Life Time Group Holdings, Inc. 10-K

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Management’s Annual Report on Internal Control over Financial Reporting 48 Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting 49 Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements (PCAOB ID No. 34 ) 50 Consolidated Financial Statements Consolidated Balance Sheets 52 Consolidated Statements of Operations 53 Consolidated Statements of Comprehensive Income 54 Consolidated Statements of Stockholders’ Equity 55 Consolidated Statements of Cash Flows 56 Notes to Consolidated Financial Statements 57 47 Table of Contents Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Exchange Act Rule 13a-15(f). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with United States generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, utilizing criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—2013 Integrated Framework. Based on our assessment, our management concluded that, as of December 31, 2025, our internal control over financial reporting was effective based on those criteria. Management’s internal control over financial reporting as of December 31, 2025 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing on the following page, in which they expressed an unqualified opinion. 48 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and the Board of Directors of Life Time Group Holdings, Inc. and subsidiaries Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Life Time Group Holdings, Inc. and subsidiaries (the “Company”) as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2025, of the Company and our report dated February 24, 2026, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte & Touche LLP Minneapolis, Minnesota February 24, 2026 49 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and the Board of Directors of Life Time Group Holdings, Inc. and subsidiaries Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Life Time Group Holdings, Inc. and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 24, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Sale-Leaseback Transactions – Refer to Notes 2, 10 and 14 to the financial statements Critical Audit Matter Description As described in Notes 2, 10 and 14 to the Company’s consolidated financial statements, the Company entered into and consummated sale-leaseback transactions involving seven properties with three unrelated third parties during the year ended December 31, 2025. The Company determined that the transactions qualified as sale-leaseback transactions in accordance with Accounting Standards Codification (“ASC”) Topic 842, Leases. We identified management’s evaluation of whether the sale-leaseback transactions transferred control, were recognized timely, and at fair value, as a critical audit matter. Management applies judgment in assessing relevant lease terms, provisions, and other conditions included in the Company’s sale and lease agreements to determine whether or not the control of the real estate property has transferred from the Company, the timing of the transaction, and the determination of fair value. Auditing these assessments made by management involved challenging auditor judgment due to the extent of specialized skills or knowledge required. 50 Table of Contents How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to sale-leaseback transactions included the following, among others: • We tested the effectiveness of controls over the accounting for sale-leaseback transactions, including controls over (a) management’s determination of fair value of the property and (b) the application of ASC 606 to determine whether a sale has occurred and ASC 842 to determine the classification of the lease. • We selected a sample of sale-leaseback transactions and performed the following: • Assessed management’s application of ASC Topic 842 and evaluated relevant lease terms, provisions and other conditions included in the Company’s sale-leaseback agreements to assess the appropriateness of the conclusion that a transfer of control has occurred. • Evaluated whether the Company appropriately accounted for the sale by recognizing the transaction price for the sale at the time control is transferred, derecognizing the carrying amount of the asset, and accounting for the lease in accordance with ASC 842. • Utilized professionals with specialized skills and knowledge in valuation to assist, for certain transactions, with assessing whether the overall transaction was at fair value. • Recalculated the operating lease right-of-use asset and liability based on the terms of the agreement and calculated incremental borrowing rate. /s/ Deloitte & Touche LLP Minneapolis, Minnesota February 24, 2026 We have served as the Company’s auditor since 2002. 51 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 204,807 $ 10,879 Restricted cash and cash equivalents 27,362 16,999 Accounts receivable, net 24,092 25,087 Center operating supplies and inventories 67,618 60,266 Prepaid expenses and other current assets 61,881 52,826 Income tax receivable — 4,918 Total current assets 385,760 170,975 Property and equipment, net 3,633,229 3,193,671 Goodwill 1,235,359 1,235,359 Operating lease right-of-use assets 2,479,804 2,313,311 Intangible assets, net 180,810 171,643 Other assets 92,989 67,578 Total assets $ 8,007,951 $ 7,152,537 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 90,249 $ 87,810 Construction accounts payable 143,545 101,551 Deferred revenue 60,309 58,252 Accrued expenses and other current liabilities 214,351 179,444 Current maturities of debt 21,848 22,584 Current maturities of operating lease liabilities 79,208 70,462 Total current liabilities 609,510 520,103 Long-term debt, net of current portion 1,485,939 1,513,157 Operating lease liabilities, net of current portion 2,555,513 2,381,094 Deferred income taxes, net 172,217 85,255 Other liabilities 58,561 42,578 Total liabilities 4,881,740 4,542,187 Commitments and contingencies (Note 13) Stockholders’ equity: Common stock, $ 0.01 par value per share, 500,000 shares authorized, 221,077 and 207,495 shares issued and outstanding, respectively 2,211 2,075 Additional paid-in capital 3,183,032 3,041,645 Accumulated deficit ( 46,902 ) ( 420,573 ) Accumulated other comprehensive loss ( 12,130 ) ( 12,797 ) Total stockholders’ equity 3,126,211 2,610,350 Total liabilities and stockholders’ equity $ 8,007,951 $ 7,152,537 See notes to consolidated financial statements. 52 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Year Ended December 31, 2025 2024 2023 Revenue: Center revenue $ 2,908,707 $ 2,546,651 $ 2,154,329 Other revenue 86,548 74,344 62,264 Total revenue 2,995,255 2,620,995 2,216,593 Operating expenses: Center operations 1,568,611 1,392,421 1,184,370 Rent 339,170 304,945 275,122 General, administrative and marketing 244,611 221,047 201,131 Depreciation and amortization 296,345 274,681 244,397 Other operating expense 65,225 70,418 86,363 Total operating expenses 2,513,962 2,263,512 1,991,383 Income from operations 481,293 357,483 225,210 Other income (expense): Interest expense, net of interest income ( 82,263 ) ( 148,095 ) ( 130,797 ) Equity in earnings (loss) of affiliates 232 ( 620 ) 377 Other income 94,241 — — Total other income (expense) 12,210 ( 148,715 ) ( 130,420 ) Income before income taxes 493,503 208,768 94,790 Provision for income taxes 119,832 52,528 18,727 Net income $ 373,671 $ 156,240 $ 76,063 Income per common share: Basic $ 1.71 $ 0.77 $ 0.39 Diluted $ 1.66 $ 0.74 $ 0.37 Weighted-average common shares outstanding: Basic 218,031 201,640 195,671 Diluted 225,495 211,164 204,005 See notes to consolidated financial statements. 53 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In thousands) Year Ended December 31, 2025 2024 2023 Net income $ 373,671 $ 156,240 $ 76,063 Other comprehensive income (loss): Foreign currency translation adjustments, net of tax of $ 0 2,720 ( 5,872 ) 2,297 Derivative instruments: Unrealized gain, net of tax of $ 773 , $ 0 and $ 0 , respectively 2,414 — — Realized gain reclassified from accumulated other comprehensive loss to earnings, net of tax of $( 1,430 ), $ 0 and $ 0 , respectively ( 4,467 ) — — Other comprehensive income (loss) 667 ( 5,872 ) 2,297 Comprehensive income $ 374,338 $ 150,368 $ 78,360 See notes to consolidated financial statements. 54 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (In thousands) Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Equity Shares Amount Balance at December 31, 2022 194,271 $ 1,943 $ 2,784,416 $ ( 652,876 ) $ ( 9,222 ) $ 2,124,261 Net income — — — 76,063 — 76,063 Other comprehensive income — — — — 2,297 2,297 Share-based compensation — — 31,151 — — 31,151 Stock option exercises 1,441 14 15,756 — — 15,770 Issuance of common shares in connection with the vesting of restricted stock units 597 6 ( 387 ) — — ( 381 ) Issuances of common stock in connection with the employee stock purchase plan 272 3 3,476 — — 3,479 Issuances of common stock in connection with business acquisitions 90 1 1,471 — — 1,472 Balance at December 31, 2023 196,671 1,967 2,835,883 ( 576,813 ) ( 6,925 ) 2,254,112 Net income — — — 156,240 — 156,240 Other comprehensive loss — — — — ( 5,872 ) ( 5,872 ) Share-based compensation — — 36,685 — — 36,685 Stock option exercises 2,220 22 25,911 — — 25,933 Issuance of common stock in connection with the Offering (Note 11), net of issuance costs 6,000 60 123,904 — — 123,964 Issuance of common shares in connection with the vesting of restricted stock units 966 9 ( 1,597 ) — — ( 1,588 ) Issuances of common stock in connection with the employee stock purchase plan 191 2 2,816 — — 2,818 Settlement of accrued compensation liabilities through the issuance of common stock 1,447 15 18,043 — — 18,058 Balance at December 31, 2024 207,495 2,075 3,041,645 ( 420,573 ) ( 12,797 ) 2,610,350 Net income — — — 373,671 — 373,671 Other comprehensive income — — — — 667 667 Share-based compensation — — 46,100 — — 46,100 Stock option exercises 10,073 101 42,386 — — 42,487 Issuance of common stock in connection with the vesting of restricted stock units 1,519 15 ( 4,858 ) — — ( 4,843 ) Issuances of common stock in connection with the employee stock purchase plan 183 2 4,288 — — 4,290 Issuance of common stock in connection with an asset acquisition 1,355 13 39,717 — — 39,730 Settlement of accrued compensation liabilities through the issuance of common stock 452 5 13,754 — — 13,759 Balance at December 31, 2025 221,077 $ 2,211 $ 3,183,032 $ ( 46,902 ) $ ( 12,130 ) $ 3,126,211 See notes to consolidated financial statements. 55 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year Ended December 31, 2025 2024 2023 Cash flows from operating activities: Net income $ 373,671 $ 156,240 $ 76,063 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 296,345 274,681 244,397 Deferred income taxes 87,492 29,457 14,577 Share-based compensation 51,750 51,034 50,144 Non-cash rent expense 32,497 33,739 37,544 Impairment charges associated with long-lived assets 9,352 11,018 14,466 (Gain) loss on disposal of property and equipment, net ( 12,165 ) ( 6,794 ) 14,089 Loss on debt extinguishment — 13,839 — Amortization of debt discounts and issuance costs 3,659 7,002 7,821 Changes in operating assets and liabilities 29,487 2,387 6,465 Other ( 1,563 ) 2,514 ( 2,562 ) Net cash provided by operating activities 870,525 575,117 463,004 Cash flows from investing activities: Capital expenditures ( 891,483 ) ( 524,535 ) ( 697,993 ) Acquisitions, net of cash acquired — — ( 1,616 ) Proceeds from sale-leaseback transactions 227,424 207,421 121,831 Proceeds from the sale of land — 15,577 4,169 Other ( 21,676 ) 8,793 ( 551 ) Net cash used in investing activities ( 685,735 ) ( 292,744 ) ( 574,160 ) Cash flows from financing activities: Proceeds from borrowings — 1,500,000 44,291 Repayments of debt ( 20,080 ) ( 411,766 ) ( 15,026 ) Proceeds from revolving credit facility 220,000 1,225,000 1,376,000 Repayments of revolving credit facility ( 230,000 ) ( 1,305,000 ) ( 1,306,000 ) Purchase of U.S. government obligations for the satisfaction and discharge of debt — ( 1,424,467 ) — Repayments of finance lease liabilities ( 2,006 ) ( 926 ) ( 1,031 ) Proceeds from financing obligations 10,300 4,300 1,500 Payments of debt discounts and issuance costs ( 628 ) ( 22,325 ) ( 3,050 ) Proceeds from the issuance of common stock, net of issuance costs — 123,964 — Proceeds from stock option exercises 42,487 25,933 15,770 Proceeds from issuances of common stock in connection with the employee stock purchase plan 4,290 2,818 3,479 Other ( 4,975 ) ( 1,916 ) ( 381 ) Net cash provided by (used in) financing activities 19,388 ( 284,385 ) 115,552 Effect of exchange rate on cash and cash equivalents and restricted cash and cash equivalents 113 ( 76 ) 61 Increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents 204,291 ( 2,088 ) 4,457 Cash and cash equivalents and restricted cash and cash equivalents – beginning of period 27,878 29,966 25,509 Cash and cash equivalents and restricted cash and cash equivalents – end of period $ 232,169 $ 27,878 $ 29,966 See notes to consolidated financial statements. 56 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 1. Nature of Business and Basis of Presentation Nature of Business Life Time Group Holdings, Inc. (collectively with its direct and indirect subsidiaries, “Life Time,” “we,” “our,” or “the Company”) is a holding company incorporated in the state of Delaware. As a holding company, Life Time Group Holdings, Inc. does not have its own independent assets or business operations, and all of our assets and business operations are through Life Time, Inc. and its direct and indirect subsidiaries. We are primarily dedicated to providing premium health, fitness and wellness experiences at our athletic country club destinations and via our comprehensive digital platform and portfolio of iconic athletic events – all with the objective of inspiring healthier, happier lives. We design, build and operate our athletic country club destinations that are distinctive and large, multi-use sports and athletic, professional fitness, family recreation and spa centers in a resort-like environment. As of December 31, 2025, we operated 189 centers in 31 states and one Canadian province. Basis of Presentation The consolidated financial statements include the accounts of Life Time Group Holdings, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. We account for all of our investments in unconsolidated subsidiaries using the equity method of accounting. We apply this method of accounting to our investments when we have the ability to exercise significant influence over the operating and financial policies of the investee. Our share of the investee’s earnings (losses) associated with our investments in unconsolidated subsidiaries is included in Equity in earnings (loss) of affiliates in our consolidated statements of operations. S ee “Other Assets” within Note 2 below for additional information regarding our investments in unconsolidated subsidiaries. 2. Summary of Significant Accounting Policies Segment Reporting We have one operating segment and one reportable segment. Our segment derives revenues from customers by providing premium health, fitness and wellness experiences and products at our athletic country club destinations and via our comprehensive digital platform and portfolio of iconic athletic events – all with the objective of inspiring healthier, happier lives. We manage our business activities on a consolidated basis. The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer (“CEO”). The CODM assesses performance for the segment and allocates resources based on consolidated net income. The measure of segment assets is reported on the balance sheet as total consolidated assets. Our CODM does not review segment assets at a different asset level and is regularly provided with only the consolidated expenses as noted on the face of the consolidated statements of operations. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In recording transactions and balances resulting from business operations, we use estimates based on the best information available. We revise the recorded estimates when better information is available, facts change or we can determine actual amounts. These revisions can affect our consolidated operating results. Recently Adopted Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance transparency of income tax disclosures. The updated guidance requires additional disclosures on income tax rate reconciliation and income taxes paid, among other things. We adopted the accounting guidance for this Annual Report. The adoption of the updated standard did not have a material impact on our financial statements, but we have increased our disclosures on rate reconciliation and income taxes paid by jurisdiction. 57 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) New Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public entities to disclose the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization and depletion, as applicable, included in each relevant expense caption presented in its income statement. We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2027. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to software development project stages and requires that an entity capitalize software costs when both (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended (referred to as the “probable-to-complete recognition threshold”). We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2028. We are currently evaluating the impact that the updated standard will have on our financial statements. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies interim disclosure requirements and the applicability of Topic 270 and includes a disclosure principle that requires disclosure of events since the end of the last annual reporting period that have a material impact on the entity. We expect to adopt this accounting guidance for our Quarterly Report on Form 10-Q for the period ended March 31, 2028. We are currently evaluating the impact that the updated standard will have on our disclosures. In December 2025, the FASB issued ASU 2025-12, Codification Improvements, to clarify, correct errors, or make minor improvements to the Codification to make the Codification easier to understand and apply. We expect to adopt this accounting guidance for our Annual Report on Form 10-K for the year ended December 31, 2027. We are currently evaluating the impact that the updated standard will have on our financial statements. Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the transaction price consideration that we expect to receive in exchange for those goods or services. We defer the revenue associated with any unsatisfied performance obligation until the obligation is satisfied (i.e., when control of the product is transferred to the customer or a service has been completed). Center Revenue Center revenue consists of center membership and on-hold membership dues, enrollment fees and revenue generated within a center, which we refer to as in-center revenue. In-center revenue includes fees for Dynamic Personal Training, aquatics and kids programming and other member services, as well as sales of products at our cafés, and sales of products and services offered at our spas and tennis and pickleball programs. Revenue from product sales is generally recognized at the point of sale to the customer; however, revenue from our various service offerings received in advance of service delivery is deferred and subsequently recognized when the services are provided. Dynamic Personal Training revenue received in advance of training sessions, as well as the related sales commissions, are initially deferred and subsequently recognized when the sessions are delivered. Upon recognition, sales commissions associated with Dynamic Personal Training sessions are included in Center operations in our consolidated statements of operations. Throughout the estimated redemption period associated with prepaid sessions, we also recognize Dynamic Personal Training breakage revenue and the related commissions, using a method that is proportionate to the pattern of redemptions. We estimate breakage based on historical redemption patterns. We may receive a one-time enrollment fee at the time a member joins. The enrollment fees are generally non-refundable after seven days . Enrollment fees and related direct expenses are deferred and recognized on a straight-line basis over an estimated average membership life, which is based on historical membership experience. If the direct expenses related to the enrollment fees exceed the enrollment fees for any center in a month, the amount of direct expenses in excess of the enrollment fees are expensed in the current period instead of deferred over the estimated average membership life. 58 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Other Revenue Other revenue includes revenue generated from our businesses outside of our centers, which are primarily media, athletic events and related services. Our media revenue includes our magazine, Experience Life ® , and the related advertising revenue is recognized over the duration of the advertising placement. Our athletic events revenue includes endurance activities such as running and cycling, and our related services revenue includes revenue from our race registration and timing businesses. Athletic event revenue and race registration revenue is recognized upon the completion of the event. Other revenue also includes revenue generated from our Life Time Work and Life Time Living locations. For more information regarding revenue, see Note 6 , Revenue. Cash and Cash Equivalents We classify all unrestricted cash accounts and highly liquid debt instruments purchased with original maturities of three months or less as cash and cash equivalents. Restricted Cash and Cash Equivalents Restricted cash is used for our self-insured workers’ compensation and general liabilities, and a portion of our self-insured medical claims under our captive insurance policy. Accounts Receivable Accounts receivable is presented net of allowance for doubtful accounts. The allowance for doubtful accounts was $ 0.9 million and $ 1.9 million at December 31, 2025 and 2024, respectively. Inventories Inventories are stated at the lower of cost or net realizable value and are removed from the balance on a first-in-first-out basis. The reserve for obsolescence was approximately $ 3.3 million and $ 1.2 million at December 31, 2025 and 2024, respectively. Property and Equipment Property, equipment and leasehold improvements are recorded at cost. Improvements are capitalized while repair and maintenance costs are charged to operations when incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the improvement. Accelerated depreciation methods are used for tax reporting purposes. Site development capitalization commences when acquisition or development of a particular property is deemed probable by management. Should a specific project be subsequently deemed not viable, any capitalized costs related to that project are recognized as an impairment charge at the time of that determination. Upon completion of a project, site development costs are classified as property and depreciated over the useful life of the asset. We capitalize interest during the construction period of our centers and this capitalized interest is included in the cost of the building. Unpaid construction costs are included in Construction accounts payable on our consolidated balance sheets. Business Combinations and Asset Acquisitions We account for business combinations in accordance with Accounting Standards Codification (“ASC”) 805, “Business Combinations” (“ASC 805”). ASC 805 requires the acquiring entity in a business combination to recognize all the assets acquired and liabilities assumed in the transaction and establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed in a business combination. T he total consideration transferred in a business combination is allocated to the assets acquired and liabilities assumed, including amounts attributable to non-controlling interests, when applicable, based on their respective estimated fair values as of the date of acquisition. Goodwill recognized in a business combination represents the excess of consideration transferred over the estimated fair value of the net assets acquired in a business combination. Certain provisions within ASC 805 prescribe, among other things, the determination of acquisition-date fair value of consideration paid in a business combination (including contingent consideration) and the exclusion of transaction and acquisition-related restructuring costs from acquisition accounting. 59 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) When an acquisition does not meet the definition of a business combination because either: (i) substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, or group of similar identified assets, or (ii) the acquired entity does not have an input and a substantive process that together significantly contribute to the ability to create outputs, we account for the acquisition as an asset acquisition. In an asset acquisition, goodwill is not recognized. Instead, any excess purchase consideration over the fair value of the net assets acquired is allocated on a relative fair value basis to the identifiable net assets as of the acquisition date and any direct acquisition-related transaction costs are capitalized as part of the purchase consideration. For information on the acquisitions that we completed during the years ended December 31, 2025 and 2024 that we accounted for as asset acquisitions, see Note 4 , Property and Equipment. Impairment of Long-Lived Assets We test long-lived asset groups for impairment when events or circumstances indicate that the net book value of the asset group may not be recoverable. As it relates to our asset groups, we consider a history of consistent and significant operating losses, or the inability to recover net book value over the remaining useful life, to be our primary indicators of potential impairment. Assets are grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows, which is generally at an individual asset group level. The determination of whether impairment has occurred is based on an estimate of undiscounted future cash flows directly related to that asset group, compared to the carrying value of the related assets. If an impairment has occurred, the amount of impairment recognized is determined by estimating the fair value of these assets and recording a loss if the carrying value is greater than the fair value. As it relates to our site development projects, we test the carrying value of capitalized development costs associated with a particular project for impairment when we determine that all or a portion of the development project is no longer deemed viable. We generally recognize an impairment charge associated with a site development project or a portion of a site development project that we deem not viable in an amount equal to the related development costs that we previously capitalized. We recognized total impairment charges of $ 9.4 million, $ 11.0 million and $ 14.5 million during the years ended December 31, 2025, 2024 and 2023, respectively, which are included in Other operating expense in our consolidated statements of operations. Of the $ 9.4 million total i mpairment charges we recognized during the year ended December 31, 2025, $ 5.8 million was associated with certain non-center businesses and $ 3.6 million was associated with certain site development projects that we deemed not viable. The impairment charges we recognized during the year ended December 31, 2024 were associated with certain site development projects that we deemed not via ble. Of the $ 14.5 million total impairment charges we recognized during the year ended December 31, 2023, $ 9.2 million was associated with certain site development projects that we deemed not viable and $ 5.3 million was associated with the sale of an outparcel of land. Goodwill We test goodwill for impairment on an annual basis, or more often if circumstances warrant, by estimating the fair value of the reporting unit to which the goodwill relates and comparing this fair value to the net book value of the reporting unit. Our policy is to test goodwill for impairment on October 1 of each year. If the fair value of a reporting unit is less than its carrying value, we reduce the carrying value accordingly and record a corresponding impairment loss. We have two reporting units: Centers and Corporate Businesses. At both December 31, 2025 and 2024, the total goodwill balance recognized on our consolidated balance sheets was $ 1,235.4 million, of which $ 1,233.1 million has been allocated to our Centers reporting unit and $ 2.3 million has been allocated to our Corporate Businesses reporting unit. At December 31, 2025, the estimated fair value of our reporting units were in excess of their carrying value. Based upon our review and analysis, no goodwill impairments were deemed to have occurred during the years ended December 31, 2025, 2024, and 2023. For more information on goodwill, see Note 5, Goodwill and Intangibles. Leases We lease many of our centers, as well as certain of our offices, other facilities, and equipment. Excluding renewal options that are not reasonably certain to be exercised, our leases have remaining contractual terms that primarily range from one year to 29 years. Most of the leases contain renewal options and escalation clauses, and certain of them include contingent rental payments, determined based on a percentage of center-specific revenue and/or other center-specific financial metrics over contractually specified levels. Our property leases require payment of real estate taxes, insurance and common area maintenance, in addition to rent. Our lease agreements do not contain any material residual value guarantees. 60 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Lease Cost Lease cost associated with operating leases and short-term leases is recognized on a straight-line basis from the date we take possession of the property through the end of the lease term. With the exception of leases containing a purchase option that we are reasonably certain to exercise, finance lease right-of-use assets are amortized on a straight-line basis over the shorter of the estimated useful life of the underlying assets or the lease term. Finance lease right-of-use assets associated with leases that do contain a purchase option that we are reasonably certain to exercise are amortized on a straight-line basis over the estimated useful life of the underlying assets. Interest associated with finance lease liabilities is recognized using the effective interest rate method. Variable lease payments not recognized in the measurement of operating and finance lease liabilities are expensed as incurred. For more information regarding lease cost included in our consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023, see Note 10 , Leases. Operating Lease Right-of-Use Assets and Liabilities The measurement of each of our operating lease liabilities represents the present value of the remaining lease payments over the remaining lease term, discounted using an appropriate incremental borrowing rate. The measurement of each of our operating lease right-of-use assets represents the related operating lease liability measurement increased by, if applicable, prepaid rent, the fair value associated with the acquisition of a leasehold right and/or the fair value associated with the acquisition of a favorable lease, and decreased by, if applicable, lease incentives, impairment charges and/or the fair value associated with the acquisition of an unfavorable lease. For more information regarding the operating lease right-of-use assets and liabilities that are recognized on our December 31, 2025 and 2024 consolidated balance sheets, see Note 10 , Leases. Finance Lease Right-of-Use Assets and Liabilities The measurement of each of our finance lease right-of-use assets and liabilities represents the present value of the remaining lease payments associated with the arrangement over the remaining lease term, discounted using an appropriate incremental borrowing rate. Finance lease right-of-use assets are included in Other assets on our consolidated balance sheets. The current and long-term portions of our finance lease liabilities are included in Accrued expenses and other current liabilities and Other liabilities, respectively, on our consolidated balance sheets. For more information regarding the finance lease right-of-use assets and liabilities that are recognized on our December 31, 2025 and 2024 consolidated balance sheets, see Note 10 , Leases. Sale-Leaseback Arrangements We assess each of our sale-leaseback arrangements to determine whether a sale has occurred under ASC Topic 606: Revenue from Contracts with Customers (“ASC 606”), and we assess whether the classification of the lease and/or the payment terms associated with the renewal options preclude sale accounting under ASC 842, Leases (“ASC 842”). These assessments involve a determination of whether control of the underlying property has been transferred to the buyer. If we determine control of the underlying property has been transferred to the buyer, we account for the arrangement as a sale and leaseback transaction. If we determine control of the underlying property has not been transferred to the buyer, we account for the arrangement as a financing transaction. Since our adoption of ASC 842, we have accounted for each of our sale-leaseback arrangements as a sale and leaseback transaction. For each sale-leaseback arrangement we have entered into with an unrelated third party since our adoption of ASC 842, the measurements associated with the gain or loss recognized on the sale and the lease-related right-of-use assets and liabilities have been adjusted for any off-market terms. These off-market adjustments are based on the difference between the sales price of the property and its fair value. When the sales price is less than the underlying property’s fair value, we recognize the difference as an increase to the sales price and as an increase in the operating lease right-of-use asset. When the sales price is greater than the underlying property’s fair value, we recognize the difference as a reduction to the sales price and as a financing obligation that is separate from the operating lease liability. We then allocate the payments due under the lease between those associated with the operating lease liability and those associated with the financing obligation, in a manner that results in a zero balance at the end of the initial lease term for both liabilities. The financing obligation is amortized using the effective interest method, and interest is calculated using the same incremental borrowing rate as that used for purposes of measuring the related operating lease liability. 61 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) We account for sale-leaseback arrangements with related parties at their contractually stated terms. Accordingly, under these arrangements, the measurements associated with the gain or loss recognized on the sale and the lease-related right-of-use assets and liabilities are not adjusted for off-market terms. The determination of the fair value of the property related to our sale-leaseback arrangements is subjective and requires estimates, including the use of multiple valuation techniques and uncertain inputs, such as market price per square foot and assumed capitalization rates or the replacement cost of the assets, where applicable. Where real estate valuation expertise is required, we obtain independent third-party appraisals to determine the fair value of the underlying asset. While determining fair value requires a variety of input assumptions and judgment, we believe our estimates of fair value are reasonable. For more information regarding sale-leaseback transactions that were consummated during the years ended December 31, 2025, 2024 and 2023, see Note 10 , Leases. Build-to-Suit Lease Arrangements For some of our centers, we enter into build-to-suit lease arrangements related to the design and construction of a new center on the property. We evaluate build-to-suit lease arrangements by first determining whether or not we control the underlying asset being constructed prior to the commencement date of the lease. If we determine that we do not control the underlying asset during the construction period, we account for the arrangement as either an operating lease or a finance lease. If we determine that we control the underlying asset during the construction period, we initially account for the arrangement as a financing transaction. For each of our build-to-suit arrangements, we have determined that we either: (1) do not control the underlying asset currently under construction as of December 31, 2025; or (2) we did not control the underlying constructed asset prior to the commencement date of the lease. Accordingly, we have accounted for each of our build-to-suit arrangements as an operating lease. Intangible Assets Intangible assets at December 31, 2025 and 2024 include trade names and a facility license. For more information on intangible assets, see Note 5 , Goodwill and Intangibles. Indefinite-Lived Intangible Assets Intangible assets that are determined to have an indefinite useful life, such as trade names, are not amortized but instead tested for impairment at least annually. Our policy is to test indefinite-lived intangible assets for impairment on October 1 of each year. We also evaluate these assets for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of an indefinite-lived intangible asset below its carrying amount. If such a review should indicate that the carrying amount of indefinite-lived intangible assets is not recoverable, we reduce the carrying amount of such assets to fair value. Based upon our review and analysis, no indefinite-lived intangible asset impairments were deemed to have occurred during any of the periods presented. Finite-Lived Intangible Assets Finite-lived intangible assets are stated at cost, net of accumulated amortization, which is recorded on a straight-line or accelerated basis over the life of the asset. We review finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If such a review should indicate that the carrying amount of finite-lived intangible assets is not recoverable, we reduce the carrying amount of such assets to fair value. Based upon our review and analysis, no finite-lived intangible asset impairments were deemed to have occurred during any of the periods presented. Other Assets Other assets at December 31, 2025 and 2024 primarily consists of ou r executive nonqualified plan assets, o ur investments in unconsolidated subsidiaries, rent deposits and unamortized debt issuance costs associated with the revolving portion of our senior secured credit facility. 