QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
Title of each class |
Trading symbol |
Name of each exchange on which registered | ||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
7 |
||||||
Item 1. |
7 |
|||||
7 |
||||||
8 |
||||||
11 |
||||||
12 |
||||||
13 |
||||||
14 |
||||||
15 |
||||||
17 |
||||||
Item 2. |
33 |
|||||
Item 3. |
62 |
|||||
Item 4. |
63 |
|||||
64 |
||||||
Item 1. |
64 |
|||||
Item 1A. |
64 |
|||||
Item 2. |
65 |
|||||
Item 3. |
66 |
|||||
Item 4. |
66 |
|||||
Item 5. |
66 |
|||||
Item 6. |
67 |
• | our potential failure to develop a succession plan for the senior management team, including Patrick G. Ryan, and/or to recruit and retain revenue producers; |
• | the cyclicality of, and the economic conditions in, the markets in which we operate; |
• | conditions that result in reduced insurer capacity; |
• | the potential loss of our relationships with insurance carriers or our clients, failure to maintain good relationships with insurance carriers or clients, becoming dependent upon a limited number of insurance carriers or clients or the failure to develop new insurance carrier and client relationships; |
• | significant competitive pressures in each of our businesses; |
• | decreases in the premiums or commission rates set by insurers, or actions by insurers seeking repayment of commissions; |
• | decrease in the amount of supplemental or contingent commissions we receive; |
• | our inability to collect our receivables; |
• | the potential that our underwriting models contain errors or that are otherwise ineffective; |
• | damage to our reputation; |
• | failure to maintain, protect and enhance our brand; |
• | decreases in current market share as a result of disintermediation within the insurance industry, including increased competition from insurance companies, technology companies and the financial services industry, as well as the shift away from traditional insurance markets; |
• | changes in the mode of compensation in the insurance industry; |
• | changes in our accounting estimates, assumptions or methodologies, or changes in accounting guidance generally; |
• | changes in interest rates that affect our cost of capital and net investment income; |
• | changes in interest rates and deterioration of credit quality that reduce the value of our cash balances; |
• | impairment of goodwill; |
• | any failure to maintain our corporate culture; |
• | the inability to maintain rapid growth and generate sufficient revenue to maintain profitability; |
• | the loss of clients or business as a result of consolidation within the retail insurance brokerage industry; |
• | the impact if our MGU programs are terminated or changed; |
• | the risks associated with the evaluation of potential acquisitions and the integration of acquired businesses as well as introduction of new products, lines of business and markets; |
• | any unsuccessful attempts to open new officers, enter new product lines, establish distribution channels, or hire new brokers and underwriters; |
• | our inability to gain internal efficiencies through the application of technology or effectively apply technology in driving value for our clients through innovation and technology-based solutions; |
• | the unavailability or inaccuracy of our clients’ and third parties’ data for pricing and underwriting our insurance policies; |
• | a variety of risks in our third-party claims administration operations that are distinct from those we face in our insurance intermediary operations; |
• | the competitiveness and cyclicality of the reinsurance industry; |
• | the higher risk of delinquency or collection inherent in our premium finance business; |
• | the occurrence of natural or man-made disasters; |
• | our inability to successfully recover upon experiencing a disaster or other business continuity problem; |
• | the economic and political conditions of the countries and regions in which we operate; |
• | the failure or take-over by the FDIC of one of the financial institutions that we use; |
• | our inability to respond quickly to operational or financial problems or promote the desired level of cooperation and interaction among our offices; |
• | the impact of third parties that perform key functions of our business operations acting in ways that harm our business; |
• | our global operations expose us to various international risks, including exchange rate fluctuations; |
• | the impact of governmental regulations, legal proceedings and governmental inquiries related to our business; |
• | being subject to E&O claims as well as other contingencies and legal proceedings; |
• | our handling of client funds and surplus lines taxes that exposes us to complex fiduciary regulations; |
• | changes in tax laws or regulations; |
• | decreased commission revenues due to proposed tort reform legislation; |
