Delaware |
7990 |
86-3355184 | ||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(IRS Employer Identification Number) |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
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F-1 |
• |
“2021 Plan” are to the Vivid Seats Inc. 2021 Incentive Award Plan; |
• |
“Amended and Restated Bylaws” are to the amended and restated bylaws of Vivid Seats Inc.; |
• |
“Amended and Restated Charter” are to the amended and restated certificate of incorporation of Vivid Seats Inc.; |
• |
“Amended and Restated Warrant Agreement” are to that certain Warrant Agreement, dated as of October 14, 2021, between Continental Stock Transfer & Trust Company and Horizon, which amended and restated the Prior Warrant Agreement; |
• |
“Blocker Corporations” are to the Blocker Corporations as defined in the Tax Receivable Agreement; |
• |
“Blocker Sellers” are to Crescent Mezzanine Partners VIB, L.P., Crescent Mezzanine Partners VIC, L.P., NPS/Crescent Strategic Partnership II, LP and Crescent Mezzanine Partners VIIB, L.P.; |
• |
“Business Combination” are to the transactions contemplated by the Transaction Agreement; |
• |
“Class A common stock” are to Vivid Seats Inc.’s Class A common stock, par value $0.0001 per share; |
• |
“Class B common stock” are to Vivid Seats Inc.’s Class B common stock, par value $0.0001 per share; |
• |
“Closing” are to the consummation of the Business Combination; |
• |
“Closing Date” are to October 18, 2021; |
• |
“Code” are to the U.S. Internal Revenue Code of 1986, as amended; |
• |
“DGCL” are to the General Corporation Law of the State of Delaware; |
• |
“Effective Time” are to the time at which the Merger becomes effective pursuant to the Transaction Agreement; |
• |
“ESPP” are to the Vivid Seats Inc. 2021 Employee Stock Purchase Plan; |
• |
“Exchange” are to the irrevocable tender by Sponsor to Horizon all of its Horizon Class B ordinary shares for cancellation in exchange for (i) the Horizon $10.00 Exercise Warrants, (ii) the Horizon $15.00 Exercise Warrants and (iii) 50,000 shares of Horizon Class A ordinary shares pursuant to the Exchange Agreement; |
• |
“Exchange Agreement” are to that certain exchange Agreement, dated as of April 21, 2021, by and between Sponsor and Horizon; |
• |
“Form of New Warrant Agreement” are to that certain form of warrant agreement entered into by and between Horizon and Continental Stock Transfer & Trust Company pursuant to which the Vivid Seats $10.00 Exercise Warrants and Vivid Seats $15.00 Exercise Warrants were issued; |
• |
“founder shares” are to Horizon Class B ordinary shares initially purchased by Sponsor in a private placement prior to the IPO, and the Horizon Class A ordinary shares issued upon the conversion thereof; |
• |
“Horizon $10.00 Exercise Warrants” are to warrants for Horizon Class A ordinary shares with an exercise price of $10.00, issued in connection with the Exchange; |
• |
“Horizon $15.00 Exercise Warrants” are to warrants for Horizon Class A ordinary shares with an exercise price of $15.00, issued in connection with the Exchange; |
• |
“Horizon Class A ordinary shares” are to Horizon’s Class A ordinary shares, par value $0.0001 per share; |
• |
“Horizon Class B ordinary shares” are to Horizon’s Class B ordinary shares, par value $0.0001 per share; |
• |
“Horizon Equityholders” are to Sponsor and any investment vehicles or funds managed or controlled, directly or indirectly, by any of Sponsor’s affiliates; |
• |
“Horizon IPO Private Placement Warrants” are to the warrants sold by Horizon as part of the private placement in connection with the IPO; |
• |
“Horizon IPO Public Warrants” are to the warrants sold by Horizon as part of the units in the IPO; |
• |
“Horizon Warrants” are to the Horizon IPO Public Warrants, Horizon IPO Private Placement Warrants, the Horizon $10.00 Exercise Warrants and the Horizon $15.00 Exercise Warrants; |
• |
“Hoya Intermediate Warrants” are warrants issued by Hoya Intermediate to Vivid Seats Inc. and Hoya Topco; |
• |
“Intermediate Common Units” means Common Units of Hoya Intermediate; |
• |
“IPO” are to Horizon’s initial public offering of units, the base offering of which closed on August 25, 2020; |
• |
“IRS” are to the U.S. Internal Revenue Service; |
• |
“Lock-up Period” are to the period beginning on the Closing Date and ending on the date that is twelve (12) months following the Closing Date; |
• |
“lock-up shares” are to (a) with respect to Sponsor, the shares of Vivid Seats common stock and warrants exercisable for shares of Vivid Seats common stock held by Sponsor and its affiliates (other than any such shares acquired in connection with the PIPE Subscription) and (b) with respect to Hoya Topco, any Vivid Seats common stock and any warrants exercisable for shares of Vivid Seats common stock held by Hoya Topco and its affiliates; |
• |
“Marketplace GOV” are to the total transactional amount of Marketplace segment orders placed on the Vivid Seats platform in a period, inclusive of fees, exclusive of taxes, and net of event cancellations that occurred during that period; |
• |
“Merger” are to the merging of Horizon with and into Vivid Seats Inc., upon which the separate corporate existence of Horizon ceased and Vivid Seats Inc. became the surviving entity; |
• |
“Nasdaq” are to The Nasdaq Global Select Market; |
• |
“PIPE Investors” are to the qualified institutional buyers and accredited investors, including Sponsor or its affiliates, that purchased shares of our Class A common stock in the PIPE Subscription; |
• |
“PIPE Subscription” are to the issuance and sale of shares of our Class A common stock to the PIPE Investors in a private placement that closed concurrently with the Closing; |
• |
“Prior Warrant Agreement” are to that certain Warrant Agreement, dated as of August 20, 2020, between Continental Stock Transfer & Trust Company and Horizon; |
• |
“Private Equity Owner” are to, collectively, GTCR Fund XI/B LP, GTCR Fund XI/C LP, GTCR Co-Invest XI LP, GTCR Golder Rauner, L.L.C., GTCR Golder Rauner II, L.L.C., GTCR Management XI LLC and GTCR LLC; |
• |
“public shareholders” are to the holders of Horizon’s public shares prior to the Closing; |
• |
“public shares” are to Horizon Class A ordinary shares sold as part of the units in the IPO (whether they were purchased in the IPO or thereafter in the open market); |
• |
“Registration Rights Agreement” are to that certain Amended and Restated Registration Rights Agreement, dated as of October 18, 2021, by and among Vivid Seats Inc., Sponsor, Hoya Topco and the other holders party thereto; |
• |
“Reorganization Transaction” are to a Reorganization Transaction as defined in the Tax Receivable Agreement; |
• |
“special dividend” are to the special dividend, in an amount of $0.23 per share as described herein, paid by Vivid Seats on November 2, 2021 to holders of shares of our Class A common stock as of the record date for such special dividend, which holders included, among others, |
• |
“Sponsor” are to Horizon Sponsor, LLC, a Delaware limited liability company; |
• |
“Sponsor Agreement” are to that certain Sponsor Agreement, dated as of April 21, 2021, by and among Eldridge Industries, LLC, Sponsor, Horizon and Hoya Topco; |
• |
“Stockholders’ Agreement” are to that certain Stockholders’ Agreement, dated as of October 18, 2021, by and among Vivid Seats Inc., Sponsor and Hoya Topco; |
• |
“Tax Receivable Agreement” are to that certain Tax Receivable Agreement, dated as of October 18, 2021, by and among Vivid Seats Inc., Hoya Intermediate, the TRA Holder Representative, Hoya Topco and the other TRA Holders; |
• |
“Topco Equityholders” are to (a) Hoya Topco or (b) after the distribution (in the aggregate pursuant to one or more distributions) by Hoya Topco of more than 50% of the voting shares of Vivid Seats Inc. held by Hoya Topco on the Closing Date, (i) GTCR Fund XI/B LP, GTCR Fund XI/C LP, GTCR Co-Invest XI LP, GTCR Golder Rauner, L.L.C., GTCR Golder Rauner II, L.L.C., GTCR Management XI LLC and/or GTCR LLC and (ii) any investment vehicles or funds managed or controlled, directly or indirectly, by or otherwise affiliated with the foregoing entities; |
• |
“Total Marketplace orders” are to the volume of Marketplace segment orders placed on the Vivid Seats platform during a period, net of event cancellations occurring during the period; |
• |
“Total Resale orders” are to the volume of Resale segment orders sold by the Vivid Seats’ resale team in a period, net of event cancellations that occurred during that period; |
• |
“TRA Holder Representative” are to GTCR Management XI, LLC; |
• |
“TRA Holders” are to the TRA Holders as defined in the Tax Receivable Agreement; |
• |
“Transactions” means the PIPE Subscription and the Business Combination; |
• |
“Transaction Agreement” are to the Transaction Agreement, dated as of April 21, 2021, by and among Horizon, Sponsor, Hoya Topco, Hoya Intermediate and Vivid Seats Inc.; |
• |
“Trust Account” are to the trust account for the benefit of Horizon, certain of its public shareholders and the underwriter of the IPO; |
• |
“Vivid Seats” are to, prior to the consummation of the Business Combination, Hoya Intermediate and its consolidated subsidiaries and, following the consummation of the Business Combination, to Vivid Seats Inc., a Delaware corporation, and its consolidated subsidiaries; |
• |
“Vivid Seats $10.00 Exercise Warrants” are to warrants for our Class A common stock with an exercise price of $10.00, issued in exchange for the Horizon $10.00 Exercise Warrants, with terms consistent with the Form of New Warrant Agreement; |
• |
“Vivid Seats $15.00 Exercise Warrants” are to warrants for our Class A common stock with an exercise price of $10.00, issued in exchange for the Horizon $15.00 Exercise Warrants, with terms consistent with the Form of New Warrant Agreement; |
• |
“Vivid Seats Class B Warrants” are to warrants for our Class B common stock exercisable upon the exercise of Hoya Intermediate Warrants held by Hoya Topco; |
• |
“Vivid Seats common stock” are to our Class A common stock and our Class B common stock, collectively; |
• |
“Vivid Seats Warrants” are to the warrants for our Class A common stock and our Class B common stock; |
• |
“Vivid Seats Private Placement IPO Warrants” are to warrants for our Class A common stock, with terms identical to the Horizon IPO Private Placement Warrants; and |
• |
“Vivid Seats Public IPO Warrants” are to warrants for our Class A common stock, with terms identical to Horizon IPO Public Warrants. |
• |
the COVID-19 pandemic, its duration, its impact on our business, results of operations, financial condition, liquidity, use of our borrowings, business practices, operations, suppliers, third-party service providers, customers, employees, industry, ability to meet future performance obligations, ability to efficiently implement advisable safety precautions; |
• |
our ability to raise financing in the future; |
• |
our future financial performance; |
• |
our success in retaining or recruiting, or changes required in, our officers, key employees or directors; |
• |
our ability to pay dividends on our Class A common stock on the terms currently contemplated or at all; and |
• |
factors relating to our business, operations and financial performance, including, but not limited to: |
• |
the impact of the COVID-19 pandemic on our business and the industries in which we operate; |
• |
our ability to compete in the ticketing industry; |
• |
our ability to maintain relationships with buyers, sellers and distribution partners; |
• |
our ability to continue to improve our platform and maintain and enhance our brand; |
• |
the impact of extraordinary events or adverse economic conditions on discretionary consumer and corporate spending or on the supply and demand of live events; |
• |
our ability to comply with domestic regulatory regimes; |
• |
our ability to successfully defend against litigation; |
• |
our ability to maintain the integrity of our information systems and infrastructure, and to mitigate possible cyber security risks; |
• |
our ability to generate sufficient cash flows or raise additional capital necessary to fund our operations; and |
• | The COVID-19 pandemic has had, and may continue to have, a material negative impact on our business and operating results. |
• | Our business is dependent on the continued occurrence of large-scale sporting events, concerts and theater shows and on relationships with buyers, sellers and distribution partners and any change in such occurrence or relationships could adversely affect our business. |
• | Changes in Internet search engine algorithms or changes in marketplace rules could have a negative impact on traffic for our sites and ultimately, our business and results of operations. |
• | We face intense competition in the ticketing industry. |
• | If we do not continue to maintain and improve our platform or develop successful new solutions and enhancements or improve existing ones, our business will suffer. |
• | We may be adversely affected by the occurrence of extraordinary events. |
• | We may be unsuccessful in potential future acquisitions. |
• | Due to our business’ seasonality, our financial performance in particular financial periods may not be indicative of, or comparable to, our financial performance in subsequent financial periods. |
• | The processing, storage, use and disclosure of personal data could give rise to liabilities as a result of governmental regulation, conflicting legal requirements or applications of privacy regulations. |
• | Unfavorable legislative outcomes, or outcomes in legal proceedings in which we may be involved, may adversely affect our business and operating results. |
• | System interruption and the lack of integration and redundancy in our systems and infrastructure may have an adverse impact on our business, financial condition and results of operations. |
• | Cyber security risks, data loss or other breaches of our network security could materially harm our business and results of operations. |
• | Our payments system depends on third-party providers. |
• | The agreements governing our indebtedness impose restrictions on us that limit the discretion of management in operating our business. |
• | We depend on the cash flows of our subsidiaries in order to satisfy our obligations, and we may face liquidity constraints if we are unable to generate sufficient cash flows and we may be unable to raise the additional capital necessary or desirable. |
• | Our Private Equity Owner controls us, and its interest may conflict with ours in the future. |
• | We are a “controlled company” within the meaning of Nasdaq listing standards. |
• | The Tax Receivable Agreement requires us to make cash payments to Hoya Topco. |
• | Our only material asset is our direct and indirect interests in Hoya Intermediate. |
• | We have identified a material weakness in our internal control over financial reporting. |
• | We are an emerging growth company. |
• | A significant portion of our total outstanding shares of our Class A common stock are restricted from resale but may be sold into the market in the future, which could cause the market price of our Class A common stock to drop significantly. |
• | Warrants will become exercisable for our Class A common stock, which may increase the number of shares eligible for resale in the market and result in dilution to our stockholders. |
• | the impact of any lingering economic downturn or recession resulting, including without limitation any reduction in discretionary spending or confidence for both buyers and sellers, that would result in a decline in ticket sales and attendance; |
• | a reduction in the profitability of our operations |
• | sub-national borders are closed to travel, which could reduce the demand for our services; |
• | |
• | loss of ticketing sales due to the economic impact whereby certain venue operators are no longer in operation, reducing the number of events our marketplace can serve; |
• | the inability to pursue expansion opportunities or acquisitions due to capital constraints; |
• | the future availability or increased cost of insurance coverage; and |
• | the incurrence of additional expenses related to compliance, precautions and management. |
• | competitors’ offerings that may include more favorable terms or pricing; |
• | technological changes and innovations that we are unable to adopt or are late in adopting that offer more attractive alternatives; |
• | other entertainment options or ticket inventory selection and variety that we do not offer; and |
• | increased pricing in the primary ticket marketplace, which could result in reduced profits for secondary ticket sellers. |
• | using a significant portion of our available cash; |
• | issuing equity securities, which would dilute current stockholders’ percentage ownership; |
• | incurring substantial debt; |
• | incurring or assuming contingent liabilities, known or unknown; and |
• | incurring large accounting write-offs, impairments or amortization expenses. |
• | integrating the operations, financial reporting, technologies and personnel of acquired companies; |
• | scaling of operations, system and infrastructure and achieving synergies to meet the needs of the combined or acquired company; |
• | managing geographically dispersed operations; |
• | the diversion of management’s attention from other business concerns; |
• | the inherent risks in entering markets or lines of business in which we have either limited or no direct experience; |
• | the potential loss of key employees, customers and strategic partners of acquired companies; and |
• | the impact of laws and regulations at the state, federal and international levels when entering new markets or business, which could significantly affect our ability to complete acquisitions and expand our business. |
• | incur additional debt; |
• | pay dividends and make distributions; |
• | make certain investments; |
• | |
• | create liens; |
• | enter into transactions with affiliates; |
• | modify the nature of our business; |
• | transfer and sell assets, including material intellectual property; |
• | amend or modify the terms of any junior financing arrangements; |
• | amend our organizational documents; and |
• | merge or consolidate. |
• | making it more difficult for us to satisfy our obligations; |
• | increasing our vulnerability to adverse economic, regulatory and industry conditions; |
• | limiting our ability to obtain additional financing for future working capital, capital expenditures, acquisitions and other purposes; |
• | requiring us to dedicate a substantial portion of our cash flow from operations to fund payments on our debt, thereby reducing funds available for operations and other purposes; |
• | limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; |
• | making us more vulnerable to increases in interest rates; and |
• | placing us at a competitive disadvantage compared to our competitors that have less debt. |
• | general economic and capital market conditions, including as a result of the COVID-19 pandemic and rising inflation; |
• | the availability of credit from banks or other lenders; |
• | investor confidence in us; and |
• | our results of operations. |
• | develop and enhance our platform and solutions; |
• | continue to invest in our technology and marketing efforts; |
• | hire, train and retain employees; |
• | respond to competitive pressures or unanticipated working capital requirements; or |
• | pursue acquisition opportunities. |
• | existing tax basis in certain assets of Hoya Intermediate and certain of its subsidiaries, including assets that will be subject to depreciation or amortization, once placed in service; |
• | tax basis adjustments resulting from taxable exchanges of Intermediate Common Units for Class A common stock acquired by us from a TRA Holder pursuant to the terms of the Second Amended and Restated Limited Liability Company Agreement of Hoya Intermediate (the “Second A&R LLCA”); |
• | certain tax attributes of Blocker Corporations holding Intermediate Common Units that are acquired by us pursuant to a Reorganization Transaction; |
• | certain tax benefits realized by us as a result of the Merger; and |
• | tax deductions in respect of portions of certain payments made under the Tax Receivable Agreement. |
• | the realization of any of the risk factors presented in this prospectus; |
• | difficult global market and economic conditions; |
• | loss of investor confidence in the global financial markets and investing in general; |
• | adverse market reaction to indebtedness we may incur, securities we may grant under our 2021 Plan or otherwise, or any other securities we may issue in the future, including shares of our Class A common stock; |
• | unanticipated variations in our quarterly and annual operating results or dividends; |
• | failure to meet securities analysts’ earnings estimates; |
• | publication of negative or inaccurate research reports about us or the live events or ticketing industry or the failure of securities analysts to provide adequate coverage of our Class A common stock in the future; |
• | changes in market valuations of similar companies; |
• | speculation in the press or investment community about our business; |
• | additional or unexpected changes or proposed changes in laws or regulations or differing interpretations thereof affecting our business or enforcement of these laws and regulations, or announcements relating to these matters; and |
• | increases in compliance or enforcement inquiries and investigations by regulatory authorities. |
• | not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of SOXA; |
• | reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and |
• | exemptions from the requirements of holding a nonbinding advisory vote on executive compensation or golden parachute payments not previously approved. |
• | Our status as an “emerging growth company” will end as soon as any of the following occurs: |
• | the last day of the fiscal year in which we have more than $1.07 billion in annual revenue; |
• | the date we qualify as a “large accelerated filer,” with at least $700 million of equity securities held by non-affiliates; |
• | the date on which we have issued, in any three-year period, more than $1.0 billion in non-convertible debt securities; or |
• | December 31, 2026 |
• | private warrants to purchase 6,519,791 share at an exercise price of $11.50 per share; |
• | warrants to purchase 17,000,000 shares at an exercise price of $10.00 per shar; and |
• | warrants to purchase 17,000,000 shares at an exercise price of $15.00 per share; |
• | the sole ability of directors to fill a vacancy on the Board; |
• | advance notice requirements for stockholder proposals and director nominations; |
• | after we no longer qualify as a “controlled company” under applicable Nasdaq listing rules, provisions limiting stockholders’ ability to (i) call special meetings of stockholders, (ii) require extraordinary general meetings of stockholders and (iii) take action by written consent; |
• | the ability of the Board to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used, among other things, to institute a rights plan that would have the effect of significantly diluting the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our governing body; |
• | the division of the Board into three classes, with each class serving staggered three-year terms; and |
• | the lack of cumulative voting for the election of directors. |
• | general economic and business conditions; |
• | our strategic plans and prospects; |
• | our business and investment opportunities; |
• | our financial condition and operating results, including our cash position, net income and realizations on investments made by its investment funds; |
• | working capital requirements and anticipated cash needs; |
• | contractual restrictions and obligations, including payment obligations pursuant to the Tax Receivable Agreement and restrictions pursuant to any credit facility; and |
• | legal, tax and regulatory restrictions. |
Pro Forma Combined |
||||||||
Number of Shares |
% Ownership |
|||||||
Hoya Topco |
118,200,000 | 60.6 | % | |||||
Horizon Public shareholders |
13,881,260 | 7.1 | % | |||||
Shares held by Horizon Sponsor and other holders of founder shares(1) |
59,557,173 | 30.5 | % | |||||
PIPE Investors(2) |
3,510,000 | 1.8 | % | |||||
|
|
|
|
|||||
Total |
195,148,433 | 100 | % | |||||
|
|
|
|
(1) | Includes shares acquired by Horizon Sponsor, or its affiliates, as part of the PIPE Subscription. Horizon Sponsor, or its affiliates, acquired 44,017,173 shares under the PIPE Subscription. |
(2) | Excludes shares acquired by Horizon Sponsor, or its affiliates, as part of the PIPE Subscription. |
• | Vivid Seats Inc. issued to Sponsor (i) warrants to purchase 17,000,000 shares of Class A common stock at an exercise price of $10.00 per share (the “Vivid Seats $10.00 Exercise Warrants”), (ii) warrants to purchase 17,000,000 shares of Class A common stock at an exercise of $15.00 per share (the “Vivid Seats $15.00 Exercise Warrants” and, collectively, the “Exercise Warrants”). |
• | Vivid Seats Inc. issued warrants to purchase 6,519,791 shares of Class A common stock of Vivid Seats Inc., at an exercise price of $11.50 per share (“Vivid Seats Private Placement IPO Warrants”), and warrants to purchase 18,132,776 shares of Class A common stock of Vivid Seats Inc., at an exercise price of $11.50 per share (“Vivid Seats Public IPO Warrants” and, together with the Vivid Seats Private Placement IPO Warrants and the Vivid Seats Exercise Warrants, the “Vivid Seats Class A Warrants”), to former holders of Horizon warrants. |
• | Hoya Intermediate issued to Hoya Topco (i) warrants to purchase 3,000,000 shares of Hoya Intermediate common units at an exercise price of $10.00 per share, and (ii) warrants to purchase 3,000,000 shares of Hoya Intermediate common units at an exercise of $15.00 per share (collectively, the “Hoya Intermediate Warrants”). |
• | In tandem with the Vivid Seats Class A Warrants, Hoya Intermediate issued to Vivid Seats Inc. an equivalent number of warrants to purchase Intermediate Common Units an exercise price equal to the exercise price of their corresponding Vivid Seats Class A Warrants. These warrants are exercisable only upon the exercise of a corresponding Vivid Seats Class A Warrant. |
• | In tandem with issuance of the Hoya Intermediate Warrants to Hoya Topco, Vivid Seats Inc. issued 6,000,000 warrants to Hoya Topco, each allowing the holder to acquire one share of Vivid Seats Inc. Class B common stock for an exercise price of $0.001 per share (“Vivid Seats Class B Warrants”). These warrants are exercisable only upon the exercise of a corresponding Hoya Intermediate Warrant by Hoya Topco. |
Vivid Seats Inc. (Historical) |
Transaction Accounting Adjustments |
Pro Forma Balance Sheet |
||||||||||
Current assets: |
||||||||||||
Cash and cash equivalents |
$ | 489,530 | $ | (196,040 | )(a) | $ | 293,490 | |||||
Restricted cash |
280 | — | 280 | |||||||||
Accounts receivable - net |
36,124 | — | 36,124 | |||||||||
Inventory - net |
11,773 | — | 11,773 | |||||||||
Prepaid expenses and other current assets |
72,504 | — | 72,504 | |||||||||
|
|
|
|
|
|
|||||||
Total current assets |
610,211 | (196,040 | ) | 414,171 | ||||||||
Property and equipment - net |
1,082 | — | 1,082 | |||||||||
Intangible assets - net |
78,511 | — | 78,511 | |||||||||
Goodwill |
718,204 | — | 718,204 | |||||||||
Other non-current assets |
787 | 1,054 | (a) | 1,841 | ||||||||
|
|
|
|
|
|
|||||||
Total assets |
$ | 1,408,795 | $ | (194,986 | ) | $ | 1,213,809 | |||||
|
|
|
|
|
|
|||||||
Current liabilities: |
||||||||||||
Accounts payable |
$ | 191,201 | $ | — | $ | 191,201 | ||||||
Accrued expenses and other current liabilities |
281,156 | — | 281,156 | |||||||||
Deferred revenue |
25,139 | — | 25,139 | |||||||||
Current maturities of long-term debt - net |
— | 2,750 | (a) | 2,750 | ||||||||
|
|
|
|
|
|
|||||||
Total current liabilities |
497,496 | 2,750 | 500,246 | |||||||||
Long-term debt - net |
460,132 | (193,974 | )(a) | 266,158 | ||||||||
Other liabilities |
25,834 | — | 25,834 | |||||||||
|
|
|
|
|
|
|||||||
Total long-term liabilities |
485,966 | (193,974 | ) | 291,992 | ||||||||
Commitments and contingencies: |
||||||||||||
Redeemable noncontrolling interests |
1,286,016 | — | 1,286,016 | |||||||||
Stockholders’ deficit: |
||||||||||||
Class A common stock, $0.0001 par value; 500,000,000 shares authorized, 79,091,871 issued and outstanding at December 31, 2021; 0 shares authorized, issued, and outstanding at December 31, 2020 |
8 | — | 8 | |||||||||
Class B common stock, $0.0001 par value; 250,000,000 shares authorized, 118,200,000 issued and outstanding at December 31, 2021; 0 shares authorized, issued, and outstanding at December 31, 2020 |
12 | — | 12 | |||||||||
Additional paid-in capital |
182,091 | — | 182,091 | |||||||||
Accumulated deficit |
(1,042,794 | ) | (3,762 | )(a) | (1,046,556 | ) | ||||||
Accumulated other comprehensive loss |
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total Shareholders’ deficit |
(860,683 | ) | (3,762 | ) | (864,445 | ) | ||||||
|
|
|
|
|
|
|||||||
Total liabilities, Redeemable noncontrolling interests, and Shareholders’ deficit |
$ | 1,408,795 | $ | (194,986 | ) | $ | 1,213,809 | |||||
|
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|
|
|
|
Vivid Seats Inc. (Historical) |
Transaction Accounting Adjustments |
Pro Forma Statement of Operations |
||||||||||
Revenues |
$ | 443,038 | $ | — | $ | 443,038 | ||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
90,617 | — | 90,617 | |||||||||
Marketing and selling |
181,358 | — | 181,358 | |||||||||
General and administrative |
92,170 | — | 92,170 | |||||||||
Depreciation and amortization |
2,322 | — | 2,322 | |||||||||
|
|
|
|
|
|
|||||||
Income from operations |
76,571 | — | 76,571 | |||||||||
Interest expense – net |
58,179 | (47,093 | )(bb) | 11,086 | ||||||||
Loss on extinguishment of debt |
35,828 | 19,903 | (bb) | 55,731 | ||||||||
Other expenses (income) |
1,389 | (5,794 | )(aa) | (4,405 | ) | |||||||
|
|
|
|
|
|
|||||||
Net (loss) income before income taxes |
(18,825 | ) | 32,984 | 14,159 | ||||||||
|
|
|
|
|
|
|||||||
Income taxes |
304 | — | (cc) | 304 | ||||||||
|
|
|
|
|
|
|||||||
Net (loss) income |
(19,129 | ) | 32,984 | 13,855 | ||||||||
Net loss attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
(12,836 | ) | 12,836 | (dd) | — | |||||||
Net loss attributable to redeemable noncontrolling interests |
(3,010 | ) | 12,171 | (dd) | 9,161 | |||||||
|
|
|
|
|
|
|||||||
Net loss attributable to Class A Common Stockholders |
$ | (3,283 | ) | $ | 7,977 | (dd) | $ | 4,694 | ||||
|
|
|
|
|
|
|||||||
Loss per Class A Common Stock |
||||||||||||
Basic |
$ | (0.04 | ) | $ | 0.06 | (ee) | ||||||
Diluted |
$ | (0.04 | ) | $ | 0.06 | (ee) | ||||||
Weighted average Class A Common Stock outstanding |
||||||||||||
Basic |
77,498,775 | 77,060,009 | ||||||||||
Diluted |
77,498,775 | 80,246,752 |
(in thousands, except share and per share data) |
||||
Net income per Class A Common Stock: |
||||
Numerator: |
||||
Net income attributable to Class A Common Stockholders—basic |
$ | 4,694 | ||
Net income effect of dilutive securities |
12 | |||
|
|
|||
Net loss attributable to Class A Common Stockholders—diluted |
$ | 4,706 | ||
|
|
|||
Denominator: |
||||
Weighted average Class A Common Stock outstanding—basic |
77,060,009 | |||
Incremental Class A Common Stock attributable to dilutive securities |
3,186,743 | |||
|
|
|||
Weighted average Class A Common Stock outstanding—diluted |
80,246,752 | |||
|
|
|||
Net income per Class A Common Stock—basic |
$ | 0.06 | ||
|
|
|||
Net income per Class A Common Stock—diluted |
$ | 0.06 | ||
|
|
2021 |
2020 |
2019 |
||||||||||
Marketplace GOV (1) |
$ | 2,399,092 | $ | 347,259 | $ | 2,279,773 | ||||||
Total Marketplace orders (2) |
6,637 | 1,066 | 7,185 | |||||||||
Total Resale orders (3) |
199 | 49 | 303 | |||||||||
Adjusted EBITDA (4) |
$ | 109,869 | $ | (80,204 | ) | $ | 119,172 |
(1) | Marketplace GOV represents the total transactional amount of Marketplace segment orders placed on our platform in a period, inclusive of fees, exclusive of taxes, and net of event cancellations that occurred during that period. During the year ended December 31, 2021, Marketplace GOV was negatively impacted by event cancellations in the amount of $108.0 million, compared to $216.0 million and $22.2 million during the years ended December 31, 2020 and 2019. |
(2) | Total Marketplace orders represents the volume of Marketplace segment orders placed on our platform during a period, net of event cancellations that occurred during that period. During the year ended December 31, 2021, our Marketplace segment experienced 257,109 event cancellations, compared to 549,085 and 54,961 event cancellations during the years ended December 31, 2020 and 2019. |
(3) | Total Resale orders represents the volume of Resale segment orders sold by our Resale team in a period, net of event cancellations that occurred during that period. During the year ended December 31, 2021, our Resale segment experienced 6,165 event cancellations, compared to 20,644 and 1,517 event cancellations during the years ended December 31, 2020 and 2019. |
(4) | Adjusted EBITDA is not a measure defined under GAAP. We believe Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our results of operations, as well as provides a useful measure for period-to-period |
2021 |
2020 |
2019 |
||||||||||
Net loss |
$ | (19,129 | ) | $ | (774,185 | ) | $ | (53,848 | ) | |||
Income tax expense |
304 | — | — | |||||||||
Interest expense |
58,179 | 57,482 | 41,497 | |||||||||
Depreciation and amortization |
2,322 | 48,247 | 93,078 | |||||||||
Sales tax liability (1) |
8,956 | 6,772 | 10,045 | |||||||||
Transaction costs (2) |
12,852 | 359 | 8,857 | |||||||||
Equity-based compensation (3) |
6,047 | 4,287 | 5,174 | |||||||||
