 per share, PIK dividend yield rate of 15.0%, expected term of 1.0 years, volatility rate of 65.00% and a risk-free rate of 0.08%. For more information regarding the Contribution Agreement and issuance of the Series A Preferred Stock, see Note 6, Debt. For more information regarding the restricted Series A Preferred Stock, see “—Restricted Series A Preferred Stock” below). Restricted Series A Preferred Stock During the second quarter of 2021, in lieu of the vast majority of cash compensation for our CEO for 2021, the Company granted an award of 0.5 million shares of restricted Series A Preferred Stock to our CEO, 50% of which vests on each anniversary of the grant date with 100% full vesting on the date that is 180 days after an initial underwritten public offering. Effective as of the grant date, our CEO has all of the rights of a stockholder with respect to these 0.5 million outstanding shares of restricted Series A Preferred Stock, including the right to receive PIK share or cash dividends. Immediately prior to the granting of this equity award, we had recognized an accrued compensation liability of approximately $1.6 million associated with our CEO’s 2021 compensation. For accounting purposes, the settlement of this $1.6 million accrued compensation liability through issuance of the restricted Series A Preferred Stock award was recognized as a decrease in Accrued expenses and other current liabilities and an increase in Additional paid-in capital on our condensed consolidated balance sheet. As of September 30, 2021, all of the restricted Series A Preferred Stock shares subject to this award were both unvested and outstanding. Share-based compensation expense associated with this restricted Series A Preferred Stock award will be recognized over the vesting period based on the grant date fair value per share, reduced by the $1.6 million of compensation expense associated with the accrued compensation liability that had previously been recognized. During the three and nine months ended September 30, 2021, we recognized share-based compensation expense associated with this restricted Series A Preferred Stock award of $2.3 million and $4.0 million, respectively, the offset for which was recognized as an increase in Mezzanine equity on our condensed consolidated balance sheet (details of which are described in “—Mezzanine Equity Classification” below). Share-based compensation expense associated with this restricted Series A Preferred Stock award is included in General, administrative and marketing in our condensed consolidated statements of operations. As of September 30, 2021, unrecognized share-based compensation expense related to this restricted Series A Preferred Stock award was approxim ately $8.1 million. The estimated fair value associated with this restricted Series A Preferred Stock award will be recognized as share-based compensation expense if and when the related recognition conditions, for accounting purposes, are met. With the consummation of the IPO, previously unrecognized share-based compensation expense associated with this restricted Series A Preferred Stock award will be recognized effective with the date that is 180 days after the effective date associated with such initial public offering. For more information on share-based compensation, see Note 9, Stockholders’ Equity. Mezzanine Equity Classification We applied the guidance in ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, “Derivatives and Hedging” (“ASC 815”), in order to determine the appropriate accounting for both the Series A Preferred Stock that the Company issued, as well as the restricted Series A Preferred Stock award that the Company granted to our CEO, during the nine months ended September 30, 2021. Based on our analysis, we determined that these shares of Series A Preferred Stock (i) do not meet any of the conditions that would require liability accounting, (ii) are more akin to an equity-like host and (iii) do not contain any embedded features that require bifurcation. Also, because these shares of Series A Preferred Stock are (x) redeemable upon the occurrence of certain Deemed Liquidation Events that are not solely within the Company’s control; and (y) required to be redeemed at a determinable price on the Redemption Date, we determined that the carrying value of the Series A Preferred Stock that the Company issued, as well the offset to the recognized share-based compensation expense associated with the restricted Series A Preferred Stock award, is required to be classified as temporary mezzanine equity on our September 30, 2021 condensed consolidated balance sheet. Accordingly, the issuance date fair value of $149.6 million associated with the 5.4 million shares of Series A Preferred Stock that the Company issued during the nine months ended September 30, 2021 was recognized as an increase in Mezzanine equity on our September 30, 2021 condensed consolidated balance sheet. Also, the offset to the $4.0 million of share-based compensation expense associated with the restricted Series A Preferred Stock award that we recognized during the nine months ended September 30, 2021 was recognized as an increase in Mezzanine equity on our September 30, 2021 condensed consolidated balance sheet. At September 30, 2021, the outstanding shares of Series A Preferred Stock were not redeemable, and we determined that it was not probable that these shares would become redeemable. Accrued Dividends At September 30, 2021, PIK dividend shares totaling approximately 0.6 million shares had accrued on the outstanding Series A Preferred Stock and the underlying shares associated with the restricted Series A Preferred Stock award. At September 30, 2021, the estimated fair value of these PIK dividend shares was approximately $16.4 million |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Authorized Common Stock For information on the increase in the amount of authorized shares of common stock of Life Time Group Holdings, Inc. during the nine months ended September 30, 2021, see “Series A Preferred Stock—Authorization and Designation” under Note 8, Mezzanine Equity. Share-Based Compensation Equity Incentive Plan On October 6, 2015, our board of directors adopted the LTF Holdings, Inc. 2015 Equity Incentive Plan (as amended, the “2015 Equity Plan”). During the nine months ended September 30, 2021, our board of directors and stockholders approved an amendment to the 2015 Equity Plan. Pursuant to the amendment, the 2015 Equity Plan provided for the issuance of up to approximately 30.6 million shares of our common stock, plus an annual increase on the first day of each calendar year beginning on January 1, 2022 and ending on and including January 1, 2025, by a number equal to 1.5% of the fully diluted shares of our common stock outstanding on the last day of the immediately preceding fiscal year; provided, that no annual increase shall occur on or after the Company (or its successor) becomes a publicly listed company. On June 6, 2019, we launched a voluntary stock option purchase offer (the “Offer”) whereby, subject to certain conditions and limitations, we offered eligible holders (not including our CEO) of qualifying stock options under the 2015 Equity Plan (“Covered Options”) the right to sell up to a certain number of vested Covered Options back to us. The Offer terminated on July 3, 2019. In connection with the Offer, we purchased approximately 1.6 million Covered Options. Effective with the purchase date, the 1.6 million Covered Options were cancelled, thereby removing these shares from the number of shares available for future grants under the 2015 Equity Plan. As of September 30, 2021, approximately 1.0 million shares were available for future stock-based award grants to employees and other eligible participants under the 2015 Equity Plan. Stock Options Summary of Stock Option Activity Stock option activity for the nine months ended September 30, 2021 is as follows: Shares Weighted Average Outstanding as of December 31, 2020 21,119 $ 11.00 Granted 3,189 19.32 Forfeited (190) 17.41 Outstanding as of September 30, 2021 $ 24,118 12.05 Exercisable as of September 30, 2021 $ — — During the nine month s ended September 30, 2021, the Company granted approximately 3.2 million stock options under the 2015 Equity Plan, of which approximately 1.1 million were granted to executives and approximately 2.1 million were granted to non-executive service providers. These options have a ten-year contractual term from the date of grant. The exercise pric es and terms of these awards were determined and approved by our board of directors or