Thryv Holdings, Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 1 Description of Business and Summary of Significant Accounting Policies

General

Thryv Holdings, Inc. (“Thryv” or the “Company”) provides small-to-medium sized businesses (“SMB” or “SMBs”) with print and digital marketing services and Software as a Service (“SaaS”) business management tools. The Company owns and operates Print Yellow Pages (“PYP” or“Print”) and digital marketing services (“Digital”), which includes Internet Yellow Pages, search engine marketing, and other digital media services, including online display advertising, and search engine optimization tools. In addition, through our all-in-one small business management platform (“Thryv Platform”), the Company is a provider of SaaS business management, communication, and marketing tools designed for SMBs.

We are dedicated to supporting local, independent service-based businesses and emerging franchises by providing a cloud-based software platform, and innovative marketing solutions to the entrepreneurs who run them. Our company is built upon a rich legacy in the marketing and advertising industry. We are one of the largest providers of SaaS all-in-one small business management software in addition to providing print and digital marketing solutions to SMBs. Our solutions enable our SMB clients to attract and generate new business leads, manage their customer relationships efficiently with artificial intelligence (“AI”) tools and automations, and run their day-to-day operations to save time, compete and win in today's SMB environment.

On October 31, 2024 (the “Keap Acquisition Date”), Thryv, Inc., the Company's wholly-owned subsidiary, acquired Infusion Software, Inc. d/b/a Keap (“Keap”), a company that operates a SaaS email marketing and sales platform for small businesses.

The Company reports its results based ontwo reportable segments (see Note 15, Segment Information):

•Thryv SaaS, which includes the Company's SaaS flagship all-in-one small business management modular software platform; and

•Thryv Marketing Services, which includes the Company's Print and Digital solutions business.

Basis of Presentation

The Company prepares its financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”). The consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, certain information and disclosures normally included in the complete financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations. The consolidated financial statements include the financial statements of Thryv Holdings, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, the accompanying consolidated financial statements reflect all adjustments, consisting of only normal recurring items and accruals, necessary for the fair statement of the financial position, results of operations and cash flows of the Company for the periods presented. The consolidated financial statements as of and for the three months ended March 31, 2025 and 2024 have been prepared on the same basis as the audited annual financial statements. The consolidated balance sheet as of December 31, 2024 was derived from the audited annual financial statements. The consolidated results for interim periods are not necessarily indicative of results for the full year and should be read in conjunction with the Company’s audited financial statements and related footnotes for the year ended December 31, 2024.

Use of Estimates

The preparation of the Company’s consolidated financial statements requires management to make estimates and assumptions about future events that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable. The results of those estimates form the basis for making judgments about the carrying values of certain assets and liabilities.

Examples of reported amounts that rely on significant estimates include revenue recognition, allowance for credit losses, assets acquired and liabilities assumed in business combinations, capitalized costs to obtain a contract, certain amounts relating to the accounting for income taxes, including the valuation allowance, stock-based compensation expense, operating lease right-of-use assets and operating lease liabilities, and pension obligations. Significant estimates are also used in determining the recoverability and fair value of fixed assets and capitalized software, operating lease right-of-use assets, goodwill and intangible assets.

Summary of Significant Accounting Policies

The Company describes its significant accounting policies in Note 1 to the consolidated financial statements in Part II, Item 8 of its Annual Report on Form 10-K for the fiscal year ended December 31, 2024. There have been no changes to the Company's significant accounting policies during the three months ended March 31, 2025.

Cash, Cash Equivalents, and Restricted Cash

The following table presents a reconciliation of cash, cash equivalents and restricted cash reported within the Company's consolidated balance sheets to the amount shown in the Company's consolidated statements of cash flows for the three months ended March 31, 2025 and 2024:

Accounts Receivable, Net of Allowance

Accounts receivable represents billed amounts for which invoices have been provided to clients and unbilled amounts for which revenue has been recognized, but amounts have not yet been billed to the client.