Senior management transition costs (4) |
— | — | 2,706 | |||||||||
Loss on extinguishment of debt (5) |
35,828 | 685 | 2,414 | |||||||||
Litigation, settlements and related costs (6) |
2,835 | 1,347 | 2,256 | |||||||||
Change to annual bonus program (7) |
— | — | 2,810 | |||||||||
Customer loyalty program stand-up costs (8) |
— | — | 3,223 | |||||||||
Impairment charges (9) |
— | 573,838 | — | |||||||||
Loss on asset disposals (10) |
— | 169 | 960 | |||||||||
Severance related to COVID-19 (11) |
286 | 795 | — | |||||||||
Change in value of warrants (12) |
1,389 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Adjusted EBITDA |
$ |
109,869 |
$ |
(80,204 |
) |
$ |
119,172 |
|||||
|
|
|
|
|
|
(1) | We have historically incurred sales tax expense in jurisdictions where we expected to remit sales tax payments but were not yet collecting from customers. During the second half of 2021, we began collecting sales tax from customers in all required states. The sales tax liability presented herein represents the exposure for sales tax prior to the date we began collecting sales tax from customers reduced by abatements received. |
(2) | Transaction costs consist of legal; accounting; tax and other professional fees; as well as personnel-related costs, which consist of severance and retention bonuses; and integration costs. Transaction costs recognized in 2021 were related to the Business Combination, to the extent they were not eligible for capitalization, and the acquisition of Betcha. Transaction costs recognized in 2020 were related to the acquisition of Fanxchange Ltd. in 2019. In 2019, we completed the acquisition of Fanxchange Ltd. and attempted to pursue an acquisition that was ultimately abandoned. These acquisition-related costs are not representative of normal, recurring, cash operating expenses. |
(3) | We incur equity-based compensation expenses for profit interests issued prior to the Business Combination and equity granted according to the 2021 Plan, which we do |
(4) | In 2019, we incurred costs associated with the transition to our |
(5) | Losses incurred resulted from the retirement of the May 2020 First Lien Loan (as defined below) and fees paid related to the early payment of a portion of the principal of the June 2017 First Lien Loan (as defined below) in October 2021, the retirement of the |
(6) | These expenses relate to external legal costs and settlement costs, which were unrelated to our |
(7) | We |
(8) | During August 2019, we stand-up costs related to the commencement of the program. These stand-up costs consist primarily of customer incentives and marketing costs, which are not expected to reoccur. |
(9) | We incurred impairment charges triggered by the effects of the COVID-19 pandemic during the year ended December 31, 2020. The impairment charges resulted in a reduction in the carrying values of indefinite-lived trademark, definite-lived intangible assets, and other long-lived assets. See our audited financial statements included elsewhere in this prospectus for additional information. |
(10) | We incurred losses on asset disposals, which are not considered indicative of |
(11) | These charges relate to severance costs resulting from significant reductions in employee headcount due to the effects of the COVID-19 pandemic during the years ended December 31, 2021 and 2020. |
(12) | These expenses relate to the modification of the terms of the Vivid Seats Public IPO Warrants in connection with the Business Combination and revaluation of Hoya Intermediate Warrants following the Business Combination. |
• | sports teams performance, the number of playoff games in a series and teams involved; |
• | the timing of tours of top grossing acts; |
• | tour and game cancellations due to weather, illness or other factors; and |
• | popularity and demand for certain performers and events. |
2021 |
2020 |
Change |
% Change |
|||||||||||||
Revenues |
$ | 443,038 | $ | 35,077 | $ | 407,961 | 1163 | % | ||||||||
Costs and expenses: |
||||||||||||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
90,617 | 24,690 | 65,927 | 267 | % | |||||||||||
Marketing and selling |
181,358 | 38,121 | 143,237 | 376 | % | |||||||||||
General and administrative |
92,170 | 66,199 | 25,971 | 39 | % | |||||||||||
Depreciation and amortization |
2,322 | 48,247 | (45,925 | ) | (95 | )% | ||||||||||
Impairment charges |
— | 573,838 | (573,838 | ) | (100 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from operations |
76,571 | (716,018 | ) | 792,589 | 111 | % | ||||||||||
Other expenses: |
||||||||||||||||
Interest expense – net |
58,179 | 57,482 | 697 | 1 | % | |||||||||||
Loss on extinguishment of debt |
35,828 | 685 | 35,143 | 5,130 | % | |||||||||||
Other expenses |
1,389 | — | 1,389 | 100 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss before income taxes |
(18,825 | ) | (774,185 | ) | 755,360 | 98 | % | |||||||||
Income tax expense |
304 | — | 304 | 100 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net loss |
(19,129 | ) | (774,185 | ) | 755,056 | 98 | % | |||||||||
Net loss attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
(12,836 | ) | (774,185 | ) | 761,349 | 98 | % | |||||||||
Net loss attributable to redeemable noncontrolling interests |
(3,010 | ) | — | (3,010 | ) | 100 | % | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Net loss attributable to Class A Common Stockholders |
$ |
(3,283 |
) |
$ |
— |
$ |
(3,283 |
) |
100 |
% | ||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Revenues: |
||||||||||||||||
Marketplace |
$ | 389,668 | $ | 23,281 | $ | 366,387 | 1,574 | % | ||||||||
Resale |
53,370 | 11,796 | 41,574 | 352 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
$ |
443,038 |
$ |
35,077 |
$ |
407,961 |
1,163 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Revenues: |
||||||||||||||||
Concerts |
$ | 171,149 | $ | 15,775 | $ | 155,374 | 985 | % | ||||||||
Sports |
175,471 | 3,484 | 171,987 | 4,936 | % | |||||||||||
Theater |
41,745 | 3,759 | 37,986 | 1,011 | % | |||||||||||
Other |
1,303 | 263 | 1,040 | 395 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Marketplace revenues |
$ |
389,668 |
$ |
23,281 |
$ |
366,387 |
1,574 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Revenues: |
||||||||||||||||
Owned Properties |
$ | 308,226 | $ | 24,188 | $ | 284,038 | 1,174 | % | ||||||||
Private Label |
81,442 | (907 | ) | 82,349 | 9,079 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Marketplace revenues |
$ |
389,668 |
$ |
23,281 |
$ |
366,387 |
1,574 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Cost of revenues: |
||||||||||||||||
Marketplace |
$ | 51,702 | $ | 13,741 | $ | 37,961 | 276 | % | ||||||||
Resale |
38,915 | 10,949 | 27,966 | 255 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cost of revenues |
$ |
90,617 |
$ |
24,690 |
$ |
65,927 |
267 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Marketing and selling: |
||||||||||||||||
Online |
$ | 160,420 | $ | 34,213 | $ | 126,207 | 369 | % | ||||||||
Offline |
20,938 | 3,908 | 17,030 | 436 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total marketing and selling |
$ |
181,358 |
$ |
38,121 |
$ |
143,237 |
376 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
General and administrative: |
||||||||||||||||
Personnel expenses |
$ | 47,546 | $ | 37,696 | $ | 9,850 | 26 | % | ||||||||
Non-income tax expenses |
10,016 | 7,060 | 2,956 | 42 | % | |||||||||||
Other |
34,608 | 21,443 | 13,165 | 61 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total general and administrative |
$ |
92,170 |
$ |
66,199 |
$ |
25,971 |
39 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
Change |
% Change |
|||||||||||||
Other expenses |
||||||||||||||||
Interest expense - net |
$ | 58,179 | $ | 57,482 | $ | 697 | 1 | % | ||||||||
Loss on extinguishment of debt |
35,828 | 685 | 35,143 | 5,130 | % | |||||||||||
Other expenses |
1,389 | — | 1,389 | 100 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total other expenses |
$ |
95,396 |
$ |
58,167 |
$ |
37,229 |
64 |
% | ||||||||
|
|
|
|
|
|
|
|
2021 |
2020 |
2019 |
||||||||||
Net cash provided by (used in) operating activities |
$ | 219,931 | $ | (33,892 | ) | $ | 76,478 | |||||
Net cash used in investing activities |
(9,345 | ) | (7,605 | ) | (40,155 | ) | ||||||
Net cash (used in) provided by financing activities |
(6,113 | ) | 245,545 | (55,462 | ) | |||||||
|
|
|
|
|
|
|||||||
Net increase (decrease) in cash and cash equivalents |
$ |
204,473 |
$ |
204,048 |
$ |
(19,139 |
) | |||||
|
|
|
|
|
|
• | Sports. |
• | Concerts. |
• | Theater. |
• | Content Rights Holders (“CRH”) |
• | Media Partners |
• | Product and Service Partners |
• | Distribution Partners |
• | We Create Exceptional Experiences |
• | We Raise the Bar |
• | We Embrace Change |
• | We Enhance Communities |
• | We are proud to partner with Chicago’s Lurie Children’s Hospital, one of the country’s top-ranked pediatric institutions, by bringing joy to patients and their families. Our employees have recorded bedtime stories, donated wish list gifts and hosted patients and their families at live events. |
• | Starting in 2020, the live entertainment industry was severely impacted by the global COVID-19 pandemic. This resulted in thousands of people having an uncertain future. We and our customers have donated millions of dollars to the Recording Academy’s charity, MusiCares, to support those in the music community and their families. |
• | availability and variety of ticket offerings; |
• | pricing, including pricing in the primary ticket market |
• | brand recognition; and |
• | technology , including functionality and ease of use to search for offerings and complete a purchase. |
• | wide selection of listings and ticketing options; |
• | competitive pricings; |
• | Vivid Seats Rewards, the comprehensive loyalty programs among our key competitors; |
• | full-service marketplace with excellent customer service; and |
• | free-to-use Skybox enterprise resource planning tool for our ticket sellers. |
• | privacy, |
• | data protection, |
• | intellectual property, |
• | competition, |
• | consumer protection, |
• | ticketing, |
• | payments, |
• | export taxation, and |
• | sports gaming. |
Name |
Age |
Position | ||
Stanley Chia |
40 | Chief Executive Officer and Director | ||
Lawrence Fey |
41 | Chief Financial Officer | ||
Jon Wagner |
49 | Chief Technology Officer | ||
Riva Bakal |
37 | Senior Vice President, Strategy and Product | ||
David Morris |
47 | General Counsel | ||
Todd Boehly |
48 | Director | ||
Jane DeFlorio |
51 | Director | ||
Craig Dixon |
46 | Director | ||
Julie Masino |
51 | Director | ||
Martin Taylor |
52 | Director | ||
Mark Anderson |
46 | Director | ||
David Donnini |
56 | Director | ||
Tom Ehrhart |
35 | Director |
• | that a majority of our Board consist of directors who qualify as “independent” as defined under Nasdaq rules; |
• | that we have a nominating and corporate governance committee and, if we have such a committee, that it is composed entirely of independent directors; and |
• | that we have a compensation committee and, if we have such a committee, that it is composed entirely of independent directors. |
• | The Class I directors are Jane DeFlorio, David Donnini and Stanley Chia; |
• | The Class II directors are Tom Ehrhart, Craig Dixon and Martin Taylor; and |
• | The Class III directors are Julie Masino, Mark Anderson and Todd Boehly. |
• | appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm; |
• | discussing with our independent registered public accounting firm their independence from management; |
• | reviewing with our independent registered public accounting firm the scope and results of their audit; |
• | approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm; |
• | overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC; |
• | reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; and |
• | establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters. |
• | reviewing and setting or making recommendations to the Board regarding the compensation of our executive officers; |
• | making recommendations to the Board regarding the compensation of our directors; |
• | reviewing and approving or making recommendations to the Board regarding our incentive compensation and equity-based plans and arrangements; and |
• | appointing and overseeing any compensation consultants. |
• | identifying individuals qualified to become members of the Board, consistent with criteria approved by the Board; |
• | recommending to the Board the nominees for election to the Board at annual meetings of our stockholders; |
• | overseeing an evaluation of the Board and its committees; and |
• | developing and recommending to the Board a set of corporate governance guidelines. |
• | Stanley Chia, Chief Executive Officer; |
• | Lawrence Fey, Chief Financial Officer; and |
• | Jon Wagner, Chief Technology Officer |
Name and Principal Position |
Year |
Salary ($) |
Stock Awards ($)(1) |
Option Awards ($)(2) |
Non-equity Incentive Plan Compensation ($)(3) |
All Other Compensation ($)(4) |
Total ($) |
|||||||||||||||||||||
Stanley Chia, Chief Executive Officer |
2021 | 600,000 | 2,500,000 | 4,303,791 | 900,000 | 20,417 | 8,324,208 | |||||||||||||||||||||
2020 | 551,539 | 1,042,105 | — | 275,769 | 26,906 | 1,896,319 | ||||||||||||||||||||||
Lawrence Fey, Chief Financial Officer |
2021 | 300,000 | 2,000,000 | 3,443,033 | 225,000 | 11,400 | 5,979,433 | |||||||||||||||||||||
2020 | 192,692 | 483,973 | — | 48,173 | 6,877 | 731,715 | ||||||||||||||||||||||
Jon Wagner, Chief Technology Officer |
2021 | 360,231 | 1,000,000 | 1,721,516 | 270,173 | 11,400 | 3,363,320 | |||||||||||||||||||||
2020 | 350,000 | 303,354 | — | 87,500 | 9,205 | 750,059 |
(1) | The amounts shown in this column represent restricted stock units granted under our 2021 Plan. The amounts represent the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. For a detailed description of the assumptions used for purposes of determining grant date fair value, see Note 20 to our audited consolidated financial statements included elsewhere in this prospectus and “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates – Equity-Based Compensation.” |
(2) | The amounts shown in this column represent stock options granted under our 2021 Plan. The amounts represent the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. For a detailed description of the assumptions used for purposes of determining grant date fair value, see Note 20 to our audited consolidated financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates – Equity-Based Compensation.” |
(3) | The amounts shown in this column represent cash incentive awards earned for 2021 and paid in the first quarter of 2022 under our Annual Incentive Plan. See “2021 Annual Incentive Plan Awards” below. |
(4) | The amount for Mr. Chia reflects (a) Young President’s Organization international membership in the amount of $9,017, and (b) employer matching contribution under our 401(k) in the amount of $11,400. The amounts for Mr. Fey and Mr. Wagner reflect employer matching contributions under our 401(k). |
Actual Revenue / Adjusted EBITDA Performance as % of Operating Plan Target |
Payout |
|||||||
Threshold |
85 | % | 40 | % | ||||
90 | % | 60 | % | |||||
95 | % | 80 | % | |||||
Target |
100 | % | 100 | % | ||||
105 | % | 120 | % | |||||
110 | % | 135 | % | |||||
Maximum |
115 | % | 150 | % |
• | medical, dental and vision benefits; |
• | medical and dependent care flexible spending accounts; |
• | short-term and long-term disability insurance; and |
• | life insurance. |
Annual Base Salary |
COBRA Health Insurance Premiums | |||
Mr. Chia |
12 months | 12 months | ||
Mr. Fey |
12 months | 12 months | ||
Mr. Wagner |
9 months | 9 months |
Position |
Reporting Structure |
Primary Location | ||||
Mr. Chia | sole CEO, most senior officer, and member of Board of Directors | Our Board of Directors | Headquarters in Chicago | |||
Mr. Fey | CFO | CEO or Board of Directors | Austin-Round Rock-San Marcos metropolitan area or Chicago-Naperville-Elgin metropolitan area | |||
Mr. Wagner | CTO | CEO | Philadelphia-Camden-Wilmington metropolitan area or Chicago-Naperville-Elgin metropolitan area |
Option Awards |
Stock Awards |
|||||||||||||||||||||||||||
Name |
Type of Equity |
Grant Date |
Number of Securities Underlying Unexercised Options (#) Unexercisable |
Number of Securities Underlying Unexercised Options (#) Unexercisable (1) |
Option Exercise Price ($) |
Option Expiration Date |
Number of Shares or Units of Stock That Have Not Vested (#) (2) |
Market Value of Shares or Units of Stock That Have Not Vested ($) |
||||||||||||||||||||
Stanley Chia |
Profit interests | 11/5/2018 | — | 200,306 | (1) |
874,262 | (8) | |||||||||||||||||||||
Phantom equity | 9/1/2020 | — | 360,000 | (2) |
2,674,172 | (8) | ||||||||||||||||||||||
Profit interests | 9/1/2020 | — | 360,000 | (2) |
14,760,865 | (8) | ||||||||||||||||||||||
Stock Options | 10/19/2021 | — | 938,812 | (3) |
12.86 | (4) |
10/19/2031 | |||||||||||||||||||||
Stock Options | 10/19/2021 | — | 275,682 | (3) |
15.00 | 10/19/2031 | ||||||||||||||||||||||
Restricted Stock Units | 10/19/2021 | — | 250,000 | (5) |
2,720,000 | (9) | ||||||||||||||||||||||
Lawrence Fey |
Phantom equity | 9/1/2020 | — | 88,000 | (6) |
653,686 | (8) | |||||||||||||||||||||
Profit interests | 9/1/2020 | — | 88,000 | (6) |
3,608,212 | (8) | ||||||||||||||||||||||
Profit interests | 9/1/2020 | — | 352,000 | (6) |
1,310,901 | (8) | ||||||||||||||||||||||
Stock Options | 10/19/2021 | — | 751,050 | (3) |
12.86 | (4) |
10/19/2031 | |||||||||||||||||||||
Stock Options | 10/19/2021 | — | 220,546 | (3) |
15.00 | 10/19/2031 | ||||||||||||||||||||||
Restricted Stock Units | 10/19/2021 | — | 200,000 | (5) |
2,176,000 | (9) | ||||||||||||||||||||||
Jon Wagner |
Profit interests | 12/17/2018 | — | 36,000 | (7) |
— | (8) | |||||||||||||||||||||
Phantom equity | 9/1/2020 | — | 61,600 | (6) |
457,580 | (8) | ||||||||||||||||||||||
Profit interests | 9/1/2020 | — | 61,600 | (6) |
2,525,748 | (8) | ||||||||||||||||||||||
Profit interests | 9/1/2020 | — | 192,000 | (6) |
715,037 | (8) | ||||||||||||||||||||||
Stock Options | 10/19/2021 | — | 375,525 | (3) |
12.86 | (4) |
10/19/2031 | |||||||||||||||||||||
Stock Options | 10/19/2021 | — | 110,273 | (3) |
15.00 | 10/19/2031 | ||||||||||||||||||||||
Restricted Stock Units | 10/19/2021 | — | 100,000 | (5) |
1,088,000 | (9) |
(1) | Vesting occurs in 20% equal installments on each anniversary of November 5, 2018, subject to Mr. Chia’s continued employment through each vesting date. Upon certain qualifying terminations, (a) an additional 10% of unvested profits interests will accelerate and vest in connection with Mr. Chia’s termination and (b) if a sale of Hoya Topco is consummated in the six-month period following Mr. Chia’s termination, all of the unvested units will accelerate and vest. |
(2) | Vesting occurs in 20% equal installments on each anniversary of June 30, 2020, subject to Mr. Chia’s continued employment through each vesting date. Upon certain qualifying terminations, (a) an additional 10% of unvested profits interests will accelerate and vest in connection with Mr. Chia’s termination and (b) if a sale of Hoya Topco is consummated in the six-month period following Mr. Chia’s termination, all of the unvested units will accelerate and vest. |
(3) | The stock options vest in 16 equal quarterly installments beginning on January 19, 2022. |
(4) | The options were awarded with an original exercise price of $13.09 per share on the date of grant. On the grant date, we anticipated that we would pay an extraordinary dividend of $0.23 per share in the near term. When the dividend was paid on November 2, 2021, the exercise price of the options was reduced by $0.23 per share, which resulted in an exercise price of $12.86 per share. |
(5) | The restricted stock units vest in 16 equal quarterly installments beginning on January 19, 2022. |
(6) | Vesting occurs in 20% equal installments on each anniversary of June 30, 2020, subject to the named executive officer’s continued employment through each vesting date. |
(7) | Vesting occurs in 20% equal installments on each anniversary of December 12, 2018, subject to the named executive officer’s continued employment through each vesting date. |
(8) | There is no public market for the profits interests. For purposes of this disclosure, we have valued the profits interests primarily based on the Class A share price as of December 31, 2021. The amount reported above under the heading “Market Value of Shares or Units of Stock That Have Not Vested” reflects the intrinsic value of the profits interests as of December 31, 2021, based upon the terms of each individual’s profits interests. |
(9) | Represents the fair market value per share of our common stock of $10.88, as of December 31, 2021. |
Name |
Fees Earned or Paid in Cash ($) |
Stock Awards ($) (1) (2) |
All Other Compensation ($) |
Total ($) |
||||||||||||
Mark Anderson |
9,680.71 | 320,000 | — | 329,681 | ||||||||||||
Todd Boehly |
9,680.71 | 320,000 | — | 329,681 | ||||||||||||
Jane DeFlorio |
10,190.22 | 320,000 | — | 330,190 | ||||||||||||
Craig Dixon |
10,190.22 | 320,000 | — | 330,190 | ||||||||||||
David Donnini |
10,699.73 | 320,000 | — | 330,700 | ||||||||||||
Tom Ehrhart |
9,171.20 | 320,000 | — | 329,171 | ||||||||||||
Julie Masino |
11,209.24 | 320,000 | — | 331,209 | ||||||||||||
Martin Taylor |
— | — | — | — |
(1) | The amounts shown in this column for 2021 represent awards granted under our 2021 Incentive Award Plan. The amounts listed are equal to the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. For a detailed description of the assumptions used for purposes of determining grant date fair value, see Note 20 to our audited consolidated financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates – Equity-Based Compensation.” |
(2) | The restricted stock units vest in five equal annual installments on the first five anniversaries of the date of grant, subject to the non-employee director’s continued service through each vesting date. |
• | Restricted stock units having an aggregate grant date fair value of $320,000 on the date of his or her initial election or appointment to our Board, which will vest in five equal installments on the first five anniversaries of the date of grant, and |
• | Restricted stock units having an aggregate grant date fair value of $160,000 on an annual basis on the date of our annual meeting of shareholders; provided, however, that the value of this award will be paid pro rata based on the number of days that have elapsed during the Board term. Each annual award will vest on the earlier of the day before the date of the first annual meeting of shareholders after the date of grant and the first anniversary of the date of grant. |
• | in whole and not in part; |
• | at a price of $0.01 per Vivid Seats Public IPO Warrant; |
• | upon a minimum of 30 days’ prior written notice of redemption (the “30-day redemption period”) to each holder of Vivid Seats Public IPO Warrants; and |
• | if, and only if, the closing price of the shares of Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a Vivid Seats Public IPO Warrant as described under the heading “— Vivid Seats IPO Warrants — Public — Anti-Dilution Adjustments”) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the holders of Vivid Seats Public IPO Warrants. |
• | The Form of New Warrant Agreement excludes references to ownership through The Depository Trust Company; |
• | The Form of New Warrant Agreement reflects the fact that the Vivid Seats $10.00 Exercise Warrants and Vivid Seats $15.00 Exercise Warrants were not issued as part of a unit; |
• | The Form of New Warrant Agreement does not distinguish between “private” and “public” warrants; |
• | The Vivid Seats $10.00 Exercise Warrants and the Vivid Seats $15.00 Exercise Warrants terminate on the date that is ten years after the date of completion of the Business Combination; |
• | The Form of New Warrant Agreement does not provide for the redemption of the Vivid Seats $10.00 Exercise Warrants or the Vivid Seats $15.00 Exercise Warrants; |
• | The underlying value for purposes of warrant exercise makes reference to the last reported sale price; and |
• | The Form of New Warrant Agreement excludes provisions contingent upon the consummation of the Business Combination. |
• | Action by Written Consent; Special Meetings of Stockholders |
• | Advance Notice Procedures |
• | Authorized but Unissued Shares |
• | Business Combinations with Interested Stockholders anti-takeover law. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a business combination, such as a merger, with an “interested stockholder” (which includes a person or group owning 15% or more of the corporation’s voting stock) for a period of three years following the date the person became an interested stockholder, unless (with certain exceptions) the business combination or the transaction in which the person became an interested stockholder is approved in a prescribed manner. Accordingly, we are not subject to any anti-takeover effects of Section 203. Nevertheless, the Amended and Restated Charter contains provisions that have a similar effect to Section 203, except that they provide that Sponsor, Hoya Topco, and the Private Equity Owner, and their respective affiliates and successors and their direct and indirect transferees will not be deemed to be “interested stockholders,” regardless of the percentage of our voting stock owned by them, and accordingly will not be subject to such restrictions. |
• | Director Designees; Classes of Directors |
• | No Cumulative Voting for Directors |
• | Restriction on Issuance of Class B Common Stock |
• | each person who is known to be the beneficial owner of more than 5% of our voting shares; |
• | each of our named executive officers and directors; and |
• | all our executive officers and directors as a group. |
Class A Common Stock |
Class B Common Stock |
Combined Voting Power (%) (1) |
||||||||||||||||||
Name and Address of Beneficial Owner |
Number |
% |
Number |
% |
||||||||||||||||
Five Percent Holders: |
— | — | ||||||||||||||||||
Hoya Topco, LLC (2) |
— | — | 124,200,000 | 100 | 61.07 | |||||||||||||||
Eldridge Industries, LLC (3) (5) |
100,243,630 | 80.29 | — | — | 41.24 | |||||||||||||||
The Vanguard Group (4) |
4,108,645 | 5.19 | — | — | 2.08 | |||||||||||||||
Delaware Life Holdings Parent II, LLC (6) |
5,000,000 | 6.32 | — | — | 2.53 | |||||||||||||||
Named Executive Officers: |
||||||||||||||||||||
Stanley Chia (3) |
183,061 | * | — | — | * | |||||||||||||||
Lawrence Fey (3) |
146,449 | * | — | — | * | |||||||||||||||
Jon Wagner (3) |
71,085 | * | — | — | * | |||||||||||||||
Non-Employee Directors: |
||||||||||||||||||||
Todd Boehly (3) (5) |
100,243,630 | 80.29 | — | — | 41.24 | |||||||||||||||
Jane DeFlorio (3) |
— | * | — | — | * | |||||||||||||||
Craig Dixon (3) |
— | * | — | — | * | |||||||||||||||
Julie Masino (3) |
— | * | — | — | * | |||||||||||||||
Martin Taylor (3) |
— | * | — | — | * | |||||||||||||||
Mark Anderson (2) (3) |
— | * | 124,200,000 | 100 | 61.07 | |||||||||||||||
David Donnini (2) (3) |
— | * | 124,200,000 | 100 | 61.07 | |||||||||||||||
Tom Ehrhart (3) |
— | * | — | — | * | |||||||||||||||
All directors and executive officers, as a group (13 individuals) |
100,705,080 | 80.38 | 124,200,000 | 100 | 90.15 |
(1) | Percentage of combined voting power represents voting power with respect to all shares of Class A common stock and Class B common stock, voting together as a single class. Each holder of Class A common stock and Class B common stock is entitled to one vote per share. |
(2) | GTCR Fund XI/B LP (“GTCR Fund XI/B”), GTCR Fund XI/C LP (“GTCR Fund XI/C”) and certain other entities affiliated with GTCR LLC (“GTCR”) have the right to appoint a majority of the members of the Board of Managers of Hoya Topco, LLC. GTCR Partners XI/B LP (“GTCR Partners XI/B”) is the general partner of GTCR Fund XI/B. GTCR Partners XI/A&C LP (“GTCR Partners XI/A&C”) is the general |
partner of GTCR Fund XI/C LP. GTCR Investment XI LLC (“GTCR Investment XI”) is the general partner of each of GTCR Partners XI/B and GTCR Partners XI/A&C. GTCR Investment XI is managed by a Board of Managers which includes Mark M. Anderson and David A. Donnini, and no single person has voting or dispositive authority over the securities reported herein. As such, each of the foregoing entities and individuals may be deemed to share beneficial ownership of the securities reported herein. Each of them disclaims any such beneficial ownership. The address for each of the entities and individuals is 300 North LaSalle Street, Suite 5600, Chicago, Illinois, 60654. This amount includes shares of Class B common stock issuable in connection with 6,000,000 Vivid Seats Class B Warrants. The following table sets forth our directors’ and named executive officers’ direct and indirect beneficial ownership interests in Hoya Topco, LLC, excluding, in the case of directors, any shares indirectly owned by such individuals as a result of his or her partnership interest in GTCR or its affiliates. |
Name of Beneficial Owner |
Class B Units |
Class B-1 Incentive Units |
Class C Units (a) |
Percentage of Class C Units Beneficially Owned |
Class D Units |
Class E Units |
||||||||||||||||||
Stanley Chia (b) |
— | 450,000 | — | — | — | 500,765 | ||||||||||||||||||
Lawrence Fey (c) |
— | 110,000 | — | — | 440,000 | — | ||||||||||||||||||
Jon Wagner (d) |
— | 77,000 | — | — | 330,000 | — |
(a) | The Class C Units are the voting securities of Hoya Topco, LLC. |
(b) | Includes vested and unvested interests. Excludes 450,000 phantom units of Hoya Topco. The Class E Units are profit interests of Hoya Topco. |
(c) | Includes vested and unvested interests. Excludes 110,000 phantom units of Hoya Topco. The Class D Units are profit interests of Hoya Topco. |
(d) | Includes vested and unvested interests. Excludes 77,000 phantom units of Hoya Topco. The Class D Units are profit interests of Hoya Topco. |
(3) | The following table sets forth our named executive officers’, directors’, and executive officers and directors as a group’s shares of common stock subject to options that are exercisable within 60 days of February 28, 2022. |
Name of Beneficial Owner |
Number of Shares subject to Options |
|||
Executive Officers |
||||
Stanley Chia |
151,811 | |||
Lawrence Fey |
121,449 | |||
Jon Wagner |
60,724 | |||
Non-Employee Directors |
||||
Mark Anderson |
— | |||
Todd Boehly |
— | |||
Jane DeFlorio |
— | |||
Craig Dixon |
— | |||
David Donnini |
— | |||
Tom Ehrhart |
— | |||
Julie Masino |
— | |||
Martin Taylor |
— | |||
All executive officers and directors as a group (13 individuals) |
386,014 |
(4) | The number of shares of Class A common stock held by The Vanguard Group (“Vanguard”) is based on a Schedule 13G filed with the SEC on February 10, 2022 by Vanguard. Vanguard reported that it has sole voting power with respect to 0 shares, shared voting power with respect to 3,710 shares, sole dispositive power with respect to 4,097,467 shares and shared dispositive power with respect to 11,178 shares. The address of Vanguard is 100 Vanguard Blvd. Malvern, PA 19355. |
(5) | Interests shown consist of shares of Class A common stock held by Eldridge Industries, LLC (“Eldridge”), Sponsor, Post Portfolio Trust, LLC (“PPT”) and DraftKings Inc. (“DraftKings”). Interests shown include (i) 52,057,173 shares of Class A common stock and (ii) 45,686,457 shares of Class A common stock subject to warrants that are exercisable within 60 days of February 28, 2022. Eldridge is a private investment firm specializing in providing both equity and debt capital. Todd L. Boehly (“Mr. Boehly”) is the Chairman, Chief Executive Officer and indirect controlling member of Eldridge and in such capacity may be deemed to have voting and dispositive power with respect to the shares held by Sponsor and PPT. DraftKings has appointed Todd L. Boehly (“Mr. Boehly”) as its true and lawful proxy and attorney-in-fact, |
(6) | Based on a Schedule 13G filed with the SEC on March 4, 2022 on behalf of Vivid Public Holdings, LLC (“VPH”), DLHPII Public Investments, LLC (“Public Investment”), DLHPII Investment Holdings, LLC (“Investment Holdings”), Delaware Life Holdings Parent II, LLC (“Parent”), Delaware Life Holdings Manager, LLC (“Manager”) and Mark R. Walter (“Mr. Walter”) (together, VPH, Public Investment, Investment Holdings, Parent, Manager, and Mr. Walter are the “Reporting Persons”). Consists of 5,000,000 shares of Class A Common Stock (the “Class A Shares”) held directly by VPH. VPH is a wholly-owned subsidiary of Public Investments. Public Investments is a wholly-owned subsidiary of Investment Holdings. Investment Holdings is a wholly-owned subsidiary of Parent. Each of VPH, Public Investments, Investment Holdings and Parent is managed by Manager and each of Parent and Manager is controlled by Mr. Walter. Each of the Reporting Persons have shared voting and dispositive power over the securities reported. Each of Public Investments, Investment Holdings, Parent, Manager and Mr. Walter disclaim beneficial ownership of such securities except to the extent of their respective pecuniary interest therein. The principal business address of each of VPH, Public Investments, Investment Holdings, Parent, Manager and Mr. Walter is 227 West Monroe, Suite 5000 Chicago, IL 60606. |
Before the Offering |
After the Offering |
|||||||||||||||||||||||||||||||
Name of Selling Shareholder |
Number of Shares of Class A Common Stock |
Number of Warrants |
Number of Shares of Class A Common Stock Being Offered |
Number of Warrants Being Offered |
Number of Shares of Class A Common Stock |
Percentage of Outstanding Shares of Class A Common Stock |
Number of Warrants |
Percentage of Outstanding Warrants |
||||||||||||||||||||||||
Hoya Topco, LLC (1) |
124,200,000 | — | 124,200,000 | — | — | — | — | |||||||||||||||||||||||||
Eldridge Industries, LLC (2) |
