10-Q 1 plnt-20220331.htm 10-Q plnt-20220331
FALSE2022Q10001637207--12-31http://fasb.org/us-gaap/2021-01-31#PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortizationhttp://fasb.org/us-gaap/2021-01-31#PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortizationhttp://fasb.org/us-gaap/2021-01-31#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2021-01-31#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2021-01-31#OtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2021-01-31#OtherLiabilitiesNoncurrent9111100016372072022-01-012022-03-310001637207us-gaap:CommonClassAMember2022-05-01xbrli:shares0001637207us-gaap:CommonClassBMember2022-05-0100016372072022-03-31iso4217:USD00016372072021-12-310001637207us-gaap:CommonClassAMember2021-12-31iso4217:USDxbrli:shares0001637207us-gaap:CommonClassAMember2022-03-310001637207us-gaap:CommonClassBMember2021-12-310001637207us-gaap:CommonClassBMember2022-03-310001637207us-gaap:FranchiseMember2022-01-012022-03-310001637207us-gaap:FranchiseMember2021-01-012021-03-310001637207plnt:CommissionIncomeMember2022-01-012022-03-310001637207plnt:CommissionIncomeMember2021-01-012021-03-310001637207us-gaap:AdvertisingMember2022-01-012022-03-310001637207us-gaap:AdvertisingMember2021-01-012021-03-310001637207plnt:CorporateOwnedStoresMember2022-01-012022-03-310001637207plnt:CorporateOwnedStoresMember2021-01-012021-03-310001637207plnt:EquipmentRevenueMember2022-01-012022-03-310001637207plnt:EquipmentRevenueMember2021-01-012021-03-3100016372072021-01-012021-03-310001637207us-gaap:CommonClassAMember2022-01-012022-03-310001637207us-gaap:CommonClassAMember2021-01-012021-03-3100016372072020-12-3100016372072021-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-12-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-12-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001637207us-gaap:AdditionalPaidInCapitalMember2021-12-310001637207us-gaap:RetainedEarningsMember2021-12-310001637207us-gaap:NoncontrollingInterestMember2021-12-310001637207us-gaap:RetainedEarningsMember2022-01-012022-03-310001637207us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001637207us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-01-012022-03-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-01-012022-03-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-03-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-03-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310001637207us-gaap:AdditionalPaidInCapitalMember2022-03-310001637207us-gaap:RetainedEarningsMember2022-03-310001637207us-gaap:NoncontrollingInterestMember2022-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-12-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-12-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001637207us-gaap:AdditionalPaidInCapitalMember2020-12-310001637207us-gaap:RetainedEarningsMember2020-12-310001637207us-gaap:NoncontrollingInterestMember2020-12-310001637207us-gaap:RetainedEarningsMember2021-01-012021-03-310001637207us-gaap:NoncontrollingInterestMember2021-01-012021-03-310001637207us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-01-012021-03-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-01-012021-03-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001637207us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-03-310001637207us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-03-310001637207us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001637207us-gaap:AdditionalPaidInCapitalMember2021-03-310001637207us-gaap:RetainedEarningsMember2021-03-310001637207us-gaap:NoncontrollingInterestMember2021-03-310001637207srt:MinimumMember2022-01-012022-03-31plnt:memberplnt:storeplnt:stateplnt:segment0001637207plnt:PlaFitHoldingsLLCMember2015-08-05xbrli:pure0001637207plnt:PlanetIntermediateLLCMemberplnt:PlaFitHoldingsLLCMember2015-08-050001637207plnt:PlanetIntermediateLLCMemberplnt:PlanetFitnessHoldingsLLCMember2015-08-050001637207plnt:PlaFitHoldingsLLCMember2022-03-310001637207plnt:PlaFitHoldingsLLCMemberplnt:HoldingsUnitsMember2022-03-310001637207us-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001637207us-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310001637207us-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001637207us-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001637207plnt:PlanetFitnessAustraliaHoldingsMember2021-04-090001637207plnt:PlanetFitnessAustraliaHoldingsMember2021-04-092021-04-090001637207plnt:SunshineFitnessGrowthHoldingsLLCMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMember2022-02-102022-02-100001637207us-gaap:CommonClassAMemberplnt:SunshineFitnessGrowthHoldingsLLCMember2022-02-102022-02-100001637207us-gaap:CommonClassAMemberplnt:SunshineFitnessGrowthHoldingsLLCMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberplnt:HoldingsUnitsMember2022-02-102022-02-100001637207us-gaap:CommonClassBMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberus-gaap:FranchiseRightsMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberus-gaap:FranchiseRightsMember2022-02-102022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberus-gaap:CustomerRelationshipsMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberus-gaap:CustomerRelationshipsMember2022-02-102022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberplnt:AreaDevelopmentAgreementsMember2022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMemberplnt:AreaDevelopmentAgreementsMember2022-02-102022-02-100001637207plnt:SunshineFitnessGrowthHoldingsLLCMember2022-01-012022-03-310001637207plnt:SunshineFitnessGrowthHoldingsLLCMember2021-01-012021-03-310001637207us-gaap:CustomerRelationshipsMember2022-03-310001637207us-gaap:FranchiseRightsMember2022-03-310001637207us-gaap:TrademarksAndTradeNamesMember2022-03-310001637207us-gaap:CustomerRelationshipsMember2021-12-310001637207us-gaap:FranchiseRightsMember2021-12-310001637207us-gaap:TrademarksAndTradeNamesMember2021-12-310001637207plnt:FranchiseSegmentMember2021-12-310001637207plnt:CorporateOwnedStoresSegmentMember2021-12-310001637207plnt:EquipmentSegmentMember2021-12-310001637207plnt:FranchiseSegmentMember2022-01-012022-03-310001637207plnt:CorporateOwnedStoresSegmentMember2022-01-012022-03-310001637207plnt:EquipmentSegmentMember2022-01-012022-03-310001637207plnt:FranchiseSegmentMember2022-03-310001637207plnt:CorporateOwnedStoresSegmentMember2022-03-310001637207plnt:EquipmentSegmentMember2022-03-310001637207plnt:FixedRateSeniorSecuredNotesClassA2IMemberus-gaap:SeniorNotesMember2022-03-310001637207plnt:FixedRateSeniorSecuredNotesClassA2IMemberus-gaap:SeniorNotesMember2021-12-310001637207plnt:FixedRateSeniorSecuredNotesClassA2IIMemberus-gaap:SeniorNotesMember2022-03-310001637207plnt:FixedRateSeniorSecuredNotesClassA2IIMemberus-gaap:SeniorNotesMember2021-12-310001637207us-gaap:SeniorNotesMemberplnt:FixedRateSeniorSecuredNotesClassA2Member2022-03-310001637207us-gaap:SeniorNotesMemberplnt:FixedRateSeniorSecuredNotesClassA2Member2021-12-310001637207us-gaap:SeniorNotesMemberplnt:FixedRateSeniorSecuredNotesClassA2I2022Member2022-03-310001637207us-gaap:SeniorNotesMemberplnt:FixedRateSeniorSecuredNotesClassA2I2022Member2021-12-310001637207plnt:FixedRateSeniorSecuredNotesClassA2II2022Memberus-gaap:SeniorNotesMember2022-03-310001637207plnt:FixedRateSeniorSecuredNotesClassA2II2022Memberus-gaap:SeniorNotesMember2021-12-310001637207us-gaap:RevolvingCreditFacilityMemberplnt:VariableFundingNotesMember2022-03-310001637207us-gaap:RevolvingCreditFacilityMemberplnt:VariableFundingNotesMember2021-12-310001637207plnt:FixedRateSeniorSecuredNotesClassA2IMemberus-gaap:SeniorNotesMember2018-08-010001637207plnt:FixedRateSeniorSecuredNotesClassA2IIMemberus-gaap:SeniorNotesMember2018-08-010001637207us-gaap:RevolvingCreditFacilityMemberplnt:VariableFundingNotesMember2018-08-010001637207us-gaap:SeniorNotesMemberplnt:FixedRateSeniorSecuredNotesClassA2Member2019-12-030001637207plnt:A3251FixedRateClassA2ISeniorSecuredNotesMemberus-gaap:SeniorNotesMember2022-02-100001637207us-gaap:SeniorNotesMemberplnt:A4008FixedRateClassA2IISeniorSecuredNotesMember2022-02-100001637207us-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2022-02-100001637207us-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2022-02-102022-02-100001637207us-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2022-03-310001637207us-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2018-08-012018-08-010001637207us-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2018-08-01plnt:extension0001637207srt:ScenarioForecastMemberus-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2023-09-012023-09-3000016372072018-08-012018-08-0100016372072019-12-032019-12-0300016372072022-02-102022-02-100001637207plnt:FixedRateSeniorSecuredNotesClassA2IMember2022-01-012022-03-310001637207us-gaap:SecuredDebtMemberplnt:SecuritizedSeniorNotesMember2018-08-0100016372072022-04-012022-03-3100016372072023-01-012022-03-3100016372072024-01-012022-03-3100016372072025-01-012022-03-3100016372072026-01-012022-03-3100016372072027-01-012022-03-310001637207plnt:FranchiseSegmentMember2021-01-012021-03-310001637207plnt:EquipmentSegmentMember2021-01-012021-03-310001637207plnt:AreaDevelopmentAgreementsMember2022-03-310001637207plnt:AreaDevelopmentAgreementsMember2021-12-310001637207us-gaap:AdministrativeServiceMemberplnt:PlanetFitnessNAFLLCMember2022-01-012022-03-310001637207us-gaap:AdministrativeServiceMemberplnt:PlanetFitnessNAFLLCMember2021-01-012021-03-310001637207plnt:CorporateTravelMembersrt:AffiliatedEntityMember2022-01-012022-03-310001637207plnt:CorporateTravelMembersrt:AffiliatedEntityMember2021-01-012021-03-310001637207plnt:HoldingsUnitsMember2022-01-012022-03-310001637207us-gaap:CommonClassBMember2022-01-012022-03-310001637207plnt:HoldingsUnitsMember2022-01-012022-03-310001637207plnt:PlaFitHoldingsLLCMember2022-01-012022-03-310001637207us-gaap:CommonClassAMemberplnt:SecondaryOfferingAndExchangeMemberus-gaap:InvestorMember2022-03-310001637207us-gaap:CommonClassAMemberplnt:PlaFitHoldingsLLCMemberplnt:CommonStockholdersMemberplnt:SecondaryOfferingAndExchangeMemberus-gaap:InvestorMember2022-03-310001637207plnt:SecondaryOfferingAndExchangeMemberus-gaap:InvestorMember2022-03-310001637207plnt:PlaFitHoldingsLLCMemberplnt:SecondaryOfferingAndExchangeMemberus-gaap:InvestorMember2022-01-012022-03-310001637207plnt:ContinuingLLCOwnersMemberplnt:SecondaryOfferingAndExchangeMember2022-03-310001637207plnt:PlaFitHoldingsLLCMemberplnt:ContinuingLLCOwnersMemberplnt:SecondaryOfferingAndExchangeMember2022-01-012022-03-310001637207us-gaap:CommonClassBMemberplnt:ContinuingLLCOwnersMemberplnt:SecondaryOfferingAndExchangeMember2022-03-310001637207us-gaap:CommonClassBMemberplnt:PlaFitHoldingsLLCMemberplnt:ContinuingLLCOwnersMemberplnt:SecondaryOfferingAndExchangeMemberplnt:ContinuingLLCOwnersMember2022-03-310001637207us-gaap:EmployeeStockOptionMember2022-01-012022-03-310001637207us-gaap:EmployeeStockOptionMember2021-01-012021-03-310001637207us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001637207us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001637207us-gaap:CommonClassBMemberus-gaap:EquityUnitPurchaseAgreementsMember2022-01-012022-03-310001637207us-gaap:CommonClassBMemberus-gaap:EquityUnitPurchaseAgreementsMember2021-01-012021-03-310001637207us-gaap:CommonClassBMemberus-gaap:EmployeeStockOptionMember2022-01-012022-03-310001637207us-gaap:CommonClassBMemberus-gaap:EmployeeStockOptionMember2021-01-012021-03-310001637207us-gaap:CommonClassBMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001637207us-gaap:CommonClassBMemberus-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-31plnt:agreement0001637207plnt:TRAHoldersMember2022-03-310001637207us-gaap:CommonClassAMemberplnt:TRAHoldersMember2022-01-012022-03-310001637207plnt:TRAHoldersMember2022-01-012022-03-310001637207us-gaap:PendingLitigationMemberplnt:CivilActionBroughtByFormerEmployeeMember2022-03-310001637207us-gaap:IntersegmentEliminationMember2022-01-012022-03-310001637207plnt:FranchiseSegmentMembercountry:US2022-01-012022-03-310001637207plnt:FranchiseSegmentMembercountry:US2021-01-012021-03-310001637207plnt:FranchiseSegmentMemberus-gaap:NonUsMember2022-01-012022-03-310001637207plnt:FranchiseSegmentMemberus-gaap:NonUsMember2021-01-012021-03-310001637207plnt:CorporateOwnedStoresSegmentMembercountry:US2022-01-012022-03-310001637207plnt:CorporateOwnedStoresSegmentMembercountry:US2021-01-012021-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:NonUsMember2022-01-012022-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:NonUsMember2021-01-012021-03-310001637207plnt:CorporateOwnedStoresSegmentMember2021-01-012021-03-310001637207plnt:EquipmentSegmentMembercountry:US2022-01-012022-03-310001637207plnt:EquipmentSegmentMembercountry:US2021-01-012021-03-310001637207plnt:EquipmentSegmentMemberus-gaap:NonUsMember2022-01-012022-03-310001637207plnt:EquipmentSegmentMemberus-gaap:NonUsMember2021-01-012021-03-310001637207plnt:FranchiseSegmentMemberplnt:PlacementServicesMember2022-01-012022-03-310001637207plnt:FranchiseSegmentMemberplnt:PlacementServicesMember2021-01-012021-03-310001637207plnt:FranchiseSegmentMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001637207plnt:FranchiseSegmentMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001637207plnt:EquipmentSegmentMemberus-gaap:OperatingSegmentsMember2022-01-012022-03-310001637207plnt:EquipmentSegmentMemberus-gaap:OperatingSegmentsMember2021-01-012021-03-310001637207us-gaap:CorporateNonSegmentMember2022-01-012022-03-310001637207us-gaap:CorporateNonSegmentMember2021-01-012021-03-310001637207plnt:FranchiseSegmentMemberus-gaap:OperatingSegmentsMember2022-03-310001637207plnt:FranchiseSegmentMemberus-gaap:OperatingSegmentsMember2021-12-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:OperatingSegmentsMember2022-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:OperatingSegmentsMember2021-12-310001637207plnt:EquipmentSegmentMemberus-gaap:OperatingSegmentsMember2022-03-310001637207plnt:EquipmentSegmentMemberus-gaap:OperatingSegmentsMember2021-12-310001637207us-gaap:MaterialReconcilingItemsMember2022-03-310001637207us-gaap:MaterialReconcilingItemsMember2021-12-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:GeographicDistributionForeignMember2022-03-310001637207plnt:CorporateOwnedStoresSegmentMemberus-gaap:GeographicDistributionForeignMember2021-12-310001637207us-gaap:FranchisedUnitsMember2021-12-310001637207us-gaap:FranchisedUnitsMember2020-12-310001637207us-gaap:FranchisedUnitsMember2022-01-012022-03-310001637207us-gaap:FranchisedUnitsMember2021-01-012021-03-310001637207us-gaap:FranchisedUnitsMember2022-03-310001637207us-gaap:FranchisedUnitsMember2021-03-310001637207us-gaap:EntityOperatedUnitsMember2021-12-310001637207us-gaap:EntityOperatedUnitsMember2020-12-310001637207us-gaap:EntityOperatedUnitsMember2022-01-012022-03-310001637207us-gaap:EntityOperatedUnitsMember2021-01-012021-03-310001637207us-gaap:EntityOperatedUnitsMember2022-03-310001637207us-gaap:EntityOperatedUnitsMember2021-03-310001637207us-gaap:SubsequentEventMemberus-gaap:RevolvingCreditFacilityMemberplnt:A2022VariableFundingNotesMember2022-05-092022-05-09