62 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Investments in Unconsolidated Subsidiaries In 1999, we, together with two unrelated organizations, formed an Illinois limited liability company named Bloomingdale LIFE TIME Fitness L.L.C. (“Bloomingdale LLC”) for the purpose of constructing and operating a center in Bloomingdale, Illinois. We currently account for our investment in Bloomingdale LLC using the equity method of accounting. In December 2019, we formed both a Delaware limited liability company named Dallas-Montfort Holdings, LLC (“D-M Holdings”) and a Delaware limited liability company named Dallas-Montfort Property, LLC, which is a wholly owned subsidiary of D-M Holdings. Also in December 2019, we and an unrelated organization each became a holder of 50 % of the membership interests in D-M Holdings in exchange for a cash capital contribution. These capital contributions were made in connection with the acquisition of a property in Texas. T here was no operating activity associated with D-M Holdings during the years ended December 31, 2025, 2024 and 2023. We currently account for our investment in D-M Holdings using the equity method of accounting. In addition to our investments in Bloomingdale LLC and D-M Holdings, we also have investments in various other unconsolidated subsidiaries. The amounts we have currently invested in each of these unconsolidated subsidiaries is not material. We currently account for each of these investments using the equity method of accounting. Debt Discounts and Issuance Costs Debt discounts and issuance costs are amortized over the periods of the related debt financing. We recognize and present issuance costs associated with revolving debt arrangements as an asset and include the unamortized costs in Other assets on our consolidated balance sheets. We recognize and present unamortized discounts and issuance costs associated with non-revolving debt as a deduction from the face amount of related indebtedness. For more information on debt discounts and issuance costs, see Note 9 , Debt. Derivative Instruments and Hedging Activities We are exposed to interest rate risk on our variable rate debt (see Note 9 , Debt). As a result, we utilize derivative instruments from time to time, including interest rate swap agreements, to manage our exposure. We only hold derivative instruments for economic hedging purposes, not for speculative or trading purposes. Derivative instruments expose us to credit risk to the extent that the counterparties are unable to meet the terms of the arrangements. To minimize our exposure to such credit risk, we transact only with highly-rated banks and financial institutions. For each derivative instrument that qualifies for and is designated as a cash flow hedge of interest rate risk, the unrealized gain or loss associated with changes in the fair value of the instrument is initially recognized as a component of accumulated other comprehensive loss (“AOCL”) on our consolidated balance sheet. This gain or loss is subsequently reclassified into earnings in the same period that the forecasted hedged transaction affects earnings. We assess hedge effectiveness using the dollar-offset method on a cumulative basis at inception and on an ongoing basis. We would prospectively discontinue hedge accounting for a cash flow hedge derivative instrument if and when the applicable criteria are no longer met, the instrument expires, is sold, terminated or exercised or we remove the hedge designation. In that circumstance, the net unrealized gain or loss that is then recognized in AOCL would be reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings, unless the forecasted transaction is no longer probable in which case the net gain or loss would be reclassified into earnings immediately. For more information on amounts reclassified from AOCL to earnings, see No te 8, Derivative I nstruments and Hedging Activities. 63 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Fair Value Measurements The accounting guidance establishes a framework for measuring fair value and expanded disclosures about fair value measurements. The guidance applies to all assets and liabilities that are measured and reported on a fair value basis. This enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The guidance requires that each asset and liability carried at fair value be classified into one of the following categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The carrying amounts related to cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, income tax receivable, accounts payable and accrued liabilities approximate fair value. Fair Value Measurements on a Recurring Basis. As of December 31, 2025 and 2024, assets and liabilities that are measured at fair value on a recurring basis were as follows: December 31, 2025 Level 1 Level 2 Level 3 Total Assets: Interest rate swaps (1) $ — $ 397 $ — $ 397 Cash surrender value of life insurance policies (2) — 17,963 — 17,963 Total assets $ — $ 18,360 $ — $ 18,360 Liabilities: Interest rate swaps (1) $ — $ 2,917 $ — $ 2,917 Deferred compensation (3) 16,379 — — 16,379 Total liabilities $ 16,379 $ 2,917 $ — $ 19,296 December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Cash surrender value of life insurance policies (2) $ — $ 15,979 $ — $ 15,979 Liabilities: Deferred compensation (3) $ 13,575 $ — $ — $ 13,575 (1) Interest rate swaps are valued using pricing models that incorporate market interest rate curves that are observable at commonly quoted intervals for the full term of the swaps. (2) The life insurance policies are valued based on the underlying investment assets, which are priced using observable market data. (3) Deferred compensation liabilities are valued based on the quoted market prices associated with the underlying assumed investments that have been selected by the plan participants. For more information regarding our interest rate swaps, see Note 8, Derivative Instruments and Hedging Activities. 64 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Long-term debt . At December 31, 2025 and December 31, 2024, the carrying value and fair value of our outstanding long-term debt was as follows: December 31, 2025 December 31, 2024 Carrying Value Fair Value Carrying Value Fair Value Long-term debt (1) $ 1,525,363 $ 1,539,085 $ 1,555,597 $ 1,551,222 (1) Excludes unamortized debt discounts and issuance costs. The f air value of our debt is based on the amount of future cash flows discounted using rates we would currently be able to realize for similar instruments of comparable maturity. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. For more information regarding our debt, see Note 9, Debt. Fair Value Measurements on a Nonrecurring Basis. Assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to our goodwill, intangible assets and other long-lived assets, which are remeasured when the derived fair value is below carrying value on our consolidated balance sheets. For these assets, we do not periodically adjust carrying value to fair value except in the event of impairment. If we determine that impairment has occurred, the carrying value of the asset would be reduced to fair value and the difference would be recorded as a loss within operating income in our consolidated statements of operations. For information regarding impairment charges associated with our long-lived assets that we recognized during each of the periods presented, see the Impairment of Long-Lived Assets section within this footnote. Marketing Expenses Marketing expenses, which are included in General, administrative and marketing in our consolidated statements of operations, primarily consist of marketing department costs and media and advertising costs to support and grow our Center membership levels, in-center businesses, new center openings and our ancillary businesses. Marketing expenses are recognized as incurred. Marketing expenses for the years ended December 31, 2025, 2024 and 2023 were $ 38.0 million, $ 35.1 million and $ 32.9 million, respectively. Litigation We have been engaged in a material litigation matter with an insurance provider involving a complaint we filed seeking declaratory relief and damages associated with a property/ business interruption insurance claim. We are also engaged in various other legal matters incidental to the normal course of business. Due to their nature, such legal proceedings involve inherent uncertainties, including but not limited to court rulings, negotiations between affected parties and governmental intervention. We establish reserves for matters that are probable and estimable in amounts we believe are adequate to cover reasonable adverse outcomes. A gain contingency is an uncertain situation that will be resolved in the future, possibly resulting in a gain. We do not allow the recognition of a gain contingency prior to settlement of the underlying event. If we were to have a gain contingency, we would disclose it in the notes to the financial statements. Based upon the information available to us and discussions with legal counsel, it is our opinion that the outcome of the various legal actions and claims that are incidental to our business will not have a material adverse impact on our consolidated financial position, results of operations or cash flows. Such matters are subject to many uncertainties, and the outcomes of individual matters are not predictable with assurance. For more information on our legal matters, see Note 13 , Commitments and Contingencies. Employee Retention Credits On March 27, 2020, Congress enacted the CARES Act to provide certain relief as a result of the COVID-19 pandemic. The CARES Act, among other things, provided for refundable payroll tax credits for employee retention, or employee retention credits. During the year ended December 31, 2025 , the Company received $ 54.6 million in net cash proceeds from these employee retention credits, including interest income and net of fees and expenses. These credits were recognized in the period in which the cash was received and are included in Other income in our consolidated statement of operations for the year ended December 31, 2025 . 65 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations. In the event we were to determine that we would be able to realize our deferred income tax assets in the future in excess of their net recorded amount, we would decrease the valuation allowance, which would reduce the provision for income taxes. Our income tax returns are periodically audited by U.S. federal, state and local and Canadian tax authorities . At any given time, multiple tax years may be subject to audit by various tax authorities. In evaluating the exposures associated with our various tax filing positions, we may record a liability for such exposures. We recognize, measure, present and disclose a liability for unrecognized tax benefits related to certain tax positions that we have taken or expect to take in our income tax returns. We recognize a tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. We adjust our liability for unrecognized tax benefits in the period in which an uncertain tax position is effectively settled, that statute of limitations expires for the relevant taxing authority to examine the tax position or when more information becomes available. Our liability for unrecognized tax benefits, including penalties and interest, is included in Other liabilities on our consolidated balance sheets. We recognize adjustments to our liability for unrecognized tax benefits, including penalties and interest, within Provision for income taxes in our consolidated statements of operations. For more information on income taxes, see Note 7 , Income Taxes. One Big Beautiful Bill Act The United States Congress passed budget reconciliation bill H.R. 1, referred to as the One Big Beautiful Bill Act (“the OBBB Act”), into law on July 4, 2025. The OBBB Act provides for, among other things, the reinstatement of full expensing for qualified business property acquired and placed in service after January 19, 2025, immediate expensing of domestic research and experimental expenditures and modification of the limitation on the business interest deduction. The OBBB Act has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The provisions that are effective in 2025 increase the deferred tax liability and increase the current tax receivable but do not have an impact on the effective tax rate or the provision for income taxes. Share-Based Compensation We account for share-based compensation related to instruments issued to employees and non-employees in accordance with ASC 718, “Compensation – Stock Compensation” (“ASC 718”). We recognize compensation expense associated with each share-based award over the requisite service period based on the estimated grant-date fair value of the award. W e estimate the fair value of stock options to purchase shares of the Company’s common stock using the Black-Scholes option pricing model. This pricing model requires management to make assumptions and to apply judgment to determine the fair value of equity awards. These assumptions and judgments include the expected term of stock options, expected stock price volatility and future stock option exercise behaviors. Share-based compensation expense related to restricted stock units and performance stock units is recorded based on the market value of our common stock on the date of grant. We account for share-based payment awards that represent a fixed dollar amount that, if payable, will be settled in a variable number of shares of the Company’s common stock as liability-classified awards. We have elected to account for forfeitures as they occur. For more information on share-based compensation, see Note 11 , Stockholders’ Equity. Income per Share Basic income per share is computed by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding during the period. The numerator in the diluted income per share calculation is derived by adding the effect of assumed common stock conversions to income available to common stockholders. The denominator in the diluted income per share calculation is derived by adding shares of common stock deemed to be potentially dilutive to the 66 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) weighted average number of shares of common stock outstanding during the period. Potentially dilutive securities that are subject to performance or market conditions are considered contingently issuable shares for purposes of calculating diluted income per share. Accordingly, these contingently issuable shares are excluded from the computation of diluted income per share until the performance or market conditions have been met. Other potentially dilutive securities that do not involve contingently issuable shares are also excluded from the computation of diluted income per share if their effect is antidilutive . For more information on the basic and diluted income per share calculations for the years ended December 31, 2025, 2024 and 2023, see Note 12, Income Per Share. Changes in Accumulated Other Comprehensive Loss The changes in accumulated other comprehensive loss during the years ended December 31, 2025, 2024 and 2023 is related to foreign currency translation adjustments associated with our Canadian operations and derivative instruments related to our interest rate swaps. 