a committee thereof. The exercise price associated with each of these awards is not less than the fair market value per share of our common stock, as determined by our board of directors or a committee thereof, at the time of grant. Of the 1.1 million options granted to executives during the nine months ended September 30, 2021, 50% are time vesting options and 50% are performance vesting options. The time vesting options vest in four four The 2.1 million stock options that were granted to non-executive team members during the nine months ended September 30, 2021 are time vesting options, which vest in four equal installments on each of the first four Unless otherwise determined by the administrator of the 2015 Equity Plan, with respect to the 3.2 million stock options that the Company granted during the nine months ended September 30, 2021: (i) upon an option holder’s termination of services for any reason, any portion of an option that has not become vested on or prior to the termination date shall be forfeited on such date and shall not thereafter become vested or exercisable, and (ii) upon an involuntary termination by the Company for cause (as defined in the underlying option agreement), any portion of an option that has become vested on or prior to the termination date shall be forfeited on such date and shall not thereafter become exercisable. At September 30, 2021, options to purchase approximately 24.1 million shares of our common stock were outstanding. At September 30, 2021, there were no options exercisable because the option exercisability provisions of the underlying stock option agreements were not met. Fair Value of Stock Option Awards The fair value of the approximately 3.2 million stock options granted during the nine months ended September 30, 2021 was calculated using the Black-Scholes option pricing model. The following weighted average assumptions were used in determining the fair value of these options: Nine Months Ended September 30, 2021 Dividend yield 0.00% Risk-free interest rate (1) 0.94% Expected volatility (2) 60.00% Expected term of options (in years) (3) 6.12 Fair Value $ 10.71 (1) The risk-free rate is based on the U.S. treasury yields, in effect at the time of grant or modification, corresponding with the expected term of the options. (2) Expected volatility is based on historical volatilities for a time period similar to that of the expected term of the options. (3) Expected term of the options is based on probability and expected timing of market events leading to option exercise. Share-Based Compensation Expense Associated with Stock Options No share-based compensation expense associated with stock options was recognized for the three and nine months ended September 30, 2021 and 2020. As of September 30, 2021, unrecognized share-based compensation expense related to stock options was approximately $347.8 million . The estimated fair value associated with each outstanding option will be recognized as share-based compensation expense if and when the related recognition conditions, for accounting purposes, are met. A significant portion of the $347.8 million unrecognized share-based compensation expense as of September 30, 2021 is associated with stock options that were granted prior to 2021. Each of these options shall become fully vested and exercisable immediately prior to the effective date associated with the first measurement date (as described in “—Summary of Stock Option Activity” above for all stock options other than those granted to our CEO, which stock options held by our CEO become fully vested and exercisable immediately prior to the effective date associated with a change of control or an initial public offering (notwithstanding any lock-up period)) to occur after the grant date. Accordingly, upon the consummation of the first measurement date to occur after the grant date associated with each of these options, previously unrecognized share-based compensation expense associated with the vested portion of the then-outstanding options will be recognized as of the effective date associated with such measurement date. Restricted Stock Units Beginning on March 15, 2020, our CEO decided to forego 100% of his base salary for the remainder of 2020. During the second quarter of 2021, our compensation committee, in consultation with our CEO and our board of directors, established a new compensation program for our CEO. Under the new program, in light of the foregone salary and bonuses in 2020, the compensation committee determined to grant our CEO an equity award of approximately 0.5 million restricted stock units, 50% of which vests on each anniversary of the grant date with 100% full vesting on the date that is 180 days after an initial underwritten public offering. At December 31, 2020, we had recognized an accrued compensation liability of approximately $2.2 million associated with our CEO’s 2020 compensation. For accounting purposes, the settlement of this $2.2 million accrued compensation liability through the issuance of the restricted stock units was recognized as a decrease in Accrued expenses and other current liabilities and an increase in Additional paid-in capital on our condensed consolidated balance sheet. As of September 30, 2021, all of the restricted stock units subject to this award were both unvested and outstanding. Also during the second quarter of 2021, our compensation committee granted approximately 0.1 million restricted stock units to certain of our non-CEO executives and a new director, 50% of which vests on each anniversary of the grant date and, for the grants to our non-CEO executives, 100% full vesting occurs effective on the date that is 180 days after an initial underwritten public offering. As of September 30, 2021, all of the restricted stock units subject to these awards were both unvested and outstanding. Share-Based Compensation Expense Associated with Restricted Stock Units Share-based compensation expense associated with the restricted stock units that were granted to our CEO and non-CEO executives will be recognized over the vesting period based on the grant date fair value per share of $19.32 . The expense measurement associated with the restricted stock units granted to our CEO will be reduced by the $2.2 million of compensation expense associated with the accrued compensation liability that had previously been recognized. Share-based compensation expense associated with restricted stock units that were granted to our new director will be recognized on a straight-line basis evenly over the vesting period. Share-based compensation expense associated with restricted stock units for the three and nine months ended September 30, 2021 was $1.8 million and $2.9 million, respectively. Share-based compensation expense associated with restricted stock units is included in General, administrative and marketing in our condensed consolidated statements of operations. As of September 30, 2021, unrecognized share-based compensation expense related to restricted stock units was approximately $6.6 million . The estimated fair value associated with each outstanding restricted stock unit will be recognized as share-based compensation expense if and when the related recognition conditions, for accounting purposes, are met. With the consummation of the IPO, previously unrecognized share-based compensation expense associated with the then-outstanding restricted stock units granted to our CEO and non-CEO executives will be recognized effective with the date that is 180 days after the effective date associated with such initial public offering. Restricted Series A Preferred Stock For information regarding the restricted Series A Preferred Stock award that was granted to our CEO during the nine months ended September 30, 2021, see Note 8, Mezzanine Equity. Stockholder Note Receivable In August 2021, we entered into an agreement pursuant to which the outstanding balance owed under the stockholder note receivable was cancelled. The cancellation of the $15.0 million outstanding principal balance associated with the loan was accounted for as an equity transaction, and the Stockholder note receivable and Additional paid-in capital balances recognized on our condensed consolidated balance sheet were each reduced by $15.0 million. The income tax benefit of approximately $3.6 million associated with the stockholder note receivable cancellation was recognized as an increase in both Income tax receivable and Additional paid-in capital on our condensed consolidated balance sheet. |
Commitment and Contingencies