52,057,173 | 45,686,457 | 52,057,173 | 45,686,457 | — | — | — | — | ||||||||||||||||||||||||
DraftKings Inc. (3) |
2,500,000 | — | 2,500,000 | — | — | — | — | — | ||||||||||||||||||||||||
Vivid Public Holdings, LLC (4) |
5,000,000 | — | 5,000,000 | — | — | — | — | — | ||||||||||||||||||||||||
The Restated 2012 Irrevocable Trust F/B/O Ashley De Simone (5) |
10,000 | — | 10,000 | — | — | — | — | — |
(1) | Shares offered hereby include 124,200,000 shares of Class A common stock issuable upon exchange of Intermediate Common Units held by Hoya Topco, including 6,000,000 Intermediate Common Units issuable in the future pursuant to the exercise of warrants held by Hoya Topco. GTCR Fund XI/B LP (“GTCR Fund XI/B”), GTCR Fund XI/C LP (“GTCR Fund XI/C”) and certain other entities affiliated with GTCR LLC (“GTCR”) have the right to appoint a majority of the members of the board of managers of Hoya Topco, LLC. GTCR Partners XI/B LP (“GTCR Partners XI/B”) is the general partner of GTCR Fund XI/B. GTCR Partners XI/A&C LP (“GTCR Partners XI/A&C”) is the general partner of GTCR Fund XI/C LP. GTCR Investment XI LLC (“GTCR Investment XI”) is the general partner of each of GTCR Partners XI/B and GTCR Partners XI/A&C. GTCR Investment XI is managed by a board of managers consisting of Mark M. Anderson, Craig A. Bondy, Aaron D. Cohen, Sean L. Cunningham, Benjamin J. Daverman, David A. Donnini, Constantine S. Mihas and Collin E. Roche, and no single person has voting or dispositive authority over the securities reported herein. As such, each of the foregoing entities and individuals may be deemed to share beneficial ownership of the securities reported herein. Each of them disclaims any such beneficial ownership. The address for each of the entities and individuals listed in this footnote is 300 North LaSalle Street, Suite 5600, Chicago, Illinois, 60654. |
(2) | Securities offered hereby include (i) 15,550,000 shares of Class A common stock held by Sponsor, (ii) 36,507,173 shares of Class A common stock held by PPT and (iii) 45,686,457 warrants to purchase shares of Class A common stock held by Sponsor (and including the 45,686,457 shares of Class A common stock underlying such warrants held by Sponsor). Sponsor and PPT are indirectly controlled by Eldridge. Mr. Boehly is the indirect controlling member of Eldridge, and in such capacity, may be deemed to have voting and dispositive power with respect to the shares and warrants. Eldridge is a private investment firm specializing in providing both equity and debt capital. Mr. Boehly is the Chairman, Chief Executive Officer and controlling member of Eldridge. The |
(3) | DraftKings has appointed Mr. Boehly as its true and lawful proxy and attorney-in-fact, |
(4) | Vivid Public Holdings, LLC; DLHPII Public Investments, LLC; DLHPII Investment Holdings, LLC; Delaware Life Holdings Parent II, LLC; Delaware Life Holdings Manager, LLC; and Mark R. Walter have shared voting and dispositive power of 5,000,000 shares of Class A common stock. Vivid Public Holdings, LLC directly holds the Class A common stock. Vivid Public Holdings, LLC is a wholly-owned subsidiary of DLHPII Public Investments, LLC (“Public Investments”). Public Investments is a wholly-owned subsidiary of DLHPII Investment Holdings, LLC (“Investment Holdings”). Investment Holdings is a wholly-owned subsidiary of Delaware Life Holdings Parent II, LLC (“Parent”). Each of Vivid Public Holdings, LLC, Public Investments, Investment Holdings and Parent is managed by Delaware Life Holdings Manager, LLC (“Manager”) and each of Parent and Manager is controlled by Mr. Mark R. Walter (“Mr. Walter”). Each of Public Investments, Investment Holdings, Parent, Manager and Mr. Walter may be deemed to indirectly share voting and dispositive power over the securities held directly by Vivid Public Holdings, LLC, and as a result, may be deemed to have or share beneficial ownership of some or all of the shares held directly by Vivid Public Holdings, LLC. Each of Public Investments, Investment Holdings, Parent, Manager and Mr. Walter disclaim beneficial ownership of such securities except to the extent of their respective pecuniary interest therein. The address of Vivid Public Holdings, LLC is 227 W. Monroe Suite 5000, Chicago, IL 60606. |
(5) | The Goldman Sachs Trust Company of Delaware is the trustee of the Restated 2012 Irrevocable Trust F/B/O Ashley DeSimone. Each of Ashley DeSimone, as investment advisor of the Restated 2012 Irrevocable Trust F/B/O Ashley DeSimone, the Goldman Sachs Trust Company of Delaware, as trustee, and Glenn J. Morley, as Vice President of the Goldman Sachs Trust Company of Delaware, share voting and dispositive power over the securities held by the Restated 2012 Irrevocable Trust F/B/O Ashley DeSimone, and as a result, may be deemed to have or share beneficial ownership of such securities. The address of the Restated 2012 Irrevocable Trust F/B/O Ashley DeSimone is 200 Bellevue Parkway, Suite 500, Wilmington, DE 19089. |
• | existing tax basis in certain assets of Hoya Intermediate and certain of its direct or indirect subsidiaries, including assets that will eventually be subject to depreciation or amortization, once placed in service; |
• | tax basis adjustments resulting from taxable exchanges of Intermediate Common Units (including any such adjustments resulting from certain payments made by us under the Tax Receivable Agreement) acquired by us from a TRA Holder pursuant to the terms of the Second A&R LLCA; |
• | certain tax attributes of Blocker Corporations holding Intermediate Common Units that are acquired directly or indirectly by us pursuant to a Reorganization Transaction; |
• | certain tax benefits realized by us as a result of certain U.S. federal income tax allocations of taxable income or gain away from us and to other members of Hoya Intermediate and deductions or losses to us and away from other members of Hoya Intermediate, in each case, as a result of the Business Combination; and |
• | tax deductions in respect of portions of certain payments made under the Tax Receivable Agreement. |
• | any person who is, or at any time during the applicable period was, one of our executive officers or one of our directors; |
• | any person who is known by us to be the beneficial owner of more than 5% of our voting shares; |
• | any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law sister-in-law |
• | any firm, corporation or other entity in which any of the foregoing persons is a partner or principal, or in a similar position, or in which such person has a 10% or greater beneficial ownership interest. |
• | U.S. expatriates and former citizens or long-term residents of the United States; |
• | persons holding our securities as part of a hedge, straddle, or other risk reduction strategy or as part of a conversion transaction or other integrated investment; |
• | banks, insurance companies, and other financial institutions; |
• | brokers, dealers, or traders in securities; |
• | “controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax; |
• | partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein); |
• | tax-exempt organizations or governmental organizations; |
• | persons deemed to sell our securities under the constructive sale provisions of the Code; |
• | persons who hold or receive our securities pursuant to the exercise of any employee stock option or otherwise as compensation; |
• | tax-qualified retirement plans; and |
• | “qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds. |
• | an individual who is a citizen or resident of the United States; |
• | a corporation (or other entity taxable as a corporation) created or organized under the laws of the United States, any state thereof, or the District of Columbia; |
• | an estate, the income of which is subject to U.S. federal income tax regardless of its source; or |
• | a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code), or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes. |
• | a non-resident alien individual; |
• | a foreign corporation; or |
• | a foreign estate or trust. |
• | the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such gain is attributable); |
• | the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met; or |
• | our Class A common stock and warrants constitute U.S. real property interests (“USRPI”) by reason of our status as a U.S. real property holding corporation (“USRPHC”) for U.S. federal income tax purposes. |
• | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
• | one or more underwritten offerings; |
• | block trades in which the broker-dealer will attempt to sell the shares of Class A common stock or warrants as agent, but may position and resell a portion of the block as principal to facilitate the transaction; |
• | purchases by a broker-dealer as principal and resale by the broker-dealer for its accounts; |
• | an exchange distribution in accordance with the rules of the applicable exchange; |
• | privately negotiated transactions; |
• | distributions to their members, partners or shareholders, including in-kind distributions; |
• | short sales effected after the date of the registration statement of which this prospectus is a part is declared effective by the SEC; |
• | through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
• | in market transactions, including transactions on a national securities exchange or quotations service or over-the-counter |
• | directly to one or more purchasers; |
• | through agents; |
• | broker-dealers may agree with the Selling Shareholders to sell a specified number of such shares of Class A common stock or warrants at a stipulated price per share or warrant; and |
• | a combination of any such methods of sale. |
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F-6 | ||||
F-7 | ||||
F-9 |
December 31, 2021 |
December 31, 2020 |
|||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | $ | ||||||
Restricted cash |
||||||||
Accounts receivable – net |
||||||||
Inventory – net |
||||||||
Prepaid expenses and other current assets |
||||||||
|
|
|
|
|||||
Total current assets |
||||||||
Property and equipment – net |
||||||||
Intangible assets – net |
||||||||
Goodwill |
||||||||
Other non-current assets |
||||||||
|
|
|
|
|||||
Total assets |
$ |
$ |
||||||
|
|
|
|
|||||
Liabilities and equity (deficit) |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | $ | ||||||
Accrued expenses and other current liabilities |
||||||||
Deferred revenue |
||||||||
Current maturities of long-term debt |
||||||||
|
|
|
|
|||||
Total current liabilities |
||||||||
Long-term debt – net |
||||||||
Other liabilities |
||||||||
|
|
|
|
|||||
Total long-term liabilities |
||||||||
Commitments and contingencies (Note 15) |
||||||||
Redeemable Preferred Units and noncontrolling interests |
||||||||
Redeemable Senior Preferred Units - $ |
||||||||
Redeemable Preferred Units - $ |
||||||||
Redeemable noncontrolling interests |
||||||||
Shareholders’ deficit |
||||||||
Class A common stock, $ |
||||||||
Class B common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Accumulated other comprehensive loss |
( |
) | ||||||
|
|
|
|
|||||
Total Shareholders’ deficit |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total liabilities, Redeemable Preferred Units and noncontrolling interests, and Shareholders’ deficit |
$ |
$ |
||||||
|
|
|
|
Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Revenues |
$ | $ | $ | |||||||||
Costs and expenses: |
||||||||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
||||||||||||
Marketing and selling |
||||||||||||
General and administrative |
||||||||||||
Depreciation and amortization |
||||||||||||
Impairment charges |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
Income (loss) from operations |
( |
) |
( |
) | ||||||||
Other expenses: |
||||||||||||
Interest expense – net |
||||||||||||
Loss on extinguishment of debt |
||||||||||||
Other expenses |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
Loss before income taxes |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | |||
Income tax expense |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
Net loss |
( |
) | ( |
) | ( |
) | ||||||
Net loss attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
( |
) | ( |
) | ( |
) | ||||||
Net loss attributable to redeemable noncontrolling interests |
( |
) | — | — | ||||||||
|
|
|
|
|
|
|||||||
Net loss attributable to Class A Common Stockholders |
$ |
( |
) |
$ |
— |
$ |
— |
|||||
|
|
|
|
|
|
|||||||
Loss per Class A Common Stock (1) : |
||||||||||||
Basic |
$ | ( |
) | |||||||||
Diluted |
$ | ( |
) | |||||||||
Weighted average Class A Common Stock outstanding (1) : |
||||||||||||
Basic |
||||||||||||
Diluted |
(1) | Represents loss per common share and weighted-average common shares outstanding for the period following the Merger Transaction and PIPE Financing as defined in Note 1, Background, Description of Business and Basis of Presentation |
Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Other comprehensive income (loss): |
||||||||||||
Unrealized gain (loss) on derivative instruments |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
Comprehensive loss, net of taxes |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | |||
Comprehensive loss attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
( |
) | ( |
) | ( |
) | ||||||
Comprehensive loss attributable to redeemable noncontrolling interests |
( |
) | — | — | ||||||||
|
|
|
|
|
|
|||||||
Comprehensive loss attributable to Class A Common Stockholders |
$ |
( |
) |
$ |
— |
$ |
— |
|||||
|
|
|
|
|
|
Redeemable senior preferred units |
Redeemable preferred units |
Common units |
Class A Common Shares |
Class B Common Shares |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Units |
Amount |
Units |
Amount |
Redeemable noncontrolling interests |
Units |
Amount |
Shares |
Amount |
Shares |
Amount |
Additional paid-in capital |
Accumulated deficit |
Accumulated other comprehensive (income) loss |
Total shareholders’ deficit |
||||||||||||||||||||||||||||||||||||||||||||||
Balances at January 1, 2019 |
$ |
$ |
$ |
— |
$ |
— |
— |
$ |
— |
— |
$ |
— |
$ |
$ |
( |
$ |
$ |
|||||||||||||||||||||||||||||||||||||||||||
Net loss |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
( |
) |
— |
( |
) | ||||||||||||||||||||||||||||||||||||||||||||
Unrealized loss on derivative instruments |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
( |
) |
( |
) | ||||||||||||||||||||||||||||||||||||||||||||
Deemed contribution from former parent |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
|||||||||||||||||||||||||||||||||||||||||||||||
Accretion of senior preferred units |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
( |
) |
— |
— |
( |
) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to former parent |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
( |
) |
— |
— |
( |
) | |||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Balances at December 31, 2019 |
$ |
$ |
$ |
— |
$ |
— |
— |
$ |
— |
— |
$ |
— |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||||||||||||||||||
Unrealized gain on derivative instruments |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Loss reclassified from accumulated other comprehensive loss to earnings |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Deemed contribution from former parent |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Accretion of senior preferred units |
— | — | — | — | — | — | — | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to former parent |
— | — | — | — | — | — | — | — | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Balances at December 31, 2020 |
$ |
$ |
$ |
— |
$ |
— |
— |
$ |
— |
— |
$ |
— |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||||||||||||||||||||||||
Net loss prior to reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||||||||||||||||||
Loss reclassified from accumulated other comprehensive loss to earnings prior to reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Deemed contribution from former parent prior to reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Accretion of senior preferred units prior to reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||||||||||||||||||||
Reverse recapitalization, net |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
Net loss after reverse recapitalization |
— | — | — | — | ( |
) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Deemed contribution from former parent after reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation after reverse recapitalization |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Change in fair value of warrants |
— | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Issuance of shares related to Betcha acquisition |
— | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
Dividends paid to Class A Common Shareholders |
— | — | — | — | — | — | — | — | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||||||||||||||||||||
Subsequent remeasurement of Redeemable noncontrolling interests |
— | — | — | — | — | — | — | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Balances at December 31, 2021 |
— |
$ |
— |
— |
$ |
— |
$ |
— |
$ |
— |
$ |
$ |
$ |
$ |
( |
) |
$ |
— |
$ |
( |
) | |||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Cash flows from operating activities |
||||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
||||||||||||
Depreciation and amortization |
||||||||||||
Amortization of deferred financing costs and interest rate cap |
||||||||||||
Loss on disposal of long-lived assets |
— | |||||||||||
Equity-based compensation expense |
||||||||||||
Loss on extinguishment of debt |
||||||||||||
Interest expense paid-in-kind |
— | |||||||||||
Change in fair value of warrants |
— | — | ||||||||||
Impairment charges |
— | — | ||||||||||
Changes in operating assets and liabilities, net of impact of acquisitions: |
||||||||||||
Accounts receivable |
( |
) | ( |
) | ||||||||
Inventory |
( |
) | ( |
) | ||||||||
Prepaid expenses and other current assets |
( |
) | ||||||||||
Accounts payable |
( |
) | ||||||||||
Accrued expenses and other current liabilities |
||||||||||||
Deferred revenue |
||||||||||||
Other assets and liabilities |
( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|||||||
Net cash provided by (used in) operating activities |
( |
) |
||||||||||
Cash flows from investing activities |
||||||||||||
Cash acquired (paid) in acquisition |
— | ( |
) | |||||||||
Purchases of property and equipment |
( |
) | ( |
) | ( |
) | ||||||
Proceeds from the sale of personal seat licenses |
— | — | ||||||||||
Purchases of personal seat licenses |
( |
) | — | — | ||||||||
Investments in developed technology |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Net cash used in investing activities |
( |
) |
( |
) |
( |
) | ||||||
Cash flows from financing activities |
||||||||||||
Proceeds from PIPE Financing |
— | — | ||||||||||
Proceeds from the Merger Transaction |
— | — | ||||||||||
Redemption of Redeemable Senior Preferred Units |
( |
) | — | — | ||||||||
Payments of May 2020 First Lien Loan |
( |
) | — | — | ||||||||
Payments of June 2017 First Lien Loan |
( |
) | ( |
) | ( |
) | ||||||
Payments of June 2017 Second Lien Loan |
— | — | ( |
) |
Prepayment penalty on extinguishment of debt |
( |
) | — | — | ||||||||
Proceeds from May 2020 First Lien Loan |
— | — | ||||||||||
Proceeds from Revolving Facility |
— | — | ||||||||||
Payments of Revolving Facility |
— | ( |
) | — | ||||||||
Payments of deferred financing costs and other debt-related costs |
— | ( |
) | ( |
) | |||||||
Distributions |
— | ( |
) | ( |
) | |||||||
Payment of reverse recapitalization costs |
( |
) | — | — | ||||||||
Dividends paid to Class A Common Stock Shareholders |
( |
) | — | — | ||||||||
|
|
|
|
|
|
|||||||
Net cash (used in) provided by financing activities |
( |
) |
( |
) | ||||||||
|
|
|
|
|
|
|||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
Cash and cash equivalents – beginning of period |
||||||||||||
|
|
|
|
|
|
|||||||
Cash, cash equivalents, and restricted cash – end of period |
$ |
$ |
$ |
|||||||||
|
|
|
|
|
|
|||||||
Supplemental disclosure of cash flow information: |
||||||||||||
Paid-in-kind |
$ | $ | $ | — | ||||||||
Cash paid for interest |
$ | $ | $ | |||||||||
Betcha acquisition non-cash consideration |
$ | $ | — | $ | — | |||||||
|
|
|
|
|
|
• | Issued We su bs e quentlypaid an additional $ in transaction costs incurred by Horizon using the cash sh eq ui valents tha t became availab le to Vivid Seats Inc.; |
• | Issued |
• | Received $ |
• | Used proceeds from Horizon and the PIPE Financing to pay (i) $ |
• | Issued to Horizon Sponsor, LLC (i) warrants to purchase |
• | Issued private warrants to purchase |
Asset Class |
Useful Life | |
Computer Equipment |
||
Purchased Software |
||
Furniture and Fixtures |
Asset Class |
Useful Life | |
Non-competition agreements |
||
Supplier relationships |
||
Developed technology |
||
Customer relationships |
Cash |
$ | |||
Restricted cash |
||||
Prepaid expenses and other current assets |
||||
Intangible assets |
||||
Goodwill |
||||
Accounts payable |
( |
) | ||
Accrued expenses and other current liabilities |
( |
) | ||
Net assets acquired |
$ |
|||
Fair value of common stock |
$ | |||
Cash consideration |
||||
Fair value of milestone payments |
||||
Fair value of earnouts |
||||
Total purchase consideration |
$ |
|||
Cost |
Estimated Useful Life |
|||||||
Customer relationships |
||||||||
Developed technology |
||||||||
Total acquired intangible assets |
$ |
|||||||
2021 |
2020 |
2019 |
||||||||||
Marketplace revenues: |
||||||||||||
Owned Properties |
$ | $ | $ | |||||||||
Private Label |
( |
) | ||||||||||
Total Marketplace revenues |
$ |
$ |
$ |
|||||||||
2021 |
2020 |
2019 |
||||||||||
Marketplace revenues: |
||||||||||||
Concerts |
$ | $ | $ | |||||||||
Sports |
||||||||||||
Theater |
||||||||||||
Other |
||||||||||||
Total Marketplace revenues |
$ |
$ |
$ |
|||||||||
Goodwill |
$ | |||
Indefinite-lived trademark |
||||
Definite-lived intangible assets |
||||
Property and equipment |
||||
Personal seat licenses |
||||
Total impairment charges |
$ |
|||
2021 |
||||
Computer equipment |
$ | |||
Construction in progress |
||||
Total property and equipment |
||||
Less: accumulated depreciation |
||||
Total property and equipment – net |
$ |
|||
Definite-lived Intangible Assets |
Trademark |
Goodwill |
||||||||||
Balance at January 1, 2020 |
$ |
$ |
$ |
|||||||||
Capitalized development costs |
— | — | ||||||||||
Impairment |
( |
) | ( |
) | ( |
) | ||||||
Disposals |
( |
) | — | — | ||||||||
Amortization |
( |
) | — | — | ||||||||
Balance at December 31, 2020 |
||||||||||||
Acquisition of Betcha |
— | |||||||||||
Capitalized development costs |
— | — | ||||||||||
Amortization |
( |
) | — | — | ||||||||
Balance at December 31, 2021 |
$ |
$ |
$ |
|||||||||
2022 |
$ | |||
2023 |
$ | |||
2024 |
$ | |||
2025 |
$ | |||
2026 |
$ | |||
|
|
|||
Total |
$ |
|||
|
|
2021 |
2020 |
|||||||
Recovery of future customer compensation |
$ | $ | ||||||
Insurance recovery asset |
||||||||
Prepaid expenses |
||||||||
Other current assets |
||||||||
|
|
|
|
|||||
Total prepaid expenses and other current assets |
$ |
$ |
||||||
|
|
|
|
2021 |
2020 |
|||||||
Accrued marketing expense |
$ | $ | ||||||
Accrued taxes |
||||||||
Accrued customer credits |
||||||||
Accrued future customer compensation |
||||||||
Accrued contingencies |
||||||||
Other current liabilities |
||||||||
|
|
|
|
|||||
Total accrued expenses and other current liabilities |
$ |
$ |
||||||
|
|
|
|
2021 |
2020 |
|||||||
June 2017 First Lien Loan |
$ | $ | ||||||
May 2020 First Lien Loan |
||||||||
|
|
|
|
|||||
Total long-term debt, gross |
||||||||
Less: unamortized debt issuance costs |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total long-term debt, net of issuance costs |
||||||||
Less: current portion |
( |
) | ||||||
|
|
|
|
|||||
Total long-term debt, net |
$ |
$ |
||||||
|
|
|
|
2022 |
$ | |||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
Total |
$ |
|||
Interest rate cap |
||||
Beginning accumulated derivative loss in AOCL |
$ | ( |
) | |
Amount of gain (loss) recognized in AOCL |
— | |||
Less: Amount of loss reclassified from AOCL to income |
( |
) | ||
Ending accumulated derivative loss in AOCL |
$ |
|||
Interest rate swaps |
Interest rate cap |
Total |
||||||||||
Beginning accumulated derivative loss in AOCL |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Amount of gain recognized in AOCL |
— | |||||||||||
Less: Amount of loss reclassified from AOCL to income |
— | ( |
) | ( |
) | |||||||
Ending accumulated derivative loss in AOCL |
$ |
$ |
( |
) | $ |
( |
) | |||||
2021 |
2020 |
2019 |
||||||||||
United States |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Foreign |
( |
) | ( |
) | ( |
) | ||||||
Total loss before income taxes |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | |||
2021 |
||||
Current |
||||
U.S. Federal |
$ | |||
State & Local |
||||
Foreign |
||||
|
|
|||
Total current income tax expense (benefit) |
||||
|
|
|||
Deferred |
||||
U.S. Federal |
||||
State & Local |
||||
Foreign |
||||
|
|
|||
Total deferred income tax expense (benefit) |
||||
|
|
|||
Total income tax expense (benefit) |
$ |
|||
|
|
2021 |
||||
At U.S. statutory tax rate |
% | |||
State income taxes |
( |
)% | ||
Foreign rate differential |
% | |||
Pass-through loss / (income) |
( |
)% | ||
Noncontrolling interest |
( |
)% | ||
Change in valuation allowance |
( |
)% | ||
Warrants remeasurement |
( |
)% | ||
Other |
% | |||
|
|
|||
Total income tax expense (benefit) |
( |
)% | ||
|
|
2021 |
||||
Deferred Tax Assets |
||||
Net operating loss |
$ | |||
Interest carryforward |
||||
Investment in partnerships |
||||
Other |
||||
|
|
|||
Total deferred tax assets |
||||
|
|
|||
Valuation allowance |
( |
) | ||
|
|
|||
Total deferred tax assets net of valuation allowance |
||||
|
|
|||
Deferred Tax Liabilities |
||||
Other |
||||
|
|
|||
Total Deferred Tax Liabilities |
||||
|
|
|||
Net Deferred Tax Asset / Liabilities |
$ |
|||
|
|
2021 |
||||
Balance of beginning of period |
$ | |||
Charged to costs and expenses |
||||
(Credited) charged to other accounts |
||||
Deductions |
||||
|
|
|||
Ending balance |
$ |
|||
|
|
Significant Unobservable Inputs |
Range (Weighted Average) | |
Discount rate |
||
Long-term growth rate |
Goodwill |
Trademark |
|||||||
50 basis point increase in discount rate |
$ | ( |
) | $ | ( |
) | ||
50 basis point decrease in long-term growth rate |
( |
) | ( |
) |
2022 |
2023 |
2024 |
2025 |
2026 |
Thereafter |
Total |
||||||||||||||||||||||
Operating leases |
$ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Purchase obligations |
||||||||||||||||||||||||||||
Total |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||||||||
Marketplace |
Resale |
Consolidated |
||||||||||
Revenues |
$ | $ | $ | |||||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
||||||||||||
Marketing and selling |
||||||||||||
Contribution margin |
$ |
$ |
||||||||||
General and administrative |
||||||||||||
Depreciation and amortization |
||||||||||||
Income from operations |
||||||||||||
Interest expense – net |
||||||||||||
Loss on extinguishment of debt |
||||||||||||
Other expenses |
||||||||||||
Loss before income taxes |
$ |
( |
) | |||||||||
Marketplace |
Resale |
Consolidated |
||||||||||
Revenues |
$ | $ | $ | |||||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
||||||||||||
Marketing and selling |
||||||||||||
Contribution margin |
$ |
( |
) |
$ |
( |
) | ||||||
General and administrative |
||||||||||||
Depreciation and amortization |
||||||||||||
Impairment charges |
||||||||||||
Loss from operations |
( |
|||||||||||
Interest expense – net |
||||||||||||
Loss on extinguishment of debt |
||||||||||||
Net loss |
$ |
( |
) | |||||||||
Marketplace |
Resale |
Consolidated |
||||||||||
Revenues |
$ | $ | $ | |||||||||
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
||||||||||||
Marketing and selling |
||||||||||||
Contribution margin |
$ |
$ |
||||||||||
General and administrative |
||||||||||||
Depreciation and amortization |
||||||||||||
Loss from operations |
( |
) | ||||||||||
Interest expense—net |
||||||||||||
Loss on extinguishment of debt |
||||||||||||
Net loss |
$ |
( |
) | |||||||||
12/31/2021 |
10/18/2021 |
|||||||
Estimated volatility |
% |
% | ||||||
Expected term (years) |
||||||||
Risk-free rate |
% |
% | ||||||
Expected dividend yield |
% |
% |
Shares |
Weighted-Average Grant Date Fair Value Per Share |
|||||||
Unvested at December 31, 2020 |
$ | |||||||
Granted |
||||||||
Forfeited |
( |
) | ||||||
Vested |
||||||||
Unvested at December 31, 2021 |
$ |
|||||||
2021 |
||||
Estimated volatility |
% | |||
Expected term (years) |
||||
Risk-free rate |
% | |||
Expected dividend yield |
% |
Class B-1 Units |
Class D Units |
Class E Units |
||||||||||||||||||||||
Number of Incentive Units |
Weighted Average Grant Date Fair Value |
Number of Incentive Units |
Weighted Average Grant Date Fair Value |
Number of Incentive Units |
Weighted Average Grant Date Fair Value |
|||||||||||||||||||
Balances at January 1, 2019 |
— |
$ |
— |
$ |
$ |
|||||||||||||||||||
Units Granted |
— | — | — | — | ||||||||||||||||||||
Units Repurchased |
— | — | ( |
) | — | — | ||||||||||||||||||
Units Forfeited |
— | — | ( |
) | — | — | ||||||||||||||||||
Balances at December 31, 2019 |
— |
— |
$ |
$ |
||||||||||||||||||||
Units granted |
— | — | ||||||||||||||||||||||
Units repurchased |
— | — | ( |
) | — | — | ||||||||||||||||||
Units forfeited |
( |
) | ( |
) | — | — | ||||||||||||||||||
Balances at December 31, 2020 |
$ |
$ |
$ |
|||||||||||||||||||||
Units granted |
— | — | — | — | — | — | ||||||||||||||||||
Units repurchased |
— | — | — | — | — | — | ||||||||||||||||||
Units forfeited |
( |
) | ( |
) | — | — | ||||||||||||||||||
Balances at December 31, 2021 |
$ |
$ |
$ |
|||||||||||||||||||||
2020 |
2019 |
|||||||
Estimated volatility |
% | % | ||||||
Expected term (years) |
||||||||
Risk-free rate |
% | % | ||||||
Expected dividend yield |
% | % |
October 18, 2021 through December 31, 2021 |
||||
Numerator—basic: |
||||
Net loss |
$ | ( |
) | |
Less: Loss attributable to redeemable noncontrolling interests |
||||
Net loss attributable to Class A Common Stockholders—basic |
( |
) | ||
Denominator—basic: |
||||
Weighted average Class A common stock outstanding—basic |
||||
Net loss per Class A common stock—basic |
$ |
( |
) | |
Numerator—diluted: |
||||
Net loss attributable to Class A Common Stockholders—basic |
$ | ( |
) | |
Net loss effect of dilutive securities: |
||||
Effect of dilutive Hoya Intermediate Warrants |
( |
) | ||
Net loss attributable to Class A Common Stockholders—diluted |
( |
) | ||
Denominator—diluted: |
||||
Weighted average Class A common stock outstanding—basic |
||||
Weighted average effect of dilutive securities: |
||||
Effect of dilutive Hoya Intermediate Warrants |
||||
Weighted average Class A common stock outstanding—diluted |
||||
Net loss per Class A common stock—diluted |
$ |
( |
) | |
For the Year Ended December 31, |
||||
2021 |
||||
RSUs |
||||
Stock options |
||||
Class A Warrants |
||||
Exercise Warrants |
||||
Hoya Intermediate Warrants |
||||
Shares of Class B common stock |
Securities and Exchange Commission registration fee |
$ | 295,689.93 | ||
Accounting fees and expenses |
100,000.00 | |||
Legal fees and expenses |
250,000.00 | |||
Financial printing and miscellaneous expenses |
60,000.00 | |||
Total |
$ | 705,689.93 |
• | On March 29, 2021, we issued 100 shares of common stock to Hoya Intermediate in connection with our formation for aggregate consideration of $10.00, which were cancelled in connection with the Closing. |
• | On October 18, 2021, we issued 118,200,000 shares of Class B common stock and 6,000,000 warrants to purchase Class B common stock to Hoya Topco for nominal cash consideration. |
• | On October 18, 2021, we issued 47,517,173 shares of Class A common stock to certain qualified institutional buyers and accredited investors that agreed to purchase such shares in connection with the Business Combination for aggregate consideration of $475,171,730. |
• | On October 18, 2021, we issued 17,000,000 Vivid Seats $10.00 Exercise Warrants to purchase shares of Class A common stock at an exercise price of $10.00 per share, and 17,000,000 Vivid Seats $15.00 Exercise Warrants to purchase Class A common stock at $15.00 per share, in exchange for Sponsor irrevocably tendering to Horizon all of its Class B ordinary shares of Horizon for cancellation pursuant to the Exchange Agreement. |
• | On December 13, 2021, we agreed to issue 2,143,438 shares of Class A common stock to certain accredited investors in exchange for equity interests of Betcha Sports, Inc. |
† | Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Registrant agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request. |
* | Previously filed. |
VIVID SEATS INC. | ||
By: | /s/ Stanley Chia | |
Stanley Chia | ||
Chief Executive Officer |
Signature |
Title |
Date | ||
/s/ Stanley Chia Stanley Chia |
Chief Executive Officer and Director (principal executive officer) |
March 18, 2022 | ||
* Lawrence Fey |
Chief Financial Officer (principal financial officer) | March 18, 2022 | ||
* Edward Pickus |
Chief Accounting Officer (principal accounting officer) | March 18, 2022 | ||
* Mark Anderson |
Director | March 18, 2022 | ||
* David Donnini |
Director | March 18, 2022 | ||
* Todd Boehly |
Director | March 18, 2022 | ||
* Jane DeFlorio |
Director | March 18, 2022 |
Signature |
Title |
Date | ||
* Craig Dixon |
Director | March 18, 2022 | ||
* Julie Masino |
Director | March 18, 2022 | ||
* Martin Taylor |
Director | March 18, 2022 | ||
* Tom Ehrhart |
Director | March 18, 2022 |
*By: | /s/ Stanley Chia | |
Stanley Chia | ||
Attorney-in-fact |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the use in this Registration Statement No. 333-260839 on Form S-1 of our report dated March 15, 2022 relating to the financial statements of Vivid Seats Inc. We also consent to the reference to us under the heading Experts in such Registration Statement.