• | the impact of regulations affecting insurance carriers; |
• | the impact on our operations and financial condition from the effects of the current COVID-19 pandemic and resulting governmental and societal responses; |
• | the impact of breaches in security that cause significant system or network disruptions; |
• | the impact of improper disclosure of confidential, personal or proprietary data, misuse of information by employees or counterparties or as a result of cyberattacks; |
• | the impact of infringement, misappropriation or dilution of our intellectual property; |
• | the impact of the failure to protect our intellectual property rights, or allegations that we have infringed on the intellectual property rights of others; |
• | our outstanding debt potentially adversely affecting our financial flexibility and subjecting us to restrictions and limitations that could significantly affect our ability to operate; |
• | not being able to generate sufficient cash flow to service all of our indebtedness and being forced to take other actions to satisfy our obligations under such indebtedness; |
• | the impact of being unable to refinance our indebtedness; |
• | being affected by further changes in the U.S.-based credit markets; |
• | changes in our credit ratings; |
• | the impact of failure to raise additional capital or generate cash flows necessary to expand our operations and invest in new technologies in the future; and |
• | other factors disclosed in the section entitled “Risk Factors” and elsewhere in the IPO Prospectus and this Quarterly Report on Form 10-Q. |
• | “we”, “us”, “our”, the “Company”, “RSG”, and similar references refer: (i) following the consummation of the Organizational Transactions, including our IPO, to Ryan Specialty Group Holdings, Inc., and, unless otherwise stated, all of its subsidiaries, including Holdings LLC, and (ii) prior to the completion of the Organizational Transactions, including our IPO, to Holdings LLC and, unless otherwise stated, all of its subsidiaries. |
• | Admitted: The insurance market comprising insurance carriers licensed to write business on an “admitted” basis by the insurance commissioner of the state in which the risk is located. Insurance rates and forms in this market are highly regulated by each state and coverages are largely uniform. |
• | Affiliate (and, with a correlative meaning, “Affiliated”): With respect to a specified Person, each other Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the Person specified. As used in this definition, “control” (including with correlative meanings, “controlled by” and “under common control with”) means possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of voting securities or by contract or other agreement). |
• | All Risks: All Risks Specialty, LLC (f/k/a All Risk, Ltd.), an insurance specialist providing services in wholesale brokerage and delegated underwriting authority. |
• | All Risks Acquisition: In September 2020, RSG acquired All Risks. |
• | ARL: Collectively, All Risks, Limited and Independent Claims Services. |
• | Binding Authority: Our Binding Authority receives submissions for insurance directly from retail brokers, evaluates price and makes underwriting decisions regarding these submissions based on narrowly prescribed guidelines provided by carriers, and binds and issues policies on behalf of insurance carriers who retain the insurance underwriting risk. |
• | Common Units: Collectively, all Class A common units and all Class B common units of Holdings LLC. |
• | E&O: Errors and omissions. |
• | E&S: Excess and surplus lines. In this insurance market, carriers are licensed on a “non-admitted” basis. The excess and surplus lines market often offers carriers more flexibility in terms, conditions, and rates than does the Admitted market. |
• | Family Group: (i) In the case of a member of Holdings LLC or a Holdings LLC Employee who is an individual, such individual’s spouse, parents and descendants (whether natural or adopted) and any trust or estate planning vehicle or entity solely for the benefit of such individual and/or the individual’s spouse, parents, descendants and/or other relatives, and (ii) in the case of a member of Holdings LLC or a Holdings LLC Employee that is a trust, the beneficiary of such trust. |
• | Founder: Patrick G. Ryan. |
• | Founder Group: Founder, members of the Founder’s Family Group and Founder’s Affiliates. |
• | Person: An individual or any corporation, partnership, limited liability company, trust, unincorporated organization, association, joint venture or any other organization or entity, whether or not a legal entity. |
• | Holdings LLC: Ryan Specialty Group, LLC and its subsidiaries. |
• | Incentive units: Incentive-based common units of Holdings LLC. |
• | IPO: Initial public offering. |
• | IPO Prospectus: our final prospectus for our IPO dated as of July 21, 2021 and filed with the SEC pursuant to Rule 424(b)(4) under the Securities Act. |