Commitment and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Life Time, Inc. et al. v. Zurich American Insurance Company On August 19, 2020, Life Time, Inc., several of its subsidiaries, and a joint venture entity, Bloomingdale Life Time Fitness LLC (collectively, the “Life Time Parties”) filed a Complaint against Zurich American Insurance Company (“Zurich”) in the Fourth Judicial District of the State of Minnesota, County of Hennepin (Case No. 27-CV-20-10599) (the “Action”) seeking declaratory relief and damages with respect to Zurich’s failure under a property/business interruption insurance policy to provide certain coverage to the Life Time Parties related to the closure or suspension by governmental authorities of their business activities due to the spread or threat of spread of COVID-19. On March 15, 2021, certain of the Life Time Parties filed a First Amended Complaint in the Action adding claims against Zurich under a Builders’ Risk policy related to the suspension of multiple construction projects. This Action is subject to many uncertainties, and the outcome of the matter is not predictable with any assurance. Other Litigation We are also engaged in other proceedings incidental to the normal course of business. Due to their nature, such legal proceedings involve inherent uncertainties, including but not limited to court rulings, negotiations between affected parties and governmental intervention. We establish reserves for matters that are probable and estimable in amounts we believe are adequate to cover reasonable adverse judgments. Based upon the information available to us and discussions with legal counsel, it is our opinion that the outcome of the various legal actions and claims that are incidental to our business will not have a material adverse impact on our consolidated financial position, results of operations or cash flows. Such matters are subject to many uncertainties, and the outcomes of individual matters are not predictable with assurance. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In preparing the accompanying condensed consolidated financial statements, we have evaluated the period from September 30, 2021 through the date the condensed consolidated financial statements were issued for material subsequent events. With the exception of the subsequent events disclosed in Note 1, Nature of Business and Basis of Consolidation and Presentation, there have been no other such events or transactions during this time which would have a material effect on the condensed consolidated financial statements and therefore would require recognition or disclosure |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Accounting and Use of Estimates | The unaudited condensed consolidated financial statements include the accounts of Life Time Group Holdings, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (‘‘GAAP’’), which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In recording transactions and balances resulting from business operations, we use estimates based on the best information available. We revise the recorded estimates when better information is available, facts change or we can determine actual amounts. These revisions can affect our consolidated operating results. All adjustments (consisting of normal recurring adjustments) considered necessary to fairly present our consolidated financial position, results of operations and cash flows for the periods have been included. |
Recently Adopted Accounting Pronouncements | In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 also amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. We adopted ASU 2020-06 effective January 1, 2021. The adoption of ASU 2020-06 did not have an impact on our condensed consolidated financial statements. |
Segment Reporting | Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is our Founder, Chairman and Chief Executive Officer (“CEO”). Our CODM assesses financial performance and allocates resources based on the consolidated financial results at the total entity level. Accordingly, we have determined that we have one operating segment and one reportable segment. |
Fair Value Measurements | The accounting guidance establishes a framework for measuring fair value and expanded disclosures about fair value measurements. The guidance applies to all assets and liabilities that are measured and reported on a fair value basis. This enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The guidance requires that each asset and liability carried at fair value be classified into one of the following categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts related to cash and cash equivalents, accounts receivable, income tax receivable, accounts payable and accrued liabilities approximate fair value. Fair Value Measurements on a Recurring Basis. We had no remeasurements of such assets or liabilities to fair value during either of the three or nine months ended September 30, 2021 and 2020. Financial Assets and Liabilities. At both September 30, 2021 and December 31, 2020, the gross carrying amount of our outstanding debt approximates fair value. The fair value of our debt is based on the amount of future cash flows discounted using rates we would currently be able to realize for similar instruments of comparable maturity. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. For more information regarding our debt, see Note 6, Debt. Fair Value Measurements on a Nonrecurring Basis. Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to our long-lived assets, goodwill, and intangible assets, which are remeasured when the derived fair value is below carrying value on our condensed consolidated balance sheets. For these assets, we do not periodically adjust carrying value to fair value except in the event of impairment. If we determine that impairment has occurred, the carrying value of the asset would be reduced to fair value and the difference would be recorded as a loss within operating income in our condensed consolidated statements of operations. |
Deferred Offering Costs | Prepaid expenses and other current assets at September 30, 2021 include deferred IPO costs totaling approximately $2.2 million. These deferred costs primarily consist of legal, accounting, and other fees relating to the Company’s IPO. With the consummation of the IPO in October 2021, these deferred offering costs will be netted against the related IPO proceeds and recognized during the fourth quarter as a reduction in Additional paid-in capital on our consolidated balance sheet. |
Loss per Share | Basic loss per share is computed by dividing loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. The numerator in the diluted loss per share calculation is derived by adding the effect of assumed common stock conversions to loss available to common stockholders. The denominator in the diluted loss per share calculation is derived by adding shares of common stock deemed to be potentially dilutive to the weighted average number of shares of common stock outstanding during the period. Potentially dilutive securities that are subject to performance or market conditions are considered contingently issuable shares for purposes of calculating diluted loss per share. Accordingly, these contingently issuable shares are excluded from the computation of diluted loss per share until the performance or market conditions have been met. Other potentially dilutive securities that do not involve contingently issuable shares are also excluded from the computation of diluted loss per share if their effect is antidilutive. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Prepaid Expenses | Prepaid expenses and other current assets consisted of the following: September 30, December 31, Property held for sale $ — $ 49,686 Construction contract receivables 5,645 12,398 Deferred membership origination costs 4,177 7,212 Prepaid expenses 25,392 17,935 Prepaid expenses and other current assets $ 35,214 $ 87,231 |
Other Current Assets | Prepaid expenses and other current assets consisted of the following: September 30, December 31, Property held for sale $ — $ 49,686 Construction contract receivables 5,645 12,398 Deferred membership origination costs 4,177 7,212 Prepaid expenses 25,392 17,935 Prepaid expenses and other current assets $ 35,214 $ 87,231 |
Accrued Expenses | Accrued expenses and other current liabilities consisted of the following: September 30, December 31, Real estate taxes $ 33,814 $ 31,015 Accrued interest 41,673 15,010 Payroll liabilities 29,146 17,136 Utilities 7,774 5,379 Self-insurance accruals 24,963 22,444 Corporate accruals 24,711 24,123 Dividends payable 16,414 — Current maturities of finance lease liabilities 1,383 1,171 Other 3,825 1,397 Accrued expenses and other current liabilities $ 183,703 $ 117,675 |
Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following: September 30, December 31, Real estate taxes $ 33,814 $ 31,015 Accrued interest 41,673 15,010 Payroll liabilities 29,146 17,136 Utilities 7,774 5,379 Self-insurance accruals 24,963 22,444 Corporate accruals 24,711 24,123 Dividends payable 16,414 — Current maturities of finance lease liabilities 1,383 1,171 Other 3,825 1,397 Accrued expenses and other current liabilities $ 183,703 $ 117,675 |
Basic and Diluted Loss Per Share | The following table sets forth the calculation of basic and diluted loss per share for both the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Net loss $ (45,442) $ (93,647) $ (274,599) $ (276,304) Dividends accrued on Series A Preferred Stock (6,126) — (16,414) — Loss available to common stockholders $ (51,568) $ (93,647) $ (291,013) $ (276,304) Weighted average common shares outstanding—basic and diluted 145,196 145,196 145,196 145,118 Loss per share—basic and diluted $ (0.36) $ (0.64) $ (2.00) $ (1.90) |
Potential Common Shares Excluded from Computation of Diluted Loss Per Share | The following is a summary of potential shares of common stock that were excluded from the computation of diluted loss per share for both the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Stock options 24,118 21,252 24,118 21,252 Unvested restricted stock units 610 — 610 — Outstanding shares of Series A Preferred Stock 5,430 — 5,430 — Unvested restricted Series A Preferred Stock 500 — 500 — Potential common shares excluded from diluted loss per share 30,658 21,252 30,658 21,252 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Cash Flow Information | Decreases (increases) in operating assets and increases (decreases) in operating liabilities are as follows: Nine Months Ended 2021 2020 Accounts receivable $ (3,604) $ 6,149 Center operating supplies and inventories (3,836) 6,063 Prepaid expenses and other current assets (3,243) 9,965 Income tax receivable 4,372 2,348 Other assets 1,950 4,491 Accounts payable 17,709 10,890 Accrued expenses and other current liabilities 60,270 (3,636) Deferred revenue (16,777) (3,776) Other liabilities 773 12,602 Changes in operating assets and liabilities $ 57,614 $ 45,096 Additional supplemental cash flow information is as follows: Nine Months Ended 2021 2020 Net cash paid for income taxes, net of refunds received (received from income tax refunds, net of taxes paid) $ 221 $ (32,510) Cash payments for interest, net of capitalized interest 82,228 76,213 Capitalized interest 2,476 3,719 |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Indefinite-Lived Intangible Assets | Intangible assets consisted of the following: September 30, 2021 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — 163,000 Member relationships 62,100 (62,100) — Other 15,029 (4,425) 10,604 Total intangible assets $ 240,129 $ (66,525) $ 173,604 December 31, 2020 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — $ 163,000 Member relationships 62,100 (62,100) — Other 5,252 (3,833) 1,419 Total intangible assets $ 230,352 $ (65,933) $ 164,419 |
Finite-Lived Intangible Assets | Intangible assets consisted of the following: September 30, 2021 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — 163,000 Member relationships 62,100 (62,100) — Other 15,029 (4,425) 10,604 Total intangible assets $ 240,129 $ (66,525) $ 173,604 December 31, 2020 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — $ 163,000 Member relationships 62,100 (62,100) — Other 5,252 (3,833) 1,419 Total intangible assets $ 230,352 $ (65,933) $ 164,419 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following is a summary of revenue, by major revenue stream, that we recognized during the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Membership dues and enrollment fees $ 261,033 $ 169,612 $ 653,584 $ 490,151 In-center revenue 110,967 58,737 280,106 214,768 Total center revenue 372,000 228,349 933,690 704,919 Other revenue 13,040 2,681 23,835 14,991 Total revenue $ 385,040 $ 231,030 $ 957,525 $ 719,910 The timing associated with the revenue we recognized during the three months ended September 30, 2021 and 2020 is as follows: Three Months Ended September 30, 2021 Three Months Ended September 30, 2020 Center Other Total Center Other Total Goods and services transferred over time $ 324,350 $ 13,040 $ 337,390 $ 201,174 $ 2,681 $ 203,855 Goods and services transferred at a point in time 47,650 — 47,650 27,175 — 27,175 Total Revenue $ 372,000 $ 13,040 $ 385,040 $ 228,349 $ 2,681 $ 231,030 The timing associated with the revenue we recognized during the nine months ended September 30, 2021 and 2020 is as follows: Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2020 Center Other Total Center Other Total Goods and services transferred over time $ 813,425 $ 23,835 $ 837,260 $ 618,003 $ 14,991 $ 632,994 Goods and services transferred at a point in time 120,265 — 120,265 86,916 — 86,916 Total Revenue $ 933,690 $ 23,835 $ 957,525 $ 704,919 $ 14,991 $ 719,910 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt Components | Debt consisted of the following: September 30, 2021 December 31, 2020 Term Loan Facility, maturing December 2024 $ 843,625 $ — Prior Term Loan Facility, retired January 2021 — 1,471,584 Prior Revolving Credit Facility, retired January 2021 — 94,000 Secured Notes, maturing January 2026 925,000 — Unsecured Notes, maturing April 2026 475,000 — 2023 Notes, retired February 2021 — 450,000 Secured loan—related parties, retired January 2021 — 101,503 Mortgage notes, various maturities (1) 151,244 167,872 Other debt 4,289 4,289 Fair value adjustment 1,981 2,469 Total debt 2,401,139 2,291,717 Less unamortized debt discounts and issuance costs (37,798) (19,121) Total debt less unamortized issuance costs 2,363,341 2,272,596 Less current maturities (31,841) (139,266) Long-term debt, less current maturities $ 2,331,500 $ 2,133,330 (1) Mortgage notes collateralized by certain related real estate and buildings, due through 2027 at a weighted average interest rate of 4.69% and 4.68% at September 30, 2021 and December 31, 2020, respecti vely. |
Future Maturities of Long-Term Debt | Aggregate annual future maturities of long-term debt, excluding unamortized discounts, issuance costs and fair value adjustments, at September 30, 2021 were as follows: October 2021 through September 2022 $ 31,841 October 2022 through September 2023 28,252 October 2023 through September 2024 72,682 October 2024 through September 2025 830,825 October 2025 through September 2026 1,413,281 Thereafter 22,277 Total future maturities of long-term debt $ 2,399,158 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Lease Cost, Weighted-Average Remaining Lease Terms , Discount Rates and Supplemental Cash Flow Information | Lease cost included in our condensed consolidated statements of operations for the three months ended September 30, 2021 and 2020 consisted of the following: Three Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 50,987 46,644 Rent Short-term lease cost 281 338 Rent Variable lease cost 1,245 557 Rent Finance lease cost: Amortization of right-of-use assets 380 652 Depreciation and amortization Interest on lease liabilities 42 43 Interest expense, net of interest income Total lease cost $ 52,935 $ 48,234 Lease cost included in our condensed consolidated statements of operations for the nine months ended September 30, 2021 and 2020 consisted of the following: Nine Months Ended Classification in Condensed 2021 2020 Lease cost: Operating lease cost 150,475 136,760 Rent Short-term lease cost 747 928 Rent Variable lease cost 3,330 782 Rent Finance lease cost: Amortization of right-of-use assets 1,119 1,925 Depreciation and amortization Interest on lease liabilities 140 143 Interest expense, net of interest income Total lease cost $ 155,811 $ 140,538 The weighted-average remaining lease terms and discount rates associated with our operating and finance lease liabilities at September 30, 2021 were as follows: September 30, 2021 Weighted-average remaining lease term (1) Operating leases 18.0 years Finance leases 2.2 years Weighted-average discount rate Operating leases 7.98% Finance leases 6.42% (1) The weighted-average remaining lease term associated with our operating and finance lease liabilities does not include all of the optional renewal periods available to us under our current lease arrangements. Rather, the weighted-average remaining lease term only includes periods covered by an option to extend a lease if we are reasonably certain to exercise that option. Supplemental cash flow information associated with our operating and finance leases is as follows: Nine Months Ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 137,942 $ 87,924 Operating cash flows from finance leases 140 143 Financing cash flows from finance leases 1,133 1,034 Non-cash information: Right-of-use assets obtained in exchange for initial lease liabilities: Operating leases 194,021 145,384 Finance leases 1,150 2,021 Right-of-use asset adjustments recognized as a result of the remeasurement of existing lease liabilities: Operating leases (5,357) 36,865 Non-cash increase in operating lease right-of-use assets associated with below-market sale-leaseback transactions 9,500 19,310 |