/s/ Deloitte & Touche LLP
Chicago, Illinois
March 18, 2022
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Cover Page |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Cover [Abstract] | |
Document Type | POS AM |
Amendment Flag | false |
Entity Registrant Name | Vivid Seats Inc. |
Entity Central Index Key | 0001856031 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Net loss | $ (19,129) | $ (774,185) | $ (53,848) |
Hoya Intermediate, LLC | |||
Net loss | (19,129) | (774,185) | (53,848) |
Other comprehensive income | |||
Unrealized gain (loss) on derivative instruments | 822 | 1,095 | (7,225) |
Comprehensive loss, net of taxes | (18,307) | (773,090) | (61,073) |
Comprehensive loss attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization | (12,836) | $ (773,090) | $ (61,073) |
Comprehensive loss attributable to redeemable noncontrolling interests | (3,010) | ||
Comprehensive loss attributable to Class A Common Stockholders | $ (2,461) |
Consolidated Statements of Equity (Deficit) - USD ($) $ in Thousands |
Total |
Hoya Intermediate, LLC |
Noncontrolling Interest [Member] |
Redeemable Senior Preferred Units |
Redeemable Senior Preferred Units
Hoya Intermediate, LLC
|
Redeemable Preferred Units |
Common Class A [Member]
Hoya Intermediate, LLC
|
Common Class B [Member]
Hoya Intermediate, LLC
|
Common Units [Member] |
Common Units [Member]
Common Class A [Member]
|
Common Units [Member]
Common Class B [Member]
|
Additional Paid-in Capital |
Accumulated Deficit |
Accumulated Other Comprehensive (Income) Loss |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Temporary equity, Balances, shares at Dec. 31, 2018 | 100 | 100 | ||||||||||||
Temporary equity, Balances at Dec. 31, 2018 | $ 182,755 | $ 9,939 | ||||||||||||
Balances, shares at Dec. 31, 2018 | 100 | |||||||||||||
Balances at Dec. 31, 2018 | $ 596,669 | $ 790,003 | $ (198,642) | $ 5,308 | ||||||||||
Net income (loss) | $ (53,848) | (53,848) | (53,848) | |||||||||||
Unrealized gain (loss) on derivative instruments | (7,225) | (7,225) | ||||||||||||
Deemed contribution from former parent | 5,174 | 5,174 | ||||||||||||
Accretion of senior preferred units | (14,399) | $ 14,399 | (14,399) | |||||||||||
Distributions to former parent | (8,095) | (8,095) | ||||||||||||
Temporary equity, Balances, shares at Dec. 31, 2019 | 100 | 100 | ||||||||||||
Temporary equity, Balances at Dec. 31, 2019 | $ 197,154 | $ 9,939 | ||||||||||||
Balances, shares at Dec. 31, 2019 | 100 | |||||||||||||
Balances at Dec. 31, 2019 | 518,276 | 772,683 | (252,490) | (1,917) | ||||||||||
Net income (loss) | (774,185) | (774,185) | (774,185) | |||||||||||
Unrealized gain (loss) on derivative instruments | 887 | 887 | ||||||||||||
Loss reclassified from accumulated other comprehensive loss to earnings | 208 | 208 | ||||||||||||
Deemed contribution from former parent | 4,287 | 4,287 | ||||||||||||
Accretion of senior preferred units | 21,134 | $ 21,134 | 21,134 | |||||||||||
Distributions to former parent | (120) | (120) | ||||||||||||
Temporary equity, Balances, shares at Dec. 31, 2020 | 100 | 100 | 100 | |||||||||||
Temporary equity, Balances at Dec. 31, 2020 | $ 218,288 | $ 218,288 | $ 9,939 | |||||||||||
Balances, shares at Dec. 31, 2020 | 0 | 0 | 100 | |||||||||||
Balances at Dec. 31, 2020 | (271,781) | 755,716 | (1,026,675) | (822) | ||||||||||
Net income (loss) | $ (19,129) | (19,129) | ||||||||||||
Net loss Prior to Reverse Recapitalization | (12,836) | (12,836) | ||||||||||||
Loss Reclassified From Accumulated Other Comprehensive Loss to Earnings Prior to Reverse Recapitalization | 822 | $ 822 | ||||||||||||
Deemed contribution from former parent prior to reverse recapitalization | 3,692 | 3,692 | ||||||||||||
Accretion of Senior Preferred Units Prior to Reverse Recapitalization | (17,738) | $ 17,738 | (17,738) | |||||||||||
Reverse Recapitalization, Net - Shares | (100) | (100) | (100) | 76,948,433 | 118,200,000 | |||||||||
Reverse Recapitalization, Net | 637,361 | $ 84,874 | $ (236,026) | $ (9,939) | $ 8 | $ 12 | 637,341 | 0 | ||||||
Net loss after reverse recapitalization | 3,283 | (3,010) | 3,283 | |||||||||||
Deemed contribution from parent after reverse recapitalization | 293 | 438 | 293 | |||||||||||
Equity-based compensation after reverse recapitalization | 1,624 | 1,624 | ||||||||||||
Change in fair value of warrants | $ 1,269 | $ 1,269 | ||||||||||||
Issuance of shares related to Betcha Acquisition | 21,306 | 2,143,438 | 21,306 | |||||||||||
Dividends paid to Class A Common Shareholders | $ (17,698) | $ (17,698) | ||||||||||||
Subsequent Remeasurement of Noncontrolling interests | (1,203,714) | 1,203,714 | (1,203,714) | |||||||||||
Temporary equity, Balances, shares at Dec. 31, 2021 | 0 | |||||||||||||
Temporary equity, Balances at Dec. 31, 2021 | $ 1,286,016 | $ 0 | ||||||||||||
Balances, shares at Dec. 31, 2021 | 79,091,871 | 118,200,000 | 79,091,871 | 118,200,000 | ||||||||||
Balances at Dec. 31, 2021 | $ (860,683) | $ 8 | $ 12 | $ 182,091 | $ (1,042,794) |
Consolidated Statements of Cash Flows - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Cash flows from operating activities | |||
Net income (loss) | $ (19,129) | $ (774,185) | $ (53,848) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 2,322 | 48,247 | 93,078 |
Amortization of deferred financing costs and interest rate cap | 4,472 | 3,863 | 2,860 |
Loss on disposal of long-lived assets | 169 | 960 | |
Equity-based compensation expense | 6,047 | 4,287 | 5,174 |
Loss on extinguishment of debt | 35,828 | 685 | 2,414 |
Interest expense paid-in-kind | 25,214 | 15,678 | |
Change in fair value of warrants | 1,389 | ||
Impairment charges | 573,838 | ||
Changes in operating assets and liabilities, net of impact of acquisitions: | |||
Accounts receivable | (874) | (10,250) | 225 |
Inventory | (4,311) | 4,094 | (1,628) |
Prepaid expenses and other current assets | 7,623 | (67,584) | 642 |
Accounts payable | 128,160 | (28,674) | 1,792 |
Accrued expenses and other current liabilities | 14,196 | 195,404 | 23,272 |
Deferred revenue | 19,183 | 24 | 2,005 |
Other assets and liabilities | (189) | 512 | (468) |
Net cash provided by (used in) operating activities | 219,931 | (33,892) | 76,478 |
Cash flows from investing activities | |||
Cash acquired (paid) in acquisition | 301 | (31,118) | |
Purchases of property and equipment | (1,132) | (341) | (1,258) |
Proceeds from the sale of personal seat licenses | 170 | ||
Purchases of personal seat licenses | (76) | ||
Investments in developed technology | (8,438) | (7,264) | (7,949) |
Net cash used in investing activities | (9,345) | (7,605) | (40,155) |
Cash flows from financing activities | |||
Proceeds from PIPE Financing | 475,172 | ||
Proceeds from the Merger Transaction | 277,738 | ||
Redemption of Redeemable Senior Preferred Units | (236,026) | ||
Payments of May 2020 First Lien Loan | (304,141) | ||
Prepayment penalty on extinguishment of debt | (27,974) | ||
Proceeds from Revolving Facility | 50,000 | ||
Payments of Revolving Facility | (50,000) | ||
Payments of deferred financing costs and other debt-related costs | (8,479) | (400) | |
Distributions | (120) | (8,095) | |
Payment of reverse recapitalization costs | (20,175) | ||
Dividends paid to Class A Common Stock Shareholders | (17,698) | ||
Net cash (used in) provided by financing activities | (6,113) | 245,545 | (55,462) |
Net increase (decrease) in cash and cash equivalents and restricted cash | 204,473 | 204,048 | (19,139) |
Cash and cash equivalents – beginning of period | 285,337 | 81,289 | 100,428 |
Cash, cash equivalents, and restricted cash - end of period | 489,810 | 285,337 | 81,289 |
Supplemental disclosure of cash flow information: | |||
Paid-in-kind interest added to May 2020 First Lien Loan principal | 28,463 | 15,678 | |
Cash paid for interest | 28,595 | 34,592 | 38,653 |
Betcha acquisition non-cash consideration | 21,306 | ||
June 2017 First Lien Loan | |||
Cash flows from financing activities | |||
Payments of June 2017 First Lien Loan | $ (153,009) | (5,856) | (6,967) |
June 2017 Second Lien Loan | |||
Cash flows from financing activities | |||
Payments of June 2017 Second Lien Loan | $ (40,000) | ||
May 2020 First Lien Loan | |||
Cash flows from financing activities | |||
Proceeds from May 2020 First Lien Loan | $ 260,000 |
Background, Description of Business and basis of presentation |
12 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||
Vivid Seats Inc | |||||||||||||||||||||||||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||||||||||||||||||||||||
BACKGROUND, DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 1. B ACKGROUND , DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Vivid Seats Inc. and its subsidiaries including Hoya Intermediate, LLC and Vivid Seats LLC (collectively the “Company,” “us,” “we,” and “our”), provide an online secondary ticket marketplace, that enables ticket buyers to discover and easily purchase tickets to sports, concerts, theater, and other live events in the United States and Canada. Through our Marketplace segment, we operate an online platform enabling ticket buyers to purchase tickets to live events, while enabling ticket sellers to seamlessly manage their operations. In our Resale segment, we acquire tickets to resell on secondary ticket marketplaces, including our own. Our consolidated financial statements include all of our accounts, including those of our consolidated subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We have included all adjustments necessary for a fair presentation of the results for the full year. These adjustments consist of normal and recurring items. Vivid Seats Inc. was incorporated in Delaware on March 29, 2021 as a wholly owned subsidiary of Hoya Intermediate, LLC (“Hoya Intermediate”). Vivid Seats Inc. was formed for the purpose of completing the transactions contemplated by the definitive transaction agreement, dated April 21, 2021 (the “Transaction Agreement”), by and among Horizon Acquisition Corporation (“Horizon”), a publicly traded special purpose acquisition company, Hoya Intermediate, Hoya Topco, LLC (“Hoya Topco”), a Delaware limited liability company, the Company and the other parties thereto. As more fully described below, on October 18, 2021, the transactions contemplated by the Transaction Agreement were completed. As a result, Vivid Seats Inc. holds approximately 40.1% of the common units of Hoya Intermediate, which represents a controlling interest in Hoya Intermediate. The Merger Transaction and PIPE Financing In connection with the Merger Transaction, Vivid Seats Inc.:
F-9
In connection with the Merger Transaction, Hoya Intermediate issued to Hoya Topco (i) warrants to purchase 3,000,000 shares of Hoya Intermediate common units at an exercise price of $10.00 per share, and (ii) warrants to purchase 3,000,000 shares of Hoya Intermediate common units at an exercise of $15.00 per share (collectively, the “Hoya Intermediate Warrants”). A portion of the Hoya Intermediate Warrants consists of warrants to purchase 1,000,000 Hoya Intermediate common units at exercise prices of $10.00 and $15.00 per unit, respectively, were issued in tandem with stock options issued by Vivid Seats, Inc. to members of our management team (“Option Contingent Warrants”). The Option Contingent Warrants only become available to exercise by Hoya Topco in the event that a corresponding management option is forfeited. For additional details regarding the issuance of warrants in connection with the Merger Transaction, refer to Note 18, Warrants Following the business combination, the legacy unit holders of Hoya Intermediate own a controlling interest in Vivid Seats Inc. through their ownership of Class B common stock in Vivid Seats Inc. COVID-19 UpdateCOVID-19 pandemic has materially impacted our business and results of operations in the years ended December 31, 2021 and 2020. During the year ended December 31, 2020, we recognized impairment charges resulting in a reduction in the carrying values of goodwill, indefinite-lived trademarks, definite-lived intangible assets, and other long-lived assets. Beginning in the second quarter of 2021, and continuing through the fourth quarter of 2021, we have seen a recovery in ticket orders as mitigation measures ease. The
COVID-19 pandemic is evolving, and as new variants emerge the ultimate pace and timing of recovery continues to remain uncertain. We expect uncertainties around our key accounting estimates to continue to evolve depending on the duration and degree of impact associated with the COVID-19 pandemic. Our estimates may change as new events occur and additional information emerges, and such changes are recognized or disclosed in our consolidated financial statements. If economic conditions caused by the pandemic do not continue to recover, our financial condition, cash flows, and results of operations may be further materially impacted. |
Summary of Significant Accounting Policies |
12 Months Ended | |||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||
Hoya Intermediate, LLC | ||||||||||||||||||||||||||||||||||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. S UMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates —We use estimates and assumptions in the preparation of our consolidated financial statements in accordance with GAAP. Our estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Our actual financial results could differ significantly from these estimates. The significant estimates underlying our consolidated financial statements include the accrual for future customer compensation and the related recovery of future customer compensation asset; inventory valuation; accounts receivable valuation; valuation of equity-based compensation; valuation of warrants; valuation of acquired intangible assets and goodwill and valuation of earnouts issued in connection with our acquisition of Betcha Sports, Inc.; breakage rates related to customer credits; useful life of definite-lived intangible assets and other long-lived assets; and impairments of goodwill, indefinite-lived intangible assets, definite-lived intangible assets, and long-lived assets.Cash and Cash Equivalents highly liquid investments purchased with original maturities of three months or less. Our cash and cash equivalents consist primarily of domestic bank accounts, interest-bearing deposit accounts, and money market accounts managed by third-party financial institutions. Cash and cash equivalents held in interest-bearing accounts may exceed the Federal Deposit Insurance Corporation insurance limits. To reduce credit risk, we monitor the credit standing of the financial institutions that hold our cash and cash equivalents. However, balances could be impacted in the future if underlying financial institutions fail. As of December 31, 2021 and 2020, we have not experienced any loss or lack of access to its cash and cash equivalents.Restricted Cash —Restricted cash consists of user funds which are separate from our operational funds and is reserved for users.Accounts Receivable and Credit Policies —Due to the significant number of COVID-19 pandemic related event cancellations experienced during 2021 and 2020, $7.2 million and $23.4 million of the Accounts receivable balance at December 31, 2021 and 2020, respectively, consisted of amounts due from marketplace ticket sellers for cancelled event tickets. There is a concentration of risk associated with that cohort of creditors due to the unfavorable impact of the COVID-19 pandemic on the live event industry. We recorded an allowance for doubtful accounts of $1.4 million and $5.7 million at December 31, 2021 and 2020, respectively to reflect potential challenges in collecting funds from marketplace ticket sellers. The allowance for doubtful accounts decreased during 2021 as ticket sellers on the marketplace platform repaid their outstanding balances. Accounts receivable balances are stated net of allowance for doubtful accounts. Bad debt expense is presented as a reduction of Revenues in the Consolidated Statements of Operations. Write-offs were $1.0 million for the year ended December 31, 2021 and immaterial for the years ended December 31, 2020, and 2019. Inventory —Inventory consists of tickets to live events purchased by our Resale segment. All inventory is valued at the lower of cost or net realizable value, determined by the specific identification method. A provision is recorded to adjust inventory to its estimated realizable value when inventory is determined to be in excess of anticipated demand. During the years ended December 31, 2021, 2020, and 2019, we incurred inventory write-downs of $2.1 million, $1.6 million, and $3.6 million, respectively, which are presented in Cost of revenues in the Consolidated Statements of Operations. Property and Equipment—
Leasehold improvements are amortized over the shorter of the term of the lease or the improvements’ estimated useful lives. Long-Lived Assets Impairment Assessments During the second quarter of 2020, we determined a triggering event occurred that required us to evaluate our long-lived assets for impairment. We recorded an impairment charge as a result of those assessments. Refer to Note 5, Impairments Goodwill and Intangible Assets non-compete agreements, and trademarks. We evaluate goodwill and our indefinite-lived intangible asset for impairment annually on October 31 or more frequently when an event occurs or circumstances change that indicates the carrying value may not be recoverable. We have the option to assess goodwill and our indefinite-lived intangible asset for impairment by first performing a qualitative assessment to determine whether it is more-likely-than-not that the fair value of a reporting unit or the indefinite-lived intangible asset is less than its carrying value. If it is determined that the reporting unit’s or the indefinite-lived intangible asset’s fair value is more-likely-than-not less than its carrying value, or if we do not elect the option to perform an initial qualitative assessment, we perform a quantitative assessment of the reporting unit’s or the indefinite-lived intangible asset’s fair value. If the fair value of the reporting unit or the indefinite-lived intangible asset is in excess of its carrying value, the related goodwill or the indefinite-lived intangible asset is not impaired. If the fair value of the reporting unit is less than the carrying value, we recognize an impairment equal to the difference between the carrying value of the reporting unit and its fair value, not to exceed the carrying value of goodwill. If the fair value of the indefinite-lived intangible asset is less than the carrying value, we recognize an impairment equal to the difference. The fair value of our definite-lived intangible assets is determined using both the market approach and income approach, utilizing Level 3 inputs. We review our definite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If circumstances require a definite-lived intangible asset or its asset group to be held and used be tested for possible impairment, we first compare the undiscounted cash flows expected to be generated by that definite-lived intangible asset or asset group to its carrying amount. If the carrying amount of the definite-lived intangible asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Definite-lived intangible assets are amortized on a straight-line basis over their estimated period of benefit, over the following estimated useful lives:
During the second quarter of 2020, we determined a triggering event occurred that required us to evaluate our goodwill, indefinite-lived intangible asset, and definite-lived intangible assets for impairment, and we recorded an impairment charge as a result of those assessments. Refer to Note 5, Impairments Capitalized Development Costs —We incur costs related to internal-use software and website development. Costs incurred in both the preliminary project stage and post-implementation stage of development are expensed as incurred. Qualifying development costs, including those incurred for upgrades and enhancements that result in additional functionality to existing software, are capitalized. Capitalized development costs are classified as Intangible assets – net on the Consolidated Balance Sheets and amortized using the straight-line method over the estimated useful life of the applicable software. The amortization is presented in Depreciation and amortization expense in the Consolidated Statements of Operations. Accrued Customer Credits —We may issue credits to customers for cancelled events that can be applied to future purchases on our marketplace. The amount recognized in Accrued expenses and other current liabilities in the Consolidated Balance Sheets represents the balance owed to customers on credit. Breakage income from customer credits that are not expected to be used is estimated and recognized as revenue in proportion to the pattern of redemption for the customer credits that are used. When customer credits are used to make a purchase, revenue is recognized for the new transaction. Accrued Future Customer Compensation —Provisions for accrued future customer compensation are included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets and represent compensation to be paid to customers for event cancellations or other service issues related to previously recorded sales transactions. The expected recoveries of these obligations are included in Prepaid expenses and other current assets. These provisions are based on historic experience, revenue volumes for future events, and management’s estimate of the likelihood of future event cancellations and are recognized as a component of Revenue. This estimated accrual could be impacted by future activity differing from our estimates, the effects of which could be material to the consolidated financial statements .F-12 Income Taxes Following the Merger Transaction, our parent legal entity is Vivid Seats Inc. We are subject to income taxes at the U.S. federal, state, and local levels for income tax purposes, including with respect to its allocable share of any taxable income of Hoya Intermediate. Income taxes are accounted for using the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences on differences between the carrying amounts of assets and liabilities and their respective tax basis, using tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is “more-likely-than not” that some portion or all of the deferred tax assets will not be realized. The realization of the deferred tax assets is dependent on the amount of our future taxable income. We recognize interest and penalties related to underpayment of income taxes in Income tax expense on the Consolidated Statements of Operations. To date, the interest or penalties incurred related to income taxes have not been material. Tax Receivable Agreement The amount and timing of future tax benefits Vivid Seats Inc. realizes as a result of future exchanges of Intermediate Common Units by Hoya Topco and other TRA Holders, and the resulting amounts Vivid Seats Inc. will be required to pay to Hoya Topco and other TRA Holders pursuant to the Tax Receivable Agreement, will vary based on, among other things, (i) the amount and timing of future exchanges of Intermediate Common Units by Hoya Topco and other TRA Holders, and the extent to which such exchanges are taxable, (ii) the price per share of the Vivid Seats Class A common stock at the time of the exchanges, (iii) the amount and timing of future income against which to offset the tax benefits, and (iv) the tax rates then in effect. To date, no exchanges of Intermediate Common Units by Hoya Topco or other TRA Holders have occurred, and as a result, we have not recognized a liability under the Tax Receivable Agreement. Debt —Term debt is carried at the outstanding principal balance, less debt issuance costs and any unamortized discount or premium. Deferred borrowing costs and discounts are amortized to interest expense over the terms of the respective borrowings using the effective interest method. Upon the repayment of our term debt, we reflected prepayment penalties and the write-off of any unamortized borrowing costs and discounts as loss on extinguishment of debt on the Consolidated Statements of Operations. Derivatives Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of the gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the earnings effect of the hedged forecasted transactions in a cash flow hedge. We formally evaluate, both at the inception of the hedge and quarterly, whether the derivative financial instrument is highly effective in offsetting changes in cash flows of the related underlying exposure.For derivatives that are designated as, and meet all the required criteria for, a cash flow hedge, the net interest payments are recorded in Interest expense – net in the Consolidated Statements of Operations and the remaining changes in the fair value are recorded in Accumulated other comprehensive loss (“AOCL”) in the Consolidated Balance Sheets and reclassified into earnings as the underlying hedged item affects earnings. Derivative instruments related to our hedging of interest rates are classified within Prepaid expenses and other current assets or Other liabilities in the Consolidated Balance Sheets depending on the nature of the balance at the end of the period. We also entered into a series of warrant agreements in connection with the Merger Transaction. Certain of these warrants are classified as a liability within Other Liabilities in the Consolidated Balance Sheets. Fair Value of Financial Instruments Level 1 Level 2 Level 3 Warrant Accounting —In connection with the Merger Transaction, we issued several types of warrants. We separately evaluate the terms for each of these outstanding warrants in accordance with ASC 480, Distinguishing Liabilities from Equity, 815-40, Derivatives and Hedging: Contracts in an Entity’s Own Equity Redeemable Noncontrolling Interests one-to-one As the redeemable noncontrolling interests are redeemable upon the occurrence of an event that is not solely within our control, we classify our redeemable noncontrolling interests as temporary equity. The redeemable noncontrolling interests were initially measured at Hoya Topco’s share in the net assets of Hoya Intermediate upon consummation of the Merger Transaction. Subsequent remeasurements of our redeemable noncontrolling interests are recorded as a deemed dividend each reporting period, which reduces retained earnings, if any, or additional paid-in capital of Vivid Seats Inc. Remeasurements of our redeemable noncontrolling interests are based on the fair value of our Class A common stock.Offering costs —We incurred incremental costs associated with the Merger Transaction and PIPE Financing related legal, accounting, and other third-party fees. In accordance with Staff Accounting Bulletin (“SAB”) Topic 5.A, Expenses of Offering paid-in capital on the Consolidated Balance Sheets. Our total transaction costs were $32.7Equity-Based Compensation non-directors and on an annual basis over a five-year period for directors. The stock options vest on a quarterly basis over a four-year period and expire ten years from the date of the grant. Both are subject to the employee’s continued employment through the applicable vesting date. The fair value of stock options granted to certain employees is estimated on the grant date using the Hull-White model, a lattice model which assumes holders will exercise when they achieve certain return thresholds. We account for forfeitures in the period they occur. The RSU and stock options grants are accounted for as equity-based compensation. Prior to the Merger Transaction, certain members of management received profit interests in Hoya Topco, LLC and Phantom units in a cash bonus pool funded by Hoya Topco. Under Accounting Standards Codification (“ASC”) 718, Compensation–Stock Compensation Distinguishing Liabilities from Equity A market-based approach was used to determine the total equity value of Hoya Topco and allocate the resulting value between share classes using the Black-Scholes option pricing model to determine the grant date fair value of employee grants. The exercise prices used are based on various scenarios considering the waterfall payout structure of the units that exists at the Hoya Topco, LLC level. For liability-based compensation with service and performance conditions, we recognize a liability for the fair value of the outstanding units only when we conclude it is probable that the performance condition will be achieved. As of December 31, 2021 and 2020, it is not probable the performance condition will be achieved. Segment Reporting— Operating segments are defined as components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and performance assessment. Our CODM is our Chief Executive Officer. We have determined that we have two operating and reportable segments: Marketplace and Resale. Revenue Recognition Revenue from Contracts with Customers We report revenue on a gross or net basis based on management’s assessment of whether we are acting as a principal or agent in the transaction. Revenue is reported net of sales taxes. The determination of whether we are acting as a principal or an agent in a transaction is based on the evaluation of control over the ticket, including the right to sell the ticket, before it is transferred to the ticket buyer. Marketplace We act as an intermediary