• | LLC Unitholders: holders of the LLC Units. |
• | LLC Units: non-voting common interest units of Holdings LLC. |
• | Management Incentive Units: management incentive units with a participation threshold equal to the IPO price, which are subject to vesting and will be exchangeable into LLC Units. |
• | Mandatory Participation: As part of the reclassification of common stock related to the Organizational Transactions and subject to certain limited exceptions, all existing holders of LLC Units were required to sell 15.0% of their vested interest (inclusive of vested equity grants and purchased equity) in Holdings LLC in connection with the IPO. |
• | MGA: Managing general agent. |
• | MGU: Managing general underwriter. |
• | Onex: Onex Corporation and its affiliates, a holder of LLC Units prior to the Organizational Transactions, and one of our shareholders following the Organizational Transactions. |
• | Optional Participation: As part of the reclassification of common stock related to the Organizational Transactions, all existing holders of LLC Units had the option to sell up to (i) an additional 10.0% of their vested interest received as an equity grant under compensatory plans or arrangements and (ii) 100% of their remaining purchased interest, in each case, on a pro rata basis, subject to reduction in connection with the IPO and certain other limited exceptions. |
• | Organizational Transactions: The series of organizational transactions completed by the Company in connection with the IPO, as described in the IPO Prospectus. |
• | Participation: Collectively, the Mandatory Participation and the Optional Participation. |
• | Restructuring Plan: Plan to reduce costs and increase efficiencies, streamline management reporting structures, and centralize functions across the Company to improve operating margin, which is expected to be fully actioned by June 30, 2022. |
• | Ryan Parties: Patrick G. Ryan, founder, chairman and chief executive officer of RSG and certain members of his family and various entities and trusts over which Patrick G. Ryan and his family exercise control. |
• | SEC: The Securities and Exchange Commission. |
• | Securities Act: Securities Act of 1933, as amended. |
• | Specialty: One of the three RSG primary distribution channels, which includes Wholesale Brokerage, Binding Authority, and Underwriting Management. |
• | Tax Receivable Agreement or TRA: The tax receivable agreement entered into in connection with the IPO. |
• | U.S. GAAP: Accounting principles generally accepted in the United States of America. |
• | Underwriting Management: Underwriting Management administers an expansive number of MGUs, MGAs and programs that offer commercial and personal insurance for specific product lines or industry classes. Underwriters act with delegated underwriting authority based on varying degrees of prescribed guidelines as provided by carriers, quoting, binding and issuing policies on behalf of RSG’s carrier trading partners which retain the insurance underwriting risk. |
• | Wholesale Brokerage: Wholesale Brokerage distributes a wide range and diversified mix of specialty property, casualty, professional lines, personal lines and workers’ compensation insurance products, as a broker between the carriers and retail brokerage firms. |
June 30, 2021 |
March 5, 2021 |
|||||||
ASSETS |
||||||||
Cash |
$ | $ | — | |||||
TOTAL ASSETS |
$ |
$ |
— |
|||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Payable due to affiliate |
$ | $ | — | |||||
Total liabilities |
$ |
$ |
— |
|||||
STOCKHOLDERS’ EQUITY |
||||||||
Stock subscription receivable from Ryan Specialty Group, LLC |
$ | ( |
) | $ | ( |
) | ||
Class A common stock, $ |
||||||||
Total Stockholders’ equity |
$ | $ | — | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
$ |
— |
|||||
• | The adoption of the Sixth Amended and Restated Limited Liability Company Agreement of Holdings LLC (the “LLC Operating Agreement”) to, among other things, appoint Ryan Specialty Group Holdings, Inc. as the sole managing member of Holdings LLC. |
• | All Class A common units of Holdings LLC, including existing units with a participation threshold, were reclassified into an aggregate of Units, and all Class B common units of Holdings LLC were reclassified into an aggregate of their vested interest (inclusive of vested equity grants and purchased equity) in Holdings LLC and (ii) had the option to sell up to (x) an additional |
• | We amended and restated the certificate of incorporation of Ryan Specialty Group Holdings, Inc. to, among other things, provide for Class A common stock and Class B common stock. |
• | An entity through which Onex held its common unit interest in Holdings LLC (the “Common Blocker Entity”) engaged in a series of transactions that resulted in Onex exchanging all of the equity interests in the Common Blocker Entity for |