Operating and Finance Lease Right-of-Use Assets and Lease Liabilities | Operating and finance lease right-of-use assets and lease liabilities were as follows: September 30, 2021 December 31, 2020 Classification on Condensed Lease right-of-use assets: Operating leases 1,864,246 1,708,597 Operating lease right-of-use assets Finance leases (1) 2,325 2,295 Other assets Total lease right-of-use assets $ 1,866,571 $ 1,710,892 Lease liabilities: Current Operating leases 44,137 49,877 Current maturities of operating lease liabilities Finance leases 1,383 1,171 Accrued expenses and other current liabilities Non-Current Operating leases 1,902,784 1,738,393 Operating lease liabilities, net of current portion Finance leases 1,007 1,202 Other liabilities Total Lease liabilities $ 1,949,311 $ 1,790,643 |
Maturities of Operating Lease Liabilities | The maturities associated with our operating and finance lease liabilities at September 30, 2021 are as follows: Operating leases Finance leases Total October 2021 through September 2022 $ 184,947 1,493 186,440 October 2022 through September 2023 195,386 874 196,260 October 2023 through September 2024 203,040 167 203,207 October 2024 through September 2025 205,024 — 205,024 October 2025 through September 2026 208,241 — 208,241 Thereafter 2,803,049 — 2,803,049 Total lease payments 3,799,687 2,534 3,802,221 Less: Imputed interest 1,852,766 144 1,852,910 Present value of lease liabilities $ 1,946,921 $ 2,390 $ 1,949,311 |
Maturities of Finance Lease Liabilities | The maturities associated with our operating and finance lease liabilities at September 30, 2021 are as follows: Operating leases Finance leases Total October 2021 through September 2022 $ 184,947 1,493 186,440 October 2022 through September 2023 195,386 874 196,260 October 2023 through September 2024 203,040 167 203,207 October 2024 through September 2025 205,024 — 205,024 October 2025 through September 2026 208,241 — 208,241 Thereafter 2,803,049 — 2,803,049 Total lease payments 3,799,687 2,534 3,802,221 Less: Imputed interest 1,852,766 144 1,852,910 Present value of lease liabilities $ 1,946,921 $ 2,390 $ 1,949,311 |
Mezzanine Equity (Tables)
Mezzanine Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Temporary Equity Disclosure [Abstract] | |
Mezzanine Equity Components | Mezzanine equity consists of Series A Preferred Stock. The following table summarizes the changes in mezzanine equity for the nine months ended September 30, 2021: Preferred Stock Shares Amount Balance at January 1, 2021 — $ — Issuance of Series A Preferred Stock 5,430 149,585 Issuance of restricted Series A Preferred Stock (1) 500 — Share-based compensation associated with restricted Series A Preferred Stock (1) — 4,035 Balance at September 30, 2021 5,930 $ 153,620 (1) During the nine months ended September 30, 2021, the Company granted 0.5 million shares of restricted Series A Preferred Stock to our CEO. At September 30, 2021, th e 0.5 million |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Stock Option Activity | Stock option activity for the nine months ended September 30, 2021 is as follows: Shares Weighted Average Outstanding as of December 31, 2020 21,119 $ 11.00 Granted 3,189 19.32 Forfeited (190) 17.41 Outstanding as of September 30, 2021 $ 24,118 12.05 Exercisable as of September 30, 2021 $ — — |
Weighted Average Assumptions Used in Determining Fair Value of Stock Options | The following weighted average assumptions were used in determining the fair value of these options: Nine Months Ended September 30, 2021 Dividend yield 0.00% Risk-free interest rate (1) 0.94% Expected volatility (2) 60.00% Expected term of options (in years) (3) 6.12 Fair Value $ 10.71 (1) The risk-free rate is based on the U.S. treasury yields, in effect at the time of grant or modification, corresponding with the expected term of the options. (2) Expected volatility is based on historical volatilities for a time period similar to that of the expected term of the options. |
Nature of Business and Basis _2
Nature of Business and Basis of Consolidation and Presentation (Details) $ / shares in Units, $ in Millions | Nov. 01, 2021USD ($)$ / sharesshares | Oct. 12, 2021USD ($)$ / sharesshares | Sep. 30, 2021USD ($)provincecenterstate$ / sharesshares | Jan. 11, 2021$ / sharesshares | Jan. 10, 2021shares | Dec. 31, 2020$ / sharesshares |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Number of centers | center | 155 | |||||
Number of states in which entity operates | state | 29 | |||||
Number of provinces in which entity operates | province | 1 | |||||
Sale of Stock [Line Items] | ||||||
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 | 170,000,000 | 170,000,000 | ||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock, authorized (in shares) | 25,000,000 | |||||
Preferred stock, par value (in usd per share) | $ / shares | $ 0.01 | |||||
Unrecognized share-based compensation expense | $ | $ 362.5 | |||||
Subsequent Event | ||||||
Sale of Stock [Line Items] | ||||||
Stock issued upon conversion (in shares) | 6,700,000 | |||||
Conversion of mezzanine equity, shares issued (in shares) | 600,000 | |||||
Common stock, authorized (in shares) | 500,000,000 | |||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | |||||
Preferred stock, authorized (in shares) | 10,000,000 | |||||
Preferred stock, par value (in usd per share) | $ / shares | $ 0.01 | |||||
Subsequent Event | Term Loan Facility, maturing December 2024 | Term Loan Facility | ||||||
Sale of Stock [Line Items] | ||||||
Repayments of debt | $ | $ 575.7 | |||||
Prepayment penalty | $ | $ 5.7 | |||||
Subsequent Event | Series A Preferred Stock | ||||||
Sale of Stock [Line Items] | ||||||
Number of shares converted (in shares) | 5,400,000 | |||||
Conversion of mezzanine equity, shares converted (in shares) | 500,000 | |||||
IPO | Subsequent Event | ||||||
Sale of Stock [Line Items] | ||||||
Sale of common stock (in shares) | 39,000,000 | |||||
Sale of common stock, price (in usd per share) | $ / shares | $ 18 | |||||
Sale of common stock, gross proceeds | $ | $ 702 | |||||
Underwriting discounts and other offering expenses | $ | 22.9 | |||||
Sale of common stock, net proceeds | $ | $ 679.1 | |||||
Underwriters option | Subsequent Event | ||||||
Sale of Stock [Line Items] | ||||||
Sale of common stock (in shares) | 1,600,000 | |||||
Sale of common stock, price (in usd per share) | $ / shares | $ 18 | |||||
Sale of common stock, gross proceeds | $ | $ 28.4 | |||||
Underwriting discounts and other offering expenses | $ | 1.3 | |||||
Sale of common stock, net proceeds | $ | $ 27.1 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)segment | Sep. 30, 2020USD ($) | |
Accounting Policies [Abstract] | ||||
Number of operating segments | segment | 1 | |||
Number of reportable segments | segment | 1 | |||
Impairment charges, long-lived assets | $ | $ 0.7 | $ 9.9 | $ 2.5 | $ 16.9 |
Deferred offering costs | $ | $ 2.2 | $ 2.2 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Property held for sale | $ 0 | $ 49,686 |
Construction contract receivables | 5,645 | 12,398 |
Deferred membership origination costs | 4,177 | 7,212 |
Prepaid expenses | 25,392 | 17,935 |
Prepaid expenses and other current assets | $ 35,214 | $ 87,231 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Real estate taxes | $ 33,814 | $ 31,015 |
Accrued interest | 41,673 | 15,010 |
Payroll liabilities | 29,146 | 17,136 |
Utilities | 7,774 | 5,379 |
Self-insurance accruals | 24,963 | 22,444 |
Corporate accruals | 24,711 | 24,123 |
Dividends payable | 16,414 | 0 |
Current maturities of finance lease liabilities | 1,383 | 1,171 |
Other | 3,825 | 1,397 |
Accrued expenses and other current liabilities | $ 183,703 | $ 117,675 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accounting Policies [Abstract] | ||||
Net loss | $ (45,442) | $ (93,647) | $ (274,599) | $ (276,304) |
