Bahram Akradi
About Bahram Akradi
Founder of Life Time (director since 1992), Chairman and CEO since May 1996; age 63. He has 30+ years operating experience in health and fitness and previously co‑founded U.S. Swim & Fitness (1984–1989) . Pay-versus-performance shows improving fundamentals: TSR value of $100 invested since IPO rose to $124.62 by 2024, Net Income turned to $156.2m in 2024, and Adjusted EBITDA reached $676.8m; company-selected pay linkage emphasizes Adjusted EBITDA, leverage ratio, and stock price . He also exercised a legacy 2015 option award in full on Feb 27, 2025, following vesting connected to the IPO, a notable insider event for liquidity/supply analysis .
| Metric | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|
| Total Shareholder Return ($100 base) | 96.96 | 67.38 | 84.96 | 124.62 |
| Net Income (Loss) ($m) | (579.4) | (1.8) | 76.1 | 156.2 |
| Adjusted EBITDA ($m) | 80.3 | 281.7 | 536.8 | 676.8 |
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| U.S. Swim & Fitness Corporation | Co‑Founder & EVP | 1984–1989 | Predecessor experience in fitness operations and growth |
| Life Time Group Holdings | Director (Founder) | 1992–present | Founding governance continuity |
| Life Time Group Holdings | CEO & Chairman | 1996–present | Strategy, capital allocation, growth and IPO execution |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Northern Oil & Gas, Inc. (NYSE: NOG) | Chairman/Director | 2017–present | Cross‑industry board leadership; network effects |
Fixed Compensation
- Annualized base salary set at $1,500,000 for 2023 and 2024 .
- 2024 “All Other Compensation” items included personal aircraft use $101,648, car allowance $12,000, car gross‑up $10,058, phone $600, home connectivity $1,075, LTD insurance $2,220, and other $70,588 .
| Component ($) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 1,472,116 | 1,500,000 | 1,465,385 |
| All Other Compensation | 434,677 | 89,462 | 198,189 |
| Total Compensation | 8,078,464 | 12,089,472 | 15,163,556 |
Notes: No cash bonus reported; equity comprises the majority of total pay .
Performance Compensation
- Program design: 2024 long-term incentive (LTI) split 50% time-based RSUs (pro‑rata over three years) and 50% PSUs tied to leverage ratio and Adjusted EBITDA over 2024–2026; leverage PSUs vest one‑third annually if yearly leverage target achieved; EBITDA PSUs performance is measured annually with vesting at end of year 3 . Key pay-linkage measures: Adjusted EBITDA, leverage ratio, stock price .
- 2024 outcomes: Adjusted EBITDA ($676.8m) exceeded tranche level ($630m) and year‑end leverage ratio was 2.3x versus ≤3.0x threshold; one‑year STIP PSUs and the first third of LTI leverage PSUs vested on Feb 28, 2025; EBITDA PSUs for the first third were determined at 250% of tranche two but vest at end of three years .
| Incentive | Grant Date | Metric | Target / Structure | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| STIP PSU (Leverage) | 2/7/2024 | Leverage ratio ≤3.0x | 56,475 units | 2.3x achieved; vested 100% | Vested 2/28/2025 |
| STIP PSU (Adj. EBITDA) | 2/7/2024 | Tranche 3 Adj. EBITDA | Target 56,476; Max 282,380 units; $3,750,006 GDFV | Paid in equity under program; performance achieved above tranche levels | Vested 2/28/2025 (STIP equity form) |
| LTI RSU | 2/7/2024 | Time-based | 338,855 units; $4,499,994 GDFV | N/A | Pro‑rata over 3 years |
| LTI PSU (Leverage) | 2/7/2024 | Leverage ratio each of 2024–2026 | ~112,952 units; $1,499,989 GDFV | 2024 segment achieved; first third vested | One‑third vests annually if met |
| LTI PSU (Adj. EBITDA) | 2/7/2024 | Adj. EBITDA each of 2024–2026 | 225,904 units; up to 250% payout potential | First third determined at 250% for 2024 | Vests end of 3‑year period |
Additional design, governance and risk controls:
- Clawback: NYSE/SEC-compliant recovery of excess incentive pay upon restatement (3‑year lookback) .
- 2024 Say‑on‑Pay support: >96% approval, signaling shareholder backing of program .
- Compensation consultant: WTW advises on market practices and peer group; peer list includes premium leisure/hospitality (e.g., HLT, H, RCL, Vail, LULU, WW); for 2025 added Travel + Leisure Co. and removed Cedar Fair .
Equity Ownership & Alignment
- Beneficial ownership: 15,826,973 shares (7.3%) as of March 5, 2025; includes direct, trust holdings, and options eligible within 60 days (see footnote breakdown) . Anti‑hedging and anti‑pledging: officers/directors are prohibited from hedging or pledging Life Time stock (no margin accounts) . CEO stock ownership guideline: 5x base salary; executives must hold 50% of net shares until compliant; all executives are in compliance or progressing .
| Ownership Detail | Amount / Terms |
|---|---|
| Shares beneficially owned | 15,826,973 (7.3% of 217,711,044 shares outstanding) |
| Footnote breakdown | Direct and trusts; includes options exercisable/vesting within 60 days: 352,131 vested/exercisable; 98,065 vest 3/9/2025; 127,032 vest 3/17/2025 |
| 2015 Option (legacy) | 9,388,000 options @ $10.00, exp. 10/6/2025; exercisable at 12/31/2024; exercised in full 2/27/2025 |
| 2022 Options | 254,066 ex / 254,064 unex @ $13.65, exp. 3/17/2032 |
| 2023 Options | 98,065 ex / 294,194 unex @ $17.27, exp. 3/9/2033 |
| Unvested RSUs/PSUs (12/31/2024) | RSUs: 338,855; PSUs (Leverage): 112,951; PSUs (Adj. EBITDA): 225,904 |
Vesting and recent insider activity:
- One‑year STIP PSUs (leverage) and first third of 3‑year leverage PSUs vested 2/28/2025 (performance met); first year EBITDA PSU performance set at 250% but vests at end of 3 years .
