8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of The Securities Exchange Act of 1934

January 10, 2022

Date of Report (Date of earliest event reported)

Planet Fitness, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-37534	38-3942097
(State or other jurisdiction<br>of incorporation)	(Commission<br>File Number)	(I.R.S. Employer<br>Identification No.)

4 Liberty Lane West

Hampton, NH 03842

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (603) 750-0001

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Exchange act:

Title of each class	Trading<br>Symbol(s)	Name of each exchange<br>on which registered
Class A common stock, $0.0001 Par Value	PLNT	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

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. ☐

Item 1.01. Entry into a Material Definitive Agreement.

Equity Purchase Agreement

On January 10, 2022, Planet Fitness, Inc. (the “Company”) and Pla-Fit Holdings LLC, a wholly owned subsidiary of the Company (together with the Company, the “Buyers”), entered into an equity purchase agreement (the “Purchase Agreement”) with Sunshine Fitness Growth Holdings, LLC, a Delaware limited liability company (“Sunshine”), TSG7 A AIV III, L.P., a Delaware limited partnership, Sunshine Fitness Group Holdings, LLC, a Delaware limited liability company, Eric Dore, Shane McGuiness, Joseph Landau, The Glenn Dowler Irrevocable GST Trust of 2018, the Shannon Dowler Irrevocable GST Trust of 2018, Michael Hicks, The David W. Blevins Irrevocable GST Trust of 2020, and The Heather L. Blevins Irrevocable GST Trust of 2020, TSG7 A AIV III Holdings-A, L.P., TSG7 A AIV III Holdings, L.P., a Delaware limited partnership (“Blocker” together with the Company, the “Acquired Entities” ), and TSG7 A AIV III, L.P., in its capacity as the Sellers’ Representative. Pursuant to the Purchase Agreement, Buyers will acquire 100% of the equity interests of the Acquired Entities (the “Transaction”).

Pursuant to the Purchase Agreement, and subject to the terms and conditions thereof, the Buyers have agreed to acquire all the outstanding equity interests of the Acquired Entities for aggregate consideration of $800 million including $425 million in cash consideration and $375 million of a combination of Class A Common Stock, par value $0.0001, of the Company and membership units of Pla-Fit Holdings, LLC, together with shares of Class B Common Stock, par value $0.0001, of the Company, valued at the volume weighted average of the closing price of the Class A Common Stock on the New York Stock Exchange for the ten trading day period comprised of the five trading days immediately preceding the execution of the Purchase Agreement (including the date of the Purchase Agreement) and the five trading days following execution of the Purchase Agreement. The purchase price is subject to customary adjustments at closing, including for working capital adjustments. The Purchase Agreement provides for customary representations, warranties and covenants, and provides certain termination rights for each party. The Transaction is expected to close in the first quarter of 2022. Closing under the Purchase Agreement is subject to conditions, including financing of the acquisition, consents of third parties and approval or expiration of the waiting period under the Hart-Scott Rodino Act.

Item 2.02. Results of Operations and Financial Condition.

On January 11, 2022, the Company issued a press release including commentary regarding operational results for the year ended December 31, 2021. A copy of this press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 2.02.

In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Press Release dated January 11, 2022
104	The cover page from this Current Report on Form 8-K, formatted in Inline XBRL (included as Exhibit 101)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

PLANET FITNESS, INC.
By: /s/ Thomas Fitzgerald
Name: Thomas Fitzgerald
Title:   Chief Financial Officer

Dated: January 11, 2022

EX-99.1

Exhibit 99.1

****

PLANET FITNESS, INC. TO ACQUIRE 114 LOCATIONS FROM ONE OF ITS TOPFRANCHISEES,

SUNSHINE FITNESS GROWTH HOLDINGS, LLC.

Transaction expected to be accretive to Adjusted Net Income per diluted share in 2022

Locations with leading store-level profit margins in the Planet Fitness system

Company will own approximately 10% of total systemwide store base upon completion of the transaction,

retaining its asset-light business model

Company provides member count and new store development for fiscal year 2021

HAMPTON, N.H. (January 11, 2022) – Planet Fitness, Inc. (NYSE: PLNT), one of the largest and fastest-growing franchisors and operators of fitness centers with more members than any other fitness brand, announced today it has signed a definitive agreement to acquire Sunshine Fitness Growth Holdings, LLC (“Sunshine Fitness”), a leading owner and operator of more than 100 Planet Fitness clubs in the Southeast United States in a cash and stock transaction valued at $800 million.