Dividends accrued on Series A Preferred Stock | (6,126) | 0 | (16,414) | 0 |
Loss available to common stockholders - basic | (51,568) | (93,647) | (291,013) | (276,304) |
Loss available to common stockholders - diluted | $ (51,568) | $ (93,647) | $ (291,013) | $ (276,304) |
Weighted average common shares outstanding - basic (in shares) | 145,196 | 145,196 | 145,196 | 145,118 |
Weighted average common shares outstanding - diluted (in shares) | 145,196 | 145,196 | 145,196 | 145,118 |
Loss per share - diluted (in usd per share) | $ (0.36) | $ (0.64) | $ (2) | $ (1.90) |
Loss per share - basic (in usd per share) | $ (0.36) | $ (0.64) | $ (2) | $ (1.90) |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Potential Common Shares Excluded from Computation of Diluted Loss Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potential common shares excluded from diluted loss per share | 30,658,000 | 21,252,000 | 30,658,000 | 21,252,000 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potential common shares excluded from diluted loss per share | 24,118,000 | 21,252,000 | 24,118,000 | 21,252,000 |
Unvested restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potential common shares excluded from diluted loss per share | 610,000 | 0 | 610,000 | 0 |
Outstanding shares of Series A Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potential common shares excluded from diluted loss per share | 5,430,000 | 0 | 5,430,000 | 0 |
Unvested restricted Series A Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potential common shares excluded from diluted loss per share | 500,000 | 0 | 500,000 | 0 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information - Changes in Operating Assets and Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts receivable | $ (3,604) | $ 6,149 |
Center operating supplies and inventories | (3,836) | 6,063 |
Prepaid expenses and other current assets | (3,243) | 9,965 |
Income tax receivable | 4,372 | 2,348 |
Other assets | 1,950 | 4,491 |
Accounts payable | 17,709 | 10,890 |
Accrued expenses and other current liabilities | 60,270 | (3,636) |
Deferred revenue | (16,777) | (3,776) |
Other liabilities | 773 | 12,602 |
Changes in operating assets and liabilities | $ 57,614 | $ 45,096 |
Supplemental Cash Flow Inform_4
Supplemental Cash Flow Information - Additional Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net cash paid for income taxes, net of refunds received (received from income tax refunds, net of taxes paid) | $ 221 | $ (32,510) |
Cash payments for interest, net of capitalized interest | 82,228 | 76,213 |
Capitalized interest | $ 2,476 | $ 3,719 |
Goodwill and Intangibles - Narr
Goodwill and Intangibles - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 1,233,176 | $ 1,233,176 | $ 1,233,176 | ||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense, intangible assets | 200 | $ 200 | 600 | $ 3,600 | |
License | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible assets acquired | 10,200 | ||||
Liability for intangible assets acquired | $ 1,100 | $ 1,100 |
Goodwill and Intangibles - Inta
Goodwill and Intangibles - Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ (66,525) | $ (65,933) |
Intangible assets, gross | 240,129 | 230,352 |
Intangible assets, net | 173,604 | 164,419 |
Trade name | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 163,000 | 163,000 |
Member relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 62,100 | 62,100 |
Finite-lived intangible assets, accumulated amortization | (62,100) | (62,100) |
Finite-lived intangible assets, net | 0 | 0 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 15,029 | 5,252 |
Finite-lived intangible assets, accumulated amortization | (4,425) | (3,833) |
Finite-lived intangible assets, net | $ 10,604 | $ 1,419 |
Revenue - Revenue by Major Reve
Revenue - Revenue by Major Revenue Stream (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 385,040 | $ 231,030 | $ 957,525 | $ 719,910 |
Total center revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 372,000 | 228,349 | 933,690 | 704,919 |
Membership dues and enrollment fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 261,033 | 169,612 | 653,584 | 490,151 |
In-center revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 110,967 | 58,737 | 280,106 | 214,768 |
Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 13,040 | $ 2,681 | $ 23,835 | $ 14,991 |
Revenue - Revenue by Timing (De
Revenue - Revenue by Timing (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 385,040 | $ 231,030 | $ 957,525 | $ 719,910 |
Goods and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 337,390 | 203,855 | 837,260 | 632,994 |
Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 47,650 | 27,175 | 120,265 | 86,916 |
Total center revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 372,000 | 228,349 | 933,690 | 704,919 |
Total center revenue | Goods and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 324,350 | 201,174 | 813,425 | 618,003 |
Total center revenue | Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 47,650 | 27,175 | 120,265 | 86,916 |
Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,040 | 2,681 | 23,835 | 14,991 |
Other revenue | Goods and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,040 | 2,681 | 23,835 | 14,991 |
Other revenue | Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||||
Contract liabilities | $ 30,800 | $ 50,300 | $ 30,800 | |
Contract liabilities, current | 28,190 | 45,800 | 28,190 | $ 42,274 |
Contract liabilities, long-term | 2,600 | 4,500 | 2,600 | |
Decrease in contract liabilities | $ (16,777) | $ (3,776) | ||
Decrease in current contract liabilities | 17,600 | |||
Decrease in long-term contract liabilities | $ 1,900 |
Debt - Components (Details)
Debt - Components (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Feb. 05, 2021 | Jan. 22, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Debt | $ 2,399,158 | |||
Fair value adjustment | 1,981 | $ 2,469 | ||
Total debt | 2,401,139 | 2,291,717 | ||
Less unamortized debt discounts and issuance costs | (37,798) | (19,121) | ||
Total debt less unamortized issuance costs | 2,363,341 | 2,272,596 | ||
Less current maturities | (31,841) | (139,266) | ||
Long-term debt, less current maturities | 2,331,500 | 2,133,330 | ||
Term Loan Facility | Term Loan Facility, maturing December 2024 | ||||
Debt Instrument [Line Items] | ||||
Debt | 843,625 | 0 | ||
Term Loan Facility | Prior Term Loan Facility, retired January 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt | 0 | $ 1,471,600 | 1,471,584 | |
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt | 0 | $ 109,000 | 94,000 | |
Line of Credit | Revolving Credit Facility | Prior Revolving Credit Facility, retired January 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt | 0 | 94,000 | ||
Secured Notes, maturing January 2026 | ||||
Debt Instrument [Line Items] | ||||
Debt | 925,000 | 0 | ||
Unsecured Notes, maturing April 2026 | ||||
Debt Instrument [Line Items] | ||||
Debt | 475,000 | 0 | ||
2023 Notes, retired February 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt | 0 | $ 450,000 | 450,000 | |
Secured loan—related parties, retired January 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt | 0 | 101,503 | ||
Mortgage notes, various maturities | ||||
Debt Instrument [Line Items] | ||||
Debt | $ 151,244 | $ 167,872 | ||
Weighted average interest rate | 4.69% | 4.68% | ||
Other debt | ||||
Debt Instrument [Line Items] | ||||
Debt | $ 4,289 | $ 4,289 |
Debt - Senior Secured Credit Fa
Debt - Senior Secured Credit Facility (Details) - USD ($) $ in Millions | Jan. 22, 2021 | Jan. 21, 2021 | Jun. 30, 2015 |
Term Loan Facility | Term Loan Facility, maturing December 2024 | |||
Line of Credit Facility [Line Items] | |||
Aggregate principal amount | $ 850 | ||
Line of Credit | Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Borrowing capacity, maturity extended | 325.2 | ||
Borrowing capacity | $ 357.9 | ||
Line of Credit | Term Loan Facility, maturing December 2024 | Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Borrowing capacity, maturity extended | 325.2 | ||
Borrowing capacity | $ 357.9 | ||
Accordion feature | $ 400 |
Debt - Term Loan Facility (Deta
Debt - Term Loan Facility (Details) - USD ($) $ in Thousands | Jan. 22, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Outstanding balance | $ 2,399,158 | ||
Mandatory quarterly principal repayments | 2,100 | ||
Prior Term Loan Facility, retired January 2021 | Term Loan Facility | |||
Debt Instrument [Line Items] | |||
Outstanding balance | $ 1,471,600 | 0 | $ 1,471,584 |
Repayments of debt | 1,129,200 | ||