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________to ______________
Commission file number: 001-37534
PLANET FITNESS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 38-3942097
(State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.)
4 Liberty Lane West, Hampton, NH 03842
(Address of Principal Executive Offices and Zip Code)
(603) 750-0001
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act: 
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stock, $0.0001 Par ValuePLNTNew York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes       No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes       No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer   Accelerated filer 
    
Non-accelerated filer   Smaller reporting company 
       
Emerging growth company     
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes      No  
As of May 1, 2022 there were 84,925,763 shares of the Registrant’s Class A Common Stock, par value $0.0001 per share, outstanding and 6,145,722 shares of the Registrant’s Class B Common Stock, par value $0.0001 per share, outstanding.



PLANET FITNESS, INC.
TABLE OF CONTENTS
  
2


Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q, as well as information included in oral statements or other written statements made or to be made by us, contain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, and other future conditions. Forward-looking statements can be identified by words such as “anticipate,” “believe,” “envision,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” “ongoing,” “contemplate” and other similar expressions, although not all forward-looking statements contain these identifying words. Examples of forward-looking statements include, among others, statements we make regarding:
future financial position;
business strategy;
budgets, projected costs and plans;
future industry growth;
financing sources;
potential return of capital initiatives;
the impact of litigation, government inquiries and investigations;
the impact of the novel coronavirus disease (“COVID-19”) and actions taken in response; and
all other statements regarding our intent, plans, beliefs or expectations or those of our directors or officers.
We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. Important factors that could cause actual results and events to differ materially from those indicated in the forward-looking statements include, among others, risks and uncertainties associated with the following:
•    Our business and results of operations have been and may in the future be materially impacted by the ongoing COVID-19 pandemic, and could be impacted by similar events in the future.
Our success depends substantially on the value of our brand, which could be materially and adversely affected by the high level of competition in the health and fitness industry, our ability to anticipate and satisfy consumer preferences, shifting views of health and fitness and our ability to obtain and retain high-profile strategic partnership arrangements.
Our and our franchisees’ stores may be unable to attract and retain members, which would materially and adversely affect our business, results of operations and financial condition.
Our intellectual property rights, including trademarks, trade names, copyrights and trade dress, may be infringed, misappropriated or challenged by others.
We and our franchisees rely heavily on information systems, including the use of email marketing and social media, and any material failure, interruption or weakness may prevent us from effectively operating our business, damage our reputation or subject us to potential fines or other penalties.
If we fail to properly maintain the confidentiality and integrity of our data, including member credit card, debit card, bank account information and other personally identifiable information, our reputation and business could be materially and adversely affected.
The occurrence of cyber incidents, or a deficiency in cybersecurity, could negatively impact our business by causing a disruption to our operations, a compromise or corruption of confidential information, and/or damage to our employee and business relationships and reputation, all of which could harm our brand and our business.
If we fail to successfully implement our growth strategy, which includes new store development by existing and new franchisees, our ability to increase our revenues and operating profits could be adversely affected.
Our planned growth and changes in the industry could place strains on our management, employees, information systems and internal controls, which may adversely impact our business.
If we cannot retain our key employees and hire additional highly qualified employees, we may not be able to successfully manage our businesses and pursue our strategic objectives.
Economic, political and other risks associated with our international operations could adversely affect our profitability and international growth prospects.
Our financial results are affected by the operating and financial results of, our relationships with and actions taken by our franchisees.
We are subject to a variety of additional risks associated with our franchisees, such as potential franchisee bankruptcies, franchisee changes in control, franchisee turnover rising costs related to construction of new stores and maintenance of existing stores, which could adversely affect the attractiveness of our franchise model, and in turn our business, results of operations and financial condition.
3


We and our franchisees could be subject to claims related to health and safety risks to members that arise while at both our corporate-owned and franchise stores.
Our business is subject to various laws and regulations including, among others, those governing indoor tanning, electronic funds transfer, ACH, credit card, debit card, digital payment options auto-renewal contracts, and consumer protection more generally, and changes in such laws and regulations, failure to comply with existing or future laws and regulations or failure to adjust to consumer sentiment regarding these matters, could harm our reputation and adversely affect our business.
We are subject to risks associated with leasing property subject to long-term non-cancelable leases.
If we and our franchisees are unable to identify and secure suitable sites for new franchise stores, our revenue growth rate and profits may be negatively impacted.
Opening new stores in close proximity may negatively impact our existing stores’ revenues and profitability.
Our franchisees may incur rising costs related to construction of new stores and maintenance of existing stores, which could adversely affect the attractiveness of our franchise model, and in turn our business, results of operations and financial condition.
We may be unable to successfully realize the anticipated benefits of the Sunshine Acquisition (as defined herein).
Our dependence on a limited number of suppliers for equipment and certain products and services could result in disruptions to our business and could adversely affect our revenues and gross profit; and
the other factors identified under the heading “Risk Factors” in our annual report on Form 10-K for the fiscal year ended December 31, 2021 filed with the Securities and Exchange Commission.
The forward-looking statements in this Quarterly Report on Form 10-Q represent our views as of the date of this Report. We undertake no obligation to publicly update any forward-looking statements whether as a result of new information, future developments or otherwise.
4