• | The Ryan Parties exchanged an aggregate of |
• | Through a series of internal transactions, certain of our current and past employees and existing investors in Holdings LLC (i) either sold one-for-one |
• | With respect to certain current and former employee holders of incentive units that ceased to be holders of LLC Units and became holders of Class A common stock in connection with the Organizational Transactions, such incentive units (after giving effect to the Participation) were exchanged for an aggregate of the “top-up options” or “reload options ”). Each such top-up option issued under the 2021 Plan is exercisable for IPO price of $ |
• | With respect to the LLC Unitholders who have incentive units and remained as LLC Unitholders after completion of the Organizational Transactions, subject to any reclassification adjustment, such incentive units were exchanged (i) for an aggregate of IPO price of $“top-up Management Incentive Units.” |
• | The issuance of an aggregate of IPO price of $Incentive Units (exclusive of the top-up Management Incentive Units) with a participation threshold equal to the IPO price of $Holdings LLC, in each case, were issued to certain employees in connection with the IPO as IPO awards and are subject to vesting. |
• | With respect to the Ryan Parties, subject to any reclassification adjustment, their common units with a participation threshold were exchanged (after giving effect to the Participation) for an aggregate of |
• | Ryan Specialty Group Holdings, Inc. issued shares of Class B common stock to the LLC Unitholders, on a one-to-one |
• | Pursuant to the LLC Operating Agreement, the LLC Unitholders were entitled to exchange LLC Units for shares of Class A common stock on a |
• | Ryan Specialty Group Holdings, Inc. entered into a Tax Receivable Agreement with the LLC Unitholders and Onex that will provide for the payment by us to the LLC Unitholders and Onex, collectively, of of the amount of cash savings, if any, in U.S. federal, state and local income taxes (computed using simplifying assumptions to address the impact of state and local taxes) the Company actually realizes (or, under certain circumstances is deemed to realize in the case of an early termination payment by us, a change in control or a material breach by us of our obligations under the Tax Receivable Agreement, as discussed below) as a result of certain (i) increases in the tax basis of assets of Holdings LLC and its subsidiaries resulting from purchases or exchanges of LLC Units, (ii) tax attributes of Holdings LLC and subsidiaries of Holdings LLC that existed prior to the IPO or to which we succeed as a result of the Common Blocker Mergers, (iii) the IPO or had their LLC Units (after giving effect to the Participation) exchanged for shares of Class A common stock on a one-time lump sum payment in an aggregate amount of $ |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2021 |
2020 |
2021 |
2020 |
|||||||||||||
REVENUE |
||||||||||||||||
Net commissions and fees |
$ | $ | $ | $ | ||||||||||||
Fiduciary investment income |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenue |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
EXPENSES |
||||||||||||||||
Compensation and benefits |
||||||||||||||||
General and administrative |
||||||||||||||||
Amortization |
||||||||||||||||
Depreciation |
||||||||||||||||
Change in contingent consideration |
— | |||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
OPERATING INCOME |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Interest expense |
||||||||||||||||
Income from equity method investment in related party |
— | |||||||||||||||
Other non-operating income (loss) |
( |
) | ( |
) | ( |
) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
INCOME BEFORE INCOME TAXES |
$ |
$ |
$ |
$ |
||||||||||||
Income tax expense |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
NET INCOME |
$ |
$ |
$ |
$ |
||||||||||||
Net income (loss) attributable to non-controlling interests, net of tax |
— | ( |
) | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
NET INCOME ATTRIBUTABLE TO MEMBERS |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2021 |
2020 |
2021 |
2020 |
|||||||||||||
NET INCOME |
$ |
$ |
$ |
$ |
||||||||||||
Net income (loss) attributable to non-controlling interests, net of tax |
— | ( |
) | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
NET INCOME ATTRIBUTABLE TO MEMBERS |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss), net of tax: |
||||||||||||||||
Foreign currency translation adjustments |
||||||||||||||||
Change in share of equity method investment in related party other comprehensive loss |
— | — | ( |
) | — | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total other comprehensive income (loss), net of tax |
$ |
$ |
$ |
( |
) |
$ |
||||||||||
|
|
|
|
|
|
|
|