- 2015 options (9.388m) fully exercised on 2/27/2025, a sizable potential source of share supply depending on disposition; the proxy confirms exercise but not sale details .
Employment Terms
- CEO Offer Letter (effective Aug 18, 2021): base salary $1.5m; annual bonus 0%–300% of base; annual equity grants with target (tranche two) of at least $7.5m for 2022–2024 (Board discretion); he voluntarily declined the IPO equity grant .
- Severance: none before Aug 18, 2024; thereafter, if terminated without Cause or resigns for Good Reason, severance benefits at least as favorable as those for other senior executives; 280G “best‑net” cutback applies . Non‑compete and non‑solicit covenants through the later of 36 months post‑IPO or 24 months post‑termination . Definitions of “Cause” and “Good Reason” are detailed in the proxy .
Potential payments (assuming 12/31/2024 trigger and $22.12 share price for equity value):
| Scenario | Cash ($) | Equity Acceleration ($) | Other ($) | Total ($) |
|---|---|---|---|---|
| Termination w/o Cause or for Good Reason (No CIC) | 6,750,000 | — | 27,375 | 6,777,375 |
| Change in Control (No Termination) | — | 19,673,629 | — | 19,673,629 |
| Termination w/o Cause or for Good Reason (In Connection with CIC) | 6,750,000 | 19,673,629 | 27,375 | 26,451,004 |
| Death/Disability | 4,500,000 | — | — | 4,500,000 |
Board Governance
- Roles: Chairman of the Board (non‑independent) and CEO; Chair of Nominating & Corporate Governance and Capital Allocation; Member of Compensation Committee . Lead Independent Director: John Danhakl; independent directors meet in regular executive sessions; Board met six times in 2024 with ≥75% attendance by each member .
- Committee composition and oversight: Audit (financial expert chair), Compensation (oversees pay, succession, clawback, ownership guidelines), NCG (governance, ESG, board evaluation), Capital Allocation (development plans, sale‑leasebacks) . Because the Compensation Committee includes insiders, a sub‑committee of non‑employee directors is used for Rule 16b‑3 approvals (insider transaction governance) .
- Stockholders Agreement: principal stockholders (including Akradi) retain board nomination rights, influencing board composition; Akradi designates one director nominee .
Director compensation note: As an executive director, Akradi receives no additional director pay; standard non‑employee director retainers and RSUs apply only to eligible independent directors .
Related Party Transactions (Governance Risk Indicators)
- Leases and sale‑leasebacks with entities in which Akradi has interests resulted in 2024 rent payments of approximately: $1.0m (property leased since 2003; amended in 2023), $1.3m (2018 sale‑leaseback), $2.3m (2019 transaction; co‑owned with a director), $2.6m (2020 lease with LTRE), and $0.8m (2024 sale‑leaseback with minority interests held by Akradi and a director) . Oversight by the Audit Committee is noted for related‑party matters .
Compensation Peer Group and Shareholder Feedback
- Peer group for 2024 included leading hospitality/leisure and premium consumer brands; for 2025, Cedar Fair, L.P. was removed and Travel + Leisure Co. added, per WTW’s recommendation; peer data is a reference point, not a formulaic target .
- 2024 Say‑on‑Pay support exceeded 96%, indicating broad investor support for program design and pay mix .
Risk Controls, Policies, and Pensions/Deferred Comp
- Anti‑hedging/pledging: prohibited for all officers and directors; trading windows and preclearance apply .
- Clawback policy aligned with NYSE/SEC rules .
- No pension plan participation for NEOs; 2024 contains no pension value change; Akradi showed no 2024 deferred comp contributions in the nonqualified plan table (dashes) .
Investment Implications
- Alignment: Founder ownership at 7.3% with strict anti‑pledging and 5x salary ownership guideline supports long‑term alignment and reduces forced‑sale risk; equity-heavy pay mix ties outcomes to Adjusted EBITDA, leverage, and stock performance .
- Potential supply: Large equity vesting on Feb 28, 2025 (one‑year PSUs and first third of leverage PSUs) and the full exercise of 9.388m legacy options on Feb 27, 2025 are notable events for float/supply monitoring; the proxy confirms exercise but not subsequent dispositions .
- Pay-for-performance: 2024 metrics were met/exceeded (Adj. EBITDA, leverage), reinforcing pay linkage; Say‑on‑Pay >96% suggests low near‑term shareholder pressure on compensation reforms .
- Governance trade‑offs: Combined CEO/Chair role plus Akradi’s membership on the Compensation Committee and principal stockholder nomination rights concentrate influence; mitigating features include a Lead Independent Director, executive sessions, committee structure, and related‑party oversight .
- Related‑party real estate: Ongoing lease payments to entities with executive/director interests are a continuing governance consideration as they scale with footprint (Audit Committee oversight noted) .
Overall: High founder ownership and EBITDA/leverage-tied incentives align with deleveraging and margin expansion. Monitor post‑exercise share movements and 2025–2026 PSU performance paths; governance structure warrants attention due to dual roles and related‑party transactions, though investor support and policy controls currently appear robust .