between ticket buyers and ticket sellers in our online secondary ticketing marketplace. Revenue primarily consists of service fees from ticketing operations and is reduced by incentives provided to ticket buyers. We have one primary performance obligation, facilitating the Marketplace transaction between the ticket seller and ticket buyer and seller, which is satisfied at the time the order is confirmed. In this transaction, we act as an agent as it does not control the ticket prior to it transferring to the ticket buyer. F-15 Revenue is recognized net of the amount due to the seller when the ticket seller confirms an order with the ticket buyer, at which point the seller is obligated to deliver the tickets to the buyer in accordance with the original marketplace listing. Payment from the buyer is due at the time of sale. Our sales terms provide that we will compensate the ticket buyer for the total amount of the purchase if an event is cancelled, the ticket is invalid, or if the ticket is delivered after the promised time. We have determined this is considered a stand-ready obligation to provide a return that is not a separate performance obligation, but is an element of variable consideration, which results in a reduction to revenue. The revenue reversal is reflected within Accrued expenses and other current liabilities in the Consolidated Balance Sheets when the buyer has yet to be compensated. We estimate the customer compensation liability, and corresponding charge against revenue, using the expected value method, which best predicts customer compensation for future cancellations. To the extent we estimate that a portion of the refund is recoverable from the ticket seller, we record the recovery as revenue to align with the net presentation of the original transaction. The timing of event cancellations and rescheduling of postponed events versus new sales transactions can result in customer compensation costs exceeding current period sales resulting in negative marketplace revenue for that period. In certain instances, ticket buyers are compensated with credit to be used on future purchases. When a credit is redeemed, revenue is recognized for the newly placed order. Breakage income from customer credits that are not expected to be used is estimated and recognized as revenue in proportion to the pattern of redemption for the customer credits that are used. We also earn referral commissions on purchases of third-party insurance services by ticket buyers at the time of sale of the associated ticket on the Marketplace platform. Referral commissions are recognized as revenue when the ticket buyer makes a purchase from the third-party insurance provider during customer checkout. Payment from the third-party provider is due to us net 30 from when invoiced. This revenue is included within all categories of Marketplace disaggregated revenue described in Note 4, Revenue Recognition. Resale We sell tickets we own on secondary ticket marketplaces. The Resale business has one performance obligation, which is to transfer control of a live event ticket to a ticket buyer once an order has been confirmed. We act as a principal in these transactions as we own the ticket and therefore controls the ticket prior to transferring the ticket to the customer. Revenue is recorded on a gross basis based on the value of the ticket and is recognized when an order is confirmed in the secondary ticket marketplace. Payment from the marketplace is typically due upon delivery of the ticket or after the event has passed. Secondary ticket marketplace terms and conditions require sellers to repay amounts received for events that are cancelled or tickets that are invalid or delivered after the promised time. We have determined that this obligation is a stand-ready obligation to provide a return that is not a separate performance obligation, but is an element of variable consideration, which results in a reduction to revenue. We recognize a liability for known and estimated cancellation charges within Accrued expenses and other current liabilities in the Consolidated Balance Sheets. We estimate the future customer compensation liability, and corresponding charge against revenue, using the expected value method. To the extent we estimate that a portion of the charge is recoverable from the event host, we record the estimated recovery asset to Prepaid expenses and other current assets. When our Resale business sells a ticket in our own marketplace, the service fee is recorded in Marketplace revenues and the sales price of the ticket is recorded in Resale revenues. Deferred Revenue Deferred revenue consists of fees received related to unsatisfied performance obligations at the end of the period. The majority of the unsatisfied performance obligations are related to our loyalty program, Vivid Seats Rewards. Vivid Seats Rewards allows customers to earn credits on certain purchases and then redeem those credits on future transactions. The credits earned in the program represent a material right to the customer and constitute an additional performance obligation for us. As such, we defer revenue based on expected future usage and recognizes the deferred revenue as credits are redeemed.F-16 Revenues of sales of contingent events, such as postseason sporting events, is initially recorded as Deferred revenue in the Consolidated Balance Sheets and is recognized when the contingency is resolved. Sales Tax —Sales taxes are imposed by state, county, and city governmental authorities. We collect sales tax from the customer where required and remit to the appropriate governmental agency. Collected sales taxes are recorded as a liability until remitted. There is no impact on the Consolidated Statements of Operations as revenue is recorded net of sales tax. Advertising Costs —We utilize various forms of advertising, including paid search, sponsorship agreements, e-mail marketing, and other forms of media. Advertising costs are expensed as incurred and were $180.7 million, $37.5 million, and $175.9 million for the years ended December 31, 2021, 2020, and 2019 respectively. Advertising costs are presented as part of Marketing and selling expense in the Consolidated Statements of Operations. Shipping and Handling —Shipping and handling charges to customers are included in Revenues in the Consolidated Statements of Operations. Shipping and handling costs incurred by us are treated as fulfillment activities, and as such are included in Cost of revenues in the Consolidated Statements of Operations. These costs are accrued upon recognition of revenue. Recent Accounting Pronouncements As an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we are provided the option to adopt new or revised accounting guidance either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as non-public business entities, including early adoption when permissible. The following provides a brief description of recent accounting pronouncements that could have a material effect on our financial statements: Issued accounting standards adopted Income taxes No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Issued accounting standards not yet adopted Leases —In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) right-of-use lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease) in the balance sheet. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. ASU 2020-05, Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities, non-public companies. ASU 2016-02 is now effective for fiscal periods beginning after December 15, 2021. We elected the extended transition period available to emerging growth companies and expects to adopt this guidance using a modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application, January 1, 2022. We expect that this standard will have a material effect on its consolidated financial statements. While we continue to assess all of the effects of the adoption, it currently estimates that the most significant impact upon adoption will be to record operating lease liabilities and right-of-use 2016-02 will also require significant new disclosures about our leases.Financial Instruments-Credit Losses —In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments 2019-10, Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates non-public companies. The standard is effective for non-public companies for fiscal years beginning after December 15, 2022. We elected the extended transition period available to emerging growth companies and is currently evaluating the effect of adoption of the standard on our consolidated financial statements and related disclosures. Reference Rate Reform —In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reportingimpact on its consolidated financial statements and related disclosures. |
Business Acquisition |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition | 3. B USINESS ACQUISITION On December 13, 2021, we acquired 100% of the equity interests of Betcha Sports, Inc. (“Betcha”). Betcha is a real money daily fantasy sports app with social and gamification features. The acquisition was accounted for as an acquisition of a business in accordance with the acquisition method of accounting. Acquisition costs directly related to the transaction were immaterial and are included in General and administrative expenses in the Consolidated Statements of Operations for the year ended December 31, 2021. The purchase consideration transferred consisted of $0.8 million in cash and 2,143,438 shares of Class A common stock. The purchase consideration also includes cash earnouts of $7.5 million as of the acquisition date representing the estimated fair value that we may be obligated to pay if Betcha meets certain earnings objectives following the acquisition. The earnouts are measured at fair value using a Monte Carlo simulation model. In addition, the purchase consideration includes future milestone payments of $9.7 million as of the acquisition date representing the estimated fair value that we may be obligated to pay upon the achievement of certain integration objectives. The milestone payments are measured at fair value using a discounted cash flow valuation approach. As of December 31, 2021, we made no payments related to cash earnouts and milestone payments. As part of the acquisition, we agreed to pay cash bonuses to certain Betcha employees (the “Retention Bonus”) over three years on the payroll date following the anniversary of the acquisition date. The Retention Bonus payouts are subject to the condition of continued employment, and therefore treated as compensation and expensed. Proforma financial information has not been presented as the Betcha acquisition was not considered material to our Consolidated Financial Statements. F-18 The purchase consideration was allocated to the assets acquired and liabilities assumed based on their fair value as of the acquisition date. The excess of the purchase price over the net assets acquired was recorded as goodwill. The goodwill recorded is not deductible for tax purposes as the Betcha acquisition was primarily a stock acquisition and is attributable to the assembled workforce as well as the anticipated synergies from the integration of Betcha’s technology with our technology. The purchase consideration allocation for Betcha is preliminary because the evaluations necessary to assess the fair values of the net assets acquired are still in process. The primary areas that are not yet finalized relate to the valuations of certain intangible assets, cash earnouts, milestone payments, and acquired income tax assets and liabilities. As a result, these allocations are subject to change during the purchase price allocation period as the valuations are finalized. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands):
The following table summarizes the purchase consideration (in thousands):
The following table sets forth the components of identifiable intangible assets acquired (in thousands) and their estimated useful lives (in years) as of the date of acquisition (in thousands):
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Revenue Recognition |
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Revenue Recognition | 4. R EVENUE RECOGNITION We recognize revenue in accordance with ASC 606. We have two reportable segments: Marketplace and Resale. Through the Marketplace segment, we act as an intermediary between ticket buyers and sellers. We earn revenue processing ticket sales from our Owned Properties, consisting of the Vivid Seats website and mobile applications, and from our Private Label offering, which is comprised of numerous distribution partners. During the years ended December 31, 2021, 2020, and 2019 Marketplace revenues consisted of the following (in thousands):
During the years ended December 31, 2021, 2020, and 2019 Marketplace revenues consisted of the following event categories (in thousands):
Within the Resale segment, we sell tickets we hold in inventory on resale ticket marketplaces. Resale revenues were $53.4 million, $11.8 million, and $65.3 million during the years ended December 31, 2021, 2020, and 2019, respectively. At December 31, 2021, Deferred revenue in the Consolidated Balance Sheets was $25.1 million, which primarily relates to Vivid Seats Rewards, our loyalty program. At December 31, 2020, $6.0 million was recorded as deferred revenue, of which $3.3 million was recognized as revenue during the year ended December 31, 2021. Deferred revenue for contingent events at December 31, 2021 and 2020 was immaterial. |
Impairments |
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IMPAIRMENTS | 5. I MPAIRMENTS As disclosed in Note 2, Summary of Significant Accounting Policies During the second quarter of 2020, we identified the COVID-19 pandemic as a triggering event for its long-lived assets, goodwill, indefinite-lived trademark, and definite-lived intangible assets. Due to global social distancing efforts put in place to mitigate the spread of the virus, and compliance with restrictions enacted by various governmental entities, most live events during 2020 were either postponed or cancelled . Consequently, we experienced a significant reduction of revenue during the nine months ended September 30, 2020. The following summarizes the impairment charges recorded by us during the year ended December 31, 2020 (in thousands):
Long-lived asset impairments We assessed its long-lived assets for potential impairment during the second quarter of 2020. ASC 360, Property, Plant, and Equipment assets. For the fair value of the asset group, we compared the expected future undiscounted cash flows associated with the asset group to the long-lived asset group’s carrying value and concluded that the carrying value was not recoverable. We then measured the fair value of the asset group using a discounted cash flow model. The significant estimates used in the undiscounted and discounted cash flow models include projected operating cash flows; forecasted capital expenditures and working capital needs; rates of long-term growth; and the discount rate (in the discounted cash flow model). The significant unobservable inputs included forecasted revenues which reflected significant declines in earlier years as a result of the COVID-19 pandemic and included estimates regarding when revenue would return to pre-pandemic levels. The significant unobservable inputs also included forecasted costs, capital expenditures, and working capital needs which were informed by actual historical experience and estimates of the timing of when live events would return to pre-pandemic levels. Refer to Note 14, Fair Value, No impairment triggering events to our long-lived assets were identified during 2021. Indefinite-lived trademark and goodwill impairments During the second quarter of 2020, we determined that the estimated carrying value of its indefinite-lived trademark was in excess of its fair value. The fair value of the indefinite-lived trademark asset, classified as a Level 3 measurement, was measured using the relief-from-royalty method. This methodology involves estimating reasonable royalty rates for the trademarks, applying the royalty rate to a net sales stream, and utilizing the discounted cash flow method. We utilized a 2.0% royalty rate, consistent with the rate used in the initial valuation of the trademark. We recorded an impairment charge of $78.7 million related to the indefinite-lived trademark. The impairment charge is presented in Impairment charges in the Consolidated Statements of Operations. As part of the goodwill impairment assessment performed during the second quarter of 2020, we determined that the carrying value of its Marketplace reporting unit exceeded its estimated fair value, resulting in a goodwill impairment charge of $377.1 million, which is presented in Impairment charges in the Consolidated Statements of Operations. The fair value estimate of our reporting units was based on a blended analysis of the present value of future discounted cash flows and market value approach, using Level 3 inputs. The significant estimates used in the discounted cash flow models are projected operating cash flows; forecasted capital expenditures and working capital needs; weighted average cost of capital; and rates of long-term growth. These estimates considered the recent deterioration in financial performance of the reporting units, as well as the anticipated rate of recovery, and implied risk premiums based on the market prices of our equity and debt as of the assessment date. The significant estimates used in the market multiple valuation approach include identifying business factors; such as size, growth, profitability, risk and return on investment; and assessing comparable revenue and earnings multiples. Following the impairment charge, the carrying value of the Marketplace reporting unit’s goodwill was $683.3 million. In accordance with its annual re-assessment, we assessed its goodwill and indefinite-lived trademark for impairment as of October 31, 2020, determining no further impairment had occurred. No triggering events were identified during the year ended December 31, 2021. Our goodwill and indefinite-lived trademark constitute nonfinancial assets measured at fair value on a nonrecurring basis. These nonfinancial assets are classified as Level 3 assets in the fair value hierarchy established under ASC Topic 820,
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Property and Equipment | 6. PROPERTY AND EQUIPMENT Long-lived asset impairment charges related to property and equipment of $3.7 million were recognized for the year ended December 31, 2020, resulting in a full impairment of all property and equipment. The impairment charges are presented in Impairment charges in the Consolidated Statements of Operations. The following table summarizes our major classes of property and equipment, net of accumulated depreciation at December 31, 2021 (in thousands):
Depreciation expense related to property and equipment was $0.1 million, $0.6 million, and $1.1 million for the years ended December 31, 2021, 2020, and 2019 respectively, and is presented in Depreciation and amortization expense in the Consolidated Statements of Operations. There were no impairment charges for the years ended December 31, 2021 and 2019. |
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GOODWILL AND INTANGIBLE ASSETS | 7. G OODWILL AND INTANGIBLE ASSETS Definite-lived intangible assets includes developed technology and customer relationships, which had a net carrying amount of $13.8 million and $2.4 million at December 31, 2021 and 2020, respectively. At December 31, 2021 and 2020, accumulated amortization related to our developed technology was $2.5 million and $0.3 million, respectively. Prior to its impairment, recorded during the second quarter of 2020, our definite-lived intangible assets included supplier relationships, customer relationships, and non-compete agreements, in addition to developed technology. Our goodwill is included in our Marketplace segment. The net changes in the carrying amounts of our intangible assets and goodwill were as follows (in thousands):
We had recorded $563.2 million of cumulative impairment charges related to our intangible assets and goodwill as of December 31, 2021 and 2020. Amortization expense on our definite-lived intangible assets was $2.3 million, $47.4 million, and $91.5 million for the years ended December 31, 2021, 2020, and 2019, respectively, and is presented in Depreciation and amortization in the Consolidated Statements of Operations. The estimated future amortization expense related to the definite-lived intangible assets as of December 31, 2021 is a follows (in thousands): |
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PREPAID EXPENSES AND OTHER CURRENT ASSETS | 8. P REPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets at December 31, 2021 and 2020 consist of the following (in thousands):
Recovery of future customer compensation represents expected recoveries of compensation to be paid to customers for event cancellations or other service issues related to previously recorded sales transactions. Recovery of future customer compensation costs decreased by $16.9 million during the year ended December 31, 2021, due to a reduction in the estimated rate of future cancellations in 2021 compared to 2020, partially offset by an increase in order volume. The provision related to these expected recoveries are included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets. Prepaid expenses increased by $7.3 million primarily related to a $4.5 million prepayment in a legal settlement pool. Other current assets was $4.1 million at December 31, 2021 due to a deposit associated with a corporate credit card. |
Accrued Expenses and Other Current Liabilities |
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ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 9. A CCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities at December 31, 2021 and 2020 consist of the following (in thousands):
Accrued customer credits represent credits issued and outstanding for event cancellations or other service issues related to recorded sales transactions. The accrued amount is reduced by the amount of credits estimated to go unused, which is recognized in proportion to the pattern of redemption for the customer credits. During the year ended December 31, 2021, $55.9 million of accrued customer credits were redeemed and we recognized $3.3 million of revenue from breakage. During the year ended December 31, 2020, $7.4 million of accrued customer credits were redeemed and we recognized $0.8 million of revenue from breakage. Accrued future customer compensation represents an estimate of the amount of customer compensation due from cancellation charges in the future. These provisions are based on historic experience, revenue volumes for future events, and management’s estimate of the likelihood of future event cancellations and are recognized as a component of Revenues. The expected recoveries of these obligations are included in Prepaid expenses and other current assets in the Consolidated Balance Sheets. This estimated accrual could be impacted by future activity differing from our estimates, the effects of which could be material. During the years ended December 31, 2021, 2020, and 2019, we recognized an increase in revenue of $5.1 million, a decrease in revenue of $15.3 million, and an increase in revenue of $0.4 million, respectively, from the reversals of previously recorded revenue and changes to accrued future customer compensation related to event cancellations where the performance obligations were satisfied in prior periods. Accrued contingencies includes the current portion of cash earnouts of $3.9 million that we may be obligated to pay if Betcha meets certain earnings objectives following the acquisition. In addition, it includes the current portion of future milestone payments of $8.8 million upon the achievement of certain integration objectives. Accrued marketing expense and other current liabilities increased during the year ended December 31, 2021 due primarily to the increased volume of sales transactions occurring on our platform. Accrued taxes decreased as we have h istorically accrued sales tax expense in jurisdictions where we expected to remit sales tax payments but were not yet collecting from ticket buyers. During the second half of 2 021, we began collecting sales tax from customers. The majority of the tax accrual represents the exposure for sales tax prior to the date we began collecting sales tax from customers reduced by abatements received. Refer to Note 15, Commitments and Contingencies, for further discussion of the accrued tax expense. |
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Debt | 10. DEBT Our outstanding debt at December 31, 2021 and 2020 is comprised of the following (in thousands):
First Lien Loans On May 22, 2020, we entered into a new $260.0 million first lien term loan (the “May 2020 First Lien Loan”) that is pari passu with the June 2017 First Lien Loan. The proceeds from the May 2020 First Lien Loan were used for general corporate purposes and to extinguish and retire the Revolving Facility in full. On October 18, 2021, in connection with and using the proceeds from the Merger Transaction , we paid off in full its May 2020 First Lien LoanAll obligations under the June 2017 First Lien Loan and May 2020 First Lien Loan are unconditionally guaranteed by Hoya Intermediate and substantially all Hoya Intermediate’s existing and future direct and indirect wholly owned domestic subsidiaries. The amortization of original issue discount and debt issuance costs on the June 2017 First Lien Loan and May 2020 First Lien Loan was $3.6 million, $3.7 million, and $2.9 million for the years ended December 31, 2021, 2020, and 2019, respectively, and is presented in Interest expense – net in the Consolidated Statements of Operations. The key terms of our debt agreements are as follows: June 2017 First Lien Loan The June 2017 First Lien Loan is required to be prepaid, subject to certain exceptions, upon the following conditions: (i) up to 50.0% of excess cash flow subject to certain leverage ratios; (ii) all of the net cash proceeds of certain asset sales or insurance/condemnation events subject to certain leverage ratios; and (iii) all of the net cash proceeds of any issuance or incurrence of debt other than permitted debt. At our option, the June 2017 First Lien Loan bears periodic interest of either (A) the LIBOR rate plus an applicable margin, ranging from 3.00% to 3.50% per annum based on the our first lien net leverage ratio, or (B) the base rate plus an applicable margin, ranging from 2.00% to 2.50% per annum based on our first lien net leverage ratio. The LIBOR rate for the June 2017 First Lien Loan is subject to a 1.00% floor. The effective interest rate on the June 2017 First Lien Loan was 4.5% per annum at December 31, 2021 and 2020. May 2020 First Lien Loan The interest rate for the May 2020 First Lien Loan was determined using a LIBOR rate plus an applicable margin of 9.50% per annum, or a base rate plus an applicable margin of 8.50% per annum. The LIBOR rate was subject to a 1.00% floor and the base rate was subject to a 2.00% floor. For any period ending prior to May 22, 2022, we had the option of submitting paid-in-kind paid-in-kind paid-in-kind Under the terms of the May 2020 First Lien Loan, for certain prepayments and repricing transactions that occurred prior to May 22, 2023, we would owe a prepayment penalty of 3.0% on the first $91.0 million of prepayments. For prepayments greater than $91.0 million prior to May 22, 2022, the amount exceeding $91.0 million would be subject to a prepayment penalty equal to the greater of i) 6.0% and ii) the excess of the discounted measure of principal and interest due upon the second anniversary of the effective date and the outstanding principal at the time of the prepayment. For prepayments greater than $91.0 million on or after May 22, 2022 and prior to May 22, 2023, the amount exceeding $91.0 million would be subject to a prepayment penalty equal to 6.0% . The following is a summary of activity related to debt instruments during the years ended December 31, 2021 and 2020: June 2017 First Lien Loan principal payments May 2020 First Lien Loan borrowing and payoff On October 18, 2021, in connection with, and using the proceeds from, the Merger Transaction, we paid off in full the remaining principal on the May 2020 First Lien Loan of $304.1 million. The debt extinguishment resulted in a loss of $34.1 million, which is presented in Loss on extinguishment of debt in the Consolidated Statements of Operations. The loss consists of a $28.0 million prepayment penalty and the remaining balance of the original issuance discount and issuance costs of $6.1 million. Revolving Facility drawdown and repayment Future maturities of our outstanding debt, excluding interest, as of December 31, 2021 were as follows (in thousands):
We are subject to certain reporting and compliance-related covenants to remain in good standing under the June 2017 First Lien Loan. These covenants, among other things, limit our ability to incur additional indebtedness, and in certain circumstances, create restrictions on the ability to enter into transactions with affiliates; create liens; merge or consolidate; and make certain payments.