PART I-FINANCIAL INFORMATION
1. Financial Statements
Planet Fitness, Inc. and subsidiaries
Condensed consolidated balance sheets
(Unaudited)
(Amounts in thousands, except per share amounts) 
 March 31, 2022December 31, 2021
Assets  
Current assets:  
Cash and cash equivalents
$471,176 $545,909 
Restricted cash
65,492 58,032 
Accounts receivable, net of allowance for bad debts of $0 and $0 as of March 31, 2022
   and December 31, 2021, respectively
12,886 27,257 
Inventory
1,745 1,155 
Restricted assets – national advertising fund
22,569  
Prepaid expenses
18,476 12,869 
Other receivables
19,622 13,519 
Income tax receivables3,669 3,673 
Total current assets615,635 662,414 
Property and equipment, net of accumulated depreciation of $169,432 and $152,296 as of
   March 31, 2022 and December 31, 2021, respectively
332,935 173,687 
Investments, net of allowance for expected credit losses of $15,352 and $17,462
   as of March 31, 2022 and December 31, 2021, respectively
21,083 18,760 
Right-of-use assets, net353,536 190,330 
Intangible assets, net475,419 200,937 
Goodwill696,299 228,569 
Deferred income taxes493,834 539,264 
Other assets, net3,661 2,022 
Total assets$2,992,402 $2,015,983 
Liabilities and stockholders’ deficit
Current liabilities:
Current maturities of long-term debt
$20,750 $17,500 
Borrowings under Variable Funding Notes75,000  
Accounts payable
24,147 27,892 
Accrued expenses
63,784 51,714 
Equipment deposits
12,966 6,036 
Deferred revenue, current
64,178 28,351 
Payable pursuant to tax benefit arrangements, current
20,302 20,302 
Other current liabilities
44,876 24,815 
Total current liabilities326,003 176,610 
Long-term debt, net of current maturities1,989,533 1,665,273 
Borrowings under Variable Funding Notes 75,000 
Lease liabilities, net of current portion346,695 197,682 
Deferred revenue, net of current portion32,607 33,428 
Deferred tax liabilities910  
Payable pursuant to tax benefit arrangements, net of current portion504,016 507,805 
Other liabilities3,576 3,030 
Total noncurrent liabilities2,877,337 2,482,218 
Commitments and contingencies (Note 13)
Stockholders’ equity (deficit):
Class A common stock, $.0001 par value - 300,000 authorized, 84,907 and 83,804 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively
8 8 
Class B common stock, $.0001 par value - 100,000 authorized, 6,146 and 3,056 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively
1 1 
Accumulated other comprehensive income97 12 
Additional paid in capital
479,535 63,428 
Accumulated deficit
(692,340)(708,804)
Total stockholders’ deficit attributable to Planet Fitness Inc.(212,699)(645,355)
Non-controlling interests
1,761 2,510 
Total stockholders’ deficit(210,938)(642,845)
Total liabilities and stockholders’ deficit$2,992,402 $2,015,983 
 See accompanying notes to condensed consolidated financial statements
5

Planet Fitness, Inc. and subsidiaries
Condensed consolidated statements of operations
(Unaudited)
(Amounts in thousands, except per share amounts)
 
 For the three months ended
March 31,
 20222021
Revenue:  
Franchise$65,614 $52,180 
Commission income503 272 
National advertising fund revenue13,967 11,609 
Corporate-owned stores76,157 37,877 
Equipment30,435 9,939 
Total revenue186,676 111,877 
Operating costs and expenses:
Cost of revenue22,361 7,985 
Store operations47,535 25,907 
Selling, general and administrative30,826 22,490 
National advertising fund expense14,547 12,753 
Depreciation and amortization25,683 15,474 
Other (gains) losses, net(2,933)(2,138)
Total operating costs and expenses138,019 82,471 
Income from operations48,657 29,406 
Other expense, net:
Interest income209 217 
Interest expense(22,631)(20,244)
Other income4,090 165 
Total other expense, net(18,332)(19,862)
Income before income taxes30,325 9,544 
Equity earnings (losses) of unconsolidated entities, net of tax(238) 
Provision for income taxes11,711 3,354 
Net income18,376 6,190 
Less net income attributable to non-controlling interests1,912 609 
Net income attributable to Planet Fitness, Inc.$16,464 $5,581 
Net income per share of Class A common stock:
Basic$0.20 $0.07 
Diluted$0.19 $0.07 
Weighted-average shares of Class A common stock outstanding:
Basic84,166 83,084 
Diluted84,635 83,707 
 
See accompanying notes to condensed consolidated financial statements.
6

Planet Fitness, Inc. and subsidiaries
Condensed consolidated statements of comprehensive income
(Unaudited)
(Amounts in thousands)
 
 For the three months ended
March 31,
 20222021
Net income including non-controlling interests$18,376 $6,190 
Other comprehensive income, net:
Foreign currency translation adjustments85 11 
Total other comprehensive income, net85 11 
Total comprehensive income including non-controlling interests18,461 6,201 
Less: total comprehensive income attributable to non-controlling interests1,912 609 
Total comprehensive income attributable to Planet Fitness, Inc.$16,549 $5,592 
 
See accompanying notes to condensed consolidated financial statements.
7

Planet Fitness, Inc. and subsidiaries
Condensed consolidated statements of cash flows
(Unaudited)
(Amounts in thousands)
 For the three months ended March 31,
 20222021
Cash flows from operating activities:  
Net income$18,376 $6,190 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization25,683 15,474 
Amortization of deferred financing costs1,369 1,571 
Amortization of asset retirement obligations17 (21)
Dividends accrued on investment(451) 
Deferred tax expense10,940 2,737 
Loss on extinguishment of debt1,583  
Equity loss of unconsolidated entities, net of tax238  
Gain on adjustment of allowance for credit losses on held-to-maturity investment(2,110) 
Gain on re-measurement of tax benefit arrangement(3,788)(348)
Loss on reacquired franchise rights1,160  
Equity-based compensation2,850 1,439 
Other(53)11 
Changes in operating assets and liabilities, excluding effects of acquisitions:
Accounts receivable14,415 9,428 
Inventory(589)6 
Other assets and other current assets(5,522)3,708 
Restricted assets - national advertising fund(22,569)(13,721)
Accounts payable and accrued expenses(7,284)(7,677)
Other liabilities and other current liabilities1,035 (3,876)
Income taxes625 295 
Equipment deposits6,869 (621)
Deferred revenue15,306 8,802 
Leases and deferred rent(90)126 
Net cash provided by operating activities58,010 23,523 
Cash flows from investing activities:
Additions to property and equipment(23,872)(6,359)
Acquisition of franchises, net of cash acquired(425,834) 
Investments (25,000)
Net cash used in investing activities(449,706)(31,359)
Cash flows from financing activities:
Principal payments on capital lease obligations(52)(53)
Proceeds from issuance of long-term debt900,000  
Proceeds from issuance of Variable Funding Notes75,000  
Repayment of long-term debt(634,250)(4,375)
Payment of deferred financing and other debt-related costs(16,191) 
Proceeds from issuance of Class A common stock525 344 
Distributions to Continuing LLC Members(815) 
Net cash provided by (used in) financing activities324,217 (4,084)
Effects of exchange rate changes on cash and cash equivalents206 53 
Net decrease in cash, cash equivalents and restricted cash(67,273)(11,867)
Cash, cash equivalents and restricted cash, beginning of period603,941 515,800 
Cash, cash equivalents and restricted cash, end of period$536,668 $503,933 
Supplemental cash flow information:
Net cash paid for income taxes$130 $322 
Cash paid for interest$16,874 $18,794 
Non-cash investing activities:
Non-cash additions to property and equipment$4,470 $7,419 
Fair value of common stock issued as consideration for acquisition$393,730 $ 
 See accompanying notes to condensed consolidated financial statements.
8