Under the terms of the agreement, Planet Fitness is expected to fund the cash portion of the purchase price through the proceeds from a new series of securitized notes issued under their existing securitization financing facility and from available cash on hand. The transaction is expected to close in the first quarter of 2022, and, based on historical and anticipated financial results of the Sunshine Fitness locations, is expected to be accretive to Planet Fitness’ Adjusted Net Income per diluted share in the low double-digit percent range in 2022. The Company expects to contribute the acquired stores and their related profitability to its wholly-owned securitization subsidiaries, consistent with its existing company-owned stores. In connection with the securitization debt financing, Planet Fitness also expects to refinance its Series 2018-1 Class A-2-I Notes, which as of September 30, 2021, had a principal balance of approximately $558 million. The acquisition and debt financing is expected to result in a slightly lower debt-to-Adjusted EBITDA ratio on a pro-forma consolidated basis.

Sunshine Fitness was the first franchisee in the Planet Fitness system and has been backed by TSG Consumer Partners (“TSG”) since 2017. Sunshine Fitness operates 114 locations in Alabama, Florida, Georgia, North Carolina, and South Carolina that will be combined into the current Planet Fitness company-owned portfolio, which is predominantly located in the Northeast. Upon closing of the transaction, Shane McGuiness, Co-Founder and CEO of Sunshine Fitness, who has been an owner and operator in the Planet Fitness system for nearly 20 years, will oversee operations of the combined corporate store portfolio.

“We are excited to announce the acquisition of Sunshine Fitness, one of our best-performing franchisees in the system, with locations that will provide geographic diversity to our current corporate store portfolio and that are in markets with a long runway for future store development,” said Chris Rondeau, Chief Executive Officer of Planet Fitness. “Owning corporate stores is an important part of our strategy, as it gives us both relevancy and credibility when making decisions that impact the entire system. Additionally, joining our corporate team is a management team that has built some of the highest store-level profit generating locations in our system which will enhance our corporate store leadership and capabilities.”

Rondeau continued, “Following this purchase, we will own more than 200 corporate stores, or approximately 10 percent of our total system, allowing us to retain our asset-light business model which is an important part of our shareholder value proposition.”

“Partnering with TSG has been an incredible experience. Their support for our business and growth never wavered and it has led to this next exciting moment in our evolution as an organization,” said Shane McGuiness, CEO of Sunshine Fitness. “We look forward to joining the Planet Fitness corporate team and being a part of the brand’s next chapter, working with Chris and the broader team to drive continued success in the company-owned stores.”

Michael Layman, Managing Director at TSG, commented, “My partner, Pierre LeComte, and I have a deep understanding of, and respect for, Planet Fitness and its management team through our long investment and ownership history in both Planet Fitness and, subsequently, Sunshine Fitness. We are pleased that through this transaction we will once again be a shareholder in Planet Fitness and believe it is well positioned to take advantage of the significant opportunities for growth in the years ahead.”

TSG’s involvement with the Planet Fitness brand dates back to November of 2012 when TSG acquired a majority stake in Planet Fitness. For nearly five years, TSG and Planet Fitness worked together to develop the Planet Fitness brand and improve the support and value proposition for both members and franchisees. In August of 2015, Planet Fitness began trading publicly on the New York Stock Exchange. After a successful partnership, TSG fully exited its investment in PLNT as of May of 2017. In December of 2017, TSG acquired a majority stake in Sunshine Fitness.

Planet Fitness 2021 Preliminary Key Year-End Metrics

Planet Fitness ended fiscal year 2021 with 15.2 million members, an increase of 1.7 million members over the past 12 months. In 2021, 132 new stores were opened, and the company ended the year with 2,254 stores worldwide. Currently, 98 percent of Planet Fitness’ stores are open including 100 percent of domestic locations.

“We exceeded our expectations for both member and new store growth in 2021. The silver lining of the pandemic is that it opened people’s eyes to the importance of fitness and overall health, and we’re seeing members who are visiting our stores are visiting more frequently than in the past, demonstrating their commitment to improving their health,” said Rondeau. “There is tremendous long-term untapped opportunity for our brand to get people off the couch, which is why, as a leader in the fitness industry, we are making this strategic investment for the future.”