3. Supplemental Balance Sheet and Cash Flow Information Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: December 31, 2025 2024 Property held for sale $ 2,471 $ 1,866 Construction contract receivables 12,231 8,513 Interest rate swap assets 397 — Prepaid insurance 2,082 2,351 Prepaid commissions 7,569 6,476 Prepaid rent 4,053 3,927 Prepaid software licenses and maintenance 7,306 5,199 Prepaid payroll 13,155 11,883 Other 12,617 12,611 Prepaid expenses and other current assets $ 61,881 $ 52,826 Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: December 31, 2025 2024 Real estate taxes $ 38,147 $ 34,779 Accrued interest 7,637 10,170 Payroll liabilities 53,050 44,347 Accrued variable rent 16,693 13,903 Self-insurance accruals 35,549 29,437 Goods and services received but not invoiced 42,099 35,653 Current maturities of finance lease liabilities 12,099 1,108 Other 9,077 10,047 Accrued expenses and other current liabilities $ 214,351 $ 179,444 67 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Supplemental Cash Flow Information (Increases) decreases in operating assets and increases (decreases) in operating liabilities are as follows: Year Ended December 31, 2025 2024 2023 Accounts receivable $ 872 $ ( 2,475 ) $ ( 12,857 ) Center operating supplies and inventories ( 7,318 ) ( 7,524 ) ( 7,131 ) Prepaid expenses and other current assets ( 883 ) ( 20,706 ) 7,967 Income tax receivable 4,918 5,183 ( 9,352 ) Other assets ( 312 ) 2,360 5,160 Accounts payable 3,513 7,055 7,145 Accrued expenses and other current liabilities 26,765 12,469 8,334 Deferred revenue 1,944 8,566 10,977 Other liabilities ( 12 ) ( 2,541 ) ( 3,778 ) Changes in operating assets and liabilities $ 29,487 $ 2,387 $ 6,465 Supplemental cash flow information, excluding information associated with our lease arrangements, which is detailed in Note 10 , Leases, is as follows: Year Ended December 31, 2025 2024 2023 Net cash paid for income taxes, net of refunds received $ 27,231 $ 18,182 $ 14,051 Net cash paid for interest (including cash settlements associated with interest rate swaps), net of capitalized interest 85,393 136,860 122,154 Capitalized interest 17,736 6,180 18,692 Non-cash activities: Common stock issuance in connection with an asset acquisition 39,730 — — Settlement of accrued compensation liabilities through the issuance of common stock 13,759 18,058 — U.S. government obligations deposited with a trustee in connection with the satisfaction and discharge of the 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes (as defined in Note 9, Debt) (1) — 1,424,467 — Principal and related accrued and unpaid interest obligations derecognized in connection with the satisfaction and discharge of the 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes (as defined in Note 9, Debt) (1) — 1,420,115 — Common stock issuance in connection with a business acquisition — — 1,472 Acquisition of property and equipment through the assumption of a mortgage — — 10,600 (1) See Note 9 , Debt, for more information on the satisfaction and discharge of our 5.750 % Senior Secured Notes and the 8.000 % Senior Unsecured Notes for the year ended December 31, 2024. 68 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 4. Property and Equipment Property and equipment, net consisted of the following: Depreciable December 31, Lives 2025 2024 Land $ 431,467 $ 368,245 Buildings and related fixtures 3 - 44 years 2,107,227 2,174,729 Leasehold improvements 1 - 30 years 1,187,954 1,012,124 Construction in progress 555,090 224,108 Equipment and other 1 - 15 years 1,281,711 1,150,430 Property and equipment, gross 5,563,449 4,929,636 Less accumulated depreciation ( 1,930,220 ) ( 1,735,965 ) Property and equipment, net $ 3,633,229 $ 3,193,671 Included in the construction in progress balances are site development costs which consist of legal, engineering, architectural, environmental, feasibility, other direct expenditures incurred for certain new projects and capitalized interest. Equipment and other includes exercise equipment, capitalized software, computers, audio visual equipment, furniture and fixtures, decor and signage, as well as café, spa, playground and laundry equipment. Depreciation expense, which is included in Depreciation and amortization in our consolidated statements of operations, for the years ended December 31, 2025, 2024 and 2023 was $ 292.7 million, $ 272.7 million and $ 242.0 million, respectively. Asset Acquisitions During the year ended December 31, 2025, we acquired existing health club and racquet facilities for a total purchase price of $ 59.7 million, of which $ 19.3 million was paid in cash, $ 39.7 million was paid through the issuance of unregistered shares of the Company’s common stock and $ 0.7 million represents liabilities we assumed. T he entire purchase price was allocated to property and equipment. Accordingly, the $ 19.3 million we paid in cash in connection with this acquisition is included in Capital expenditures in our consolidated statements of cash flows. During the year ended December 31, 2024, we acquired two health club facilities for a total purchase price of $ 21.9 million, all of which was paid in cash. The entire purchase price was allocated to property and equipment and is included in Capital expenditures in our consolidated statements of cash flows. During the year ended December 31, 2023, we acquired a health club facility for a total purchase price of $ 15.8 million. As part of this acquisition, we paid cash of $ 4.0 million and assumed an existing mortgage note and related accrued interest liability of $ 10.6 million and $ 1.2 million, respectively. The mortgage note matured in June 2024. The entire purchase price was allocated to property and equipment. Accordingly, the $ 4.0 million we paid in cash in connection with this acquisition is included in Capital expenditures in our consolidated statements of cash flows. 69 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 5. Goodwill and Intangibles Goodwill The goodwill balance was $ 1,235.4 million at both December 31, 2025 and December 31, 2024. Intangibles Intangible assets consisted of the following: December 31, 2025 Gross Accumulated Amortization Net Intangible Assets: Trade names $ 173,000 $ — $ 173,000 Other 12,731 ( 4,921 ) 7,810 Total intangible assets $ 185,731 $ ( 4,921 ) $ 180,810 December 31, 2024 Gross Accumulated Amortization Net Intangible Assets: Trade name $ 163,000 $ — $ 163,000 Other 12,450 ( 3,807 ) 8,643 Total intangible assets $ 175,450 $ ( 3,807 ) $ 171,643 During the year ended December 31, 2025 , we acquired a trade name and related intangible assets associated with our LTH nutritional products for a total purchase price of $ 10.0 million, of which $ 9.5 million was paid in cash at closing and $ 0.5 million was held back until July 2026 for potential indemnification claims. T he $ 9.5 million we paid at closing is included in Other within investing activities in our consolidated statement of cash flows. Other intangible assets at both December 31, 2025 and 2024 includes a facility license associated with our race registration and timing businesses. Amortization expense associated with intangible assets for the years ended December 31, 2025, 2024 and 2023 was $ 1.1 million, $ 1.1 million and $ 1.4 million, respecti vely. Amortization of intangible assets is included in Depreciation and amortization in our consolidated statements of operations. As of December 31, 2025, the expected remaining amortization associated with intangible assets for the next five years was as follows: 2026 $ 1,114 2027 1,114 2028 1,114 2029 1,114 2030 1,114 70 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 6. Revenue Revenue associated with our membership dues, enrollment fees, and certain services from our in-center businesses is recognized over time as earned. Revenue associated with products and services offered in our cafes and spas, as well as through e-commerce, is recognized at a point in time. The following is a summary of revenue, by major revenue stream, that we recognized during the years ended December 31, 2025, 2024 and 2023: Year Ended December 31, 2025 2024 2023 Membership dues and enrollment fees $ 2,111,370 $ 1,853,963 $ 1,557,289 In-center revenue 797,337 692,688 597,040 Total center revenue 2,908,707 2,546,651 2,154,329 Other revenue 86,548 74,344 62,264 Total revenue $ 2,995,255 $ 2,620,995 $ 2,216,593 The timing associated with the revenue we recognized during the years ended December 31, 2025, 2024, and 2023 is as follows: Year Ended December 31, 2025 2024 2023 Center Revenue Other Revenue Total Revenue Center Revenue Other Revenue Total Revenue Center Revenue Other Revenue Total Revenue Services transferred over time $ 2,594,259 $ 85,224 $ 2,679,483 $ 2,262,373 $ 73,607 $ 2,335,980 $ 1,904,061 $ 62,264 $ 1,966,325 Goods and services transferred at a point in time 314,448 1,324 315,772 284,278 737 285,015 250,268 — 250,268 Total revenue $ 2,908,707 $ 86,548 $ 2,995,255 $ 2,546,651 $ 74,344 $ 2,620,995 $ 2,154,329 $ 62,264 $ 2,216,593 Contract liabilities Contract liabilities, which represent payments or consideration received in advance for goods or services that we have not yet transferred to the customer, consisted of the following: Year Ended December 31, 2025 2024 Classification in Consolidated Balance Sheets Contract liabilities - current $ 60,309 $ 58,252 Deferred revenue Contract liabilities - long-term 41 139 Other liabilities Total contract liabilities $ 60,350 $ 58,391 Contract liabilities consist primarily of deferred revenue for fees collected in advance for Dynamic Personal Training, media and athletic events, enrollment fees, other in-center service offerings and membership dues. The following table reflects the change in contract liabilities for the year ended December 31, 2025: Amount Total contract liabilities balance at December 31, 2024 $ 58,391 Revenue recognized that was included in contract liabilities at the beginning of the year ( 53,692 ) Increase, excluding amounts recognized as revenue during the period 55,651 Total contract liabilities balance at December 31, 2025 $ 60,350 71 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 7. Income Taxes Income from continuing operations before income taxes is comprised of: Year Ended December 31, 2025 2024 2023 Domestic $ 488,578 $ 200,691 $ 92,057 Foreign 4,925 8,077 2,733 Income from continuing operations before taxes $ 493,503 $ 208,768 $ 94,790 The provision for income taxes is comprised of: Year Ended December 31, 2025 2024 2023 Current tax expense (benefit) Federal $ 12,330 $ 5,913 $ ( 2,497 ) State and local 20,010 17,158 6,649 Foreign — — ( 2 ) Total current tax expense 32,340 23,071 4,150 Deferred tax expense (benefit) Federal 73,271 35,464 25,341 State and local 13,006 ( 40 ) ( 11,491 ) Foreign 1,215 ( 5,967 ) 727 Total deferred tax expense 87,492 29,457 14,577 Provision for income taxes $ 119,832 $ 52,528 $ 18,727 The amount of deferred tax expense differs from the change in the year-end deferred tax balances due to the tax effect of other comprehensive income, additional paid-in capital items or change in foreign currency exchange rates. The reconciliation between our effective tax rate on income before income taxes and the statutory tax rate is as follows: Year Ended December 31, 2025 2024 2023 Amount Percent Amount Percent Amount Percent U.S. federal statutory tax rate $ 103,636 21.0 % $ 43,841 21.0 % $ 19,906 21.0 % State and local income taxes, net of federal income tax effect (1) 29,594 6.0 % 13,719 6.6 % ( 6,667 ) ( 7.0 ) % Foreign tax effects Canada Change in valuation allowance — — % ( 7,516 ) ( 3.6 ) % ( 157 ) ( 0.2 ) % Other 180 — % ( 148 ) ( 0.1 ) % 308 0.3 % Effects of changes in tax laws/rates enacted in the current period 51 — % — — % — — % Tax credits ( 2,100 ) ( 0.4 ) % ( 1,183 ) ( 0.6 ) % ( 2,485 ) ( 2.6 ) % Changes in valuation allowance — — % ( 950 ) ( 0.4 ) % — — % Share-based payment awards ( 11,900 ) ( 2.4 ) % 6,020 2.9 % 6,190 6.5 % Other 594 0.1 % 433 0.2 % 741 0.8 % Other adjustments ( 223 ) — % ( 1,688 ) ( 0.8 ) % 891 1.0 % Effective tax rate $ 119,832 24.3 % $ 52,528 25.2 % $ 18,727 19.8 % (1) The stat es that make up the majority (greater than 50 percent) of the effect of the state and local income taxes category are Minnesota, New Jersey, Illinois and New York for the year ended December 31, 2025. The states that make up the majority (greater than 50 percent) of the effect of the state and local income taxes category are Minnesota, Texas, Illinois and New Jersey for the year ended 72 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) December 31, 2024. The states that make up the majority (greater than 50 percent) of the effect of the state and local income taxes category are Illinois, Minnesota, California and New Jersey for the year ended December 31, 2023. Income taxes paid were as follows: Year Ended December 31, 2025 2024 2023 Federal taxes paid $ 11,800 $ 1,000 $ 6,800 State and local taxes paid 15,431 17,182 7,251 Total $ 27,231 $ 18,182 $ 14,051 Income taxes paid (net of refunds) exceeded 5% of total income taxes paid (net of refunds) in the following jurisdictions: Year Ended December 31, 2025 2024 2023 State Illinois * 2,940 2,390 Massachusetts * 1,360 * Minnesota * 1,900 * New Jersey 1,520 2,110 * New York 1,526 2,524 * Texas 2,300 1,550 1,957 5,346 12,384 4,347 *Jurisdiction below the threshold for the period presented The net deferred tax liabilities as of December 31, 2025 and 2024 consisted of the following: Year Ended December 31, 2025 2024 Classification in Consolidated Balance Sheets U.S. deferred tax liability $ ( 172,217 ) $ ( 85,255 ) Deferred income taxes, net Canadian deferred tax asset 291 — Other assets Total net deferred tax liability $ ( 171,926 ) $ ( 85,255 ) Deferred income taxes are the result of provisions of the tax laws that either require or permit certain items of income or expense to be reported for tax purposes in different periods than they are reported for financial reporting. The tax effect of temporary differences that gives rise to the net deferred tax liability are as follows: 73 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) December 31, 2025 2024 Deferred tax assets: Lease-related liabilities $ 692,974 $ 640,039 Share-based compensation 20,708 69,082 Accrued expenses 24,725 21,129 Deferred revenue 182 907 Net operating loss 7,097 47,827 Business interest 30,116 66,333 Other 6,403 4,644 Valuation allowance ( 532 ) ( 440 ) Total deferred tax assets 781,673 849,521 Deferred tax liabilities: Property and equipment ( 250,903 ) ( 280,481 ) Intangibles ( 48,299 ) ( 46,547 ) Operating and finance lease right-of-use assets ( 639,799 ) ( 594,519 ) Partnership interest ( 1,958 ) ( 1,869 ) Prepaid expenses ( 11,517 ) ( 10,393 ) Costs related to deferred revenue ( 6 ) ( 38 ) Other ( 1,117 ) ( 929 ) Total deferred tax liabilities ( 953,599 ) ( 934,776 ) Net deferred tax liability $ ( 171,926 ) $ ( 85,255 ) We recognize a tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. We adjust our liability for unrecognized tax benefits in the period in which an uncertain tax position is effectively settled, that statute of limitations expires for the relevant taxing authority to examine the tax position or when more information becomes available. No unrecognized tax benefits were recorded in any of the periods presented. We are subject to taxation in the U.S., Canada and various states. Our tax years 2025, 2024, 2023 and 2022 are subject to examination by the tax authorities. With few exceptions, we are no longer subject to U.S. federal, state or local examinations by tax authorities for years before 2022. As of December 31, 2025, we had state net operating loss carryforwards totaling approximately $ 105.2 million ($ 6.3 million tax effected), of which approximately $ 83.5 million ($ 5.2 million tax effected) expires between 2030 and 2046 and approximately $ 21.6 million ($ 1.1 million tax effected) can be carried forward indefinitely. As it relates to our Canada operations, we had an income tax net operating loss carryforward of approximately $ 3.0 million ($ 0.8 million tax effected) as of December 31, 2025, which is subject to expiration in 2042. As of December 31, 2024, we had a federal income tax net operating loss carryforward related to our U.S. operations of approximately $ 170.7 million ($ 35.9 million tax effected), that could be carried forward indefinitely. As of December 31, 2024, we also had state net operating loss carryforwards totaling approximately $ 155.5 million ($ 8.8 million tax effected), of which approximately $ 121.9 million ($ 7.0 million tax effected) was to expire between 2027 and 2045 and approximately $ 33.6 million ($ 1.8 million tax effected) could be carried forward indefinitely. As it relates to our Canada operations, we had an income tax net operating loss carryforward of approximately $ 11.9 million ($ 3.2 million tax effected) as of December 31, 2024, which was subject to expiration between tax years 2037 and 2042. As of December 31, 2025 and 2024 , we had a business interest carryforward of approximately $ 119.0 million ($ 30.1 million tax effected) and $ 264.2 million ($ 66.3 million tax effected), respectively, that can be carried forward indefinitely. We considered all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations to determine the extent to which we believe net 74 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) deferred tax assets will more likely than not be realized. Based on this assessment, as of December 31, 2025, a valuation allowance of $ 0.5 million has been recorded to reduce the deferred tax asset associated with certain state net operating loss carryforwards. As of December 31, 2024, a valuation allowance of $ 0.4 million was recorded to reduce the deferred tax asset associated with the state net operating loss carryforwards and other deferred tax assets. We consider the earnings of certain non-U.S. subsidiaries to be indefinitely invested outside the United States on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs and our specific plans for reinvestment of those subsidiary earnings. We have not recorded a deferred tax liability related to the U.S. federal and state income taxes and foreign withholding taxes on undistributed earnings of foreign subsidiaries indefinitely invested outside the United States. 8. Derivative Instruments and Hedging Activities Interest Rate Swaps During the year ended December 31, 2025, we entered into receive-variable, pay-fixed interest rate swap agreements with five high-quality institutional banks, each of which had an effective date of April 8, 2025 and is set to expire on April 5, 2028. On the effective date, the initial aggregate notional amount associated with these interest rate swaps was $ 997.5 million, the then-outstanding variable rate borrowings under our Term Loan Facility. The aggregate notional amount associated with these interest rate swaps decreases over time in a manner that is aligned with the timing and amount of scheduled principal payments due with respect to the outstanding borrowings under our Term Loan Facility. At December 31, 2025, the aggregate notional amount associated with these interest rate swaps was $ 992.5 million. Pursuant to these interest rate swaps, we make fixed interest payments at 3.409 % in exchange for receiving variable interest payments based on Term Secured Overnight Financing Rate (“SOFR”). Because the fair value of interest rate swap arrangements is derived from market-based rates, they are classified as derivative financial instruments. We recognize all of our interest rate swap assets and liabilities at fair value (see “Fair Value Measurements” within Note 2, Summary of Significant Accounting Policies). Each of our interest rate swaps qualifies for and has been designated as a cash flow hedge. As of December 31, 2025, w e have determined that each of our interest rate swaps is highly effective in achieving offsetting changes in the fair value of the expected future variable cash flows associated with the outstanding borrowings under our Term Loan Facility. Accordingly, unrealized gains or losses associated with changes in the fair value of our interest rate swaps are recognized as a component of AOCL on our consolidated balance sheets. Realized gains or losses associated with the monthly cash settlements we receive or pay, respectively, in connection with our interest rate swaps are reclassified out of AOCL and recognized in Interest expense, net of interest income in our consolidated statements of operations in the same period during which interest expense associated with the hedged variable interest rate payments is recognized. The monthly cash settlements we receive or pay in connection with these interest rate swaps are reported within operating activities in our consolidated statements of cash flows. 