Planet Fitness, Inc. and subsidiaries
Condensed consolidated statements of changes in equity (deficit)
(Unaudited)
(Amounts in thousands) 
 Class A
common stock
Class B
common stock
Accumulated
other
comprehensive income
Additional paid-
in capital
Accumulated
deficit
Non-controlling
interests
Total (deficit)
equity
 SharesAmountSharesAmount
Balance at December 31, 202183,804 $8 3,056 $1 $12 $63,428 $(708,804)$2,510 $(642,845)
Net income— — — — — — 16,464 1,912 18,376 
Equity-based compensation expense
— — — — — 2,850 — — 2,850 
Exchanges of Class B common stock
548 — (548)— — (197)— 197  
Exercise of stock options, vesting of restricted share units and ESPP share purchase
38 — — — — 374 — — 374 
Issuance of common stock for acquisition517 — 3,638 — — 395,545 — (1,815)393,730 
Tax benefit arrangement liability and deferred taxes arising from exchanges of Class B common stock
— — — — — 17,535 — — 17,535 
Non-cash adjustments to VIEs
— — — — — — — (228)(228)
Distributions paid to members of Pla-Fit Holdings
— — — — — — — (815)(815)
Other comprehensive income— — — — 85 — — — 85 
Balance at March 31, 202284,907 $8 6,146 $1 $97 $479,535 $(692,340)$1,761 $(210,938)
 
 Class A
common stock
Class B
common stock
Accumulated
other
comprehensive income
Additional paid-
in capital
Accumulated
deficit
Non-controlling
interests
Total (deficit)
equity
 SharesAmountSharesAmount
Balance at December 31, 202082,821 $8 3,722 $1 $27 $45,673 $(751,578)$196 $(705,673)
Net income— — — — — — 5,581 609 6,190 
Equity-based compensation expense
— — — — — 1,439 — 1,439 
Exchanges of Class B common stock
359 — (359)— — (415)— 415  
Exercise of stock options, vesting of restricted share units and ESPP share purchase
22 — — — — 414 — — 414 
Tax benefit arrangement liability and deferred taxes arising from exchanges of Class B common stock
— — — — — 1,164 — — 1,164 
Non-cash adjustments to VIEs
— — — — — — — (223)(223)
Other comprehensive income— — — — 11 — — — 11 
Balance at March 31, 202183,202 $8 3,363 $1 $38 $48,275 $(745,997)$997 $(696,678)

See accompanying notes to condensed consolidated financial statements.
9

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)


(1) Business Organization
Planet Fitness, Inc. (the “Company”), through its subsidiaries, is a franchisor and operator of fitness centers, with more than 16.2 million members and 2,291 owned and franchised locations (referred to as stores) in 50 states, the District of Columbia, Puerto Rico, Canada, Panama, Mexico and Australia as of March 31, 2022.
In March 2020, the Company proactively closed all of its stores system wide in response to COVID-19 in order to promote the health and safety of its members, team members and their communities. As of March 31, 2022, there were no store closures related to COVID-19.
The Company serves as the reporting entity for its various subsidiaries that operate three distinct lines of business:
Licensing and selling franchises under the Planet Fitness trade name.
Owning and operating fitness centers under the Planet Fitness trade name.
Selling fitness-related equipment to franchisee-owned stores.
The Company was formed as a Delaware corporation on March 16, 2015 for the purpose of facilitating an initial public offering (the “IPO”), which was completed on August 11, 2015 and related transactions in order to carry on the business of Pla-Fit Holdings, LLC and its subsidiaries (“Pla-Fit Holdings”). As of August 5, 2015, in connection with the recapitalization transactions that occurred prior to the IPO, the Company became the sole managing member and holder of 100% of the voting power of Pla-Fit Holdings. Pla-Fit Holdings owns 100% of Planet Intermediate, LLC, which has no operations but is the 100% owner of Planet Fitness Holdings, LLC, a franchisor and operator of fitness centers through its subsidiaries. With respect to the Company, Pla-Fit Holdings and Planet Intermediate, LLC, each entity owns nothing other than the respective entity below it in the corporate structure and each entity has no other material operations.
The Company is a holding company whose principal asset is a controlling equity interest in Pla-Fit Holdings. As the sole managing member of Pla-Fit Holdings, the Company operates and controls all of the business and affairs of Pla-Fit Holdings, and through Pla-Fit Holdings, conducts its business. As a result, the Company consolidates Pla-Fit Holdings’ financial results and reports a non-controlling interest related to the portion of limited liability company units of Pla-Fit Holdings (“Holdings Units”) not owned by the Company. Unless otherwise specified, “the Company” refers to both Planet Fitness, Inc. and Pla-Fit Holdings throughout the remainder of these notes.
As of March 31, 2022, Planet Fitness, Inc. held 100.0% of the voting interest and 93.3% of the economic interest of Pla-Fit Holdings and the holders of Holdings Units of Pla-Fit Holdings (the “Continuing LLC Owners”) held the remaining 6.7% economic interest in Pla-Fit Holdings.