Term Loan Facility, maturing December 2024 | Term Loan Facility | |||
Debt Instrument [Line Items] | |||
Outstanding balance | $ 843,625 | $ 0 | |
Aggregate principal amount | 850,000 | ||
Cash proceeds received | 507,600 | ||
Amount rolled over | $ 342,400 | ||
Amortization interest rate | 0.25% | ||
Interest rate floor | 1.00% | ||
Term Loan Facility, maturing December 2024 | Term Loan Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable interest rate | 4.75% | ||
Term Loan Facility, maturing December 2024 | Term Loan Facility | Base rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable interest rate | 3.75% |
Debt - Revolving Credit Facilit
Debt - Revolving Credit Facility (Details) - USD ($) | Jan. 22, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Jan. 21, 2021 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | |||||
Outstanding balance | $ 2,399,158,000 | ||||
Repayments of Long-term Lines of Credit | 228,000,000 | $ 587,902,000 | |||
Revolving Credit Facility | Line of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 357,900,000 | ||||
Outstanding balance | $ 109,000,000 | 0 | $ 94,000,000 | ||
Borrowing capacity, maturity extended | 325,200,000 | ||||
Borrowing capacity, maturity not extended | 32,700,000 | ||||
Repayments of Long-term Lines of Credit | $ 109,000,000 | ||||
Debt covenant, minimum liquidity requirement | 100,000,000 | ||||
Available capacity | $ 217,800,000 | ||||
Weighted average interest rate | 3.83% | ||||
Weighted average amount outstanding | $ 12,100,000 | ||||
Highest month-end balance | 40,000,000 | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario One | |||||
Line of Credit Facility [Line Items] | |||||
Available capacity | $ 185,100,000 | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario One | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable interest rate | 4.25% | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario One | Base rate | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable interest rate | 3.25% | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario Two | |||||
Line of Credit Facility [Line Items] | |||||
Available capacity | $ 32,700,000 | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario Two | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable interest rate | 3.00% | ||||
Revolving Credit Facility | Line of Credit | Interest Rate Scenario Two | Base rate | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable interest rate | 2.00% | ||||
Letter of Credit | Line of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Outstanding balance | $ 40,100,000 |
Debt - Secured Notes (Details)
Debt - Secured Notes (Details) - USD ($) $ in Thousands | Jan. 22, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Outstanding balance | $ 2,399,158 | ||
Secured Notes, maturing January 2026 | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 925,000 | ||
Interest rate | 5.75% | ||
Percentage of principal allowed to redeem | 40.00% | ||
Redemption price percentage | 105.75% | ||
Outstanding balance | $ 925,000 | $ 0 |
Debt - Unsecured Notes (Details
Debt - Unsecured Notes (Details) - USD ($) $ in Thousands | Feb. 05, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2015 |
Debt Instrument [Line Items] | ||||
Outstanding balance | $ 2,399,158 | |||
2023 Notes, retired February 2021 | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 450,000 | |||
Outstanding balance | $ 450,000 | 0 | $ 450,000 | |
Repayments of debt | 450,000 | |||
Unsecured Notes, maturing April 2026 | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 475,000 | |||
Outstanding balance | $ 475,000 | $ 0 | ||
Interest rate | 8.00% | |||
Percentage of principal allowed to redeem | 40.00% | |||
Redemption price percentage | 108.00% |
Debt - Secured Loan - Related P
Debt - Secured Loan - Related Parties (Details) - Secured loan—related parties, retired January 2021 - USD ($) $ in Millions | Jan. 22, 2021 | Sep. 30, 2021 | Jun. 24, 2020 |
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 101.5 | ||
Interest expense, related party | $ 0.7 | ||
Debt, amount converted | $ 108.6 | ||
Stock issued upon conversion (in shares) | 5,400,000 | ||
Stock issued upon conversion | $ 149.6 | ||
Debt extinguishment loss | $ 41 |
Debt - Debt Discounts and Issua
Debt - Debt Discounts and Issuance Costs (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Debt issuance costs incurred | $ 44,400 | ||
Debt discounts and issuance costs, net | 37,798 | $ 19,121 | |
Debt discounts and issuance costs, gross | 78,600 | ||
Debt discount and issuance cost write-offs | 18,325 | $ 0 | |
Credit facility debt issuance costs, net | 1,700 | $ 1,300 | |
Line of Credit | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Debt issuance costs incurred | 800 | ||
Credit facility debt issuance costs, gross | $ 7,400 |
Debt - Debt Covenants (Details)
Debt - Debt Covenants (Details) - Revolving Credit Facility - Line of Credit | Sep. 30, 2021USD ($) |
Debt Instrument [Line Items] | |
Debt covenant, minimum liquidity requirement | $ 100,000,000 |
Debt covenant, first lien net leverage ratio, percent of commitments outstanding threshold | 30.00% |
Debt covenant, first lien net leverage ratio, amount of letters of credit excluded | $ 20,000,000 |
Debt - Future Maturities of Lon
Debt - Future Maturities of Long-Term Debt (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Debt Disclosure [Abstract] | |
October 2021 through September 2022 | $ 31,841 |
October 2022 through September 2023 | 28,252 |
October 2023 through September 2024 | 72,682 |
October 2024 through September 2025 | 830,825 |
October 2025 through September 2026 | 1,413,281 |
Thereafter | 22,277 |
Total future maturities of long-term debt | $ 2,399,158 |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Lease cost: | ||||
Operating lease cost | $ 50,987 | $ 46,644 | $ 150,475 | $ 136,760 |
Short-term lease cost | 281 | 338 | 747 | 928 |
Variable lease cost | 1,245 | 557 | 3,330 | 782 |
Finance lease cost: | ||||
Amortization of right-of-use assets | 380 | 652 | 1,119 | 1,925 |
Interest on lease liabilities | 42 | 43 | 140 | 143 |
Total lease cost | $ 52,935 | $ 48,234 | $ 155,811 | $ 140,538 |
Leases - Operating and Finance
Leases - Operating and Finance Lease Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Lease right-of-use assets: | ||
Operating leases | $ 1,864,246 | $ 1,708,597 |
Finance leases | $ 2,325 | $ 2,295 |
Finance leases location | Other assets | Other assets |
Total lease right-of-use assets | $ 1,866,571 | $ 1,710,892 |
Current | ||
Operating leases | 44,137 | 49,877 |
Finance leases | $ 1,383 | $ 1,171 |
Finance leases location | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Non-Current | ||
Operating leases | $ 1,902,784 | $ 1,738,393 |
Finance leases | $ 1,007 | $ 1,202 |
Finance leases location | Other liabilities | Other liabilities |
Total Lease liabilities | $ 1,949,311 | $ 1,790,643 |
Finance lease right-of-use assets, accumulated amortization | $ 2,100 | $ 1,200 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021USD ($)renewal_option | Sep. 30, 2020USD ($) | |
Leases [Abstract] | ||
Leases commenced during period, operating lease right-of-use asset recognized | $ 203,700 | |
Leases commenced during period, operating lease liability recognized | 194,000 | |
Modified lease remeasured during period, increase in operating lease right-of-use assets | (5,357) | $ 36,865 |
Modified lease remeasured during period, increase in operating lease liabilities | (5,400) | |
Finance lease right-of-use assets for leases commenced during the period | 1,200 | |
Finance lease liabilities for leases commenced during the period | 1,200 | |
Sale-leaseback transaction, net book value | 86,100 | |
Sale-leaseback transaction, gross proceeds | 76,000 | |
Sale-leaseback transaction, transaction costs | 2,000 | |
Sale-leaseback transaction, net proceeds | 73,981 | 122,883 |
Sale-leaseback transaction, fair value | 85,500 | |
Sale-leaseback transaction, fair value adjustment increase | 9,500 | $ 19,310 |
Sale-leaseback transaction, loss | $ 2,600 | |
Sale-leaseback transaction, lease term | 25 years | |
Sale-leaseback transaction, number of renewal options | renewal_option | 6 | |
Sale-leaseback transaction, renewal term | 5 years |
Leases - Remaining Lease Terms
Leases - Remaining Lease Terms and Discount Rates (Details) | Sep. 30, 2021 |
Weighted-average remaining lease term | |
Operating leases | 18 years |
Finance leases | 2 years 2 months 12 days |
Weighted-average discount rate | |
Operating leases | 7.98% |
Finance leases | 6.42% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 137,942 | $ 87,924 |