75 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) The fair value of our outstanding designated interest rate swap assets and liabilities is reported in our consolidated balance sheet as follows: December 31, 2025 Classification on Consolidated Balance Sheet Interest rate swap assets $ 397 Prepaid expenses and other current assets Interest rate swap liabilities $ 2,917 Other liabilities The unrealized gain (loss) associated with our interest rate swaps that was recognized in AOCL, as well as the realized gain that was reclassified out of AOCL to earnings, during the year ended December 31, 2025 were as follows: December 31, 2025 Affected Line Item on Consolidated Statements of Operations Balance in AOCL at December 31, 2024 $ — Unrealized gain: Pretax unrealized gain (effective portion) 3,187 Less: Tax expense ( 773 ) Unrealized gain, net of tax (effective portion) 2,414 Realized gain reclassified to earnings: Pretax realized gain reclassified to earnings (effective portion) ( 5,897 ) Interest expense, net of interest income Less: Tax expense 1,430 Provision for income taxes Realized gain reclassified to earnings, net of tax (effective portion) ( 4,467 ) Balance in AOCL at December 31, 2025 $ ( 2,053 ) At December 31, 2025, we expect approximately $ 0.1 million of after-tax realized loss on interest rate swaps to be reclassified out of AOCL to earnings within the next 12 months. The remaining maturity of our interest rate swaps at December 31, 2025 was 2.3 years. 9. Debt Debt consisted of the following: December 31, 2025 2024 Term Loan Facility, maturing November 2031 $ 992,512 $ 1,000,000 Revolving Credit Facility, maturing September 2029 — 10,000 6.000 % Senior Secured Notes, maturing November 2031 500,000 500,000 Mortgage Notes, various maturities 29,423 41,865 Other debt 3,298 3,448 Fair value adjustment 130 284 Total debt 1,525,363 1,555,597 Less unamortized debt discounts and issuance costs ( 17,576 ) ( 19,856 ) Total debt less unamortized debt discounts and issuance costs 1,507,787 1,535,741 Less current maturities ( 21,848 ) ( 22,584 ) Long-term debt, less current maturities $ 1,485,939 $ 1,513,157 76 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Refinancing Transactions Senior Secured Credit Facility In June 2015, Life Time, Inc. and certain of our other wholly-owned subsidiaries entered into a senior secured credit facility (the “Credit Facilities”) with a group of lenders led by Deutsche Bank AG as the administrative agent. During 2024 and 2025, we entered into the following amendments to the credit agreement governing our Credit Facilities (the “Credit Agreement”): • Twelfth amendment in June 2024 pursuant to which we replaced the Canadian Dollar Offered Rate (CDOR), which ceased at the end of June 2024, with the Canadian Overnight Repo Rate Average (CORRA). We do not have any outstanding borrowings in Canadian dollars under our Revolving Credit Facility. • Thirteenth amendment in September 2024 pursuant to which we, among other things, (i) increased the commitments under the Revolving Credit Facility to $ 650.0 million, (ii) reduced the floating interest rate per annum to, at our option, SOFR plus an applicable margin of 2.50 % or a base rate plus 1.50 %, and reduced the undrawn commitment fee rate from 50 basis points to 25 basis points, and (iii) extended the maturity of the revolving credit facility to September 20, 2029. The applicable margins have now decreased 50 basis points upon our achieving a certain first lien net leverage ratio and public corporate family ratings of Ba3 or BB- from any two of Moody’s, S&P and Fitch. • Fourteenth amendment in November 2024 pursuant to which we incurred new term loans maturing in November 2031 in an aggregate principal amount of $ 1,000 million (the “Term Loan Facility”). The term loans under the Term Loan Facility bore interest at a rate per annum of equal to SOFR plus an applicable margin of 2.50 %, which applicable margin decreased by 25 basis points to 2.25 % upon achieving the public corporate family ratings noted above. • Fifteenth amendment in August 2025 pursuant to which we refinanced the Term Loan Facility to reduce the interest rate margin by an additional 0.25 % to 2.00 %. Loans under this amendment were issued at par with no original issue discount. 6.000 % Senior Secured Notes In November 2024, Life Time, Inc. completed the issuance of $ 500.0 million in aggregate principal amount of 6.000 % Senior Secured Notes due 2031 (the “ 6.000 % Senior Secured Notes”). Satisfaction and Discharge of 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes In November 2024, pursuant to the terms of the indentures governing the 5.750 % Senior Secured Notes and the 8.000 % Senior Unsecured Notes, Life Time, Inc. issued a notice of full redemption and used a portion of the proceeds from the Term Loan Facility and 6.000 % Senior Secured Notes to purchase $ 1,424.5 million of U.S. government obligations, which were deposited with the trustee and were sufficient to fund the payment at par of (1) the $ 925.0 million outstanding principal amount and the accrued and unpaid interest associated with the 5.750 % Senior Secured Notes on the scheduled redemption date of January 15, 2025, and (2) the $ 475.0 million outstanding principal amount and the accrued and unpaid interest associated with the 8.000 % Senior Unsecured Notes on the scheduled redemption date of February 1, 2025. The $ 1,424.5 million of cash we paid to purchase the U.S. government obligations during the year ended December 31, 2024 is reported within financing activities in our consolidated statement of cash flows. After the irrevocable deposit of such U.S. government obligations with the trustee, our obligations under the indentures were satisfied and discharged and the transactions were accounted for as debt extinguishments. Upon extinguishment of the 5.750 % Senior Secured Notes and the 8.000 % Senior Unsecured Notes , we derecognized (1) t he $ 1,424.5 million of U.S. government obligations we deposited with the trustee, (2) the $ 1,420.1 million aggregate outstanding principal and related a ccrued and unpaid interest obligations associated with the notes, and (3) $ 6.7 million of unamortized debt discounts and issuance costs associated with the notes. Accordingly, we recognized a loss of $ 11.1 million on the extinguishment of the 5.750 % Senior Secured Notes and the 8.000 % Senior Unsecured Notes during the year ended December 31, 2024, which is included in Interest expense, net of interest income in our consolidated statement of operations. The non-cash financing activities associated with the $ 1,424.5 million of U.S. government obligations we deposited with the trustee, as well as the $ 1,420.1 million aggregate principal and related accrued and unpaid interest obligations that we derecognized in connection with the satisfaction and discharge of the 5.750 % Senior Secured Notes and the 8.000 % Senior Unsecured Notes are disclosed as supplemental non-cash financing activities in Note 3, Supplemental Balance Sheet and Cash Flow Information. 77 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Term Loan Facilities We retired our former term loan facility in September 2024 when we paid the remaining aggregate principal amount of $ 200.0 million in connection with the thirteenth amendment to our Credit Agreement. We had previously used a portion of the net proceeds we received from an equity offering (see Note 11, Stockholders’ Equity) in August 2024 to pay down an aggregate principal amount of $ 110.0 million. Loans under the former term loan facility had a floating interest rate per annum of, at our option, SOFR plus an applicable credit adjustment spread ranging from 0.11448 % to 0.42826 % depending on the duration of borrowing plus the continued applicable margin of 4.00 % or a base rate plus 3.00 %. Effective April 8, 2025, we entered into interest rate swap agreements for our entire Term Loan Facility notional amount of $ 997.5 million, which converted the variable interest rate of our Term Loan Facility to a fixed interest rate of 3.409 %, plus the applicable margin. With the upgrade of our issuer credit rating by S&P Global Ratings on June 18, 2025, our applicable margin was reduced by 0.25 % to 2.25 % effective on June 19, 2025, and with the amendment to our Term Loan Facility on August 18, 2025, our applicable margin was reduced by an additional 0.25 % to 2.00 %. As a result, the effective fixed interest rate associated with our outstanding Term Loan Facility borrowings at December 31, 2025 was 5.409 %. We are required to make quarterly principal payments of 0.25 % of the outstanding balance on the Term Loan Facility. See Note 8, Derivative Instruments and Hedging Activities for more information regarding our interest rate swaps. Revolving Credit Facility Our Revolving Credit Facility provides for a $ 650.0 million revolver and matures in September 2029. At December 31, 2025, there were no outstanding borrowings on the Revolving Credit Facility and there were $ 31.8 million of outstanding letters of credit, resulting in total revolver availability of $ 618.2 million , which was available at intervals ranging from 30 to 180 days at interest rates of SOFR plus 2.00 % or base rate plus 1.00 %. The weighted average interest rate and debt outstanding under the Revolving Credit Facility for the year ended December 31, 2025 wa s 7.26 % and $ 3.8 million, respectively. The highest balance during the year was $ 60.0 million. Upon the exercise of an accordion feature and subject to certain conditions, borrowings under the Credit Facilities may be increased subject, in certain cases, to meeting a first lien net leverage ratio. The Credit Facilities are secured by a first priority lien (on a pari-passu basis with the 6.000 % Senior Secured Notes) on substantially all of our assets. 6.000 % Senior Secured Notes On November 5, 2024, Life Time, Inc. (the “Issuer”) completed the issuance of the 6.000 % Senior Secured Notes. The terms of the 6.000 % Senior Secured Notes are governed by an indenture dated as of November 5, 2024 (the “Indenture”), among the Issuer, the guarantors party thereto and Wilmington Savings Fund Society, FSB, as trustee and notes collateral agent. The 6.000 % Senior Secured Notes mature on November 15, 2031 and bear interest at a rate of 6.00 % per annum payable semi-annually in arrears on May 15 and November 15 of each year, commencing May 15, 2025. The 6.000 % Senior Secured Notes are guaranteed on a senior secured basis by LTF Intermediate Holdings, Inc., the direct parent of the Issuer, and each of the Issuer’s existing and future wholly owned domestic restricted subsidiaries that guarantees its Term Loan Facility, subject to certain exceptions. At any time prior to November 15, 2027, we may redeem some or all of the 6.000 % Senior Secured Notes at a redemption price equal to 100 % of the principal amount of the 6.000 % Senior Secured Notes redeemed plus a “make-whole” premium plus accrued and unpaid interest, if any, to, but not including, the applicable redemption date, as described in the Indenture. At any time prior to November 15, 2027, we may redeem up to 10 % of the original aggregate principal amount of the 6.000 % Senior Secured Notes during each calendar year at a redemption price equal to 103 % of the principal amount of the 6.000 % Senior Secured Notes redeemed, plus accrued and unpaid interest, if any, to, but not including, the redemption date; provided that in any given calendar year, any amount not utilized pursuant to this provision may be carried forward to subsequent calendar years. In addition, at any time and from time to time on or prior to November 15, 2027, we may choose to redeem up to 40.0 % of the aggregate principal amount of the 6.000 % Senior Secured Notes outstanding with the proceeds of certain equity offerings at a redemption price equal to 106 % of the principal amount plus accrued and unpaid interest, if any, to, but not including, the applicable redemption date, so long as the lesser of 50 % of the aggregate amount of the 6.000 % Senior Secured Notes then outstanding and $ 150 million remains outstanding immediately after such redemption. Beginning on November 15, 2027, we may redeem some or all of the 6.000 % Senior Secured Notes at any time, and from time to time, at the redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any, to, but not including, the applicable redemption date. 78 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 5.750 % Senior Secured Notes On January 22, 2021, Life Time, Inc. issued senior secured notes (the “ 5.750 % Senior Secured Notes”) in an aggregate principal amount of $ 925.0 million. These notes were originally scheduled to mature in January 2026 and interest only payments were due semi-annually in arrears at 5.750 %. As noted in the Satisfaction and Discharge of 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes section within this footnote, in November 2024, we issued a notice of full redemption and deposited a portion of the proceeds from the Term Loan Facility and the 6.000 % Senior Secured Notes with the trustee of the 5.750 % Senior Secured Notes to satisfy and discharge them. Following such satisfaction and discharge, the trustee used such proceeds to pay in full at 100 % of the principal amount, plus accrued and unpaid interest, the 5.750 % Senior Secured Notes in January 2025. 8.000 % Senior Unsecured Notes On February 5, 2021, Life Time, Inc. issued senior unsecured notes (the “ 8.000 % Senior Unsecured Notes”) in the original principal amount of $ 475.0 million. The 8.000 % Senior Unsecured Notes were originally scheduled to mature in April 2026 and interest only p ayments were due semi-annually in arrears at 8.00 %. As noted in the Satisfaction and Discharge of 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes section within this footnote, in November 2024, we issued a notice of full redemption and deposited a portion of the proceeds from the Term Loan Facility and the 6.000 % Senior Secured Notes with the trustee of the 8.000 % Senior Unsecured Notes to satisfy and discharge them. Following such satisfaction and discharge, the trustee used such proceeds to pay in full at 100% of the principal amount, plus accrued and unpaid interest, the 8.000 % Senior Unsecured Notes in February 2025. Construction Loan On January 22, 2021, we closed on a construction loan (the “Construction Loan”) providing up to $ 28.0 million to partially finance the construction of a Life Time Living location. The Construction Loan was originally scheduled to mature on February 15, 2026 and was collateralized by the property. Borrowings under the Construction Loan bore interest at a variable annual rate of no less than 4.80 %. Interest only payments were due monthly beginning April 15, 2022 and continuing through February 15, 2024. Beginning March 15, 2024, based on the principal balance due as of February 15, 2024, monthly principal and interest installment payments were due in an amount sufficient to fully amortize the principal balance at maturity. On August 15, 2024, we fully paid the remaining principal balance and accrued interest associated with our Construction Loan totaling $ 28.2 million. Mortgage Notes Certain of our subsidiaries have entered into mortgage facilities with various financial institutions (collectively, the “Mortgage Notes”), which are collateralized by certain of our related real estate and buildings, including one of our corporate headquarters properties. The Mortgage Notes have varying maturity dates from September 2026 through August 2027 and carried a weighted average interest rate of 5.47 % and 5.56 % at December 31, 2025 and 2024, respectively. Payments of principal and interest on each of the Mortgage Notes are payable monthly on the first business day of each month. During the year ended December 31, 2024, we fully paid at maturity the principal balance and remaining accrued interest associated with two of our Mortgage Notes totaling $ 62.9 million. Debt Discounts and Issuance Costs Unamortized debt discounts and issuance costs associated with the Term Loan Facility and 6.000 % Senior Secured Notes of $ 17.6 million and $ 19.9 million at December 31, 2025 and 2024, respectively, are included in Long-term debt, net of current portion on our consolidated balance sheets. Unamortized revolver-related debt issuance costs of $ 2.8 million and $ 3.6 million are included in Other assets on our consolidated balance sheets at December 31, 2025 and 2024, respectively. During the year ended December 31, 2024, in connection with the pay down in full of each of our former term loan facility and Construction Loan, and the satisfaction and discharge of each of our 5.750 % Senior Secured Notes and 8.000 % Senior Unsecured Notes, we recognized $ 9.4 million of debt discounts and issuance cost write-offs, which are included in Interest expense, net of interest income in our consolidated statement of operations. 