(2) Summary of Significant Accounting Policies
(a) Basis of presentation and consolidation
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these interim financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented have been reflected. All significant intercompany balances and transactions have been eliminated in consolidation.
The condensed consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 are unaudited. The condensed consolidated balance sheet as of December 31, 2021 has been derived from the audited financial statements at that date but does not include all of the disclosures required by U.S. GAAP. These interim condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the “Annual Report”) filed with the SEC on March 1, 2021. The Company’s significant interim accounting policies include the proportional recognition of national advertising fund expenses within interim periods. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year.
(b) Use of estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these
10

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

estimates are based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results. Significant areas where estimates and judgments are relied upon by management in the preparation of the consolidated financial statements include revenue recognition, valuation of equity-based compensation awards, valuation of long-lived and intangible assets acquired in a business combination, the evaluation of the recoverability of goodwill and long-lived assets, including intangible assets, income taxes, including deferred tax assets and liabilities and reserves for unrecognized tax benefits, the liability for the Company’s tax benefit arrangements, and the value of the lease liability and related right-of-use asset recorded in accordance with ASC 842 (see Note 7).
(c) Fair Value
ASC 820, Fair Value Measurements and Disclosures, establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows:
Level 1—Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2—Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3—Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
 
The carrying value and estimated fair value of certain assets and liabilities as of March 31, 2022 and December 31, 2021 were as follows:
March 31, 2022December 31, 2021
Carrying value
Estimated fair value(1)
Carrying value
Estimated fair value(1)
Liabilities
Long-term debt(1)
$2,040,750 $1,943,457 $1,700,000 $1,725,021 
Variable Funding Notes(1)
$75,000 $75,000 $75,000 $75,000 
(1) The Company’s Variable Funding Notes are a variable rate loan and the fair value of this loan approximates book value based on the borrowing rates currently available for variable rate loans obtained from third party lending institutions. The estimated fair value of our fixed rate long-term debt is estimated primarily based on current bid prices for our long-term debt. Judgment is required to develop these estimates. As such, the fair value of our long-term debt is classified within Level 2, as defined under U.S. GAAP.
(d) Recent accounting pronouncements
The FASB issued ASU No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, in October, 2021. The guidance improves the accounting for acquired revenue contracts with customers in a business combination by requiring contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC Topic 606, Revenue from Contracts with Customers, as if the acquirer had originated the contracts. This guidance will be effective for fiscal years beginning after December 15, 2022, including interim periods within that year, with early adoption permitted. The Company early adopted this guidance as of January 1, 2022, for all acquisitions subsequent to the adoption date.

11

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

(3) Investments
Investments - Debt securities
As of March 31, 2022, the Company’s debt security investments consist of redeemable preferred shares that are accounted for as held-to-maturity debt securities. The Company’s investments are measured at amortized cost within Investments in the condensed consolidated balance sheets. The Company reviews its held-to-maturity securities for expected credit losses under ASC Topic 326, Credit Impairment, on an ongoing basis.
During the three months ended March 31, 2022, the Company’s review of the investee’s operations and financial position indicated that an adjustment to its allowance for expected credit losses was necessary. The Company utilized a probability-of-default (“PD”) and loss-given-default (“LGD”) methodology to calculate the allowance for expected credit losses. The Company derived its estimate using historical lifetime loss information for assets with similar risk characteristics, adjusted for management’s expectations. Adjustments for management’s expectations were based on the investees recent financial results, current financial position, and forward-looking financial forecasts. Based upon its analysis, the Company recorded a gain on the adjustment of its allowance for credit losses of $2,110 within other (gains) losses, net on the consolidated statements of operations.
The amortized cost, including accrued dividends, of the Company’s held-to-maturity debt security investments was $26,852 and $26,401 and the allowance for expected credit losses was $15,352 and $17,462, as of March 31, 2022 and December 31, 2021, respectively. During the three months ended March 31, 2022, the Company recognized dividend income of $451 within other income on the consolidated statements of operations.
As of March 31, 2022, all of the Company’s held-to-maturity investments had a contractual maturity in 2026.
A roll forward of the Company’s allowance for expected credit losses on held-to-maturity investments is as follows:
Three months ended March 31, 2022
Beginning allowance for expected credit losses$17,462 
Gain on adjustment in allowance for expected credit losses(2,110)
Write-offs, net of recoveries 
Ending allowance for expected credit losses$15,352 
Equity method investments
On April 9, 2021, the Company acquired a 21% ownership in Planet Fitness Australia Holdings, the Company’s franchisee and store operator in Australia, which is deemed to be a related party, for $10,000, which is accounted for under the equity method. For the three months ended March 31, 2022, the Company’s proportionate share of the earnings in accordance with the equity method was a loss of $238, recorded within equity earnings of unconsolidated entities on the condensed consolidated statement of operations. The adjusted carrying value of the equity method investment was $9,582 and $9,820 as of March 31, 2022 and December 31, 2021, respectively.




12

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

(4) Acquisition
Sunshine Fitness Acquisition
On February 10, 2022, the Company and Pla-Fit Holdings (together with the Company, the “Buyers”), acquired 100% of the equity interests (“Sunshine Acquisition”) of Sunshine Fitness Growth Holdings, LLC, a Delaware limited liability company and Planet Fitness franchisee (“Sunshine Fitness”). The Company acquired 114 stores in Alabama, Florida, Georgia, North Carolina, and South Carolina from Sunshine Fitness. The preliminary purchase price of the acquisition was approximately $825,670 consisting of approximately $431,939 in cash consideration and approximately $393,730 of equity consideration, including 517,348 shares of Class A Common Stock, par value $0.0001, of the Company and 3,637,678 membership units of Pla-Fit Holdings, LLC, together with shares of Class B Common Stock, par value $0.0001, of the Company, valued based on the closing trading price of the Company’s Class A common stock on the acquisition date. As a result of the transaction, the Company incurred a loss on unfavorable reacquired franchise rights of $1,160, which has been reflected in other (gains) losses, net in the condensed consolidated statement of operations. The loss reduced the net purchase price to $824,509. In connection with the acquisition, the Company recorded a gain of $2,059 related to the settlement of preexisting contracts with Sunshine Fitness within other (gains) losses, net on the condensed consolidated statement of operations. The acquired stores are included in the corporate-owned stores segment.
The preliminary allocation of the estimated purchase consideration was allocated as follows:
Amount
Cash and cash equivalents$6,105 
Other current assets4,930 
Property and equipment152,548 
Right of use assets165,847 
Other long term assets1,613 
Intangible assets283,000 
Goodwill467,730 
Deferred income taxes, net(52,942)
Deferred revenue(19,638)
Other current liabilities(15,134)
Lease liabilities(168,783)
Other long term liabilities(767)
$824,509 
The fair values assigned to tangible and intangible assets acquired and liabilities assumed are preliminary based on management’s estimates and assumptions, which include Level 3 unobservable inputs, and are determined using generally accepted valuation techniques. These estimates may be subject to change as additional information is received and certain tax matters are finalized. The excess of purchase consideration over the fair value of other assets acquired and liabilities assumed was recorded as goodwill. The resulting goodwill is primarily attributable to increased expansion for market opportunities, the expansion of store membership and synergies from the integration of the stores into the broader corporate-owned store portfolio. Approximately $163,000 of the preliminary goodwill recorded is expected to be amortizable and deductible for tax purposes, the majority of which is deductible over 15 years.
13

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

The following table sets for the components of identifiable intangible assets acquired in the Sunshine Acquisition and their preliminary estimated useful lives as of the date of the acquisition:
Fair valueUseful life
Reacquired franchise rights (1)
256,340 11.9
Customer relationships (2)
25,220 8.0
Reacquired area development rights (3)
1,440 5.0
Total intangible assets subject to amortization283,000 
(1) Reacquired franchise rights represent the fair value of the reacquired franchise agreements using the income approach, specifically, the multi-period excess earnings method.
(2) Customer relationships represent the fair value of the existing contractual customer relationships using the income approach, specifically, the multi-period excess earnings method.
(3) Reacquired area development rights represent the fair value of the undeveloped area development agreement rights using the cost approach.
The fair value of the identified intangible assets subject to amortization will be amortized over the assets’ preliminary estimated useful lives based on the pattern in which the economic benefits are expected to be received.
The primary areas that remain preliminary relate to the fair values of certain tangible and intangible assets acquired, income and non-income-based taxes and residual goodwill. The Company expects to finalize the valuation as soon as practicable, but not later than one year from the acquisition date.

