UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
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:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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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.
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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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 |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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 Exchange Act). Yes ☐ No
As of August 8, 2022, the registrant had
Table of Contents
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PART I. |
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Item 1. |
1 |
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1 |
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2 |
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Condensed Consolidated Statements of Changes to Stockholder's/Member’s Equity (Deficit) |
3 |
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4 |
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6 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
29 |
Item 3. |
44 |
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Item 4. |
44 |
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PART II. |
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Item 1. |
45 |
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Item 1A. |
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Item 2. |
46 |
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Item 3. |
46 |
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Item 4. |
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Item 5. |
46 |
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Item 6. |
47 |
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48 |
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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
Xponential Fitness, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(amounts in thousands, except share and per share amounts)
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June 30, |
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December 31, |
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2022 |
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2021 |
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Assets |
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Current Assets: |
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Cash, cash equivalents and restricted cash |
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$ |
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$ |
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Accounts receivable, net (Note 10) |
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Inventories |
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Prepaid expenses and other current assets |
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Deferred costs, current portion |
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Notes receivable from franchisees, net (Note 10) |
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Total current assets |
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Property and equipment, net |
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Right-of-use assets |
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Goodwill |
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Intangible assets, net |
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Deferred costs, net of current portion |
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Notes receivable from franchisees, net of current portion (Note 10) |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities, redeemable convertible preferred stock and deficit |
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Current Liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses |
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Deferred revenue, current portion |
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Notes payable |
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Current portion of long-term debt |
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Other current liabilities |
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Total current liabilities |
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Deferred revenue, net of current portion |
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Contingent consideration from acquisitions (Note 16) |
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Long-term debt, net of current portion, discount and issuance costs |
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Lease liability |
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Other liabilities |
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Total liabilities |
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Redeemable convertible preferred stock, $ |
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Stockholders' equity (deficit): |
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Undesignated preferred stock, $ |
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Class A common stock, $ |
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Class B common stock, $ |
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Additional paid-in capital |
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Receivable from shareholder (Note 10) |
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( |
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Accumulated deficit |
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Total stockholders' deficit attributable to Xponential Fitness, Inc. |
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( |
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Noncontrolling interests |
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Total stockholders' deficit |
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( |
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Total liabilities, redeemable convertible preferred stock and deficit |
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$ |
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$ |
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See accompanying notes to condensed consolidated financial statements.
1
Xponential Fitness, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(amounts in thousands, except share and per share amounts)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2022 |
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2021 |
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2022 |
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2021 |
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Revenue, net: |
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Franchise revenue |
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$ |
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$ |
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$ |
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$ |
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Equipment revenue |
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Merchandise revenue |
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Franchise marketing fund revenue |
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Other service revenue |
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Total revenue, net |
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Operating costs and expenses: |
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Costs of product revenue |
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Costs of franchise and service revenue |
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Selling, general and administrative expenses (Note 10) |
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Depreciation and amortization |
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Marketing fund expense |
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Acquisition and transaction expenses (income) |
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Total operating costs and expenses |
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Operating income (loss) |
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Other (income) expense: |
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Interest income |
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Interest expense (Note 10) |
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Gain on debt extinguishment |
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— |
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— |
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Total other expense |
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Income (loss) before income taxes |
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Income taxes |
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Net income (loss) |
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Less: net income attributable to noncontrolling interests |
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— |
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— |
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Net income (loss) attributable to Xponential Fitness, Inc. |
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$ |
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$ |
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$ |
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$ |
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Net earnings per share of Class A common stock: |
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Basic |
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$ |
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N/A |
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$ |
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N/A |
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Diluted |
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$ |
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N/A |
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$ |
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N/A |
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Weighted average shares of Class A common stock outstanding: |
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Basic |
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N/A |
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N/A |
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Diluted |
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N/A |
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N/A |
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See accompanying notes to condensed consolidated financial statements.
2
Xponential Fitness, Inc.
Condensed Consolidated Statements of Changes to Stockholders'/Member’s Equity (Deficit)
(Unaudited)
(amounts in thousands, except share amounts)
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Class A Common Stock |
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Class B Common Stock |
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Shares |
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Amount |
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Shares |
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Amount |
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Additional Paid-In Capital |
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Member’s |
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Receivable from |
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Accumulated |
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Noncontrolling interests |
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Total |
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Balance at December 31, 2021 |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Conversion of Class B shares to Class A shares |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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Payment of preferred stock dividend |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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Adjustment of preferred stock to redemption value |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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Vesting of Class B Shares |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Balance at March 31, 2022 |
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( |
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Equity based compensation |
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— |
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— |
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— |
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— |
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— |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Conversion of Class B shares to Class A shares |
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— |
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( |
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— |
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( |
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— |
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— |
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— |
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— |
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Payment of preferred stock dividend |
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— |
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— |
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— |
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( |
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— |
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Adjustment of preferred stock to redemption value |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Vesting of Class B Shares |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Vesting of restricted stock units |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Balance at June 30, 2022 |
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