79 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Debt Covenants We are required to comply with certain affirmative and restrictive covenants under our Credit Facilities, 6.000 % Senior Secured Notes and Mortgages Notes. We are also required to comply with a first lien net leverage ratio covenant under the Revolving Credit Facility, which requires us to maintain a first lien net leverage ratio, if 30.00 % or more of the Revolving Credit Facility commitments are outstanding shortly after the end of any fiscal quarter (excluding all cash collateralized undrawn letters of credit and other undrawn letters of credit up to $ 90.0 million). As of December 31, 2025, we were either in compliance in all material respects with the covenants or the covenants were not applicable. Future Maturities of Long-Term Debt Aggregate annual future maturities of long-term debt, excluding unamortized debt discounts, issuance costs and fair value adjustments, at December 31, 2025 were as follows: 2026 $ 21,848 2027 27,812 2028 10,139 2029 10,149 2030 10,167 Thereafter 1,445,118 Total future maturities of long-term debt $ 1,525,233 10. Leases Lease Cost Lease cost included in our consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023 consisted of the following: Year Ended December 31, 2025 2024 2023 Classification in Consolidated Statements of Operations Lease cost: Operating lease cost $ 311,887 $ 282,271 $ 261,144 Rent Short-term lease cost 2,611 4,328 4,105 Rent Variable lease cost 24,672 18,346 9,873 Rent Variable lease cost 84,224 72,763 66,007 Center operations Finance lease and financing obligations cost: Amortization of right-of-use assets 2,517 905 1,024 Depreciation and amortization Interest on lease liabilities 983 160 98 Interest expense, net of interest income Interest on financing obligations 3,784 2,818 2,401 Interest expense, net of interest income Total lease cost $ 430,678 $ 381,591 $ 344,652 80 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Sale-Leaseback Transactions Sale-Leaseback Transactions with Unrelated Third Parties Duri ng the year ended December 31, 2025, we entered into and consummated sale-leaseback transactions with three unrelated third parties. Under these transactions, we sold seven properties with a combined net book value of $ 239.5 million for an aggregate gross sales price of $ 249.9 million, of which $ 239.0 million was received in cash and $ 10.9 million was received in the form of non-cash consideration. The non-cash consideration represented property conveyed to us by a buyer in lieu of cash, measured at $ 11.8 million fair value, net of $ 0.9 million of cash paid back to the buyer. The aggregate gross sales price of $ 249.9 million was reduced by transaction costs of $ 1.3 million, resulting in a net aggregate sales price of $ 248.6 million. The estimated fair value of the property sold was $ 253.6 million. Of the $ 237.7 million net cash we received in connection with these sale-leaseback transactions, $ 227.4 million and $ 10.3 million is reported within investing activities and financing activities, respectively, on our consolidated statement of cash flows for the year ended December 31, 2025. W e recognized a net gain of $ 12.8 million on these sale-leaseback transactions during the year ended December 31, 2025, which is included in Other operating expense in our consolidated statement of operations. During the year ended December 31, 2024, we entered into and consummated sale-leaseback transactions with three unrelated third parties. Under these transactions, we sold five properties for gross proceeds of $ 173.2 million, which was reduced by transaction costs of $ 1.2 million, for net cash proceeds of $ 172.0 million. The estimated fair value of the property sold was $ 182.2 million. Of the $ 172.0 million net cash we received in connection with these sale-leaseback transactions, $ 167.7 million and $ 4.3 million is reported within investing activities and financing activities, respectively, on our consolidated statement of cash flows for the year ended December 31, 2024. During the year ended December 31, 2024, we recognized a net gain of $ 19.8 million on sale-leaseback transactions, which is included in Other operating expense in our consolidated statement of operations. During the year ended December 31, 2023, we entered into and consummated sale-leaseback transactions with unrelated third parties. Under these transactions, we sold three properties for gross proceeds of $ 124.0 million, which was reduced by transaction costs of $ 0.7 million, for net cash proceeds of $ 123.3 million. The estimated fair value of the property sold was $ 128.4 million. Of the $ 123.3 million net cash we received in connection with these sale-leaseback transactions, $ 121.8 million and $ 1.5 million is reported within investing activities and financing activities, respectively, on our consolidated statement of cash flows for the year ended December 31, 2023. During the year ended December 31, 2023, we recognized a loss of $ 13.6 million on sale-leaseback transactions, which is included in Other operating expense in our consolidated statement of operations. Related Party Sale-Leaseback Transactions and Leases For information on sale-leaseback transactions with related parties, as well as other related party leases not associated with sale-leaseback transactions, see Note 14, Related Party Transactions. 81 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Operating and Finance Lease Right-of-Use Assets and Lease-Related Liabilities Operating and finance lease right-of-use assets and lease-related liabilities were as follows: December 31, Classification on Consolidated Balance Sheets 2025 2024 Lease right-of-use assets: Operating leases $ 2,479,804 $ 2,313,311 Operating lease right-of-use assets Finance leases (1) 12,283 2,406 Other assets Total lease right-of-use assets $ 2,492,087 $ 2,315,717 Lease-related liabilities: Current Operating leases $ 79,208 $ 70,462 Current maturities of operating lease liabilities Finance leases 12,099 1,108 Accrued expenses and other current liabilities Financing obligations 15 10 Accrued expenses and other current liabilities Non-current Operating leases 2,555,513 2,381,094 Operating lease liabilities, net of current portion Finance leases 1,253 1,324 Other liabilities Financing obligations 37,973 27,539 Other liabilities Total lease-related liabilities $ 2,686,061 $ 2,481,537 (1) Finance lease right-of-use assets were reported net of accumulated amortization of $ 3.3 million and $ 1.2 million at December 31, 2025 and 2024, respectively. Remaining Lease Terms and Discount Rates The weighted-average remaining lease terms and discount rates associated with our lease-related liabilities at December 31, 2025 were as follows: December 31, 2025 Weighted-average remaining lease term (1) Operating leases 16.5 years Finance leases 1.0 years Financing obligations 22.5 years Weighted-average discount rate Operating leases 9.28 % Finance leases 7.34 % Financing obligations 11.63 % (1) The weighted-average remaining lease term associated with our operating and finance lease liabilities does not include all of the optional renewal periods available to us under our current lease arrangements. Rather, the weighted-average remaining lease term only includes periods covered by an option to extend a lease if we are reasonably certain to exercise that option. 82 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Supplemental Cash Flow Information Supplemental cash flow information associated with our leases is as follows: Year Ended December 31, 2025 2024 2023 Cash paid for amounts included in the measurement of lease-related liabilities: Operating cash flows from operating leases $ 282,263 $ 254,128 $ 226,896 Operating cash flows from finance leases 253 160 98 Financing cash flows from finance leases 2,006 926 1,031 Operating cash flows from financing obligations 3,635 2,716 2,307 Financing cash flows from financing obligations 10 4 — Non-cash information: Right-of-use assets obtained in exchange for initial lease liabilities: Operating leases 222,856 172,106 140,614 Finance leases 12,200 1,942 1,347 Right-of-use asset adjustments recognized as a result of the remeasurement of existing lease liabilities: Operating leases 20,003 7,241 17,364 Non-cash increase in operating lease right-of-use assets associated with below-market sale-leaseback transactions 14,000 13,350 5,900 Fair value of non-cash consideration received in connection with a sale-leaseback transaction 10,900 — — Non-cash increase in financing obligations as a result of interest accretion 149 102 94 Maturities of Operating Lease Liabilities, Finance Lease Liabilities and Financing Obligations The maturities associated with our lease-related liabilities at December 31, 2025 are as follows: Operating Leases Finance Leases Financing Obligations Total 2026 $ 23,168 $ 13,078 $ 4,279 $ 40,525 2027 309,416 1,103 4,338 314,857 2028 312,727 208 4,398 317,333 2029 306,732 — 4,461 311,193 2030 309,483 — 4,527 314,010 Thereafter 3,860,439 — 91,301 3,951,740 Total lease payments 5,121,965 14,389 113,304 5,249,658 Less: Imputed interest 2,487,244 1,037 75,316 2,563,597 Present value of lease-related liabilities $ 2,634,721 $ 13,352 $ 37,988 $ 2,686,061 Leases Not Yet Commenced As of December 31, 2025 , we had entered into several leases associated with future centers that were executed, but for which we did not yet have control of the underlying assets. Accordingly, as of December 31, 2025 , we did not recognize any right-of-use assets or lease liabilities associated with these leased locations on our consolidated balance sheet. These arrangements contain undiscounted lease payments that are payable during the initial lease terms, which range from seven to 20 years, totaling approximately $ 545.8 million. 83 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 11. Stockholders’ Equity Equity Offering On August 14, 2024, we consummated a registered offering, issuance and sale of 6.0 million shares of our common stock by the Company (the “Primary Shares”) and a registered offering and sale of 7.8 million shares of our common stock by certain of our stockholders (the “Secondary Shares”) at an offering price of $ 21.75 per share, less underwriting discounts and commissions (collectively, the “Offering”). We received total gross proceeds from the Primary Shares of $ 130.5 million, which was reduced by underwriting discounts and commissions and other expenses of $ 6.5 million, for net proceeds of $ 124.0 million. We did no t receive any proceeds from the sale of the Secondary Shares. We used a portion of the net proceeds we received from the Offering to pay down $ 110.0 million of our former term loan facility on August 19, 2024 (see Note 9, Debt). Equity Incentive Plans 2015 Equity Plan On October 6, 2015, our board of directors adopted the LTF Holdings, Inc. 2015 Equity Incentive Plan (as amended, the “2015 Equity Plan”). Effective with our initial public offering (“IPO”) in October 2021, no further grants have been or will be made under the 2015 Equity Plan. Approximately 1.0 million shares that were reserved and available for issuance under the 2015 Equity Plan are now available for issuance under the 2021 Equity Plan as detailed below. 2021 Equity Plan In connection with the IPO and effective October 6, 2021, we adopted the 2021 Incentive Award Plan (the “2021 Equity Plan”), under which we may grant cash and equity-based incentive awards to our employees, consultants and directors. The maximum number of shares of our common stock available for issuance under the 2021 Equity Plan is equal to the sum of (i) approximately 14.5 million shares of our common stock, (ii) an annual increase on the first day of each year beginning in 2022 and ending in and including 2031, equal to the lesser of (A) 4 % of the outstanding shares of our common stock on the last day of the immediately preceding fiscal year and (B) such lesser amount as determined by our board of directors, and (iii) the approximately 1.0 million shares of our common stock that were available for issuance under the 2015 Equity Plan as of October 6, 2021; provided, however, no more than 14.5 million shares may be issued upon the exercise of incentive stock options. Our board of directors determined that no additional shares would become available under the 2021 Equity Plan as of January 1, 2025, 2024 and 2023 pursuant to the evergreen feature described in part (ii) of the immediately preceding sentence. Effective January 1, 2022, the number of shares of our common stock available for issuance under the 2021 Equity Plan increased by approximately 7.7 million shares pursuant to such evergreen feature. Additionally, the number of shares of our common stock available for issuance under the 2021 Equity Plan increases with respect to awards under the 2015 Equity Plan which are forfeited or lapse unexercised and which following the effective date of the 2021 Equity Plan are not issued under such prior plan. The share reserve formula under the 2021 Equity Plan is intended to provide us with the continuing ability to grant equity awards to eligible employees, directors and consultants for the 10-year term of the 2021 Equity Plan. As of December 31, 2025, approximately 10.5 million shares were available for future awards to employees and other eligible participants under the 2021 Equity Plan. 2021 Employee Stock Purchase Plan In connection with the IPO and effective October 6, 2021, we adopted the 2021 Employee Stock Purchase Plan (the “ESPP”). The ESPP is designed to allow our eligible employees to purchase shares of our common stock, at periodic intervals, with their accumulated payroll deductions. The ESPP consists of two components: an Internal Revenue Service (“IRS”) Code section 423 (“Section 423”) component, which is intended to qualify under Section 423 of the IRS Code and a non-Section 423 component, which need not qualify under Section 423 of the IRS Code. The aggregate number of shares of our common stock that has initially been reserved for issuance under the ESPP is equal to (i) approximately 2.9 million shares of our common stock, and (ii) an annual increase on the first day of each year beginning in 2022 and ending in and including 2031, equal to the lesser of (A) 1 % of the aggregate number of shares of our common stock outstanding on the final day of the immediately preceding calendar year and (B) such smaller number of our shares of common stock as determined by our board of directors; provided that in no event will more than 29.0 million shares of our common stock be available for issuance under the Section 423 component of the ESPP. Our board of directors determined each year that no additional shares would become available under the ESPP pursuant to the evergreen feature described in part (ii) of the immediately preceding sentence. Our board of directors or the compensation committee will have authority to interpret the terms of the ESPP and determine eligibility of participants. 84 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) We launched the first offering period under the ESPP on December 1, 2022. The ESPP permits participants to purchase common stock through payroll deductions of up to 15 % of their eligible compensation, which includes a participant’s gross base compensation for services to us. On the first trading day of each offering period, each participant is automatically granted an option to purchase shares of our common stock. The purchase option expires at the end of the applicable offering period and will be exercised on each purchase date during such offering period to the extent of the payroll deductions accumulated during the offering period. We have consecutive offering periods of approximately six months in length commencing on each January 1 and July 1 during the term of the ESPP. The purchase price for a share of our common stock is 90 % of the fair market value of a share on the enrollment date for such offering period or on the purchase date, whichever is lower, and subject to adjustment by our board of directors or compensation committee. Participants may voluntarily end their participation in the ESPP prior to the end of the applicable offering period and are paid their accrued payroll deductions that have not yet been used to purchase shares of common stock. Upon exercise, the participant purchases the number of whole shares that his or her accumulated payroll deductions will buy at the purchase option price, subject to the certain participation limitations. Participation ends automatically upon a participant’s termination of employment. During the year ended December 31, 2025, 2024 and 2023, 0.2 million, 0.2 million and 0.3 million shares, respectively, were issued under the ESPP. We recognized $ 1.0 million, $ 0.7 million and $ 1.2 million of share-based compensation expense for the discount received by participants during the years ended December 31, 2025, 2024 and 2023 , respectively, all of which is included in General, administrative and marketing in our consolidated statements of operations. As of December 31, 2025, there was no unrecognized share-based compensation expense associated with the ESPP. Restricted Stock Units Restricted Stock Unit Activity Activity associated with restricted stock units during the year ended December 31, 2025 is as follows: Restricted Stock Units Shares Weighted Average Grant Date Fair Value Nonvested at December 31, 2024 3,145 $ 14.95 Granted 1,292 27.52 Vested ( 1,628 ) 14.83 Forfeited ( 93 ) 18.11 Nonvested at December 31, 2025 2,716 $ 20.90 Restricted Stock Units Granted During the year ended December 31, 2025, the Company granted approximately 1.3 million restricted stock unit awards under the 2021 Equity Plan, of which approximately 1.0 million were time-based vesting awards, the vast majority of which vest in ratable installments ranging from one to three years , and approximately 0.3 million were performance-based vesting awards granted to our executives in connection with our short-term incentive compensation program, in each case subject to continuous employment or service from the grant date through the applicable vesting date unless otherwise agreed with the award recipient . We determine the grant date fair value of restricted stock unit awards by multiplying the number of restricted stock unit awards by the closing trading price of our common stock on the grant date. During the year ended December 31, 2024 , the Company granted approximatel y 1.9 million restricted stock unit awards under the 2021 Equity Plan, of which approximately 1.2 million were time-based vesting awards that vest in three ratable annual installments, approximately 0.5 million were performance-based vesting awards granted to our executives in connection with our short-term incentive compensation program that have now vested and less than 0.2 million vest in ratable annual installments ranging from one to four years , in each case subject to continuous employment or service from the grant date through the applicable vesting date unless otherwise agreed with the award recipient. The weighted average grant date fair value associated with the approximately 1.9 million restricted stock unit awards granted during the year ended December 31, 2024 was $ 14.13 . 