Non-compliance with these covenants and failure to remedy could result in the acceleration of the loans or foreclosure on the collateral. As of December 31, 2021, we were in compliance with all of its debt covenants related to the June 2017 First Lien Loan. |
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FINANCIAL INSTRUMENTS | 11. F INANCIAL INSTRUMENTS Derivatives The financial instruments entered into by us are typically executed over-the- counter .Fair Value Interest Rate Swaps On November 10, 2017, we purchased pay-fixed, receive-float interest rate swaps with a combined notional value of $520.7 million on September 30, 2020. The interest rate swaps matured on September 30, 2020. The interest rate swaps had a fixed rate of 1.9%. The interest rate swaps were purchased to reduce a portion of the exposure to fluctuations in LIBOR interest rates associated with our variable-rate term loan. The objective in using the swaps was to add stability to interest expense and to manage the exposure to interest rate movements. The interest rate swaps are designated as effective cash flow hedges involving the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreement without exchange of the underlying notional amount. We performed a regression analysis at inception of the hedging relationship to assess the effectiveness. The design of the regression analysis addresses the effectiveness of the hedging relationship by considering how the hedge instrument performs against the forecasted transaction or hypothetical interest rate swaps over historical months. The changes in the fair value of the hedge instrument and the hedged item over the historical months demonstrated the effectiveness of the hedge relationship as the prospective and retrospective test. On an ongoing basis, we assessed hedge effectiveness prospectively and retrospectively. The hedge continued to be highly effective through its maturity date. The amount recognized in Interest expense — net in the Consolidated Statements of Operations was $4.3 million and $2.1 million for the year ended December 31, 2020 and 2019. Interest Rate Cap On November 26, 2018, we entered into an interest rate cap with an effective date of September 30, 2020. We paid $1.0 million to enter into the cap. The notional value was $516.8 million on September 30, 2021. The interest rate cap matured on September 30, 2021. The interest rate cap had a strike rate of 3.5%. The interest rate cap was purchased to reduce a portion of the exposure to fluctuations in LIBOR interest rates associated with our variable-rate term loan. The objective in using the cap is to add stability to interest expense and to manage the exposure to interest rate movements. Interest rate caps involve the borrower paying the hedge provider an initial one-time fee in exchange for the hedge provider paying the borrower the excess of the floating interest rate payment above a strike rate, in the event that the floating interest rate is greater than the strike rate during the period between the effective date and maturity date. We performed a regression analysis at inception of the hedging relationship to assess the effectiveness. The design of the regression analysis addressed the effectiveness of the hedging relationship by considering how the hedge instrument performs against the forecasted transaction or hypothetical interest rate cap over historical months. Historical changes in the fair value of the hedge instrument and the underlying item demonstrated the effectiveness of the hedging relationship. On an ongoing basis, we assess hedge effectiveness prospectively and retrospectively. The hedge continued to be highly effective through its maturity. The interest rate cap is measured at fair value, which was zero at December 31, 2020. Effect of Derivative Contracts on Accumulated Other Comprehensive Loss (“AOCL”) and Earnings Since we designated the financial instruments as effective cash flow hedges that qualify for hedge accounting, net interest payments are recorded in Interest expense – net in the Consolidated Statements of Comprehensive Income (Loss), and unrealized gains or losses resulting from adjusting the financial instruments to fair value are recorded as a component of Other comprehensive loss and subsequently reclassified into earnings in the same period during which the hedged transaction affects earnings. During the years ended December 31, 2021 and 2020, we reclassified losses of $0.8 million and $0.2 million, respectively, into Interest expense – net from AOCL related to the interest rate cap. Cash flows resulting from settlements are presented as a component of cash flows from operating activities within the Consolidated Statements of Cash Flows. The following table presents the effects of hedge accounting on AOCL for the year ended December 31, 2021 for interest rate contracts designated as cash flow hedges (in thousands):
The following table presents the effects of hedge accounting on AOCL for the year ended December 31, 2020 for interest rate contracts designated as cash flow hedges (in thousands):
We also entered into certain warrant agreements in connection with the Merger Transaction. Refer to Note 18,
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Retirement Benefits [Abstract] | |
Employee Benefit Plan | 12. E MPLOYEE BENEFIT PLAN We have a defined contribution and profit-sharing 401(k) plan that covers substantially all employees who meet eligibility requirements. Participants may contribute to the plan, through regular payroll deductions, an amount subject to limitations imposed by the Internal Revenue Code. The plan also provides for discretionary profit-sharing contributions and matching contributions. We contributed approximately $0.8 million, $0.9 million, and $1.1 million in matching contributions for the years ended December 31, 2021, 2020, and 2019, respectively, and is included in General and administrative expense in the Consolidated Statements of Operations. For the years ended December 31, 2021, and 2020, there were no discretionary profit-sharing contributions. |
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Income Taxes | 13. INCOME TAXES We are subject to U.S. federal and state income taxes with respect to our allocable share of any taxable income or loss of Hoya Intermediate generated after the Merger Transaction, as well as any stand-alone income or loss we generate. Hoya Intermediate is organized as a limited liability company and treated as a partnership for federal tax purposes, with the exception to the Canadian operations of Vivid Seats Canada Ltd. (formerly Fanxchange Ltd.), which we acquired in 2019. Instead, Hoya Intermediate’s taxable income or loss is passed through to its members, including Vivid Seats Inc. Vivid Seats Inc. files and pays corporate income taxes for U.S. federal and state income tax purposes. We anticipate this structure to remain in existence for the foreseeable future. Components of loss from continuing operations before income taxes for the years ended December 31 were as follows (in thousands):
Prior to 2021, we did not incur material amounts of income tax expense or have material income tax liability or deferred tax balances. During 2021, significant components of income tax expense were as follows (in thousands):
A reconciliation of income taxes computed at the U.S. federal statutory income tax rate of 21% to our income tax expense was as follows:
As of December 31, 2021, our deferred tax balances consisted of the following (in thousands):
We recognize deferred tax assets to the extent we believe these assets are more likely than not to be realized. Valuation allowances have been established primarily with regard to the tax benefits of certain net operating losses, tax credits, as well as its investment in partnerships. In making such a determination, we considered all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations. After considering all those factors, we recorded $145.7 million of a valuation allowance against our deferred tax assets, as these assets are not more likely than not to be realized. F-29 At December 31, 2021, we had U.S. state operating loss carryforwards totaling $16.1 million, U.S federal operating loss carryforwards totaling $32.0 million. The U.S. federal and state operating loss carryforwards begin to expire in 2029 with $33.7 million of the operating loss carryforwards having no expiration date. At December 31, 2021, with respect to our operations outside the U.S., we had foreign operating loss carryforwards totaling $6.1 million. The foreign operating loss carryforwards begin to expire in 2022. At December 31, 2021, we were not indefinitely reinvested on undistributed earnings from its foreign operations and the deferred tax liability associated with the future repatriation of these earnings is expected to be immaterial. ASC 740, Income Taxes, prescribes a recognition threshold of more-likely-than not to be sustained upon examination as it relates to the accounting for uncertainty in income tax benefits recognized in an enterprise’s financial statements. We note that as of December 31, 2021, we had no uncertain tax positions recorded in any jurisdiction. We are subject to routine audits by taxing jurisdictions. The periods subject to tax audits are 2017 through 2021. There are currently no audits for any tax periods in progress. |
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FAIR VALUE | 14. F AIR VALUE Recurring Our financial assets and liabilities are valued using market prices on both active markets (Level 1), less active markets (Level 2) and little or no market activity (Level 3). Level 1 instrument valuations are obtained from unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 instrument valuations are obtained from readily available pricing sources for comparable instruments, identical instruments in less active markets, or models using other inputs that are directly or indirectly observable in the marketplace. Level 3 instrument valuations typically reflect management’s estimate of assumptions and are derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. We did not have any transfers of financial instruments between valuation levels during the years ended December 31, 2021 and 2020. Cash and cash equivalents include all cash balances and highly liquid investments purchased with maturities of three months or less. Our cash and cash equivalents consist primarily of domestic bank accounts, interest-bearing deposit accounts, and money market accounts managed by third-party financial institutions. Cash and cash equivalents are valued by us based on quoted prices in an active market, which represent a Level 1 measurement within the fair value hierarchy. The fair value for our derivative instruments is based upon inputs corroborated by observable market data with similar tenors, which are considered Level 2 inputs. Refer to Note 11, Financial Instruments, Our June 2017 First Lien Loan is held by third-party financial institutions and is carried at the outstanding principal balance, less debt issuance costs and any unamortized discount or premium. The fair value was estimated using quoted prices that are directly observable in the marketplace, therefore, the fair value is estimated on a Level 2 basis. At December 31, 2021, the June 2017 First Lien Loan had a fair value of $465.1 millionDebt information. Our May 2020 First Lien Loan is not traded and is carried at the outstanding principal balance, less debt issuance costs and any unamortized discount or premium. The fair value was estimated by discounting the future cash flows using current interest rates at which similar borrowings with similar maturities would be made to borrowers with similar credit ratings. The fair value was estimated assuming prepayment of the loan upon the loan’s third anniversary and is estimated on a Level 3 basis, as provided by ASC Topic 820, Fair Value Measurement Debt Refer to Note 10, Debt In Connection with the Merger Transaction, we issued Hoya Intermediate Warrants to Hoya Topco, which are classified as Other Liabilities on the Consolidated Balance Sheets. The Hoya Intermediate Warrants are remeasured to fair value each reporting period using the Black-Scholes valuation model. Significant inputs used in the valuation of the Hoya Intermediate Warrants include the volatility, risk-free interest rate, and dividend yield. Other financial instruments, including accounts receivable and accounts payable, are carried at cost, which approximates their fair value because of the short-term nature of these instruments. Nonrecurring Our non-financial assets, such as goodwill, intangible assets, and long-lived assets are measured at fair value on a nonrecurring basis, utilizing Level 3 inputs. The following table presents quantitative information about the significant unobservable inputs applied to these Level 3 fair value measurements during our assessment for impairment in the second quarter of 2020:
The following table presents the sensitivities to changes in the significant unobservable inputs above (in thousands):
Refer to Note 5,
Impairments |
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COMMITMENTS AND CONTINGENCIES | 15. C OMMITMENTS AND CONTINGENCIES Our future minimum cash obligations as of December 31, 2021, were as follows (in thousands):
Operating Leases non-cancelable operating leases expiring at various dates through November 2025. The leases require monthly rental payments, which escalate over the term of the leases. We are also responsible for our proportionate share of real estate taxes, insurance, and common area maintenance. Rent expense was $3.7 million, $2.8 million, and $2.7 million for the years ended December 31, 2021, 2020, and 2019, respectively, and is included in General and administrative expense in the Consolidated Statements of Operations. During 2021, we early terminated our headquarters lease and recorded a $1.3 million lease termination expense in General and administrative expense in the Consolidated Statements of Operations. We entered into a new 11-year lease expiring on December 31, 2034 with an annual payment ranging from $1.5 million to $1.8 million. Lease expense is recognized on a straight-line basis over the term of the lease. The excess of straight-line expense over cash paid is shown as a deferred rent liability and is recorded in Other liabilities in the Consolidated Balance Sheets. The leases also require security deposits which are recorded as a component of Other non-current assets in the Consolidated Balance Sheets. Purchase Obligations non-cancelable arrangements, primarily related to the purchase of marketing services and tickets at an agreed upon price. Litigation We are a co-defendant in a class action lawsuit in Canada alleging a failure to disclose service fees prior to checkout. On January 5, 2022, we issued coupons to certain members of the class. Other members will be notified in 2022 that they are eligible to submit a claim for a coupon. As of December 31, 2021 and 2020, a liability of $0.9 million and $1.1 million, respectively, was recorded in Accrued expenses and other current liabilities in the Consolidated Balance Sheets related to expected credit redemptions as of the measurement date. We received multiple class action lawsuits related to customer compensation for cancellations, primarily as a result of COVID-19 restrictions. A final order approving settlement of one of the lawsuits was entered by the court on November 1, 2021. As such, after insurance, $ 4.5 million was funded to a claims settlement pool and is included in Prepaid expenses and other current assets in the Consolidated Balance Sheets. As of December 31, 2021 and 2020, we had accrued a liability of $ 1.7 million and $ 2.6 million, respectively, in Accrued expenses and other current liabilities in the Consolidated Balance Sheets related to these matters. We expect to recover some of these costs under our insurance policies and have separately recognized an insurance recovery asset of $ 0.5 million and $ 2.5 million, respectively, within Prepaid expenses and other current assets in the Consolidated Balance Sheets at December 31, 2021 and 2020. Other Wayfair Inc., which overturned previous case law that had precluded states from imposing sales tax collection requirements on retailers without a physical presence in the state. In response, most states have adopted laws that attempt to impose tax collection obligations on out-of-state We have recognized a liability for this potential tax of $8.8 million and $16.8 million at December 31, 2021 and 2020, respectively. This liability is recorded in Accrued expenses and other current liabilities in the Condensed Consolidated Balance Sheets. The related sales tax expense was $9.0 million, $6.8 million, and $10.0 million for the years ended December 31, 2021, 2020, and 2019, respectively, which reflects uncollected amounts owed to jurisdictions reduced by abatements received. |
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SEGMENT REPORTING | 16. S EGMENT REPORTING Our reportable segments are Marketplace and Resale. Through the Marketplace segment, we act as an intermediary between ticket buyers and sellers within our online secondary ticket marketplace. Through the Resale segment, we acquire tickets from primary sellers, which it then sells through secondary ticket marketplaces. Revenues and contribution margin are used by our Chief Operating Decision Maker (“CODM”) to assess performance of the business. We define contribution margin as revenues less cost of revenues and marketing and selling expenses. We do not report our assets, capital expenditures, or related depreciation and amortization expenses by segment, because our CODM does not use this information to evaluate the performance of our operating segments. The following table represents our segment information for the year ended December 31, 2021 (in thousands):
The following table represents our segment information for the year ended December 31, 2020 (in thousands):
The following table represents our segment information for the year ended December 31, 2019 (in thousands):
Substantially all of our sales occur and assets reside in the United States. |
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Vivid Seats Inc | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Equity | 17. E QUITY For periods prior to the Merger Transaction, Hoya Intermediate had Senior Preferred Units, Preferred Units, and Common Units, described below, authorized, issued and outstanding. As described in Note 1, Background, Description of Business and Basis of Presentation Hoya Intermediate Senior Preferred Units, Preferred Units, and Common Units Prior to the Merger Transaction, Hoya Intermediate had authorized and issued 100 units of Redeemable Senior Preferred Units, 100 units of Redeemable Preferred Units and 100 common units. The Senior Preferred Units held first and second priority liquidation preference: first for an amount equal to the sum of the amount of the aggregate unpaid yield and aggregate unreturned capital, and second for payment of any reasonable out-of-pocket Senior Preferred Units compounded semi-annually at a per annum yield rate of 12.5%. Unit holders were entitled to distributions when declared by our former parent, Hoya Topco, LLC. As of December 31, 2020, no distributions toward unpaid yield or unreturned capital were made. As of December 31, 2020 and up to the Merger Transaction, the Senior Preferred Units and Preferred Units were deemed to be currently redeemable and were measured at the maximum redemption amount, with the offset recorded to Additional paid-in capital on the Consolidated Balance Sheets. Therefore, the Senior Preferred Units were accreted to an amount equal to their liquidation preference plus the applicable premium, and the Preferred Units were carried at an amount equal to their unreturned capital. In connection with the Merger Transaction, the Senior Preferred Units and the Preferred Units were redeemed and no longer remain outstanding. As of December 31, 2021, 197,291,871 Common Units of Hoya Intermediate are outstanding. Vivid Seats Inc. holds 40.1% of the outstanding Common Units in Hoya intermediate as of December 31, 2021, with the remainder held by Hoya Topco. Vivid Seats Inc. Class A Common Stock In connection with the Merger Transaction, Vivid Seats Inc. issued 29,431,260 shares of Class A common stock. We issued an additional 2,143,438 shares of Class A common stock as part of the acquisition of Betcha. Holders of Class A common stock are entitled to full economic rights, including the right to receive dividends when and if declared by our Board, subject to any statutory or contractual restrictions on the payment of dividends and to any restrictions on the payment of dividends imposed by the terms of any outstanding preferred stock. Each holder of Class A common stock is entitled to one vote for each share of Class A common stock held. Vivid Seats Inc. Class B Common Stock In connection with the Merger Transaction, Vivid Seats Inc. issued 118,200,000 shares of Class B common stock. Holders of Class B common stock do not have economic rights but are entitled to one vote for each share of Class B common stock held. Holders of Class A common stock and Class B common stock vote as a single class on all matters requiring a shareholder vote. Following the Merger Transaction, the quantity of Vivid Seats Inc. Class A common stock and Class B common stock is equal to the quantity of Hoya Intermediate common units outstanding. Warrants In connection with the Merger Transaction, we issued Public Warrants, Private Warrants, and Exercise Warrants (collectively, the “Class A Warrants”), which are recorded as a component of equity. |
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Warrants | 18. Warrants Class A Warrants Public Warrants The Public Warrants became exercisable 30 days following the Merger transaction and expire at the earliest of five years following the Merger Transaction, liquidation of the Company, or the date of redemption elected at our option provided that the value of common stock exceeds $18.00 per share. There is an effective registration statement and prospectus relating to the shares issuable upon exercise of the warrants. Under certain circumstances, we may elect to redeem the Public Warrants at a redemption price of $0.01 per Public Warrant at any time during the term of the warrant in which our Class A common stock share trading price has been at least $18.00 per share for 20 trading days within the 30 trading-day period. If we elect to redeem the warrants, it must notify the Public Warrant holders in advance, who would then have at least 30 days from the date of notification to exercise their respective warrants. If the warrant is not exercised within that 30-day period, it will be redeemed pursuant to this provision. As of December 31, 2021, we had 18,132,776 outstanding public warrants to purchase 18,132,776 shares of our Class A common stock. As part of the Merger Transaction, we modified the terms of the Public Warrants. The modification resulted in a transfer of incremental value of $1.3 million to the holders of the Public Warrants, which we recorded as Other expenses in the Consolidated Statements of Operations. Private Warrants except that the Private Warrants are not redeemable by us. As of December 31, 2021, we had 6,519,791 outstanding private warrants to purchase 6,519,791 shares of our Class A common stock. As part of the Merger Transaction, we modified the terms of the Private Warrants. The modification did not result in a transfer of incremental value to the warrant holders. Exercise Warrants As of December 31, 2021, we had 34,000,000 outstanding Exercise Warrants to purchase 34,000,000 shares of our Class A common stock. As the Class A Warrants are indexed to our equity and meet the equity classification guidance of ASC 815-40, we reflect these warrants as a component of equity within additional paid-in capital. Upon the valid exercise of a Class A Warrant for Class A common shares of Vivid Seats Inc., Hoya Intermediate will issue to Vivid Seats Inc. an equivalent number of Intermediate Common Units. Hoya Intermediate Warrants Our Hoya Intermediate Warrants are exercisable for Hoya Intermediate common units, which allow for a potential cash redemption at the discretion of the unit holder. Hence, the Hoya Intermediate Warrants are classified as a liability in Other liabilities on our Consolidated Balance Sheets. Upon consummation of the Merger Transaction, we recorded a warrant liability of $20.4 million, reflecting the fair value of the Hoya Intermediate Warrants determined using the Black Scholes model. The fair value of the Hoya Intermediate Warrants includes Option Contingent Warrants of $1.6 million. The estimated fair value of the Option Contingent Warrants is adjusted to reflects the probability of forfeiture of the corresponding stock options based on historical forfeiture rates for Hoya Topco profits interests. The following assumptions were used to calculate the fair value of the Hoya Intermediate and Option Contingent Warrants at December 31, 2021 and upon consummation of the Merger Transaction:
For the period from October 18, 2021 until December 31, 2021, we recognized a charge to Other expenses on the Consolidated Statements of Operations resulting from an increase in the fair value of the warrants of $0.1 million. Upon the valid exercise of a Hoya Intermediate Warrant for Common Units in Hoya Intermediate, Vivid Seats Inc. will issue an equivalent amount of Vivid Seats Inc. Class B common shares to Hoya Topco. |
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Noncontrolling Interest [Abstract] | |
Non-Controlling Interest | 19. R EDEEMABLE NONCONTROLLING INTERESTS As of December 31, 2021, Hoya Topco owns 59.9% of the Common Units of Hoya Intermediate and 40.1% of the voting power. Hoya Topco has the right to exchange its common units in Hoya Intermediate for shares of Vivid Seats Class A common stock on a one-to-one The financial results of Hoya Intermediate and its subsidiaries are consolidated with Vivid Seats Inc., with the redeemable noncontrolling interests’ share of our net loss separately allocated. |
Equity-Based Compensation |
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-Based Compensation | 20. E QUITY -BASED COMPENSATION The 2021 Incentive Award Plan (“2021 Plan”) was approved and adopted in order to facilitate the grant of equity incentive awards to our employees and directors. The 2021 Plan became effective on October 18, 2021 upon closing of the Merger Transaction. RSUs On October 19, 2021, we granted 1,408,773 RSUs to directors and certain employees. RSUs granted to directors vest on an annual basis over a five-year period, subject to the directors’ continued service on the Board. RSUs granted to employees vest on a quarterly basis over a four-year period, subject to the employee’s continued employment through the applicable vesting date. We account for forfeitures of outstanding, but unvested grants, in the period they occur. A summary of activity for RSUs for the year ended December 31, 2021 is as follows (in thousands):
Unrecognized compensation expense relating to unvested RSUs as of December 31, 2021, was $16.9 million, which is expected to be recognized over a weighted average period of approximately four years. Stock options On October 19, 2021, we granted 3,061,486 stock options at an exercise price of $13.09 and 1,000,000 stock options at an exercise price of $15.00 to certain employees. Stock options provide for the purchase of shares of Vivid Seats Class A common stock in the future at an exercise price set on the grant date. These stock options vest on a quarterly basis over a four-year period and expire ten years from the date of the grant, subject to the employee’s continued employment through the applicable vesting date. Unrecognized compensation expense relating to unvested stock options as of December 31, 2021, was $14.5 million, which is expected to be recognized over a weighted average period of approximately four years. No stock options were exercised or forfeited during the year ended December 31, 2021. The fair value of stock options granted is estimated on the grant date using the Hull-White model. This valuation model requires us to make assumptions and judgments about the variables used in the calculation, including the sub-optimal exercise factor (“SOEF”), the volatility of our common stock, risk-free interest rate, and expected dividends. We use the Hull-White model under the SEC’s Staff Accounting Bulletin No. 107, Share-Based Payment, as the options were effectively out of the money on the date of grant as we had announced, but not issued, a one-time dividend. Changes in assumptions made on the risk-free rate of interest, and expected volatility can materially impact the estimate of fair value and ultimately how much share-based compensation expense is recognized. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and corresponds to the full term of the options. The expected volatility is estimated on the date of grant based on the statistics of historical stock return volatility of comparable publicly-traded companies as well as the implied volatility of our publicly traded warrants. The following assumptions were used to calculate the fair value of our stock awards on the date of grant for the year ended December 31, 2021:
Profits interest and Phantom Units Prior to the Merger Transaction, certain members of management received equity-based compensation awards for profits interest in Hoya Topco, LLC in the form of Incentive Units, Phantom Units, Class D Units, and Class E Units. Each incentive unit vests ratably over five years and accelerates upon a change in control of Hoya Topco, LLC. We do not expect any future profits interest to be granted after the Merger Transaction. The fair value of the incentive units granted is estimated using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires certain subjective inputs and assumptions, including the fair value Hoya Topco’s equity, the expected term, risk-free interest rates, and expected equity volatility. The fair value of incentive units is recognized as equity-based compensation expense on a straight-line basis over the requisite service period. We account for forfeitures as they occur. Changes in assumptions made on expected term, the risk-free rate of interest, and expected volatility can materially impact the estimate of fair value and ultimately how much share-based compensation expense is recognized. The expected term is estimated based on the timing and probabilities until a major liquidity event. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and corresponds to the expected term. The expected volatility is estimated on the date of grant based on the average historical stock price volatility of comparable publicly-traded companies. The following table summarizes the Hoya Topco, LLC Incentive Units, Class D Units, and Class E Units for the years ended December 31, 2021, 2020, and 2019:
Unrecognized compensation expense as of December 31, 2021 related to these incentive units was $9.1 million, which is expected to be recognized over a weighted average period of approximately three years. The following assumptions were used to calculate the fair value of our unit awards on the date of grant for the years ended December 31, 2020 and 2019:
Compensation expense For the years ended December 31, 2021, 2020 and 2019, equity-based compensation expense related to RSUs, stock options and profits interest was $6.0 million, $4.3 million and $5.2 million, respectively. Our Board declared a special dividend of $0.23 per share to holders of Class A Common Stock on October 18, 2021, which we paid on November 2, 2021. On November 2, 2021, the exercise price was modified and reduced by the same $0.23 per share. The amount recognized in the compensation expense relating to stock option modifications for the year ended December 31, 2021 is immaterial. |
Loss Per Share |
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Loss Per Share | 21. L OSS PER SHARE We calculate basic and diluted net loss per share of Class A common stock in accordance with ASC 260, Earnings per Share. Net loss per Class A common stock–diluted is based on the average number of shares of Class A common stock used for the basic earnings per share calculation, adjusted for the weighted-average number of common share equivalents outstanding for the period determined using the treasury stock method and if-converted method, as applicable. Net loss attributable to Class A Common Stockholders–diluted is adjusted for our share of Hoya Intermediate’s consolidated net loss after giving effect to Common Units of Hoya Intermediate that convert into potential shares of Class A common stock, to the extent it is dilutive. In addition, Net loss attributable to Class A Common Stockholders–diluted is adjusted for the impact of changes in the fair value of Hoya Intermediate Warrants, to the extent they are dilutive. We analyzed the calculation of loss per share for periods prior to the Merger Transaction and determined that it resulted in values that would not be meaningful to the users of the consolidated financial statements. Therefore, loss per share information has not been presented for periods prior to the Merger Transaction. The following table sets forth the computation of basic and diluted net loss per share of Class A common stock and represents the period from October 18, 2021 to December 31, 2021, the period where the Company had Class A and Class B common stock outstanding (in thousands, except share and per share data):
Potential shares of common stock are excluded from the computation of diluted net loss per share if their effect would have been anti-dilutive for the period presented or if the issuance of shares is contingent upon events that did not occur by the end of the period. The following table presents potentially dilutive securities excluded from the computation of diluted net loss per share for the period presented:
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Related-Party Transactions |
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Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | 22. R ELATED -PARTY TRANSACTIONS In December 2020, Vivid Cheers Inc. (“Vivid Cheers”) was incorporated as a
non-profit organization within the meaning of Section 501(c)(3) of the Internal Revenue Code. Vivid Cheers’ mission is to support causes and organizations dedicated to healthcare, education, and support of workers in the live events industry during times of need. We have the right to elect the Board of Directors of Vivid Cheers, which currently comprises our executives. We do not have a controlling financial interest in Vivid Cheers, and accordingly, do not consolidate Vivid Cheers’ statement of activities with its financial results. We made charitable contributions of $2.4 million and $0.5 million for the years ended December 31, 2021 and 2020, respectively to Vivid Cheers. We had accrued charitable contributions payable of $1.3 million and $0.5 million as of December 31, 2021 and 2020, respectively, and is included in Accrued expenses and other current liabilities in the Consolidated Balance Sheet. |
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Hoya Intermediate, LLC | |
Subsequent Event [Line Items] | |
SUBSEQUENT EVENTS | 23. S UBSEQUENT EVENTS On February 3, 2022, we repaid $190.7 million of outstanding June 2017 First Lien Loan. We entered into an amendment which refinances the remaining existing term loan with a new $275.0 million term loan with a maturity date of February 3, 2029, adds a new revolving credit facility in an aggregate principal amount of $100.0 million with a maturity date of February 3, 2027, replaces the LIBOR based floating interest rate with a term SOFR based floating interest rate and revises the springing financial covenant to require compliance with a first lien net leverage ratio. |
Summary of Significant Accounting Policies (Policies) |
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Use of Estimates | Use of Estimates —We use estimates and assumptions in the preparation of our consolidated financial statements in accordance with GAAP. Our estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Our actual financial results could differ significantly from these estimates. The significant estimates underlying our consolidated financial statements include the accrual for future customer compensation and the related recovery of future customer compensation asset; inventory valuation; accounts receivable valuation; valuation of equity-based compensation; valuation of warrants; valuation of acquired intangible assets and goodwill and valuation of earnouts issued in connection with our acquisition of Betcha Sports, Inc.; breakage rates related to customer credits; useful life of definite-lived intangible assets and other long-lived assets; and impairments of goodwill, indefinite-lived intangible assets, definite-lived intangible assets, and long-lived assets. |
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Cash and Cash Equivalents | Cash and Cash Equivalents highly liquid investments purchased with original maturities of three months or less. Our cash and cash equivalents consist primarily of domestic bank accounts, interest-bearing deposit accounts, and money market accounts managed by third-party financial institutions. Cash and cash equivalents held in interest-bearing accounts may exceed the Federal Deposit Insurance Corporation insurance limits. To reduce credit risk, we monitor the credit standing of the financial institutions that hold our cash and cash equivalents. However, balances could be impacted in the future if underlying financial institutions fail. As of December 31, 2021 and 2020, we have not experienced any loss or lack of access to its cash and cash equivalents. |
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Restricted Cash | Restricted Cash —Restricted cash consists of user funds which are separate from our operational funds and is reserved for users. |
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Accounts Receivable and Credit Policies | Accounts Receivable and Credit Policies —Due to the significant number of COVID-19 pandemic related event cancellations experienced during 2021 and 2020, $7.2 million and $23.4 million of the Accounts receivable balance at December 31, 2021 and 2020, respectively, consisted of amounts due from marketplace ticket sellers for cancelled event tickets. There is a concentration of risk associated with that cohort of creditors due to the unfavorable impact of the COVID-19 pandemic on the live event industry. We recorded an allowance for doubtful accounts of $1.4 million and $5.7 million at December 31, 2021 and 2020, respectively to reflect potential challenges in collecting funds from marketplace ticket sellers. The allowance for doubtful accounts decreased during 2021 as ticket sellers on the marketplace platform repaid their outstanding balances. Accounts receivable balances are stated net of allowance for doubtful accounts. Bad debt expense is presented as a reduction of Revenues in the Consolidated Statements of Operations. Write-offs were $1.0 million for the year ended December 31, 2021 and immaterial for the years ended December 31, 2020, and 2019. |