About Planet Fitness

Founded in 1992 in Dover, NH, Planet Fitness is one of the largest and fastest-growing franchisors and operators of fitness centers in the United States by number of members and locations. As of December 31, 2021, Planet Fitness had 15.2 million members and 2,254 stores in 50 states, the District of Columbia, Puerto Rico, Canada, Panama, Mexico and Australia. The Company’s mission is to enhance people’s lives by providing a high-quality fitness experience in a welcoming, non-intimidating environment, which we call the Judgement Free Zone^®^. More than 90% of Planet Fitness stores are owned and operated by independent business men and women.

About Sunshine Fitness Holdings LLC

Opening its first location in 2003 in Altamonte Springs, Florida, Sunshine Fitness is the very first Planet Fitness franchisee and is now one of the largest operators within the Planet Fitness brand. Started by longtime best friends, Shane McGuiness and Eric Dore, Sunshine Fitness now operates 114 locations. Today, Sunshine fitness still holds true to the original mission of enhancing people’s lives by providing a high-quality experience in a welcoming, non-intimidating environment known as the Judgement Free Zone^®^.

About TSG Consumer Partners

TSG Consumer Partners, LP is a leading private equity firm that partners with founders and management teams to build and accelerate growth for best-in-class consumer-facing businesses. Since its founding in 1986, TSG has been an active investor in the consumer industry. Representative past and present partner companies include Backcountry, Canyon Bicycles, Duckhorn, Dutch Bros, e.l.f. Cosmetics, IT Cosmetics, Joe Hudson’s Collision Centers, Mavis Tires, Planet Fitness, popchips, Power Stop, REVOLVE, Revolut, Robinhood, Smashbox, Stumptown, and vitaminwater. For more information, including a complete list of TSG’s current partner companies, visit tsgconsumer.com.

Media Contacts

McCall Gosselin

SVP Communications

press@pfhq.com

Brittany Fraser

SVP, ICR

BrittanyRae.Fraser@icrinc.com

Investor Contact

Stacey Caravella

VP, Investor Relations

Stacey.Caravella@pfhq.com

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the federal securities laws, which involve risks and uncertainties. Forward-looking statements include the Company’s statements with respect to the acquisition of Sunshine Fitness and potential benefits therefrom, as well as other statements, estimates and projections that do not relate solely to historical facts. Forward-looking statements can be identified by words such as “believe,” “expect,” “goal,” plan,” “will,” “prospects,” “future,” “strategy” and similar references to future periods, although not all forward-looking statements include these identifying words. Forward-looking statements are not assurances of future performance. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of the business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Company’s control. Actual results and financial condition may differ materially from those indicated in the forward-looking statements.

The Company’s acquisition of Sunshine Fitness is subject to closing conditions, including conditions relating to the financing of the acquisition and consents from third parties. Important factors that could cause our actual results to differ materially include risk that the parties may be unable to satisfy the conditions to closing the acquisition of Sunshine Fitness timely or at all, risk that the Sunshine Fitness management team may not continue their association with the Company for the timeline we expect or at all, risks of liabilities relating to the acquisition, risks that the financing may not be consummated on the terms or timeline we expect or at all, risk that the Company may not achieve the benefits it expects from the transaction, risks and uncertainties associated with the duration and impact of COVID-19, which has resulted and may continue to result in store closures and a decrease in our net membership base and may give rise to or heighten one or more of the other risks and uncertainties

described herein, competition in the fitness industry, the Company’s and franchisees’ ability to attract and retain members, the Company’s and franchisees’ ability to identify and secure suitable sites for new franchise stores, changes in consumer demand, changes in equipment costs, the Company’s ability to expand into new markets domestically and internationally, operating costs for the Company and franchisees generally, availability and cost of capital for franchisees, acquisition activity, developments and changes in laws and regulations, our substantial increased indebtedness as a result of our refinancing and securitization transactions and our ability to incur additional indebtedness or refinance that indebtedness in the future, our future financial performance and our ability to pay principal and interest on our indebtedness, our corporate structure and tax receivable agreements, failures, interruptions or security breaches of the Company’s information systems or technology, general economic conditions and the other factors described in the Company’s annual report on Form 10-K for the year ended December 31, 2020, and the Company’s other filings with the Securities and Exchange Commission. In light of the significant risks and uncertainties inherent in forward-looking statements, investors should not place undue reliance on forward-looking statements, which reflect the Company’s views only as of the date of this press release. Except as required by law, neither the Company nor any of its affiliates or representatives undertake any obligation to provide additional information or to correct or update any information set forth in this release, whether as a result of new information, future developments or otherwise.