85 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) During the year ended December 31, 2023 , the Company granted approximately 1.1 million restricted stock unit awards under the 2021 Equity Plan, of which approximately 0.4 million were time-based vesting awards, approximately 0.4 million were time-based vesting awards with a performance qualifier and approximately 0.3 million were performance-based vesting awards granted to our executives in connection with our short-term incentive compensation program. Of the 1.1 million r estricted stock unit awards that were granted during the year ended December 31, 2023, approximately 0.8 million vest in four ratable annual installments (subject to meeting a performance qualifier for approximately 0.4 million of such awards, which performance qualifier was met), approximately 0.3 million v ested based on meeting certain performance metrics under our short-term incentive compensation plan with performance above the target metric resulting in the issuance of additional fully-vested shares of our common stock as detailed under “—Other Share-Based Payment Awards” below and less than 0.1 million vest in two ratable annual installment, in each case subject to continuous employment or service from the grant date through the applicable vesting date unless otherwise agreed with the award recipient. The weighted average grant date fair value associated with the approximately 1.1 million restricted stock unit awards granted during the year ended December 31, 2023 was $ 17.41 . Fair Value of Vested Restricted Stock Units The total fair value of restricted stock units that vested during the years ended December 31, 2025, 2024 and 2023 was approximately $ 47.8 million , $ 17.9 million and $ 10.2 million respectively, which represents the aggregate of the fair value of the each of the underlying shares measured as of the vesting date. Share-Based Compensation Expense Assoc iated with Restricted Stock Units Share-based compensation expense associated with restricted stock units for the year ended December 31, 2025 was $ 30.6 million, of which $ 4.4 million, $ 25.3 million and $ 0.9 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Share-based compensation expense associated with restricted stock units for the year ended December 31, 2024 was $ 24.1 million, of which $ 2.9 million, $ 20.4 million and $ 0.8 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Share-based compensation expense associated with restricted stock units for the year ended December 31, 2023 was $ 18.1 million, of which $ 2.1 million, $ 15.5 million and $ 0.5 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. As of December 31, 2025, unrecognized share-based compensation expense related to restricted stock units was approximately $ 30.2 million, which is expected to be recognized over a weighted average remaining period of 1.8 years. Performance Stock Units Performance Stock Unit Activity Activity associated with performance stock units during the year ended December 31, 2025 is as follows: Performance Stock Units Shares Weighted Average Grant Date Fair Value Nonvested at December 31, 2024 505 $ 13.28 Granted 306 23.61 Vested ( 56 ) 13.28 Nonvested at December 31, 2025 755 $ 17.47 Performance Stock Units Granted During the year ended December 31, 2025, the Company granted approximately 0.3 million three-year performance stock unit awards under the 2021 Equity Plan, all of which were granted to our executives in connection with our long-term incentive compensation program. The performance stock unit awards are based on our Adjusted EBITDA with performance determined each year for one-third of such award but the entire award does not vest until the end of the three-year period. We determine the grant date fair value of performance stock unit awards by multiplying the number of performance stock unit awards by the closing trading price of our common stock on the grant date. 86 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) During the year ended December 31, 2024 , the Company granted approximately 0.5 million three-year performance stock unit awards under the 2021 Equity Plan, all of which were granted to our executives in connection with our long-term incentive compensation program. Approximately 0.3 million of the performance stock unit awards are based on our Adjusted EBITDA with performance determined each year for one-third of such award but the entire award does not vest until the end of the three-year period and approximately 0.2 million of the performance stock unit awards are based on our leverage ratio at the end of each year with one-third vesting each year dependent on achieving the leverage ratio target for such year. The weighted average grant date fair value associated with the approximately 0.5 million performance stock unit awards granted during the year ended December 31, 2024 was $ 13.28 . Share-Based Compensation Expense Assoc iated with Performance Stock Units Share-based compensation expense associated with performance stock units for the year ended December 31, 2025 and 2024 was $ 8.8 million and $ 4.4 million, respectively, all of which is included in General, administrative and marketing in our consolidated statements of operations. No share-based compensation expense associated with performance stock units was recognized during the year ended December 31, 2023 . As of December 31, 2025, unrecognized share-based compensation expense related to performance stock units was approximately $ 14.7 million, which is expected to be recognized over a weighted average remaining period of 1.9 years. Stock Options Stock Option Activity Activity associated with stock options during the year ended December 31, 2025 is as follows: Stock Options Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Outstanding at December 31, 2024 22,222 $ 12.52 Exercised ( 13,084 ) 10.45 Forfeited or cancelled ( 13 ) 18.25 Outstanding at December 31, 2025 9,125 $ 15.45 3.8 $ 101,517 Exercisable as of December 31, 2025 8,284 $ 15.35 3.5 $ 93,005 Options Granted The Company did no t grant any stock option awards during the years ended December 31, 2025 and 2024 . During the year ended December 31, 2023 , the Company granted approximately 1.4 million stock option awards under the 2021 Equity Plan. These options have a 10-year contractual term from the date of grant and vest in four ratable annual installments on each of the first four anniversaries of the grant date, subject to continuous employment or service from the grant date through the applicable vesting date unless otherwise agreed with the award recipient. The exercise price associated with each of these awards was not less than the fair market value per share of our common stock at the time of grant. Intrinsic Value and Income Tax Benefits Associated with Option Exercises The total intrinsic value of stock options exercised during the years ended December 31, 2025, 2024 and 2023 was approximately $ 265.8 million , $ 25.0 million and $ 12.2 million, respectively. In connection with the stock option exercises during the year ended December 31, 2025 , including a significant exercise by our Chief Executive Officer of stock options that were set to expire in 2025, we recognized an aggregate income tax benefit of approximately $ 15.5 million. In connection with the stock option exercises during the year ended December 31, 2024 and 2023, we recognized an aggregate income tax deficiency of approximately $ 1.9 million and $ 2.2 million, respectively. 87 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Fair Value of Stock Option Awards Granted The fair value of the options granted during the year ended December 31, 2023 was calculated using the Black-Scholes option pricing model. The following weighted average assumptions were used in determining the fair value of stock options granted: Year Ended December 31, 2023 Dividend yield 0.00 % Risk-free interest rate (1) 3.88 % Expected volatility (2) 52.50 % Expected term of options (in years) (3) 6.3 Fair Value $ 9.63 (1) The risk-free rate is based on the U.S. treasury yields, in effect at the time of grant or modification, corresponding with the expected term of the options. (2) Expected volatility is based on historical volatilities for a time period similar to that of the expected term of the options. (3) Expected term of the options is based on probability and expected timing of market events leading to option exercise. Share-Based Compensation Expense Associated with Stock Options Share-based compensation expense associated with stock options for the year ended December 31, 2025 was $ 5.7 million, of which $ 0.7 million, $ 4.9 million and $ 0.1 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Share-based compensation expense associated with stock options for the year ended December 31, 2024 was $ 7.5 million, of which $ 0.2 million, $ 7.1 million and $ 0.2 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Share-based compensation expense associated with stock options for the year ended December 31, 2023 was $ 11.8 million, of which $ 0.5 million, $ 11.0 million and $ 0.3 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. As of December 31, 2025, unrecognized share-based compensation expense related to stock options was approximately $ 3.8 million, which is expected to be recognized over a weighted average remaining period of 1.1 years. Other Share-Based Payment Awards 2025 Short-Term Incentive Program During the year ended December 31, 2025 , the Company adopted a short-term incentive compensation program for eligible team members who are not executive officers. Pursuant to this program, awards will be paid out in cash and/or through the issuance of fully-vested shares of the Company’s common stock at or around the time of determining the Company’s performance under such program in early 2026 if the Company’s performance exceeds the tranche one performance metric. As of December 31, 2025, we expect that approximately 42% of the dollar value of these awards will be settled in fully-vested shares of the Company’s common stock and the other 58% of these awards will be settled in cash. As it relates to the portion of these awards we expect to settle in fully-vested shares of the Company’s common stock, we are accounting for the potential issuance of these shares of common stock as share-based payment awards granted under this program. Share-based compensation expense associated with the portion of these awards that we expect to settle in shares of the Company’s common stock for the year ended December 31, 2025 was $ 6.3 million, of which $ 5.8 million and $ 0.5 million is included in General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Because the incentive compensation associated with these awards represents a fixed dollar amount that, if payable, will be settled in a variable number of shares of the Company’s common stock, we are currently accounting for these awards as liability-classified share-based payment awards. Accordingly, the offset to the share-based compensation expense we have recognized in connection with these awards during the year ended December 31, 2025 is included in Accrued expenses and other current liabilities on our consolidated balance sheet at December 31, 2025 . 88 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 2024 Short-Term Incentive Program During the year ended December 31, 2024, the Company adopted a short-term incentive compensation program for team members who are not executive officers, pursuant to which fully-vested shares of the Company’s common stock would be issued at or around the time of determining the Company’s performance under such program in early 2025 if the Company’s performance exceeded the tranche one performance metric. We accounted for the potential issuance of these shares of common stock as share-based payment awards granted under this program. Share-based compensation expense associated with these awards for the year ended December 31, 2025 was $( 0.6 ) million, all of which is included in General, administrative and marketing in our consolidated statement of operations. Share-based compensation expense associated with these awards for the year ended December 31, 2024 was $ 14.6 million, of which $ 0.1 million, $ 13.0 million, and $ 1.5 million is included in Center operations, General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Because the incentive compensation associated with these awards represented a fixed dollar amount that settled in a variable number of shares of the Company’s common stock, we accounted for these awards as liability-classified share-based payment awards. Accordingly, the offset to the share-based compensation expense we recognized in connection with these awards during the year ended December 31, 2024 is included in Accrued expenses and other current liabilities on our consolidated balance sheet at December 31, 2024. In February 2025, our board of directors determined that our 2024 performance exceeded the tranche three performance metric under our 2024 short-term incentive compensation program and issued corresponding shares of common stock to our eligible employees. Effective as of the determination date, the $ 13.8 million then-outstanding liability we had recognized in connection with these liability-classified share-based payment awards was reclassified out of Accrued expenses and other current liabilities and into Common stock and Additional paid-in capital on our consolidated balance sheet during the year ended December 31, 2025 . 2023 Short-Term Incentive Program During the year ended December 31, 2023 , the Company adopted a short-term incentive compensation program pursuant to which fully-vested shares of the Company’s common stock would be issued at or around the time of determining the Company’s performance under such program in early 2024 if the Company’s performance exceeded the target performance metric for executives and if the Company’s performance exceeded the threshold performance metric for non-executives. We accounted for the potential issuance of these shares of common stock as share-based payment awards granted under this program. Share-based compensation expense associated with these awards for the year ended December 31, 2024 was $( 0.2 ) million, of which $ 0.1 million and $( 0.3 ) million is included in General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Share-based compensation expense associated with these awards for the year ended December 31, 2023 was $ 19.0 million, of which $ 17.1 million and $ 1.9 million is included in General, administrative and marketing and Other operating expense, respectively, in our consolidated statement of operations. Because the incentive compensation associated with these awards represented a fixed dollar amount that settled in a variable number of shares of the Company’s common stock, we accounted for these awards as liability-classified awards. In February 2024, our board of directors determined that our 2023 performance exceeded the maximum performance metric under our 2023 short-term incentive compensation program and issued corresponding shares of common stock to our eligible employees. Effective as of the determination date, the $ 18.1 million then-outstanding liability we had recognized in connection with these share-based payment awards was reclassified out of Accrued expenses and other current liabilities and into Common stock and Additional paid-in capital on our consolidated balance sheet. 89 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) Accumulated Other Comprehensive Loss Changes in the AOCL balances for the years ended December 31, 2025, 2024 and 2023 were as follows (all amounts are reported net of tax): Foreign Currency Translation Adjustments Unrealized Loss on Derivative Instruments Total AOCL balance at December 31, 2022 $ ( 9,222 ) $ — $ ( 9,222 ) Other comprehensive income before reclassifications 2,297 — 2,297 Amounts reclassified from AOCL to earnings — — — AOCL balance at December 31, 2023 ( 6,925 ) — ( 6,925 ) Other comprehensive loss before reclassifications ( 5,872 ) — ( 5,872 ) Amounts reclassified from AOCL to earnings — — — AOCL balance at December 31, 2024 ( 12,797 ) — ( 12,797 ) Other comprehensive income before reclassifications 2,720 2,414 5,134 Amounts reclassified from AOCL to earnings — ( 4,467 ) ( 4,467 ) AOCL balance at December 31, 2025 $ ( 10,077 ) $ ( 2,053 ) $ ( 12,130 ) 12. Income Per Share For the years ended December 31, 2025 and December 31, 2024, o ur potentially dilutive securities included stock options, restricted stock units, performance stock units, shares to be issued under our ESPP and contingently issuable shares related to our short-term incentive compensation program. For the year ended December 31, 2023, o ur potentially dilutive securities included stock options, restricted stock units, shares to be issued under our ESPP and contingently issuable shares related to our short-term incentive compensation program. The following table sets forth the calculation of basic and diluted income per share for the years ended December 31, 2025, 2024 and 2023: Year Ended December 31, 2025 2024 2023 Net income $ 373,671 $ 156,240 $ 76,063 Weighted-average common shares outstanding – basic 218,031 201,640 195,671 Dilutive effect of stock-based compensation awards 7,464 9,524 8,334 Weighted-average common shares outstanding – diluted 225,495 211,164 204,005 Income per common share – basic $ 1.71 $ 0.77 $ 0.39 Income per common share – diluted $ 1.66 $ 0.74 $ 0.37 90 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) The following is a summary of potential shares of common stock that were antidilutive and excluded from the weighted average share computations for the years ended December 31, 2025, 2024 and 2023 : Year Ended December 31, 2025 2024 2023 Stock options 7 1,428 6,476 Restricted stock units 376 — 193 ESPP shares — 84 — Potential common shares excluded from the weighted average share calculation 383 1,512 6,669 For more information regarding stock options, restricted stock units and ESPP shares, see Note 11 , Stockholders’ Equity. 