Revenues and income before taxes of Sunshine Fitness included in the Company’s consolidated statement of operations from the acquisition date of February 10, 2022 to March 31, 2022 are as follows:
Total revenues$28,696 
Income before taxes$7,329 

The following pro forma financial information summarizes the combined results of operations for the Company and Sunshine Fitness, as though the companies were combined as of the beginning of 2021. The pro forma financial information was as follows:
For the three months ended March 31,
20222021
Total revenues$207,126 $148,661 
Income before taxes$15,414 $9,638 
Net income$7,163 $6,260 
14

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

(5) Goodwill and Intangible Assets
A summary of goodwill and intangible assets at March 31, 2022 and December 31, 2021 is as follows: 
March 31, 2022Gross
carrying
amount
Accumulated
amortization
Net carrying
Amount
Customer relationships$199,253 $(141,429)$57,824 
Reacquired franchise rights295,938 (24,943)270,995 
 495,191 (166,372)328,819 
Indefinite-lived intangible:
Trade and brand names146,600 — 146,600 
Total intangible assets$641,791 $(166,372)$475,419 
Goodwill$696,299 $ $696,299 
 
December 31, 2021Gross
carrying
amount
Accumulated
amortization
Net carrying
Amount
Customer relationships$174,033 $(137,699)$36,334 
Reacquired franchise rights38,158 (20,155)18,003 
 212,191 (157,854)54,337 
Indefinite-lived intangible:
Trade and brand names146,600 — 146,600 
Total intangible assets$358,791 $(157,854)$200,937 
Goodwill$228,569 $ $228,569 
A roll forward of goodwill between December 31, 2021 and March 31, 2022 is as follows:
FranchiseCorporate-owned storesEquipmentTotal
As of December 31, 2021
$16,938 $118,965 $92,666 $228,569 
Acquisition of franchisee-owned stores 467,730  467,730 
As of March 31, 2022
$16,938 $586,695 $92,666 $696,299 
The Company determined that no impairment charges were required during any periods presented.
Amortization expense related to the intangible assets totaled $8,528 and $4,159 for the three months ended March 31, 2022 and 2021, respectively. The anticipated annual amortization expense related to intangible assets to be recognized in future years as of March 31, 2022 is as follows:
 Amount
Remainder of 2022$31,992 
202350,924 
202449,791 
202538,484 
202633,660 
Thereafter123,968 
Total$328,819 
15

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

(6) Long-Term Debt
Long-term debt as of March 31, 2022 and December 31, 2021 consists of the following: 
 March 31, 2022December 31, 2021
2018-1 Class A-2-I notes$ $556,312 
2018-1 Class A-2-II notes603,125 604,688 
2019-1 Class A-2 notes537,625 539,000 
2022-1 Class A-2-I notes425,000  
2022-1 Class A-2-II notes475,000  
Borrowings under Variable Funding Notes75,000 75,000 
Total debt, excluding deferred financing costs2,115,750 1,775,000 
Deferred financing costs, net of accumulated amortization(30,467)(17,227)
Total debt2,085,283 1,757,773 
Current portion of long-term debt20,750 17,500 
Current portion of borrowings under Variable Funding Notes75,000  
Long-term debt and borrowings under Variable Funding Notes, net of current portion$1,989,533 $1,740,273 
Future annual principal payments of long-term debt as of March 31, 2022 are as follows: 
 Amount
Remainder of 2022$15,563 
202320,750 
202420,750 
2025600,438 
2026494,312 
Thereafter963,937 
Total$2,115,750 
On August 1, 2018, Planet Fitness Master Issuer LLC (the “Master Issuer”), a limited-purpose, bankruptcy remote, wholly-owned indirect subsidiary of Pla-Fit Holdings, LLC, entered into a base indenture and a related supplemental indenture (collectively, the “2018 Indenture”) under which the Master Issuer may issue multiple series of notes. On the same date, the Master Issuer issued Series 2018-1 4.262% Fixed Rate Senior Secured Notes, Class A-2-I (the “2018 Class A-2-I Notes”) with an initial principal amount of $575,000 and Series 2018-1 4.666% Fixed Rate Senior Secured Notes, Class A-2-II (the “2018 Class A-2-II Notes” and, together with the 2018 Class A-2-I Notes, the “2018 Notes”) with an initial principal amount of $625,000. In connection with the issuance of the 2018 Notes, the Master Issuer also entered into a revolving financing facility that allows for the incurrence of up to $75,000 in revolving loans and/or letters of credit under the Master Issuer’s Series 2018-1 Variable Funding Senior Notes, Class A-1 (the “2018 Variable Funding Notes”). The Company fully drew down on the Variable Funding Notes on March 20, 2020. On December 3, 2019 the Master Issuer issued Series 2019-1 3.858% Fixed Rate Senior Secured Notes, Class A-2 (the “2019 Notes”) with an initial principal amount of $550,000. The 2019 Notes were issued under the 2018 Indenture and a related supplemental indenture dated December 3, 2019 (together, the “2019 Indenture”). On February 10, 2022, the Company completed a prepayment in full of its 2018-1 Class A-2-I Notes and an issuance of Series 2022-1 3.251% Fixed Rate Senior Secured Notes, Class A-2-I with an initial principal amount of $425,000 and Series 2022-1 4.008% Fixed Rate Senior Secured Notes, Class A-2-II with an initial principal amount of $475,000 (the “2022 Notes” and, together with the 2018 Notes and 2019 Notes, the “Notes”), and also entered into a new revolving financing facility that allows for the issuance of up to $75,000 in Variable Funding Notes (“2022 Variable Funding Notes”) and certain letters of credit (the issuance of such notes, the “Series 2022-I Issuance”). The 2022 Notes were issued under the 2018 Indenture and a related supplemental indenture dated February 10, 2022 (together, with the 2019 Indenture, the “Indenture”). Together, the Notes, 2018 Variable Funding Notes and 2022 Variable Funding Notes will be referred to as the “Securitized Senior Notes”. On February 10, 2022, the Company borrowed the full amount of the $75,000 2022 Variable Funding Notes and used such proceeds to repay the outstanding principal amount (together with all accrued and unpaid interest thereon) of the 2018 Variable Funding Notes in full.
16