|||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO MEMBERS |
$ |
$ |
$ |
$ |
||||||||||||
|
|
|
|
|
|
|
|
June 30, 2021 |
December 31, 2020 |
|||||||
ASSETS |
||||||||
CURRENT ASSETS |
||||||||
Cash and cash equivalents |
$ | $ | ||||||
Commissions and fees receivable – net |
||||||||
Fiduciary assets |
||||||||
Prepaid incentives – net |
||||||||
Other current assets |
||||||||
Total current assets |
$ |
$ |
||||||
NON-CURRENT ASSETS |
||||||||
Goodwill |
||||||||
Other intangible assets |
||||||||
Prepaid incentives – net |
||||||||
Equity method investment in related party |
||||||||
Property and equipment – net |
||||||||
Lease right-of-use |
||||||||
Other non-current assets |
||||||||
Total non-current assets |
$ |
$ |
||||||
TOTAL ASSETS |
$ |
$ |
||||||
LIABILITIES, MEZZANINE EQUITY AND MEMBERS’ EQUITY |
||||||||
CURRENT LIABILITIES |
||||||||
Accounts payable and accrued liabilities |
||||||||
Preferred units repurchase payable |
— | |||||||
Accrued compensation |
||||||||
Operating lease liabilities |
||||||||
Short-term debt and current portion of long-term debt |
||||||||
Fiduciary liabilities |
||||||||
Total current liabilities |
$ |
$ |
||||||
NON-CURRENT LIABILITIES |
||||||||
Accrued compensation |
||||||||
Operating lease liabilities |
||||||||
Long-term debt |
||||||||
Net deferred tax liabilities |
||||||||
Other non-current liabilities |
||||||||
Total non-current liabilities |
$ |
$ |
||||||
TOTAL LIABILITIES |
$ |
$ |
||||||
MEZZANINE EQUITY |
||||||||
Preferred units ( |
$ | $ | ||||||
MEMBERS’ EQUITY |
||||||||
Preferred units ( December 31, 2020) |
— | |||||||
Class A common units ( |
||||||||
Class B common units ( |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Accumulated other comprehensive income |
||||||||
Total RSG members’ equity |
$ |
( |
) |
$ |
||||
Non-controlling interests |
— | |||||||
Total members’ equity |
( |
) |
||||||
TOTAL LIABILITIES, MEZZANINE AND MEMBERS’ EQUITY |
$ |
$ |
||||||
Six months ended June 30, |
||||||||
2021 |
2020 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
Net income |
$ | $ | ||||||
Adjustments to reconcile net income to cash flows from (used for) operating activities: |
||||||||
Loss (gain) from non-controlling equity interest |
( |
) | ( |
) | ||||
Amortization |
||||||||
Depreciation |
||||||||
Prepaid & deferred compensation expense |
||||||||
Equity-based compensation expense |
||||||||
Amortization of deferred debt issuance costs |
||||||||
Deferred tax benefit (loss) |
( |
) | ||||||
Change (net of acquisitions and divestitures) in: |
||||||||
Commissions and fees receivable - net |
( |
) | ( |
) | ||||
Accrued interest |
||||||||
Other current assets and accrued liabilities |
( |
) | ||||||
Other non-current assets and accrued liabilities |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total cash flows provided by operating activities |
$ |
$ |
||||||
CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
|
— | ( |
) | |||||
|
( |
) | ||||||
|
— | ( |
) | |||||
|
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total cash flows used for investing activities |
$ |
( |
) |
$ |
( |
) | ||
CASH FLOWS FROM FINANCING ACTIVITIES |
||||||||
non-controlling interest holders |
( |
) | — | |||||
|
( |
) | ( |
) | ||||
|
( |
) | ( |
) | ||||
|
— | |||||||
|
— | ( |
) | |||||
|
— | |||||||
|
— | ( |
) | |||||
|
( |
) | — | |||||
|
( |
) | ( |
) | ||||
|
( |
) | — | |||||
|
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total cash flows (used for) provided by financing activities |
$ |
( |
) |
$ |
||||
|
|
|
|
|||||
Effect of changes in foreign exchange rates on cash and cash equivalents |
( |
) | ||||||
|
|
|
|
|||||
NET CHANGE IN CASH AND CASH EQUIVALENTS |
$ |
( |
) |
$ |
||||
|
|
|
|
|||||
CASH AND CASH EQUIVALENTS—Beginning balance |
$ |
$ |
||||||
|
|
|
|
|||||
CASH AND CASH EQUIVALENTS—Ending balance |
$ |
$ |
||||||
|
|
|
|
|||||
Supplemental cash flow information: |
||||||||
Interest and financing costs paid |
$ | $ | ||||||
Income taxes paid |
$ | $ | ||||||
Related party asset acquisition |
$ | — | $ | ( |
) | |||
Forgiveness of related party receivable |
$ | — | $ | |||||
Accretion of premium on mezzanine equity |
$ | $ | ||||||
Accretion of premium on mezzanine equity in accumulated deficit |
$ | ( |
) | $ | ( |
) | ||
Repurchase of vested common units |
$ | ( |
) | $ | — | |||
Issuance of unsecured promissory note |
$ | $ | — |
Mezzanine Equity |
Preferred Units |
Common Units Class A |
Common Units Class B |
Retained Earnings (Accumulated Deficit) |
Accumulated Other Comprehensive Income (Loss) |
Non-controlling Interests |
Total Members’ Equity (Deficit) |
||||||||||||||||||||||||||||
Balance at January 1, 2021 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
$ |
|||||||||||||||||||||||||
Net income (loss) |
— | — | — | — | ( |
) | — | ( |
) | ||||||||||||||||||||||||||
Foreign currency translation adjustments |
— | — | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Change in share of equity method investment in related party other comprehensive income |
— | — | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Accumulation of preferred dividends (% return), net of tax distributions |
— | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Accretion of premium on mezzanine equity |
— | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Related party acquisition |
— | — | — | — | ( |
) | — | ( |
) | ( |
) | ||||||||||||||||||||||||
Distributions declared—tax advances |
— | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Repurchases of Class A units |
— | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Equity-based compensation expense |
— | — | — | — | — | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Balance at March 31, 2021 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
$ |
|||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Net income (loss) |
— | — | — | — | — | — | |||||||||||||||||||||||||||||
Foreign currency translation adjustments |
— | — | — | — | — | — | |||||||||||||||||||||||||||||
Accumulation of preferred dividends (% return), net of tax distributions |
— | — | — | — | — | — | |||||||||||||||||||||||||||||
Accretion of premium on mezzanine equity |
— | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Related party acquisition |
— | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Distributions declared—tax advances |
— | — | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Reclassification from preferred units to repurchase payable |
— | ( |
) | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||
Repurchases of Class A units |
— | — | ( |
) | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||
Equity-based compensation expense |
— | — | — | — | — | — | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Balance at June 30, 2021 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
$ |
( |
) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mezzanine Equity |
Preferred Units |
Common Units Class A |
Common Units Class B |
Retained Earnings (Accumulated Deficit) |
Accumulated Other Comprehensive Income (Loss) |
Non-controlling Interests |
Total Members’ Equity (Deficit) |
|||||||||||||||||||||||||||||
Balance at January 1, 2020 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||||||||
Net income (loss) |
— | — | — | — | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustments |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
Accumulation of preferred dividends (% return), net of tax distributions |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Accretion of premium on mezzanine equity |
— | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||||
Related party asset acquisition |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Distributions declared—tax advances |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Repurchases of Class A units |
— | — | ( |
) | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Equity issued to the Board of Directors |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
Equity-based compensation expense |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance at March 31, 2020 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net income (loss) |
— | — | — | — | — | ( |
) | |||||||||||||||||||||||||||||
Foreign currency translation adjustments |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
Accumulation of preferred dividends (% return), net of tax distributions |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Accretion of premium on mezzanine equity |
— | — | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||||
Distributions declared—tax advances |
— | — | — | — | ( |
) | — | — | ( |
) | ||||||||||||||||||||||||||
Repurchases of Class A units |
— | — | ( |
) | — | ( |
) | — | — | ( |
) | |||||||||||||||||||||||||
Equity-based compensation expense |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance at June 30, 2020 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. |
Basis of Presentation |
2. |
Revenue from Contracts with Customers |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2021 |
2020 |
2021 |
2020 |
|||||||||||||
Wholesale brokerage |
$ | $ | $ | $ | ||||||||||||
Binding authorities |
||||||||||||||||
Underwriting management |
||||||||||||||||
Total Net commissions and fees |
$ |
$ |
$ |
$ |
||||||||||||
3. |
Merger and Acquisition Activity |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2021 |
2020 |
2021 |
2020 |
|||||||||||||
Change in contingent consideration |
$ |
$ | — | $ | $ | |||||||||||
Interest expense |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
4. |
Restructuring |
Three June 30, |
Six June 30, |
|||||||
2021 |
2021 |
|||||||
Compensation and benefits |
$ | $ | ||||||
Occupancy and other costs (1) |
||||||||
Total |