13. Commitments and Contingencies Purchase Commitments We ha ve entered into various unconditional purchase obligations that primarily include software licenses and support, and marketing services. As of December 31, 2025, these purchase obligations totaled approximately $ 19.2 million, the majority of which are expected to be settled within the next year. These unconditional purchase obligations are in addition to the current and long-term liabilities recorded on our December 31, 2025 consolidated balance sheet and exclude agreements that are cancellable at any time without penalty. Legal Matters Life Time, Inc. et al. v. Zurich American Insurance Company On August 19, 2020, Life Time, Inc., several of its subsidiaries, and a joint venture entity, Bloomingdale Life Time Fitness LLC (collectively, the “Life Time Parties”) filed a complaint against Zurich American Insurance Company (“Zurich”) in the Fourth Judicial District of the State of Minnesota, County of Hennepin (the “District Court”) (Case No. 27-CV-20-10599) (the “Action”) seeking declaratory relief and damages with respect to Zurich’s failure under a property/business interruption insurance policy to provide certain coverage to the Life Time Parties related to the closure or suspension by governmental authorities of their business activities due to the spread or threat of the spread of COVID-19. On March 15, 2021, certain of the Life Time Parties filed a First Amended Complaint in the Action adding claims against Zurich under a Builders’ Risk policy related to the suspension of multiple construction projects. The Court granted Zurich’s dispositive motions on July 25, 2024, dismissing the Life Time Parties’ claims with prejudice, and entered judgment on July 26, 2024. The Life Time Parties appealed from that judgment to the Minnesota Court of Appeals (the “Court of Appeals”). On August 11, 2025, the Court of Appeals reversed the District Court’s order granting summary judgment in favor of Zurich, holding that governmental closure orders were the causes of the Life Time Parties’ losses under the property/business interruption policy, and not the pandemic. The Court of Appeals concluded that the Life Time Parties have a coverage limit of $ 1.0 million per occurrence and there were 29 occurrences, reflecting the 29 different jurisdictions that issued closure orders affecting the Life Time Parties’ 150 locations during that time. The Court of Appeals remanded the Action to the District Court for further proceedings. On September 8, 2025, Zurich petitioned the Minnesota Supreme Court for review of the decision of the Court of Appeals. On September 30, 2025, the Life Time Parties filed an opposition to Zurich’s petition for review. On October 29, 2025, the Minnesota Supreme Court denied Zurich’s petition for review. In November 2025, Zurich paid ap proximately $ 40 million to Life Time in partial satisfaction of Life Time’s legal claims in this Action, which is included in Other income in our consolidated statement of operations for the year ended December 31, 2025. This payment represents up to $ 1.0 million plus interest for 26 occurrences of 29 total occurrences found by the Court of Appeals in its order dated August 11, 2025. The Ac tion will be remanded to the District Court for further proceedings. The Action is subject to uncertainties, and the final outcome of the matter is not predictable with assurance. Other We are also engaged in other proceedings incidental to the normal course of business. Due to their nature, such legal proceedings involve inherent uncertainties, including but not limited to court rulings, negotiations between affected parties and governmental intervention. We establish reserves for matters that are probable and estimable in amounts we believe are 91 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) adequate to cover reasonable adverse judgments. Based upon the information available to us and discussions with legal counsel, it is our opinion that the outcome of the various legal actions and claims that are incidental to our business will not have a material adverse impact on our consolidated financial position, results of operations or cash flows. Such matters are subject to many uncertainties, and the outcomes of individual matters are not predictable with assurance. 401(k) Savings and Investment Plan We offer a 401(k) savings and investment plan (the “401(k) Plan”) to substantially all full-time employees who are at least 21 years of age. The cost associated with the Company’s discretionary contributions to the 401(k) Plan was $ 8.9 million for the year ended December 31, 2025 and was no t material for the years ended December 31, 2024 and 2023 . Letters of Credit and Posted Bonds As of December 31, 2025 and 2024, we had $ 31.8 million and $ 31.2 million, respectively, in irrevocable standby letters of credit outstanding, which were issued primarily to municipalities, for sites under construction, as well as certain insurance carriers to guarantee payments of deductibles for various insurance programs, such as workers’ compensation and commercial liability insurance. Such letters of credit are secured by the collateral under our senior secured credit facility. As of both December 31, 2025 and 2024, no amounts had been drawn on any of these irrevocable standby letters of credit. As of December 31, 2025 and 2024, we had posted bonds totaling $ 25.9 million and $ 34.0 million, respectively, related to construction activities and operational licensing. 14. Related Party Transactions Related Party Leases We did not enter into any new related party leases, including related party sale-leaseback arrangements, during the years ended December 31, 2025 or 2023 . We entered into and consummated a sale-leaseback transaction involving one property with a related party during the year ended December 31, 2024. Sale-Leaseback Transactions During the year ended December 31, 2024 , we entered into and consummated a sale-leaseback transaction involving one property with a third party in which our CEO and a member of our board of directors own a minority interest. Under this transaction, we sold one property for gross proceeds of $ 40.0 million, which was reduced by transaction costs of $ 0.3 million, for net cash proceeds of $ 39.7 million, which is reported within investing activities on our consolidated statement of cash flows for the year ended December 31, 2024. The estimated fair value of the property sold was $ 40.3 million. During the year ended December 31, 2024 , we recognized a loss of $ 17.2 million on this sale-leaseback transaction, which is included in Other operating expense in our consolidated statement of operations. The right-of-use asset and lease liability recognized in connection with this sale-leaseback transaction was $ 25.1 million and $ 24.9 million, respectively. During the year ended December 31, 2025 and 2024, we paid rent associated with this lease of $ 2.9 million and $ 0.8 million, respectively, and rent expense associated with this lease was $ 3.5 million and $ 1.2 million, respectively. During the year ended December 31, 2020, we consummated a sale-leaseback transaction involving one property with a subsidiary of a limited liability company jointly owned by our CEO, a former executive of the Company, and another member of our board of directors, among other investors (“LTRE”). During the years ended December 31, 2025, 2024 and 2023, we paid rent associated with this lease of $ 2.7 million, $ 2.6 million and $ 2.6 million, respectively, and rent expense associated with this lease was $ 3.0 million, $ 3.0 million and $ 3.0 million, respectively. During the year ended December 31, 2019, we entered into a sale-leaseback transaction involving one property with a limited liability company jointly owned by our CEO and another member of our board of directors. During the years ended December 31, 2025, 2024 and 2023, we paid rent associated with this lease of $ 2.4 million, $ 2.3 million and $ 2.3 million, respectively, and rent expense associated with this lease was $ 2.6 million, $ 2.6 million and $ 2.6 million, respectively. During the year ended December 31, 2018, we entered into a sale-leaseback transaction involving one property with a limited liability company in which our CEO owns a 33 % interest. During the years ended December 31, 2025, 2024 and 2023, we paid rent associated with this lease of $ 1.3 million, $ 1.3 million and $ 1.3 million, respectively, and rent expense associated with this lease was $ 1.4 million, $ 1.4 million and $ 1.4 million, respectively. 92 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) During the year ended December 31, 2017, we entered into sale-leaseback transactions involving two properties with a limited liability company that is a related party to one of our existing stockholders. During the years ended December 31, 2025, 2024 and 2023, we paid rent associated with these leases of $ 6.6 million, $ 6.6 million and $ 6.6 million, respectively, and rent expense associated with these leases was $ 7.4 million, $ 7.4 million and $ 7.4 million, respectively. Other Property Leases In September 2015, our CEO, through two limited liability companies in which he had a 100 % interest, acquired the Woodbury, Minnesota facility that we have occupied and operated as a tenant since 1995. The terms of the existing lease were unchanged upon the change in ownership. On September 29, 2020, our CEO contributed his ownership of our center in Woodbury, Minnesota to LTRE. Following this contribution, we terminated our existing lease with the entities owned by our CEO and entered into a new lease for the Woodbury center with subsidiaries of LTRE. We are currently accounting for the new Woodbury lease as an operating lease. During the years ended December 31, 2025, 2024 and 2023, rent payments associated with the new Woodbury lease were $ 1.2 million, $ 1.2 million and $ 1.2 million, respectively, and rent expense associated with the new Woodbury lease was $ 1.3 million, $ 1.3 million and $ 1.3 million, respectively. In October 2003, we leased a center located within a shopping center that is owned by a general partnership in which our CEO has a 100 % interest. During 2023, we amended this lease to reflect the expanded square footage that the Company is using at this location and make a corresponding adjustment to the rental payments. During the years ended December 31, 2025 , 2024 and 2023, we paid rent associated with this lease of $ 1.0 million, $ 1.0 million and $ 0.9 million, respectively, and rent expense associated with this lease was $ 1.0 million, $ 1.0 million and $ 0.9 million, respectively. Other The daughter of our CEO currently serves as a vice president of real estate development for Life Time, Inc. During the years ended December 31, 2025, 2024 and 2023, we paid total compensation of approximately $ 0.5 million , $ 0.4 million and $ 0.2 million, respectively, for her services. 15. Executive Nonqualified Plan During 2006, we implemented the Executive Nonqualified Excess Plan of Life Time Fitness, a non-qualified deferred compensation plan. This plan was established for the benefit of our highly compensated employees, which our plan defines as our employees whose projected compensation for the upcoming plan year would meet or exceed the IRS limit for determining highly compensated employees. This unfunded, non-qualified deferred compensation plan allows participants the ability to defer and grow income for retirement and significant expenses in addition to contributions made to our 401(k) Plan. All highly compensated employees eligible to participate in the Executive Nonqualified Excess Plan of Life Time Fitness, including but not limited to our executives, may elect to defer up to 50 % of their annual base salary and/or annual bonus earnings to be paid in any coming year. The investment choices available to participants under the non-qualified deferred compensation plan are of the same type and risk categories as those offered under our 401(k) Plan and may be modified or changed by the participant or us at any time. Distributions can be paid out as in-service payments or at retirement. Retirement benefits can be paid out as a lump sum or in annual installments over a term of up to 10 years. We did no t make a matching contribution to this plan during the years ended December 31, 2025, 2024 and 2023. Any contributions to this plan vest to each participant according to their years of service with us. At December 31, 2025 and 2024, $ 16.4 million and $ 13.6 million, respectively, had been deferred and is being held on behalf of the employees. These amounts are included in Other liabilities on our consolidated balance sheets. 16. Subsequent Events We have evaluated all subsequent events through the date of the consolidated financial statements were issued and determined that other than the $ 500 million share repurchase program approved by our board of directors on February 19, 2026, there have been no other events or transactions which woul d have a material effect on the consolidated financial statements and therefore would require recognition or disclosure. 93 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) 17. Condensed Financial Information of Registrant (Parent Company Only) Life Time Group Holdings, Inc. is a holding company with no material operations of its own that conducts substantially all of its activities through its subsidiaries. Life Time Group Holdings, Inc. has no cash and, as a result, all expenditures and obligations of the Company are allocated to and paid by its subsidiaries. Life Time, Inc. is the borrower under our senior secured credit facility and the indenture governing our 6.000 % Senior Secured Notes, the terms and conditions of which limit Life Time, Inc.’s ability to declare dividends or make any payment on equity to, directly or indirectly, fund a dividend or other distribution to Life Time Group Holdings, Inc. in connection with those borrowings. Dividends, redemptions and other payments on equity (restricted payments) are limited to those permitted under the senior secured credit facility and the indenture governing our 6.000 % Senior Secured Notes. Due to the aforementioned restrictions, substantially all of the net assets of our subsidiaries are restricted. For information regarding our senior secured credit facility and 6.000 % Senior Secured Notes, see Note 9, Debt. The following condensed financial statements have been presented on a “parent-only” basis. Under a parent-only presentation, our investment in our subsidiaries is presented under the equity method of accounting. During the year ended December 31, 2025, we recognized share-based compensation expense related to stock options, restricted stock units, performance stock units, our ESPP and liability-classified awards related to our 2025 short-term incentive compensation plan of $ 51.8 million, of which $ 5.7 million, $ 44.5 million and $ 1.6 million is included in Center operations, General, administrative and marketing and Other operating, respectively, in our parent-only condensed statement of operations. During the year ended December 31, 2024, we recognized share-based compensation expense related to stock options, restricted stock units, performance stock units, our ESPP and liability-classified awards related to our 2024 short-term incentive compensation plan of $ 51.0 million, of which $ 3.4 million, $ 45.4 million and $ 2.2 million is included in Center operations, General, administrative and marketing and Other operating, respectively, in our parent-only condensed statement of operations. During the year ended December 31, 2023, we recognized share-based compensation expense related to stock options, restricted stock units, our ESPP and liability-classified awards related to our 2023 short-term incentive compensation plan of $ 50.1 million, of which $ 2.6 million, $ 44.8 million and $ 2.7 million is included in Center operations, General, administrative and marketing and Other operating, respectively, in our parent-only condensed statement of operations. The cash flow activities associated with the proceeds we received from the issuance of our common stock, stock options exercised and issuance of common stock in connection with the ESPP during the years ended December 31, 2025, 2024 and 2023 were non-cash transactions for Life Time Group Holdings, Inc., as the cash inflows and outflows associated with those transactions occurred at our subsidiary, Life Time, Inc. and were accounted for as our equity contributions to Life Time, Inc. For more information regarding these transactions, see Note 11, Stockholders’ Equity. 94 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) LIFE TIME GROUP HOLDINGS, INC. (PARENT COMPANY ONLY) CONDENSED BALANCE SHEETS (In thousands, except per share data) December 31, 2025 2024 ASSETS Current assets $ — $ — Noncurrent assets: Investment in subsidiaries 3,126,211 2,610,350 Total noncurrent assets 3,126,211 2,610,350 Total assets $ 3,126,211 $ 2,610,350 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities $ — $ — Noncurrent liabilities — — Total liabilities — — Stockholders’ equity: Common stock, $ 0.01 par value per share, 500,000 shares authorized, 221,077 and 207,495 shares issued and outstanding, respectively 2,211 2,075 Additional paid-in capital 3,183,032 3,041,645 Accumulated deficit ( 59,032 ) ( 433,370 ) Total stockholders’ equity 3,126,211 2,610,350 Total liabilities and stockholders’ equity $ 3,126,211 $ 2,610,350 95 Table of Contents LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table amounts in thousands except per share data) LIFE TIME GROUP HOLDINGS, INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (In thousands) Year Ended December 31, 2025 2024 2023 Total Revenue $ — $ — $ — Operating expenses: Center operations 5,697 3,452 2,660 General, administrative and marketing 44,489 45,411 44,776 Other operating expense 1,564 2,171 2,708 Total operating expenses 51,750 51,034 50,144 Loss before income taxes ( 51,750 ) ( 51,034 ) ( 50,144 ) Benefit from income taxes ( 12,834 ) ( 12,605 ) ( 12,335 ) Net loss before equity in net income of subsidiaries ( 38,916 ) ( 38,429 ) ( 37,809 ) Equity in net income of subsidiaries 412,587 194,669 113,872 Net income 373,671 156,240 76,063 Other comprehensive income (loss) 667 ( 5,872 ) 2,297 Comprehensive income $ 374,338 $ 150,368 $ 78,360 LIFE TIME GROUP HOLDINGS, INC. (PARENT COMPANY ONLY) CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year Ended December 31, 2025 2024 2023 Cash flows from operating activities: Net income $ 373,671 $ 156,240 $ 76,063 Adjustments to reconcile net income to net cash provided by operating activities: Share-based compensation 51,750 51,034 50,144 Equity in net income of subsidiaries ( 412,587 ) ( 194,669 ) ( 113,872 ) Benefit from income taxes ( 12,834 ) ( 12,605 ) ( 12,335 ) Net cash provided by operating activities — — — Cash flows from investing activities — — — Cash flows from financing activities — — — Effect of exchange rate on cash and cash equivalents — — — Increase in cash and cash equivalents — — — Cash and cash equivalents – beginning of period — — — Cash and cash equivalents – end of period $ — $ — $ — 96 Table of Contents Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.