Operating cash flows from finance leases | 140 | 143 |
Financing cash flows from finance leases | 1,133 | 1,034 |
Right-of-use assets obtained in exchange for initial lease liabilities: | ||
Operating leases | 194,021 | 145,384 |
Finance leases | 1,150 | 2,021 |
Right-of-use asset adjustments recognized as a result of the remeasurement of existing lease liabilities: | ||
Operating leases | (5,357) | 36,865 |
Non-cash increase in operating lease right-of-use assets associated with below-market sale-leaseback transactions | $ 9,500 | $ 19,310 |
Leases - Maturities of Leases (
Leases - Maturities of Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Operating leases | ||
October 2021 through September 2022 | $ 184,947 | |
October 2022 through September 2023 | 195,386 | |
October 2023 through September 2024 | 203,040 | |
October 2024 through September 2025 | 205,024 | |
October 2025 through September 2026 | 208,241 | |
Thereafter | 2,803,049 | |
Total lease payments | 3,799,687 | |
Less: Imputed interest | 1,852,766 | |
Present value of lease liabilities | 1,946,921 | |
Finance leases | ||
October 2021 through September 2022 | 1,493 | |
October 2022 through September 2023 | 874 | |
October 2023 through September 2024 | 167 | |
October 2024 through September 2025 | 0 | |
October 2025 through September 2026 | 0 | |
Thereafter | 0 | |
Total lease payments | 2,534 | |
Less: Imputed interest | 144 | |
Present value of lease liabilities | 2,390 | |
Total | ||
October 2021 through September 2022 | 186,440 | |
October 2022 through September 2023 | 196,260 | |
October 2023 through September 2024 | 203,207 | |
October 2024 through September 2025 | 205,024 | |
October 2025 through September 2026 | 208,241 | |
Thereafter | 2,803,049 | |
Total lease payments | 3,802,221 | |
Less: Imputed interest | 1,852,910 | |
Total Lease liabilities | $ 1,949,311 | $ 1,790,643 |
Mezzanine Equity - Components (
Mezzanine Equity - Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||
Balance (in shares) | 0 | |||
Balance | $ 0 | |||
Issuance of Series A Preferred Stock (in shares) | 5,430,000 | |||
Issuance of Series A Preferred Stock | $ 149,585 | |||
Balance (in shares) | 5,930,000 | 5,930,000 | ||
Balance | $ 153,620 | $ 153,620 | ||
Stock issued (in shares) | 5,930,000 | 5,930,000 | 0 | |
CEO | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||
Issuance of Series A Preferred Stock (in shares) | 500,000 | 500,000 | ||
Share-based compensation associated with restricted Series A Preferred Stock | $ 4,035 | |||
Balance (in shares) | 500,000 | 500,000 | ||
Stock issued (in shares) | 500,000 | 500,000 | ||
Share-based compensation expense | $ 2,300 | $ 4,000 |
Mezzanine Equity - Narrative (D
Mezzanine Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Jan. 11, 2021 | Jan. 10, 2021 | Dec. 31, 2020 |
Temporary Equity [Line Items] | |||||||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 | 200,000,000 | 170,000,000 | 170,000,000 | ||
Preferred stock, authorized (in shares) | 25,000,000 | ||||||
Preferred stock, par value (in usd per share) | $ 0.01 | ||||||
Preferred stock, authorized (in shares) | 12,000,000 | 12,000,000 | 12,000,000 | 12,000,000 | |||
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock dividend rate | 15.00% | ||||||
Preferred stock issue price (in usd per share) | $ 20 | $ 20 | |||||
Preferred stock, convertible upon election of holders, percentage of outstanding shares | 75.00% | 75.00% | |||||
Stock issued (in shares) | 5,430,000 | ||||||
Period for recognition, post initial public offering | 180 days | ||||||
Stock issued | $ 149,585 | ||||||
PIK dividend shares accrued (in shares) | 600,000 | 600,000 | |||||
PIK dividend shares accrued | $ 16,400 | $ 16,400 | |||||
Strike price | |||||||
Temporary Equity [Line Items] | |||||||
Preferred stock, measurement input | 20 | 20 | |||||
Dividend yield rate | |||||||
Temporary Equity [Line Items] | |||||||
Preferred stock, measurement input | 0.150 | 0.150 | |||||
Expected term | |||||||
Temporary Equity [Line Items] | |||||||
Preferred stock, measurement input | 1 | 1 | |||||
Volatility rate | |||||||
Temporary Equity [Line Items] | |||||||
Preferred stock, measurement input | 0.6500 | 0.6500 | |||||
Risk-free rate | |||||||
Temporary Equity [Line Items] | |||||||
Preferred stock, measurement input | 0.0008 | 0.0008 | |||||
CEO | |||||||
Temporary Equity [Line Items] | |||||||
Stock issued (in shares) | 500,000 | 500,000 | |||||
Vesting percentage | 50.00% | ||||||
Accrued compensation liability | $ 1,600 | ||||||
Compensation expense | $ 1,600 | ||||||
Share-based compensation expense | $ 2,300 | $ 4,000 | |||||
Unrecognized share-based compensation expense | $ 8,100 | $ 8,100 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 10 Months Ended | |||
Jul. 03, 2019 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares authorized for issuance (in shares) | 30,600,000 | 30,600,000 | |||||
Annual increase in shares authorized for issuance, percentage of outstanding shares | 1.50% | 1.50% | |||||
Repurchase of stock options (in shares) | 1,600,000 | ||||||
Shares available for future grants (in shares) | 1,000,000 | 1,000,000 | |||||
Stock options granted (in shares) | 3,189,000 | ||||||
Stock options outstanding (in shares) | 24,118,000 | 24,118,000 | 21,119,000 | ||||
Stock options exercisable (in shares) | 0 | 0 | |||||
Unrecognized share-based compensation expense | $ 347,800 | $ 347,800 | |||||
CEO, percentage of base salary forgone | 100.00% | ||||||
Accrued compensation liability | 29,146 | $ 29,146 | $ 17,136 | ||||
Period for recognition, post initial public offering | 180 days | ||||||
Cancellation of stockholder note receivable | 3,645 | $ 3,645 | |||||
Cancellation of stockholder note receivable, income tax benefit | 3,600 | ||||||
Stockholder Note Receivable | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Cancellation of stockholder note receivable | 15,000 | $ 15,000 | |||||
Stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Contractual term | 10 years | ||||||
Share-based compensation expense | 0 | $ 0 | $ 0 | $ 0 | |||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | 1,800 | $ 2,900 | |||||
Grant date fair value per share (in usd per share) | $ 19.32 | ||||||
Unrecognized share-based compensation expense | 6,600 | $ 6,600 | |||||
Executives | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options granted (in shares) | 1,100,000 | ||||||
Vesting period | 4 years | ||||||
Executives | Time vesting options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award percentage | 50.00% | ||||||
Executives | Performance vesting options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award percentage | 50.00% | ||||||
Non-executive service providers | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options granted (in shares) | 2,100,000 | ||||||
Vesting period | 4 years | ||||||
CEO | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | 2,300 | $ 4,000 | |||||
Vesting percentage | 50.00% | ||||||
Accrued compensation liability | $ 2,200 | ||||||
Unrecognized share-based compensation expense | $ 8,100 | $ 8,100 | |||||
CEO | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards granted (in shares) | 500,000 | ||||||
Vesting percentage | 50.00% | ||||||
Vesting period after initial public offering | 180 days | ||||||
Non-CEO executives and directors | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards granted (in shares) | 100,000 | ||||||
Vesting percentage | 50.00% | ||||||
Non-CEO executives | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting percentage | 100.00% | ||||||
Vesting period after initial public offering | 180 days |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Shares | |
Outstanding (in shares) | shares | 21,119,000 |
Granted (in shares) | shares | 3,189,000 |
Forfeited (in shares) | shares | (190,000) |
Outstanding (in shares) | shares | 24,118,000 |
Exercisable (in shares) | shares | 0 |
Weighted Average Exercise Price | |
Outstanding (in usd per share) | $ / shares | $ 11 |
Granted (in usd per share) | $ / shares | 19.32 |
Forfeited (in usd per share) | $ / shares | 17.41 |
Outstanding (in usd per share) | $ / shares | 12.05 |
Exercisable (in usd per share) | $ / shares | $ 0 |
Stockholders' Equity - Weighted
Stockholders' Equity - Weighted Average Assumptions Used in Determining Fair Value of Stock Options (Details) | 9 Months Ended |
Sep. 30, 2021$ / shares | |
Equity [Abstract] | |
Dividend yield | 0.00% |
Risk-free interest rate | 0.94% |
Expected volatility | 60.00% |
Expected term of options | 6 years 1 month 13 days |
Fair value (in dollars per share) | $ 10.71 |