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Inventory | Inventory —Inventory consists of tickets to live events purchased by our Resale segment. All inventory is valued at the lower of cost or net realizable value, determined by the specific identification method. A provision is recorded to adjust inventory to its estimated realizable value when inventory is determined to be in excess of anticipated demand. During the years ended December 31, 2021, 2020, and 2019, we incurred inventory write-downs of $2.1 million, $1.6 million, and $3.6 million, respectively, which are presented in Cost of revenues in the Consolidated Statements of Operations. |
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Property and Equipment | Property and Equipment—
Leasehold improvements are amortized over the shorter of the term of the lease or the improvements’ estimated useful lives. |
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Long-Lived Assets Impairment Assessments | Long-Lived Assets Impairment Assessments During the second quarter of 2020, we determined a triggering event occurred that required us to evaluate our long-lived assets for impairment. We recorded an impairment charge as a result of those assessments. Refer to Note 5,
Impairments |
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Goodwill and Intangible Assets | Goodwill and Intangible Assets non-compete agreements, and trademarks. We evaluate goodwill and our indefinite-lived intangible asset for impairment annually on October 31 or more frequently when an event occurs or circumstances change that indicates the carrying value may not be recoverable. We have the option to assess goodwill and our indefinite-lived intangible asset for impairment by first performing a qualitative assessment to determine whether it is more-likely-than-not that the fair value of a reporting unit or the indefinite-lived intangible asset is less than its carrying value. If it is determined that the reporting unit’s or the indefinite-lived intangible asset’s fair value is more-likely-than-not less than its carrying value, or if we do not elect the option to perform an initial qualitative assessment, we perform a quantitative assessment of the reporting unit’s or the indefinite-lived intangible asset’s fair value. If the fair value of the reporting unit or the indefinite-lived intangible asset is in excess of its carrying value, the related goodwill or the indefinite-lived intangible asset is not impaired. If the fair value of the reporting unit is less than the carrying value, we recognize an impairment equal to the difference between the carrying value of the reporting unit and its fair value, not to exceed the carrying value of goodwill. If the fair value of the indefinite-lived intangible asset is less than the carrying value, we recognize an impairment equal to the difference. The fair value of our definite-lived intangible assets is determined using both the market approach and income approach, utilizing Level 3 inputs. We review our definite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. If circumstances require a definite-lived intangible asset or its asset group to be held and used be tested for possible impairment, we first compare the undiscounted cash flows expected to be generated by that definite-lived intangible asset or asset group to its carrying amount. If the carrying amount of the definite-lived intangible asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Definite-lived intangible assets are amortized on a straight-line basis over their estimated period of benefit, over the following estimated useful lives:
During the second quarter of 2020, we determined a triggering event occurred that required us to evaluate our goodwill, indefinite-lived intangible asset, and definite-lived intangible assets for impairment, and we recorded an impairment charge as a result of those assessments. Refer to Note 5,
Impairments |
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Capitalized Development Costs | Capitalized Development Costs —We incur costs related to internal-use software and website development. Costs incurred in both the preliminary project stage and post-implementation stage of development are expensed as incurred. Qualifying development costs, including those incurred for upgrades and enhancements that result in additional functionality to existing software, are capitalized. Capitalized development costs are classified as Intangible assets – net on the Consolidated Balance Sheets and amortized using the straight-line method over the estimated useful life of the applicable software. The amortization is presented in Depreciation and amortization expense in the Consolidated Statements of Operations. |
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Accrued Customers Credits | Accrued Customer Credits —We may issue credits to customers for cancelled events that can be applied to future purchases on our marketplace. The amount recognized in Accrued expenses and other current liabilities in the Consolidated Balance Sheets represents the balance owed to customers on credit. Breakage income from customer credits that are not expected to be used is estimated and recognized as revenue in proportion to the pattern of redemption for the customer credits that are used. When customer credits are used to make a purchase, revenue is recognized for the new transaction. |
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Accrued Future Customer Compensation | Accrued Future Customer Compensation —Provisions for accrued future customer compensation are included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets and represent compensation to be paid to customers for event cancellations or other service issues related to previously recorded sales transactions. The expected recoveries of these obligations are included in Prepaid expenses and other current assets. These provisions are based on historic experience, revenue volumes for future events, and management’s estimate of the likelihood of future event cancellations and are recognized as a component of Revenue. This estimated accrual could be impacted by future activity differing from our estimates, the effects of which could be material to the consolidated financial statements .F-12 |
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Income Taxes | Income Taxes Following the Merger Transaction, our parent legal entity is Vivid Seats Inc. We are subject to income taxes at the U.S. federal, state, and local levels for income tax purposes, including with respect to its allocable share of any taxable income of Hoya Intermediate. Income taxes are accounted for using the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences on differences between the carrying amounts of assets and liabilities and their respective tax basis, using tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is “more-likely-than not” that some portion or all of the deferred tax assets will not be realized. The realization of the deferred tax assets is dependent on the amount of our future taxable income. We recognize interest and penalties related to underpayment of income taxes in Income tax expense on the Consolidated Statements of Operations. To date, the interest or penalties incurred related to income taxes have not been material. Tax Receivable Agreement The amount and timing of future tax benefits Vivid Seats Inc. realizes as a result of future exchanges of Intermediate Common Units by Hoya Topco and other TRA Holders, and the resulting amounts Vivid Seats Inc. will be required to pay to Hoya Topco and other TRA Holders pursuant to the Tax Receivable Agreement, will vary based on, among other things, (i) the amount and timing of future exchanges of Intermediate Common Units by Hoya Topco and other TRA Holders, and the extent to which such exchanges are taxable, (ii) the price per share of the Vivid Seats Class A common stock at the time of the exchanges, (iii) the amount and timing of future income against which to offset the tax benefits, and (iv) the tax rates then in effect. To date, no exchanges of Intermediate Common Units by Hoya Topco or other TRA Holders have occurred, and as a result, we have not recognized a liability under the Tax Receivable Agreement. |
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Debt | Debt —Term debt is carried at the outstanding principal balance, less debt issuance costs and any unamortized discount or premium. Deferred borrowing costs and discounts are amortized to interest expense over the terms of the respective borrowings using the effective interest method. Upon the repayment of our term debt, we reflected prepayment penalties and the write-off of any unamortized borrowing costs and discounts as loss on extinguishment of debt on the Consolidated Statements of Operations. |
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Derivatives | Derivatives Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of the gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the earnings effect of the hedged forecasted transactions in a cash flow hedge. We formally evaluate, both at the inception of the hedge and quarterly, whether the derivative financial instrument is highly effective in offsetting changes in cash flows of the related underlying exposure.For derivatives that are designated as, and meet all the required criteria for, a cash flow hedge, the net interest payments are recorded in Interest expense – net in the Consolidated Statements of Operations and the remaining changes in the fair value are recorded in Accumulated other comprehensive loss (“AOCL”) in the Consolidated Balance Sheets and reclassified into earnings as the underlying hedged item affects earnings. Derivative instruments related to our hedging of interest rates are classified within Prepaid expenses and other current assets or Other liabilities in the Consolidated Balance Sheets depending on the nature of the balance at the end of the period. We also entered into a series of warrant agreements in connection with the Merger Transaction. Certain of these warrants are classified as a liability within Other Liabilities in the Consolidated Balance Sheets. |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments Level 1 Level 2 Level 3 |
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Warrant Accounting | Warrant Accounting —In connection with the Merger Transaction, we issued several types of warrants. We separately evaluate the terms for each of these outstanding warrants in accordance with ASC 480, Distinguishing Liabilities from Equity, 815-40, Derivatives and Hedging: Contracts in an Entity’s Own Equity |
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Redeemable noncontrolling interests | Redeemable Noncontrolling Interests one-to-one As the redeemable noncontrolling interests are redeemable upon the occurrence of an event that is not solely within our control, we classify our redeemable noncontrolling interests as temporary equity. The redeemable noncontrolling interests were initially measured at Hoya Topco’s share in the net assets of Hoya Intermediate upon consummation of the Merger Transaction. Subsequent remeasurements of our redeemable noncontrolling interests are recorded as a deemed dividend each reporting period, which reduces retained earnings, if any, or additional paid-in capital of Vivid Seats Inc. Remeasurements of our redeemable noncontrolling interests are based on the fair value of our Class A common stock. |
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Offering costs | Offering costs —We incurred incremental costs associated with the Merger Transaction and PIPE Financing related legal, accounting, and other third-party fees. In accordance with Staff Accounting Bulletin (“SAB”) Topic 5.A, Expenses of Offering paid-in capital on the Consolidated Balance Sheets. Our total transaction costs were $32.7 |
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Equity-Based Compensation | Equity-Based Compensation non-directors and on an annual basis over a five-year period for directors. The stock options vest on a quarterly basis over a four-year period and expire ten years from the date of the grant. Both are subject to the employee’s continued employment through the applicable vesting date. The fair value of stock options granted to certain employees is estimated on the grant date using the Hull-White model, a lattice model which assumes holders will exercise when they achieve certain return thresholds. We account for forfeitures in the period they occur. The RSU and stock options grants are accounted for as equity-based compensation. Prior to the Merger Transaction, certain members of management received profit interests in Hoya Topco, LLC and Phantom units in a cash bonus pool funded by Hoya Topco. Under Accounting Standards Codification (“ASC”) 718, Compensation–Stock Compensation Distinguishing Liabilities from Equity A market-based approach was used to determine the total equity value of Hoya Topco and allocate the resulting value between share classes using the Black-Scholes option pricing model to determine the grant date fair value of employee grants. The exercise prices used are based on various scenarios considering the waterfall payout structure of the units that exists at the Hoya Topco, LLC level. For liability-based compensation with service and performance conditions, we recognize a liability for the fair value of the outstanding units only when we conclude it is probable that the performance condition will be achieved. As of December 31, 2021 and 2020, it is not probable the performance condition will be achieved. |
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Segment Reporting | Segment Reporting— Operating segments are defined as components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and performance assessment. Our CODM is our Chief Executive Officer. We have determined that we have two operating and reportable segments: Marketplace and Resale. |
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Revenue Recognition | Revenue Recognition Revenue from Contracts with Customers We report revenue on a gross or net basis based on management’s assessment of whether we are acting as a principal or agent in the transaction. Revenue is reported net of sales taxes. The determination of whether we are acting as a principal or an agent in a transaction is based on the evaluation of control over the ticket, including the right to sell the ticket, before it is transferred to the ticket buyer. Marketplace We act as an intermediary between ticket buyers and ticket sellers in our online secondary ticketing marketplace. Revenue primarily consists of service fees from ticketing operations and is reduced by incentives provided to ticket buyers. We have one primary performance obligation, facilitating the Marketplace transaction between the ticket seller and ticket buyer and seller, which is satisfied at the time the order is confirmed. In this transaction, we act as an agent as it does not control the ticket prior to it transferring to the ticket buyer. F-15 Revenue is recognized net of the amount due to the seller when the ticket seller confirms an order with the ticket buyer, at which point the seller is obligated to deliver the tickets to the buyer in accordance with the original marketplace listing. Payment from the buyer is due at the time of sale. Our sales terms provide that we will compensate the ticket buyer for the total amount of the purchase if an event is cancelled, the ticket is invalid, or if the ticket is delivered after the promised time. We have determined this is considered a stand-ready obligation to provide a return that is not a separate performance obligation, but is an element of variable consideration, which results in a reduction to revenue. The revenue reversal is reflected within Accrued expenses and other current liabilities in the Consolidated Balance Sheets when the buyer has yet to be compensated. We estimate the customer compensation liability, and corresponding charge against revenue, using the expected value method, which best predicts customer compensation for future cancellations. To the extent we estimate that a portion of the refund is recoverable from the ticket seller, we record the recovery as revenue to align with the net presentation of the original transaction. The timing of event cancellations and rescheduling of postponed events versus new sales transactions can result in customer compensation costs exceeding current period sales resulting in negative marketplace revenue for that period. In certain instances, ticket buyers are compensated with credit to be used on future purchases. When a credit is redeemed, revenue is recognized for the newly placed order. Breakage income from customer credits that are not expected to be used is estimated and recognized as revenue in proportion to the pattern of redemption for the customer credits that are used. We also earn referral commissions on purchases of third-party insurance services by ticket buyers at the time of sale of the associated ticket on the Marketplace platform. Referral commissions are recognized as revenue when the ticket buyer makes a purchase from the third-party insurance provider during customer checkout. Payment from the third-party provider is due to us net 30 from when invoiced. This revenue is included within all categories of Marketplace disaggregated revenue described in Note 4, Revenue Recognition. Resale We sell tickets we own on secondary ticket marketplaces. The Resale business has one performance obligation, which is to transfer control of a live event ticket to a ticket buyer once an order has been confirmed. We act as a principal in these transactions as we own the ticket and therefore controls the ticket prior to transferring the ticket to the customer. Revenue is recorded on a gross basis based on the value of the ticket and is recognized when an order is confirmed in the secondary ticket marketplace. Payment from the marketplace is typically due upon delivery of the ticket or after the event has passed. Secondary ticket marketplace terms and conditions require sellers to repay amounts received for events that are cancelled or tickets that are invalid or delivered after the promised time. We have determined that this obligation is a stand-ready obligation to provide a return that is not a separate performance obligation, but is an element of variable consideration, which results in a reduction to revenue. We recognize a liability for known and estimated cancellation charges within Accrued expenses and other current liabilities in the Consolidated Balance Sheets. We estimate the future customer compensation liability, and corresponding charge against revenue, using the expected value method. To the extent we estimate that a portion of the charge is recoverable from the event host, we record the estimated recovery asset to Prepaid expenses and other current assets. When our Resale business sells a ticket in our own marketplace, the service fee is recorded in Marketplace revenues and the sales price of the ticket is recorded in Resale revenues. Deferred Revenue Deferred revenue consists of fees received related to unsatisfied performance obligations at the end of the period. The majority of the unsatisfied performance obligations are related to our loyalty program, Vivid Seats Rewards. Vivid Seats Rewards allows customers to earn credits on certain purchases and then redeem those credits on future transactions. The credits earned in the program represent a material right to the customer and constitute an additional performance obligation for us. As such, we defer revenue based on expected future usage and recognizes the deferred revenue as credits are redeemed.F-16 Revenues of sales of contingent events, such as postseason sporting events, is initially recorded as Deferred revenue in the Consolidated Balance Sheets and is recognized when the contingency is resolved. |
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Sales Tax | Sales Tax —Sales taxes are imposed by state, county, and city governmental authorities. We collect sales tax from the customer where required and remit to the appropriate governmental agency. Collected sales taxes are recorded as a liability until remitted. There is no impact on the Consolidated Statements of Operations as revenue is recorded net of sales tax. |
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Advertising Costs | Advertising Costs —We utilize various forms of advertising, including paid search, sponsorship agreements, e-mail marketing, and other forms of media. Advertising costs are expensed as incurred and were $180.7 million, $37.5 million, and $175.9 million for the years ended December 31, 2021, 2020, and 2019 respectively. Advertising costs are presented as part of Marketing and selling expense in the Consolidated Statements of Operations. |
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Shipping and Handling | Shipping and Handling —Shipping and handling charges to customers are included in Revenues in the Consolidated Statements of Operations. Shipping and handling costs incurred by us are treated as fulfillment activities, and as such are included in Cost of revenues in the Consolidated Statements of Operations. These costs are accrued upon recognition of revenue. |
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Recent Accounting Pronouncements | Recent Accounting Pronouncements As an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we are provided the option to adopt new or revised accounting guidance either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as non-public business entities, including early adoption when permissible. The following provides a brief description of recent accounting pronouncements that could have a material effect on our financial statements: Issued accounting standards adopted Income taxes No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Issued accounting standards not yet adopted |
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Leases | Leases —In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) right-of-use lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease) in the balance sheet. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. ASU 2020-05, Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities, non-public companies. ASU 2016-02 is now effective for fiscal periods beginning after December 15, 2021. We elected the extended transition period available to emerging growth companies and expects to adopt this guidance using a modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application, January 1, 2022. We expect that this standard will have a material effect on its consolidated financial statements. While we continue to assess all of the effects of the adoption, it currently estimates that the most significant impact upon adoption will be to record operating lease liabilities and right-of-use 2016-02 will also require significant new disclosures about our leases. |
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Financial Instruments Credit Losses | Financial Instruments-Credit Losses —In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments 2019-10, Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates non-public companies. The standard is effective for non-public companies for fiscal years beginning after December 15, 2022. We elected the extended transition period available to emerging growth companies and is currently evaluating the effect of adoption of the standard on our consolidated financial statements and related disclosures. |
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Reference Rate Reform | Reference Rate Reform —In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reportingimpact on its consolidated financial statements and related disclosures. |
Summary of Significant Accounting Policies (Tables) - Hoya Intermediate, LLC |
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Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||||||||||||||||||
Schedule of Estimated Useful Life | Depreciation is computed using the straight-line method over the following estimated useful lives:
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Schedule of Definite-Lived Intangible Assets Amortized | Definite-lived intangible assets are amortized on a straight-line basis over their estimated period of benefit, over the following estimated useful lives:
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Business Acquisition (Tables) |
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Schedule of Estimated Fair Values of the Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands):
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Schedule of Components of Intangible Assets Acquired | The following table sets forth the components of identifiable intangible assets acquired (in thousands) and their estimated useful lives (in years) as of the date of acquisition (in thousands):
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Schedule of Purchase Consideration | The following table summarizes the purchase consideration (in thousands):
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Revenue Recognition (Tables) |
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Disaggregation of Revenue [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Market Place Revenues | During the years ended December 31, 2021, 2020, and 2019 Marketplace revenues consisted of the following (in thousands):
During the years ended December 31, 2021, 2020, and 2019 Marketplace revenues consisted of the following event categories (in thousands):
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Impairments (Tables) |
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Acquired Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||
Summary of Impairment Charges | The following summarizes the impairment charges recorded by us during the year ended December 31, 2020 (in thousands):
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Property and Equipment (Tables) |
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Schedule of Property and Equipment | The following table summarizes our major classes of property and equipment, net of accumulated depreciation at December 31, 2021 (in thousands):
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Goodwill and Intangible Assets (Tables) - Hoya Intermediate, LLC |
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Schedule of Goodwill and Intangible Assets | The net changes in the carrying amounts of our intangible assets and goodwill were as follows (in thousands):
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Summary of Estimated Future Amortization Expenses | The estimated future amortization expense related to the definite-lived intangible assets as of December 31, 2021 is a follows (in thousands):
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Prepaid Expenses and Other Current Assets (Tables) |
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Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets at December 31, 2021 and 2020 consist of the following (in thousands):
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Accrued Expenses and Other Current Liabilities (Tables) |
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Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities at December 31, 2021 and 2020 consist of the following (in thousands):
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Debt (Tables) |
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Summary of Outstanding Debt | Our outstanding debt at December 31, 2021 and 2020 is comprised of the following (in thousands):
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Summary of Future Maturities of Outstanding Debt | Future maturities of our outstanding debt, excluding interest, as of December 31, 2021 were as follows (in thousands):
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Financial Instruments (Tables) |
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Summary of Effects of Hedge Accounting and Interest Rate Swaps | The following table presents the effects of hedge accounting on AOCL for the year ended December 31, 2021 for interest rate contracts designated as cash flow hedges (in thousands):
The following table presents the effects of hedge accounting on AOCL for the year ended December 31, 2020 for interest rate contracts designated as cash flow hedges (in thousands):
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Income Taxes (Tables) |
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Schedule of Income (Loss) from Continuing Operations Before Income Taxes | Components of loss from continuing operations before income taxes for the years ended December 31 were as follows (in thousands):
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Schedule of Components of Income Tax Expense (Benefit) | During 2021, significant components of income tax expense were as follows (in thousands):
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Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of income taxes computed at the U.S. federal statutory income tax rate of 21% to our income tax expense was as follows:
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Schedule of Deferred Tax Assets and Liabilities | As of December 31, 2021, our deferred tax balances consisted of the following (in thousands):
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Summary Of Valuation Allowance |
Fair Value (Tables) - Hoya Intermediate, LLC |
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Schedule of Significant Unobservable Inputs for Level 3 Fair Value Measurement | The following table presents quantitative information about the significant unobservable inputs applied to these Level 3 fair value measurements during our assessment for impairment in the second quarter of 2020:
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Changes in Significant Unobservable Inputs | The following table presents the sensitivities to changes in the significant unobservable inputs above (in thousands):
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Commitment and Contingencies (Tables) |
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Hoya Intermediate, LLC | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Future Minimum Cash Obligations | Our future minimum cash obligations as of December 31, 2021, were as follows (in thousands):
|
Segment Reporting (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Hoya Intermediate, LLC | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Information | The following table represents our segment information for the year ended December 31, 2021 (in thousands):
The following table represents our segment information for the year ended December 31, 2020 (in thousands):
The following table represents our segment information for the year ended December 31, 2019 (in thousands):
|
Warrants (Tables) - Hoya Intermediate, LLC |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Option Contingent Warrants | The following table presents quantitative information about the significant unobservable inputs applied to these Level 3 fair value measurements during our assessment for impairment in the second quarter of 2020:
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Option Contingent Warrants [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Option Contingent Warrants | The following assumptions were used to calculate the fair value of the Hoya Intermediate and Option Contingent Warrants at December 31, 2021 and upon consummation of the Merger Transaction:
|
Equity-Based Compensation (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Activity for RSUs | A summary of activity for RSUs for the year ended December 31, 2021 is as follows (in thousands):
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Fair Value Assumptions for Stock Option at the Date of Grant | The following assumptions were used to calculate the fair value of our stock awards on the date of grant for the year ended December 31, 2021:
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Hoya Topco, LLC | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Activity for Unit Awards | The following table summarizes the Hoya Topco, LLC Incentive Units, Class D Units, and Class E Units for the years ended December 31, 2021, 2020, and 2019:
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Fair Value Assumptions for Unit Awards at the Date of Grant | The following assumptions were used to calculate the fair value of our unit awards on the date of grant for the years ended December 31, 2020 and 2019:
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Loss Per Share (Tables) - Hoya Intermediate, LLC |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per share of Class A common stock and represents the period from October 18, 2021 to December 31, 2021, the period where the Company had Class A and Class B common stock outstanding (in thousands, except share and per share data):
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Summary of Potentially Dilutive Securities | The following table presents potentially dilutive securities excluded from the computation of diluted net loss per share for the period presented:
|
Background, Description of Business and basis of presentation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Oct. 18, 2021 |
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Defined Benefit Plan Disclosure [Line Items] | |||
Merger Transaction fees | $ 54,300 | ||
Acquisition of noncontrolling interests from Business Transaction | $ 32,700 | ||
Common Units [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Equity Method Investment, Ownership Percentage | 40.10% | ||
Class A Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock issued during period, shares | 29,431,260 | 2,143,438 | |
Stock value issued for exercise of warrants | 6,519,791 | ||
Warrant exercise price per share | $ 11.50 | ||
Class B Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock issued during period, shares | 118,200,000 | ||
Horizon Sponsor LLC | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Cash and cash equivalents | $ 293,200 | ||
Stock issued during period, values | 475,200 | ||
Repayments of debt | 482,400 | ||
Acquisition of noncontrolling interests from Business Transaction | $ 18,700 | ||
Horizon Sponsor LLC | Class A Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock issued during period, shares | 50,000 | ||
Stock Issued During Period, Shares, New Issues | 47,517,173 | ||
Warrant exercise price per share | $ 10.00 | ||
Vivid Seats Inc | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Equity Method Investment, Ownership Percentage | 40.10% | ||
Payments of Stock Issuance Costs | $ 15,500 | ||
Vivid Seats Inc | Class A Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Warrant exercise price per share | $ 15.00 | ||
Hoya Intermediate, LLC | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Equity Method Investment, Ownership Percentage | 40.10% | ||
Cash and cash equivalents | $ 489,530 | $ 285,337 | |
Redemption of preferred units | $ 236,000 | ||
Stock value issued for exercise of warrants | 1,000,000 | 1,000,000 | |
Hoya Intermediate, LLC | Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Warrant exercise price per share | $ 15.00 | ||
Hoya Intermediate, LLC | Minimum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Warrant exercise price per share | $ 10.00 | ||
Public Warrants | Class A Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock value issued for exercise of warrants | 18,132,776 | ||
Warrant exercise price per share | $ 11.50 | ||
Public Warrants | Class B Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock value issued for exercise of warrants | 6,000,000 | ||
Warrant exercise price per share | $ 0.001 | ||
Public Warrants | Horizon Sponsor LLC | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock value issued for exercise of warrants | 5,166,666 | ||
Public Warrants | Horizon Sponsor LLC | Class A Common Stock | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock issued during period, shares | 18,132,776 | ||
Stock value issued for exercise of warrants | 17,000,000 | 18,132,776 | |
Warrant exercise price per share | $ 11.50 | ||
Public Warrants | Hoya Intermediate, LLC | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock value issued for exercise of warrants | 3,000,000 | ||
Warrant exercise price per share | $ 10.00 | ||
Public Warrants | Hoya Intermediate, LLC | Common Units [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Stock value issued for exercise of warrants | 3,000,000 | ||
Warrant exercise price per share | $ 15.00 |
Summary of Significant Accounting Policies (Additional Information) (Details) |
12 Months Ended | |||
---|---|---|---|---|
Oct. 19, 2021 |
Dec. 31, 2021
USD ($)
Segment
|
Dec. 31, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
|
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Allowance for doubtful accounts | $ 1,400,000 | $ 5,700,000 | ||
Bad debt ,Write-offs | 1,000,000.0 | |||
Inventory write down | $ 2,100,000 | 1,600,000 | $ 3,600,000 | |
Number of operating segments | Segment | 2 | |||
Number of reportable segments | Segment | 2 | |||
Advertisement expenses | $ 180,700,000 | 37,500,000 | $ 175,900,000 | |
Tax benefit percent under tax receivable agreement | 85.00% | |||
Liability under the tax receivable agreement | $ 0 | |||
Acquisition of noncontrolling interests from Business Transaction | 32,700,000 | |||
Gross proceeds | 20,200 | |||
Operating Lease, Liability | $ 6,500,000 | |||
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Operating Lease, Liability | |||
Significant Impact Upon Adoption [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Operating Lease, Right-of-Use Asset | $ 9,000,000.0 | |||
Class A Common Stock | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Conversion Basis | one-to-one | |||
Hoya Intermediate, LLC | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 40.10% | |||
RSUs | Directors | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Vesting period | 5 years | 5 years | ||
RSUs | Non Directors | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Vesting period | 4 years | |||
Options [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Vesting period | 4 years | |||
Expiration period | 10 years | |||
Covid-19 | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Accounts receivable | $ 7,200,000 | $ 23,400,000 |
Summary of Significant Accounting Policies - Estimated Useful Lives of Property and Equipment (Details) |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life, years | 5 years |
Purchased Software [Member] | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life, years | 3 years |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment useful life, years | 7 years |
Summary of Significant Accounting Policies - Estimated Useful Lives of Definite Lived Intangible Assets (Details) |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Non Competition Agreements [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 3 years |
Supplier Relationships [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 4 years |
Developed Technology [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 3 years |
Developed Technology [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 5 years |
Customer Relationships [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 2 years |
Customer Relationships [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Definite lived intangible assets useful life, years | 5 years |
Business Acquisition - (Additional Information) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 13, 2021 |
Oct. 18, 2021 |
Dec. 31, 2021 |
|
Business Acquisition [Line Items] | |||
Cash Earnouts | $ 0 | ||
Fair value of milestone payments | 0 | ||
Betcha | |||
Business Acquisition [Line Items] | |||
