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Stock-based compensation
 6 Months Ended
Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-based compensation Stock-based compensation
Lineage 2024 Incentive Award Plan
The Lineage 2024 Incentive Award Plan (“Pre-IPO Incentive Award Plan”) was adopted by the Company in April 2024 with the approval of BGLH. As of June 30, 2024, the maximum number of shares of common stock which can be issued under the Pre-IPO Incentive Award Plan was 1,000,000. The Pre-IPO Incentive Award Plan is administered by the Board and provides for the award of restricted stock unit awards (“RSUs”), performance share awards, Long-Term Incentive Plan unit awards of the Operating Partnership, stock options, stock appreciation rights, and other incentive awards, each as defined in the Pre-IPO Incentive Award Plan, to eligible employees, consultants, and members of the Board. See Note 20, Subsequent events for updates concerning the Company’s July 2024 IPO.
Time-based restricted stock unit awards
Under the Pre-IPO Incentive Award Plan, certain employees were granted interests in the Company in the form of time-based RSUs covering shares of the Company’s common stock. These time-based RSUs vest over a one to three year time period provided that the recipient remains employed by the Company through the applicable vesting date, subject to acceleration of vesting in the event of the recipient’s death, disability, or termination by the Company without cause. The Company measures these time-based RSUs at fair value as of the grant date based on the price of units issued to third-party investors in arms’ length transactions in connection with BGLH and Operating Partnership capital raising activities. The Company recognizes stock‑based compensation expense over the applicable vesting term. The Company accounts for these units as equity-based awards.
Stock-based compensation expense related to time-based RSUs for the three and six months ended June 30, 2024 was $1 million. There was no stock-based compensation expense related to time-based RSUs for the three and six months ended June 30, 2023. As of June 30, 2024, there was $2 million of unrecognized noncash compensation cost related to unvested time-based RSUs that is expected to be recognized over a weighted-average period of 2 years.
The following represents a summary of these RSUs:
UnitsWeighted average grant date fair value per unit
Unvested as of December 31, 2023— $— 
Awards granted in 202432,202 96.50 
Awards vested in 2024— — 
Awards forfeited in 2024(777)96.50 
Unvested as of June 30, 202431,425$96.50 
Legacy Stock-Based Compensation Plans
The Legacy Stock-Based Compensation Plans were authorized prior to the Pre-IPO Incentive Award Plan. The Legacy Stock-Based Compensation Plan include BGLH Restricted Class B units, Management Profits Interests Class C units, and LLH Value Creation Unit Plan units.
(a)BGLH Restricted Class B units
Certain members of management and certain non-employee directors were granted interests in BGLH in the form of restricted Class B Units (“BGLH Restricted Units”). The Company fair values these BGLH Restricted Units as of the grant date based on the price of substantially similar units issued to third-party investors in arms’ length transactions in connection with other BGLH capital raising activities. The Company recognizes stock‑based compensation expense over the vesting term. The Company accounts for these units as equity-based awards.
Stock-based compensation expense related to BGLH Restricted Units for the three and six months ended June 30, 2024 was $3 million and $6 million, respectively. Stock-based compensation expense related to BGLH Restricted Units for the three and six months ended June 30, 2023 was $3 million and $6 million, respectively. As of June 30, 2024, there was $5 million of unrecognized noncash compensation cost related to unvested BGLH Restricted Units that is expected to be recognized over a weighted-average period of less than one year.
The following represents a summary of these units:
UnitsWeighted average grant date fair value per unit
Unvested as of December 31, 2023151,200 $89.29 
Awards granted in 202431,088 96.50 
Awards vested in 2024(7,778)90.00 
Unvested as of June 30, 2024174,510 $90.69 
(b)Management Profits Interests Class C units
LLH MGMT and LLH MGMT II interests were issued to members of management in the form of Management Profits Interests Class C units. These profits interests generally vest over a three to five year time period, with the number of units vested based partially on meeting certain financial targets of the Company or individual performance metrics.
Stock-based compensation related to Management Profits Interests Class C units for the three and six months ended June 30, 2024 was $2 million and $4 million, respectively. Stock-based compensation related to Management Profits Interests Class C units for the three and six months ended June 30, 2023 was $2 million and $4 million, respectively. As of June 30, 2024, there was $9 million of unrecognized noncash compensation cost related to unvested Class C units to be recognized over a weighted-average period of 1 year.
The following represents a summary of these units:
UnitsWeighted average grant date fair value per unit
Unvested as of December 31, 20236,695,123 $2.31 
Awards granted in 20241,487,235 2.93 
Awards vested in 2024(3,094,024)1.78 
Awards forfeited in 2024(147,976)2.69 
Unvested as of June 30, 20244,940,358 $2.82 
(c)LLH Value Creation Unit Plan units
Certain employees have been granted notional units under the LLH Value Creation Unit Plan (the “2015 LVCP”) in the form of appreciation rights that vest over a period of four years and upon the occurrence of a liquidity event. This plan covered awards from 2015 to 2020. A new LLH Value Creation Unit Plan was established in 2021 (the “2021 LVCP”) that generally provides for the grant of similar appreciation rights that may also vest without the occurrence of a liquidity event if the Company achieves the target value as specified in the award agreements.
As of June 30, 2024 and December 31, 2023, the cumulative unrecognized stock compensation expense related to the units issued pursuant to the 2015 LVCP and 2021 LVCP was $34 million and $37 million, respectively.