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

The Notes were issued in securitization transactions pursuant to which most of the Company’s domestic revenue-generating assets, consisting principally of franchise-related agreements, certain corporate-owned store assets, equipment supply agreements and intellectual property and license agreements for the use of intellectual property, were assigned to the Master Issuer and certain other limited-purpose, bankruptcy remote, wholly-owned indirect subsidiaries of the Company that act as guarantors of the Securitized Senior Notes and that have pledged substantially all of their assets to secure the Securitized Senior Notes.
Interest and principal payments on the Notes are payable on a quarterly basis. The requirement to make such quarterly principal payments on the Notes is subject to certain financial conditions set forth in the Indenture. The legal final maturity date of the 2018 Class A-2-II Notes is in September 2048, but it is anticipated that, unless earlier prepaid to the extent permitted under the Indenture, the 2018 Class A-2-II Notes will be repaid in or prior to September 2025. The legal final maturity date of the 2019 Notes is in December 2049, but it is anticipated that, unless earlier prepaid to the extent permitted under the Indenture, the 2019 Notes will be repaid in or prior to December 2029. The legal final maturity date of the 2022 Notes is in February 2052, but it is anticipated that, unless earlier prepaid to the extent permitted under the Indenture, the 2022 Class A-2-I Notes will be repaid in or prior to December 2026 and the 2022 Class A-2-II Notes will be repaid in or prior to December 2031 (together, the “Anticipated Repayment Dates”). If the Master Issuer has not repaid or refinanced the Notes prior to the respective Anticipated Repayment Dates, additional interest will accrue pursuant to the Indenture.

As noted above, the Company borrowed the full $75,000 in 2022 Variable Funding Notes on February 10, 2022. The 2022 Variable Funding Notes accrue interest at a variable interest rate based on (i) the prime rate, (ii) overnight federal funds rates, (iii) the secured overnight financing rate (or “SOFR”) for U.S. Dollars, or (iv) with respect to advances made by conduit investors, the weighted average cost of, or related to, the issuance of commercial paper allocated to fund or maintain such advances, in each case plus any applicable margin and as specified in the 2022 Variable Funding Notes. As of March 31, 2022, the applicable borrowing rate is 2.45%. There is a commitment fee on the unused portion of the 2022 Variable Funding Notes of 0.5% based on utilization. It is anticipated that the principal and interest on the 2022 Variable Funding Notes will be repaid in full in or prior to December 2026, subject to two additional one-year extension options. Following the anticipated repayment date (and any extensions thereof) additional interest will accrue on the 2022 Variable Funding Notes equal to 5.0% per year.

In connection with the issuance of the 2018 Notes, 2019 Notes, and 2022 Notes the Company incurred debt issuance costs of $27,133, $10,577, and $16,191 respectively. The debt issuance costs are being amortized to “Interest expense” through the Anticipated Repayment Dates of the Notes utilizing the effective interest rate method. As a result of the repayment of the 2018 Class A-2-I Notes prior to the Anticipated Repayment Date, the Company recorded a loss on early extinguishment of debt of $1,583 within interest expense on the Consolidated statements of operations, consisting of the write-off of remaining unamortized deferred financing costs related to the issuance of the 2018 Class A-2-I Notes.
The Securitized Senior Notes are subject to covenants and restrictions customary for transactions of this type, including (i) that the Master Issuer maintains specified reserve accounts to be used to make required payments in respect of the Securitized Senior Notes, (ii) provisions relating to optional and mandatory prepayments and the related payment of specified amounts, including specified make-whole payments in the case of the Notes under certain circumstances, (iii) certain indemnification payments in the event, among other things, the assets pledged as collateral for the Securitized Senior Notes are in stated ways defective or ineffective, (iv) a cap on non-securitized indebtedness of $50,000 (provided that the Company may incur non-securitized indebtedness in excess of such amount, subject to the leverage ratio cap described below, under certain conditions, including if the relevant lenders execute a non-disturbance agreement that acknowledges the bankruptcy-remote status of the Master Issuer and its subsidiaries and of their respective assets), (v) a leverage ratio cap incurrence test on the Company of 7.0x (calculated without regard for any indebtedness subject to the $50,000 cap) and (vi) covenants relating to recordkeeping, access to information and similar matters.
Pursuant to a parent company support agreement, the Company has agreed to cause its subsidiary to perform each of its obligations (including any indemnity obligations) and duties under the Management Agreement and under the contribution agreements entered into in connection with the securitized financing facility, in each case as and when due. To the extent that such subsidiary has not performed any such obligation or duty within the prescribed time frame after such obligation or duty was required to be performed, the Company has agreed to either (i) perform such obligation or duty or (ii) cause such obligations or duties to be performed on the Company’s behalf.
The Securitized Senior Notes are also subject to customary rapid amortization events provided for in the Indenture, including events tied to failure to maintain stated debt service coverage ratios, certain manager termination events, an event of default, and the failure to repay or refinance the Notes on the applicable scheduled Anticipated Repayment Dates. The Securitized
17

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

Senior Notes are also subject to certain customary events of default, including events relating to non-payment of required interest, principal, or other amounts due on or with respect to the Securitized Senior Notes, failure to comply with covenants within certain time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, and certain judgments.
In accordance with the Indenture, certain cash accounts have been established with the Indenture trustee (the “Trustee”) for the benefit of the trustee and the noteholders, and are restricted in their use. The Company holds restricted cash which primarily represents cash collections held by the Trustee, interest, principal, and commitment fee reserves held by the Trustee related to the Securitized Senior Notes. As of March 31, 2022, the Company had restricted cash held by the Trustee of $49,484. Restricted cash has been combined with cash and cash equivalents when reconciling the beginning and end of period balances in the consolidated statements of cash flows.
(7) Leases
LeasesClassificationMarch 31, 2022December 31, 2021
Assets
Operating lease ROU assetsRight of use asset, net$353,536 $190,330 
Finance lease assetsProperty and equipment, net of accumulated depreciation411 222 
Total lease assets$353,947 $190,552 
Liabilities
Current:
OperatingOther current liabilities$42,151 $22,523 
Noncurrent:
OperatingLease liabilities, net of current portion346,695 197,682 
FinancingOther liabilities419 230 
Total lease liabilities$389,265 $220,435 
Weighted-average remaining lease term (years) - operating leases8.58.7
Weighted-average discount rate - operating leases4.5 %5.0 %

During the three months ended March 31, 2022 and 2021, the components of lease cost were as follows:
Three months ended March 31,
20222021
Operating lease cost$11,595 $6,693 
Variable lease cost4,614 2,374 
Total lease cost$16,209 $9,067 

The Company’s costs related to short-term leases, those with a duration between one and twelve months, were immaterial.

18

Planet Fitness, Inc. and subsidiaries
Notes to Condensed Consolidated financial statements
(Unaudited)
(Amounts in thousands, except share and per share amounts)

Supplemental disclosures of cash flow information related to leases were as follows:
Three months ended March 31,
20222021
Cash paid for lease liabilities$10,536 $6,577 
Operating lease ROU assets obtained in exchange for operating lease liabilities, excluding the Sunshine Acquisition5,997 4,627 
Preliminary Sunshine Acquisition operating lease ROU assets obtained in exchange for operating lease liabilities165,847