Acquisition Date | Dec. 13, 2021 | ||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||
Cash | $ 759 | $ 800 | |
Cash Earnouts | 7,500 | ||
Future milestone payments | 9,700 | ||
Fair value of milestone payments | $ 9,720 | ||
Class A Common Stock | |||
Business Acquisition [Line Items] | |||
Stock Issued During Period, Shares, Acquisitions | 29,431,260 | 2,143,438 | |
Class A Common Stock | Betcha | |||
Business Acquisition [Line Items] | |||
Stock Issued During Period, Shares, Acquisitions | 2,143,438 |
Business Acquisition - Schedule of Estimated Fair Values of the Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Dec. 13, 2021 |
Jun. 30, 2020 |
---|---|---|
Business Acquisition [Line Items] | ||
Intangible assets | $ 5,320 | |
Goodwill | $ 377,100 | |
Betcha | ||
Business Acquisition [Line Items] | ||
Cash | 21 | |
Restricted Cash | 280 | |
Prepaid expenses and other current assets | 61 | |
Intangible assets | 5,320 | |
Goodwill | 34,877 | |
Accounts payable | (288) | |
Accrued expenses and other current liabilities | (986) | |
Net assets acquired | $ 39,285 |
Business Acquisition - Schedule of Consideration Paid (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 13, 2021 |
Dec. 31, 2021 |
|
Business Acquisition [Line Items] | ||
Fair value of milestone payments | $ 0 | |
Betcha | ||
Business Acquisition [Line Items] | ||
Fair value of common stock | $ 21,306 | |
Cash consideration | 759 | $ 800 |
Fair value of milestone payments | 9,720 | |
Fair value of earnouts | 7,500 | |
Total purchase consideration | $ 39,285 |
Business Acquisition - Schedule of Components of Intangible Assets Acquired (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 13, 2021 |
|
Business Acquisition [Line Items] | ||
Intangible assets | $ 5,320 | |
Customer Relationships [Member] | ||
Business Acquisition [Line Items] | ||
Intangible assets | 520 | |
Estimated useful life | 2 years | |
Developed Technology [Member] | ||
Business Acquisition [Line Items] | ||
Intangible assets | $ 4,800 | |
Estimated useful life | 5 years |
Revenue Recognition - Schedule Of Market Place Revenues (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | $ 389,668 | $ 23,281 | $ 403,645 |
Owned Properties | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | 308,226 | 24,188 | 329,262 |
Private Label | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | 81,442 | (907) | 74,383 |
Concerts | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | 171,149 | 15,775 | 187,753 |
Sports | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | 175,471 | 3,484 | 169,577 |
Theater | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | 41,745 | 3,759 | 44,754 |
Other | |||
Disaggregation Of Revenue [Line Items] | |||
Total Marketplace revenues | $ 1,303 | $ 263 | $ 1,561 |
Revenue Recognition - Additional Information (Details) - Hoya Intermediate, LLC - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Disaggregation of Revenue [Line Items] | |||
Revenue from Related Parties | $ 53,400 | $ 11,800 | $ 65,300 |
Deferred revenue | 25,139 | $ 5,956 | |
Deferred Revenue, Revenue Recognized | $ 3,300 |
Impairments - Summary of Impairment Charges (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Jun. 30, 2020 |
|
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 563,200 | $ 563,200 | |
Indefinite-lived trademark | $ 78,700 | ||
Definite-lived intangible assets | 13,845 | 107,400 | |
Property and equipment | $ 50 | ||
Hoya Intermediate, LLC | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | 377,101 | ||
Indefinite-lived trademark | 78,734 | ||
Definite-lived intangible assets | 107,365 | ||
Property and equipment | 3,670 | ||
Personal seat licenses | 6,968 | ||
Total impairment charges | $ 573,838 |
Impairments - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2020 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Oct. 31, 2020 |
|
Asset Impairment Charges [Abstract] | ||||
Royalty Rate | 2.00% | |||
Impairment | $ 118,000 | |||
Impairment of definite-lived intangible assets | $ 13,845 | $ 107,400 | ||
Impairment charge of indefinite-lived trademark | $ 78,700 | |||
Intangible Assets, Net (Including Goodwill) | 683,300 | $ 0 | ||
Goodwill | $ 377,100 |
Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Property, Plant and Equipment [Abstract] | |||
Impairment charges | $ 0 | $ 3,700 | $ 0 |
Depreciation expense | $ 100 | $ 600 | $ 1,100 |
Property and Equipment - Schedule of Property and Equipment (Details) $ in Thousands |
Dec. 31, 2021
USD ($)
|
---|---|
Property, Plant and Equipment [Line Items] | |
Total property and equipment | $ 1,132 |
Less: accumulated depreciation | 50 |
Total property and equipment - net | 1,082 |
Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Total property and equipment | 568 |
Construction in Progress [Member] | |
Property, Plant and Equipment [Line Items] | |
Total property and equipment | $ 564 |
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Goodwill [Line Items] | |||
Carrying Amount of Definite Lived Intangible Assets | $ 13,845 | $ 107,400 | |
Amortization of Intangible Assets | 2,300 | 47,400 | $ 91,500 |
Impairment | 563,200 | 563,200 | |
Hoya Intermediate, LLC | |||
Goodwill [Line Items] | |||
Carrying Amount of Definite Lived Intangible Assets | 107,365 | ||
Impairment | 377,101 | ||
Developed Technology | Hoya Intermediate, LLC | |||
Goodwill [Line Items] | |||
Carrying Amount of Definite Lived Intangible Assets | 13,800 | 2,400 | |
Accumulated amortization | $ 2,500 | $ 300 |
Goodwill and Intangible Assets - Schedule of Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Goodwill [Line Items] | ||
Impairment | $ 563,200 | $ 563,200 |
Goodwill [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 683,327 | 1,060,428 |
Acquisition of Betcha | 34,877 | |
Impairment | (377,101) | |
Ending balance | 718,204 | 683,327 |
Definite-lived Intangible Assets [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 2,358 | 149,948 |
Acquisition of Betcha | 5,320 | |
Capitalized development costs | 8,438 | 7,264 |
Impairment | (107,365) | |
Disposals | (124) | |
Amortization | (2,271) | (47,365) |
Ending balance | 13,845 | 2,358 |
Trademarks [Member] | ||
Goodwill [Line Items] | ||
Beginning balance | 64,666 | 143,400 |
Impairment | (78,734) | |
Ending balance | $ 64,666 | $ 64,666 |
Goodwill and Intangible Assets - Summary of Estimated Future Amortization Expenses (Details) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2022 | $ 4,905 | |
2023 | 4,641 | |
2024 | 2,381 | |
2025 | 960 | |
2026 | 958 | |
Total | $ 13,845 | $ 107,400 |
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - Hoya Intermediate, LLC - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ||
Recovery of future customer compensation | $ 58,319 | $ 75,257 |
Insurance recovery asset | 480 | 2,500 |
Prepaid expenses | 9,573 | 2,309 |
Other current assets | 4,132 | 0 |
Total prepaid expenses and other current assets | $ 72,504 | $ 80,066 |
Prepaid Expenses and Other Current Assets - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Change in prepaid expenses | $ (7,623) | $ 67,584 | $ (642) |
Hoya Intermediate, LLC | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Change in recovery of future customer compensation | 16,900 | ||
Prepayments for legal settlements | 4,500 | ||
Change in prepaid expenses | 7,300 | ||
Other current assets | $ 4,132 | $ 0 |
Accrued Expenses and Other Current Liabilities - Summary of Accrued Expenses and Other Current Liabilities (Details) - Hoya Intermediate, LLC - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ||
Accrued marketing expense | $ 27,304 | $ 1,086 |
Accrued tax | 9,332 | 16,913 |
Accrued customer credits | 119,355 | 125,481 |
Accrued future customer compensation | 73,959 | 94,061 |
Accrued contingencies | 12,686 | 0 |
Other current liabilities | 38,520 | 18,593 |
Total accrued expenses and other current liabilities | $ 281,156 | $ 256,134 |
Accrued Expenses and Other Current Liabilities - Additional Information (Details) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Cash Earnouts | $ 0 | ||
Hoya Intermediate, LLC | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Customer credits redeemed | 55,900,000 | $ 7,400,000 | |
Revenue from breakage | 3,300 | 800,000 | |
Increase and decrease in revenue | 5,100 | $ 15,300 | $ 400 |
Cash Earnouts | 3,900,000 | ||
Future milestone payments | $ 8,800,000 |
Debt - Summary of Outstanding Debt (Details) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Debt Instrument [Line Items] | ||
Total long-term debt, gross | $ 465,712 | $ 894,399 |
Less: unamortized debt issuance costs | (5,580) | (17,084) |
Total long-term debt, net of issuance costs | 460,132 | 877,315 |
Less: current portion | 0 | (6,412) |
Total long-term debt, net | 465,712 | |
Subsidiaries [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt, net | 460,132 | 870,903 |
June 2017 First Lien Loan | ||
Debt Instrument [Line Items] | ||
Total long-term debt, gross | 465,712 | 618,721 |
May 2020 First Lien Loan | ||
Debt Instrument [Line Items] | ||
Total long-term debt, gross | $ 0 | $ 275,678 |
Debt - (Additional Information) (Details) - USD ($) |
1 Months Ended | 12 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Oct. 18, 2021 |
May 22, 2020 |
Mar. 17, 2020 |
Oct. 28, 2019 |
Jun. 30, 2017 |
May 22, 2023 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
Jul. 02, 2018 |
|
Line of Credit Facility [Line Items] | ||||||||||
Term loan | $ 465,712,000 | |||||||||
Amortization of Debt Issuance Costs | 4,472,000 | $ 3,863,000 | $ 2,860,000 | |||||||
Debt instrument, basis spread on variable rate | 5.00% | |||||||||
Revolving Facility | 50,000,000 | |||||||||
Loss on extinguishment of debt | $ 700,000 | (35,828,000) | (685,000) | (2,414,000) | ||||||
Repayments of Revolving Facility | $ 50,000,000 | |||||||||
LIBOR Rate | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 5.00% | |||||||||
Base Rate [Member] | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 4.00% | |||||||||
Merger Transaction | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Loan Principal Payments | $ 148,200,000 | |||||||||
Revolving Credit Facility | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Revolving Facility | $ 50,000,000.0 | $ 50,000.0 | ||||||||
June 2017 First Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Long-term Line of Credit | $ 575,000,000.0 | |||||||||
Line of Credit Up-sized | $ 115,000,000.0 | |||||||||
Loan maturity Date | Jun. 30, 2024 | |||||||||
Quarterly Amortization Payment Percentage | 1.00% | |||||||||
Effective interest rate | 4.50% | |||||||||
Loan Principal Payments | 4,800,000 | $ 5,900,000 | ||||||||
Loss on extinguishment of debt | $ 1,700,000 | |||||||||
June 2017 First Lien Loan | Maximum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Cash Flow Subject to Certain Leverage Ratios | 50.00% | |||||||||
June 2017 First Lien Loan | LIBOR Rate | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Floor Rate | 1.00% | |||||||||
June 2017 First Lien Loan | LIBOR Rate | Maximum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 3.50% | |||||||||
June 2017 First Lien Loan | LIBOR Rate | Minimum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 3.00% | |||||||||
June 2017 First Lien Loan | Net Leverage Ratio | Maximum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 2.50% | |||||||||
June 2017 First Lien Loan | Net Leverage Ratio | Minimum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 2.00% | |||||||||
June 2017 Second Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt Instrument, Redemption Period, End Date | Oct. 28, 2019 | |||||||||
May 2020 First Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Term loan | 260,000.0 | |||||||||
Repayment of Term Loan | Oct. 18, 2021 | |||||||||
Amortization of Debt Issuance Costs | $ 0 | |||||||||
Loan maturity Date | May 22, 2026 | |||||||||
Springing Maturity | Jun. 30, 2024 | |||||||||
Effective interest rate | 11.50% | 11.50% | ||||||||
Prepayment Penalty Rate | 3.00% | |||||||||
Prepayments Amount | $ 91,000,000.0 | |||||||||
Loan Principal Payments | $ 304,100,000 | |||||||||
Prepayment penalty Amount | 28,000,000.0 | |||||||||
Loss on extinguishment of debt | 34,100,000 | |||||||||
Debt discount costs | 6,500,000 | |||||||||
Debt issuance costs | $ 2,000,000.0 | |||||||||
Remaining Amount Issuance Discount And Issuance Costs | $ 6,100,000 | |||||||||
May 2020 First Lien Loan | Maximum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Prepayment Penalty Rate | 6.00% | |||||||||
May 2020 First Lien Loan | Minimum | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Prepayment Penalty Rate | 91.00% | |||||||||
Prepayments Amount | $ 91,000,000.0 | |||||||||
May 2020 First Lien Loan | LIBOR Rate | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Floor Rate | 1.00% | |||||||||
Effective interest rate | 9.50% | |||||||||
May 2020 First Lien Loan | Base Rate [Member] | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Floor Rate | 2.00% | |||||||||
Effective interest rate | 8.50% | |||||||||
May 2020 First Lien Loan | Revolving Credit Facility | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Repayments of Revolving Facility | $ 260,000,000.0 | |||||||||
June 2017 and May 2020 First Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Amortization of Debt Issuance Costs | $ 3,600,000 | $ 3,700,000 | $ 2,900,000 | |||||||
Loans Payable | June 2017 First Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Long-term Line of Credit | $ 525,000,000.0 | |||||||||
Loans Payable | June 2017 Second Lien Loan | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Long-term Line of Credit | $ 185,000,000.0 |
Debt - Summary of Future maturities of our outstanding debt (Details) $ in Thousands |
Dec. 31, 2021
USD ($)
|
---|---|
Debt Disclosure [Abstract] | |
2022 | $ 0 |
2023 | 0 |
2024 | 465,712 |
2025 | 0 |
2026 | 0 |
Total long-term debt, net | $ 465,712 |
Financial Instruments - Additional Information (Details) - Hoya Intermediate, LLC - USD ($) $ in Thousands |
12 Months Ended | ||||
---|---|---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Schedule Of Available For Sale Securities [Line Items] | |||||
Interest expense – net | $ 58,179 | $ 57,482 | $ 41,497 | ||
Interest Rate Swap [Member] | |||||
Schedule Of Available For Sale Securities [Line Items] | |||||
Notional amount | $ 520,700 | ||||
Interest rate swap, fixed interest rate | 1.90% | ||||
Interest expense – net | $ 4,300 | $ 2,100 | |||
Interest Rate Cap [Member] | |||||
Schedule Of Available For Sale Securities [Line Items] | |||||
Interest rate swap, fixed interest rate | 0.00% | ||||
Interest expense – net | $ 800 | $ 200 | |||
Derivative asset, notional amount | $ 516,800 | $ 1,000 | |||
strike rate | 3.50% |
Financial Instruments - Summary of Effects of Hedge Accounting and Interest Rate Swaps (Details) - Subsidiaries [Member] - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Schedule Of Available For Sale Securities [Line Items] | ||
Beginning accumulated derivative loss in AOCL | $ (1,917) | |
Amount of gain (loss) recognized in AOCL | 887 | |
Less: Amount of loss reclassified from AOCL to income | (208) | |
Ending accumulated derivative loss in AOCL | (822) | |
Interest Rate Swap [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Beginning accumulated derivative loss in AOCL | (887) | |
Amount of gain (loss) recognized in AOCL | 887 | |
Ending accumulated derivative loss in AOCL | ||
Interest Rate Cap [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Beginning accumulated derivative loss in AOCL | $ (822) | (1,030) |
Less: Amount of loss reclassified from AOCL to income | (822) | (208) |
Ending accumulated derivative loss in AOCL | $ (822) |
Employee Benefit Plan - Additional Information (Details) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Retirement Benefits [Abstract] | |||
Employee Benefit Plan Contribution | $ 800,000 | $ 900,000 | $ 1,100,000 |
Discretionary profit-sharing contributions | $ 0 | $ 0 |
Income Taxes - Schedule of Income (Loss) from Continuing Operations Before Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Income Tax Disclosure [Abstract] | |||
United States | $ (17,859) | $ (763,664) | $ (51,520) |
Foreign | (966) | (10,521) | (2,328) |
Total loss before income taxes | $ (18,825) | $ (774,185) | $ (53,848) |
Income Taxes - Schedule of Components of Income Tax Expense (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Current | |
U.S. Federal | $ 0 |
State & Local | 304 |
Foreign | 0 |
Total current income tax expense (benefit) | 304 |
Deferred | |
U.S. Federal | 0 |
State & Local | 0 |
Foreign | 0 |
Total deferred income tax expense (benefit) | 0 |
Total income tax expense (benefit) | $ 304 |
Income Taxes (Additional Information) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Operating Loss Carryforwards [Line Items] | ||
U.S. federal statutory income tax rate | 21.00% | |
Federal and state operating loss carryforwards expire beginning year | 2029 | |
Foreign operating loss carryforwards expire beginning year | 2022 | |
Deferred Tax Assets, Valuation Allowance | $ 145,668 | $ 1,828 |
Operating loss carryforwards, Federal | 32,000 | |
Operating loss carryforwards, foreign | 6,100 | |
Operating loss carryforwards, state | 16,100 | |
Operating loss carryforwards, federal and state | 33,700 | |
Uncertain tax position | $ 0 | |
Maximum | ||
Operating Loss Carryforwards [Line Items] | ||
Income tax, Audit year | 2021 | |
Minimum | ||
Operating Loss Carryforwards [Line Items] | ||
Income tax, Audit year | 2017 |
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
At U.S. statutory tax rate | 21.00% |
State income taxes | (1.10%) |
Foreign rate differential | 0.30% |
Pass-through loss / (income) | (14.30%) |
Noncontrolling interest | (2.70%) |
Change in valuation allowance | (3.50%) |
Warrants remeasurement | (1.40%) |
Other | 0.10% |
Total income tax expense (benefit) | (1.60%) |
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Income Tax Disclosure [Abstract] | ||
Net operating loss | $ 9,670 | |
Interest carryforward | 15,206 | |
Investment in partnerships | 120,706 | |
Other | 132 | |
Total deferred tax assets | 145,714 | |
Valuation Allowance | (145,668) | $ (1,828) |
Total deferred tax assets net of valuation allowance | 46 | |
Other | 46 | |
Total Deferred Tax Liabilities | 46 | |
Net Deferred Tax Asset / Liabilities | $ 0 |
Income Taxes - Schedule of Deferred Tax Assets Valuation Allowance (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Income Tax Disclosure [Abstract] | |
Balance of beginning of period | $ 1,828 |
Valuation Allowance Charged to costs and expenses | 646 |
Valuation Allowance Charged to Other Accounts | 143,194 |
Valuation Allowance Deductions | 0 |
Ending balance | $ 145,668 |
Fair Value - Additional Information (Details) - Hoya Intermediate, LLC - Recurring - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
June 2017 First Lien Loan | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value | $ 465.1 | $ 583.1 |
Carrying amount | 460.1 | 609.1 |
Repayments of debt | $ 148.2 | |
May 2020 First Lien Loan | Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value | 319.9 | |
Carrying amount | $ 268.2 |
Fair Value - Significant Unobservable Inputs for Level 3 Fair Value Measurement (Details) - Hoya Intermediate, LLC - Nonrecurring - Level 3 |
Dec. 31, 2021 |
---|---|
Discount Rate | Minimum | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 12.5 |
Discount Rate | Maximum | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 13.5 |
Discount Rate | Weighted Average | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 13.0 |
Long-term Growth Rate | Minimum | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 2.5 |
Long-term Growth Rate | Maximum | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 3.5 |
Long-term Growth Rate | Weighted Average | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Non-fiancial asset, significant unobervable input | 3.0 |
Fair Value - Changes in Significant Unobservable Inputs (Details) - Hoya Intermediate, LLC - Nonrecurring $ in Thousands |
Dec. 31, 2021
USD ($)
|
---|---|
Discount Rate | Trademarks [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
50 basis point increase in discount rate | $ (3,935) |
Discount Rate | Goodwill [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
50 basis point increase in discount rate | (37,680) |
Long-term Growth Rate | Trademarks [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
50 basis point decrease in long-term growth rate | (2,298) |
Long-term Growth Rate | Goodwill [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
50 basis point decrease in long-term growth rate | $ (21,344) |
Commitment and Contingencies - Schedule of Future Minimum Cash Obligations (Details) - Hoya Intermediate, LLC $ in Thousands |
Dec. 31, 2021
USD ($)
|
---|---|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Operating leases, 2022 | $ 3,437 |
Operating leases, 2023 | 905 |
Operating leases, 2024 | 2,038 |
Operating leases, 2025 | 2,458 |
Operating leases, 2026 | 2,477 |
Operating leases, Thereafter | 14,736 |
Operating Leases, Total | 26,051 |
Purchase obligations, 2022 | 2,195 |
Purchase obligations, 2023 | 1,391 |
Purchase obligations, 2024 | 0 |
Purchase obligations, 2025 | 0 |
Purchase obligations, 2026 | 0 |
Purchase obligations, Thereafter | 0 |
Purchase Obligation, Total | 3,586 |
2022, Total | 5,632 |
2023, Total | 2,296 |
2024, Total | 2,038 |
2025, Total | 2,458 |
2026, Total | 2,477 |
Thereafter, Total | 14,736 |
Operating Leases And Purchase Obligations Due, Total | $ 29,637 |
Commitments and Contingencies - Additional Information (Details) - Hoya Intermediate, LLC - USD ($) $ in Millions |
12 Months Ended | |||
---|---|---|---|---|
Nov. 01, 2021 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Lease term | 11 years | |||
Termination date | Nov. 01, 2021 | |||
Sales Tax Expense | $ 9.0 | $ 6.8 | $ 10.0 | |
General and Administrative Expense [Member] | ||||
Rent expense | $ 3.7 | 2.8 | $ 2.7 | |
Termination date | Dec. 31, 2034 | |||
Lease termination expenses | $ 1.3 | |||
General and Administrative Expense [Member] | Minimum | ||||
Rent expense | 1.5 | |||
General and Administrative Expense [Member] | Maximum | ||||
Rent expense | 1.8 | |||
Prepaid Expenses and Other Current Assets [Member] | ||||
Insurance recovery assets | 0.5 | 2.5 | ||
Claim settlement pool | 4.5 | |||
Accrued expenses and other current liabilities [Member] | ||||
Company recognized a liability for sales tax | 8.8 | 16.8 | ||
Canada | ||||
Accrued liabilities | 0.9 | 1.1 | ||
Accrued Liabilities [Member] | ||||
Accrued liabilities | $ 1.7 | $ 2.6 |
Segment Reporting - Schedule of Segment Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
May 22, 2020 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | $ 2,322 | $ 48,247 | $ 93,078 | |
Impairment charges | 573,838 | |||
Loss on extinguishment of debt | $ 700 | (35,828) | (685) | (2,414) |
Subsidiaries [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (443,038) | (35,077) | (468,925) | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | (90,617) | (24,690) | (106,003) | |
General and administrative | 92,170 | 66,199 | 101,335 | |
Depreciation and amortization | 2,322 | 48,247 | 93,078 | |
Impairment charges | 573,838 | |||
Income (loss) from operations | 76,571 | (716,018) | (9,937) | |
Interest expense – net | 58,179 | 57,482 | 41,497 | |
Loss on extinguishment of debt | (35,828) | (685) | (2,414) | |
Other expense | 1,389 | |||
Marketplace | Subsidiaries [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 389,668 | 23,281 | 403,645 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 51,702 | 13,741 | 52,857 | |
Marketing and selling | 181,358 | 38,121 | 178,446 | |
Contribution Margin | 156,608 | (28,581) | 172,342 | |
Resale | Subsidiaries [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 53,370 | 11,796 | 65,280 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 38,915 | 10,949 | 53,146 | |
Marketing and selling | 0 | 0 | 0 | |
Contribution Margin | 14,455 | 847 | 12,134 | |
Consolidated | Subsidiaries [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 443,038 | 35,077 | 468,925 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 90,617 | 24,690 | 106,003 | |
Marketing and selling | 181,358 | 38,121 | 178,446 | |
Contribution Margin | 171,063 | (27,734) | 184,476 | |
General and administrative | 92,170 | 66,199 | 101,335 | |
Depreciation and amortization | 2,322 | 48,247 | 93,078 | |
Impairment charges | 573,838 | |||
Income (loss) from operations | 76,571 | (716,018) | (9,937) | |
Interest expense – net | 58,179 | 57,482 | 41,497 | |
Loss on extinguishment of debt | 35,828 | 685 | 2,414 | |
Other expense | 1,389 | |||
Net loss | $ (18,825) | $ (774,185) | $ (53,848) |
Equity - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Oct. 18, 2021 |
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Senior Preferred Units Compounded Rate | 12.50% | ||
Class A Common Stock | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Common Stock, Voting Rights | one | ||
Stock issued during period, shares | 29,431,260 | 2,143,438 | |
Class B Common Stock | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Common Stock, Voting Rights | one | ||
Stock issued during period, shares | 118,200,000 | ||
Redeemable Senior Preferred Units | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Preferred Units issued | 100 | ||
Redeemable Preferred Units | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Preferred Units issued | 100 | ||
Common Units [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Preferred Units issued | 100 | ||
Common units outstanding | 197,291,871 | ||
Equity Method Investment, Ownership Percentage | 40.10% | ||
Vivid Seats Inc | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Equity Method Investment, Ownership Percentage | 40.10% | ||
Vivid Seats Inc | Class A Common Stock | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Common stock shares issued | 29,431,260 | ||
Vivid Seats Inc | Class B Common Stock | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Common stock shares issued | 118,200,000 | ||
Hoya Topco, LLC | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Distributions to parent | $ 0 | ||
Hoya Topco, LLC | Redeemable Preferred Units | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Preferred Units outstanding | 0 |
Warrant - Schedule of Option Contingent Warrants (Detail) |
Dec. 31, 2021
d
yr
|
Oct. 18, 2021
d
yr
|
---|---|---|
Estimated volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and rights outstanding, measurement input | 36.0 | 28.0 |
Expected term (years) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and rights outstanding, measurement input | yr | 9.8 | 10.0 |
Risk-free rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and rights outstanding, measurement input | 1.5 | 1.6 |
Expected dividend yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and rights outstanding, measurement input | 0.0 | 0.0 |
Warrants (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands |
2 Months Ended | 12 Months Ended | |
---|---|---|---|
Oct. 18, 2021 |
Dec. 31, 2021 |
Dec. 31, 2021 |
|
Class of Stock [Line Items] | |||
Fair value of option contingent warrants | $ 1,600 | ||
Change in fair value of warrants | $ 1,389 | ||
Exercise Warrants | |||
Class of Stock [Line Items] | |||
Class A Warrants | 34,000,000 | 34,000,000 | |
Warrant expiration period | 10 years | 10 years | |
Hoya Intermediate, LLC | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 1,000,000 | 1,000,000 | 1,000,000 |
Derivative warrant liability | $ 20,400 | $ 20,400 | |
Change in fair value of warrants | $ 100 | ||
Hoya Intermediate, LLC | Hoya Intermediate Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 3,000,000 | 3,000,000 | |
Warrant exercise price per share | $ 10.00 | $ 10.00 | |
Hoya Intermediate, LLC | Maximum | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | $ 15.00 | ||
Hoya Intermediate, LLC | Maximum | $15 Exercise Warrants | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | 15.00 | 15.00 | |
Hoya Intermediate, LLC | Minimum | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | $ 10.00 | ||
Hoya Intermediate, LLC | Minimum | $10 Exercise Warrants | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | $ 10.00 | $ 10.00 | |
Public Warrants | Horizon Sponsor LLC | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 5,166,666 | 5,166,666 | |
Warrants Exercisable Period1 | 30 days | ||
Warrant expiration period | 5 years | 5 years | |
Value of Common Stock Exceeded | $ 18.00 | $ 18.00 | |
Redemption price per share for warrant | $ 0.01 | ||
Derivative warrant liability | $ 1,300 | $ 1,300 | |
Public Warrants | Hoya Intermediate, LLC | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 3,000,000 | ||
Warrant exercise price per share | $ 10.00 | ||
Class A Common Stock | |||
Class of Stock [Line Items] | |||
Stock issued during period, shares | 29,431,260 | 2,143,438 | |
Stock value issued for exercise of warrants | 6,519,791 | ||
Warrant exercise price per share | $ 11.50 | ||
Class A Common Stock | Class A Private Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 6,519,791 | 6,519,791 | |
Class A Common Stock | Exercise Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 34,000,000 | 34,000,000 | |
Class A Common Stock | $15 Exercise Warrants | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | $ 15.00 | $ 15.00 | |
Class A Common Stock | Horizon Sponsor LLC | |||
Class of Stock [Line Items] | |||
Stock issued during period, shares | 50,000 | ||
Warrant exercise price per share | $ 10.00 | ||
Class A Common Stock | Horizon Sponsor LLC | $10 Exercise Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 17,000,000 | 17,000,000 | |
Warrant exercise price per share | $ 10.00 | $ 10.00 | |
Class A Common Stock | Horizon Sponsor LLC | $15 Exercise Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 17,000,000 | 17,000,000 | |
Class A Common Stock | Hoya Intermediate, LLC | Hoya Intermediate Warrants | |||
Class of Stock [Line Items] | |||
Warrant exercise price per share | $ 15.00 | $ 15.00 | |
Class A Common Stock | Public Warrants | |||
Class of Stock [Line Items] | |||
Stock value issued for exercise of warrants | 18,132,776 | ||
Warrant exercise price per share | $ 11.50 | ||
Class A Common Stock | Public Warrants | Horizon Sponsor LLC | |||
Class of Stock [Line Items] | |||
Stock issued during period, shares | 18,132,776 | ||
Stock value issued for exercise of warrants | 17,000,000 | 18,132,776 | 18,132,776 |
Warrant exercise price per share | $ 11.50 | $ 11.50 | |
Class A Warrants | 18,132,776 | 18,132,776 | |
Number of Trading Days | 20 days | ||
Stock Price | $ 18.00 | $ 18.00 | |
Class A Common Stock | Public Warrants | Horizon Sponsor LLC | Class A Private Warrants | |||
Class of Stock [Line Items] | |||
Class A Warrants | 6,519,791 | 6,519,791 | |
Class A Common Stock | Private Warrants | Horizon Sponsor LLC | Class A Private Warrants | |||
Class of Stock [Line Items] | |||
Stock issued during period, shares | 6,519,791 | ||
Warrant exercise price per share | $ 11.50 | $ 11.50 |
Redeemable noncontrolling Interests (Additional Information) (Details) |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Hoya Topco L L C [Member] | |
Noncontrolling Interest [Line Items] | |
Common units ownership | 59.90% |
Class A Common Stock | |
Noncontrolling Interest [Line Items] | |
Conversion Basis | one-to-one |
Hoya Intermediate, LLC | |
Noncontrolling Interest [Line Items] | |
Common Stock Voting Power | 40.10% |
Equity-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Nov. 02, 2021 |
Oct. 19, 2021 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
Oct. 18, 2021 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation expense | $ 14.5 | |||||
Compensation expense expected to be recognized | 4 years | |||||
Stock Option Exercise Price | $ 13.09 | |||||
Stock options exercised | 0 | |||||
Stock options forfeited | 0 | |||||
Stock option, exercise price, decrease | $ 0.23 | |||||
Directors | Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Special dividend per share | $ 0.23 | |||||
Dividend Paid Date | Nov. 02, 2021 | |||||
RSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Awards granted in period | 1,408,773 | 1,408,773 | ||||
Equity-based compensation expense | $ 6.0 | $ 4.3 | $ 5.2 | |||
Unrecognized compensation expense | $ 16.9 | |||||
Compensation expense expected to be recognized | 4 years | |||||
RSUs | Directors | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 5 years | 5 years | ||||
RSUs | Employees | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Expiration period | 10 years | |||||
Shares Granted | 3,061,486 | |||||
Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares Granted | 1,000,000 | |||||
Stock Option Exercise Price | $ 15.00 | |||||
Incentive Units [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation expense | $ 9.1 | |||||
Compensation expense expected to be recognized | 3 years |
Equity-Based Compensation - Summary of Activity for RSUs (Details) - RSUs - $ / shares |
12 Months Ended | |
---|---|---|
Oct. 19, 2021 |
Dec. 31, 2021 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Beginning Balances | 0 | |
Granted | 1,408,773 | 1,408,773 |
Forfeited | (30,662) | |
Vested | 0 | |
Ending Balances | 1,378,111 | |
Weighted-Average Grant Date Fair Value Per Share, Beginning Balances | $ 0 | |
Weighted-Average Grant Date Fair Value Per Share, Granted | 12.86 | |
Weighted-Average Grant Date Fair Value Per Share, Forfeited | 12.86 | |
Weighted-Average Grant Date Fair Value Per Share, Vested | 0 | |
Weighted-Average Grant Date Fair Value Per Share, Ending Balances | $ 12.86 |
Equity-Based Compensation - Fair Value Assumptions for Stock Option at the Date of Grant (Details) - Stock Options |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Estimated volatility | 28.00% |
Expected term (years) | 10 years |
Risk-free rate | 1.70% |
Expected dividend yield | 0.00% |
Equity-Based Compensation - Summary of Activity for Unit Awards (Details) - Hoya Topco, LLC - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Class B-1 Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning Balances | 855,000 | ||
Granted | 905,000 | ||
Forfeited | (10,000) | (50,000) | |
Ending Balances | 845,000 | 855,000 | |
Weighted-Average Grant Date Fair Value Per Share, Beginning Balances | $ 2.32 | ||
Weighted-Average Grant Date Fair Value Per Share, Granted | $ 2.32 | ||
Weighted-Average Grant Date Fair Value Per Share, Forfeited | 2.32 | 2.32 | |
Weighted-Average Grant Date Fair Value Per Share, Ending Balances | $ 2.32 | $ 2.32 | |
Class E Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning Balances | 500,765 | 500,765 | 500,765 |
Ending Balances | 500,765 | 500,765 | 500,765 |
Weighted-Average Grant Date Fair Value Per Share, Beginning Balances | $ 25.46 | $ 25.46 | $ 25.46 |
Weighted-Average Grant Date Fair Value Per Share, Ending Balances | $ 25.46 | $ 25.46 | $ 25.46 |
Class D Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning Balances | 2,048,240 | 832,510 | 666,150 |
Granted | 1,755,000 | 218,000 | |
Repurchased | (97,604) | (6,000) | |
Forfeited | (60,400) | (441,666) | (45,640) |
Ending Balances | 1,987,840 | 2,048,240 | 832,510 |
Weighted-Average Grant Date Fair Value Per Share, Beginning Balances | $ 4.67 | $ 15.63 | $ 15.65 |
Weighted-Average Grant Date Fair Value Per Share, Granted | 0.89 | 15.50 | |
Weighted-Average Grant Date Fair Value Per Share, Repurchased | 15.95 | 15.28 | |
Weighted-Average Grant Date Fair Value Per Share, Forfeited | 7.01 | 7.81 | 15.42 |
Weighted-Average Grant Date Fair Value Per Share, Ending Balances | $ 4.60 | $ 4.67 | $ 15.63 |
Equity-Based Compensation - Fair Value Assumptions for Unit Awards at the Date of Grant (Details) - Hoya Topco, LLC - Unit Awards |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividend yield | 0.00% | 0.00% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Estimated volatility, minimum | 47.00% | 44.00% |
Expected term (years) | 1 year 9 months 18 days | 2 years 9 months 18 days |
Risk-free rate, minimum | 0.10% | 1.60% |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Estimated volatility, maximum | 102.00% | 47.00% |
Expected term (years) | 2 years 9 months 18 days | 3 years 3 months 18 days |
Risk-free rate, maximum | 1.60% | 2.20% |
Loss Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - Hoya Intermediate, LLC - USD ($) $ / shares in Units, $ in Thousands |
2 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2021 |
|||
Numerator for earnings per share calculation | ||||
Net income attributable to common stockholders, basic | $ (6,293) | $ (3,283) | ||
Loss attributable to redeemable noncontrolling interests | 3,010 | |||
Denominator for earnings per share calculation | ||||
Weighted-average shares, basic | [1] | 77,498,775 | ||
Basic EPS | ||||
Net Income (Loss) Available to Common Stockholders, Basic | $ (6,293) | $ (3,283) | ||
Weighted Average Number of Shares Outstanding, Basic | [1] | 77,498,775 | ||
Net income per share attributable to common stockholders, basic | [1] | $ (0.04) | ||
Effect of Dilutive Hoya Intermediate Warrants, Basic | (123) | |||
Diluted EPS | ||||
Net Income (Loss) Available to Common Stockholders, Diluted | $ (2,461) | |||
Net income per share attributable to common stockholders, diluted | [1] | $ (0.04) | ||
Effect of dilutive Hoya Intermediate Warrants | 0 | |||
Common Class A [Member] | ||||
Numerator for earnings per share calculation | ||||
Net income attributable to common stockholders, basic | $ (3,283) | |||
Denominator for earnings per share calculation | ||||
Weighted-average shares, basic | 77,498,775 | |||
Basic EPS | ||||
Net Income (Loss) Available to Common Stockholders, Basic | $ (3,283) | |||
Weighted Average Number of Shares Outstanding, Basic | 77,498,775 | |||
Net income per share attributable to common stockholders, basic | $ (0.04) | |||
Diluted EPS | ||||
Net Income (Loss) Available to Common Stockholders, Diluted | $ (3,406) | |||
Net income per share attributable to common stockholders, diluted | $ 77,498,775 | |||
|
Loss Per Share - Additional Information (Details) - Hoya Intermediate, LLC |
12 Months Ended |
---|---|
Dec. 31, 2021
shares
| |
Class A Warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 24,652,569 |
Exercise Warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 34,000,000 |
Hoya Intermediate Warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 4,000,000 |
Shares of Class B common stock | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 118,200,000 |
RSUs | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 1,378,111 |
Stock options | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Dilutive common equivalent units | 4,061,486 |
Related-Party Transactions - Additional Information (Details) - Hoya Intermediate, LLC - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Related Party Transaction [Line Items] | ||
Accrued charitable contributions payable | $ 1.3 | $ 0.5 |
Vivid Cheers [Member] | ||
Related Party Transaction [Line Items] | ||
Accrued charitable contributions payable | $ 2.4 | $ 0.5 |
Subsequent events - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Feb. 03, 2022 |
Dec. 31, 2020 |
Jun. 30, 2017 |
|
Subsequent Event [Line Items] | |||
Proceeds from Revolving Facility | $ 50,000 | ||
June 2017 First Lien Loan | |||
Subsequent Event [Line Items] | |||
Long-term Line of Credit | $ 575,000 | ||
Loan maturity Date | Jun. 30, 2024 | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Long-term Line of Credit | $ 275,000 | ||
Loan maturity Date | Feb. 03, 2027 | ||
Proceeds from Revolving Facility | $ 100,000 | ||
Subsequent Event | June 2017 First Lien Loan | |||
Subsequent Event [Line Items] | |||
Repayments of debt | $ 190,700 |
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