The following table represents the components of Accounts receivable, net of allowance:

(1)Unbilled accounts receivable relates primarily to the Company’s print services, which are recognized at a point in time upon delivery of the print services to the intended market(s), but are billed to customers monthly after the delivery of the print services. Unbilled accounts receivable are reclassified as billed accounts receivable monthly when the customers are invoiced.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”). ASU 2023-07 requires additional disclosures, including more detailed information about segment expenses about a public entity’s reportable segments on an annual and interim basis. The new segment disclosures are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Management reviewed the extent of new disclosures necessary, and has implemented the disclosure updates within the Company's consolidated financial statements. Other than additional disclosures, the Company's adoption of ASU 2023-07 did not have a material impact on its consolidated financial statements. See Note 15, Segment Information, for additional information.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 requires additional disclosures primarily related to the rate reconciliation and income taxes paid information. The new income tax disclosures are effective for the current fiscal year and we will implement the new disclosure updates within the Company's consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ending December 31, 2025. Management is in the process of reviewing the extent and impact of these new disclosures.

In November 2024, the FASB issued ASU No. 2024-03, “Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), and in January 2025, the FASB issued ASU 2025-01,“Income Statement – Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date” ("ASU 2025-01"). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. Management will review the extent and impact of new disclosures necessary in the coming years, prior to implementation in the Company's consolidated financial statements.

Note 2 Acquisitions

Keap Acquisition

On October 31, 2024, Thryv, Inc. acquired all of the outstanding capital stock of Keap for$77.0 million in cash (net of$7.6 million of cash acquired), subject to adjustment (the“Keap Acquisition”). The assets acquired as part of this transaction consisted primarily of$3.0 million in current assets,$7.8 million in fixed assets and capitalized software,$33.3 million in intangible assets, consisting primarily of customer relationships and a trade name, along with$11.1 million in deferred tax assets and$34.9 million in goodwill. The Company also assumed liabilities of$17.9 million, consisting primarily of accrued, contract, and deferred liabilities.

The primary purpose of the Keap Acquisition was to further increase Thryv's market share within the SaaS industry. Keap was founded in 2001 and operates a SaaS e-mail marketing and sales platform for small businesses, including products to manage customers, customer relationship management, marketing and e-commerce. To finance the purchase price, the Company closed an underwritten public offering of 5,715,000 shares of common stock, generating net proceeds of$76.8 million (after deducting underwriting discounts and commissions) and borrowed$5.5 million under its ABL Facility. Transaction costs expensed as part of the acquisition-related costs were recognized in the amount of$3.4 million.

The Company accounted for the Keap Acquisition using the acquisition method of accounting in accordance with ASC 805, Business Combinations ("ASC 805"). This requires that the assets acquired and liabilities assumed are measured at fair value. With the assistance of a third-party valuation firm, the Company determined, using Level 3 inputs (see Note 4, Fair Value Measurements), the fair value of certain assets and liabilities, including fixed assets and intangible assets, by applying the income approach and the cost approach. Specific to intangible assets, client relationships were valued using a combination of the income and excess earnings approaches, whereas the trade name was valued using a relief of royalty method. The fair values of existing technologies were computed using a relief of royalty approach, similar to the trade name valuation. Specific to non-compete agreements, these agreements were valued using a “with and without” analysis, whereby estimates of the non-compete agreements in place were compared to the value without them, with the difference representing the value of the non-compete agreements themselves. The preliminary purchase price allocation is expected to be finalized within 12 months after the Keap Acquisition Date.

Factors that led to goodwill being recognized, per ASC 805, included expected synergies from combining operations of Keap and Thryv within the SaaS segment.

The following table summarizes the preliminary purchase price allocation of the fair values of the assets acquired and liabilities assumed at the Keap Acquisition Date:

The excess of the purchase price over the fair value of the identifiable net assets acquired and the liabilities assumed was allocated to goodwill. The recognized goodwill of$34.9 million was primarily related to the benefits expected from the Keap Acquisition and was allocated to the SaaS segment. The goodwill recognized is not deductible for income tax purposes.

During the first quarter of 2025, the Company adjusted the purchase price allocation as a result of certain measurement period adjustments to acquired assets. The effect of these measurement period adjustments resulted in a$0.4 million decrease to fixed assets and capitalized software, a$0.1 million increase to the purchase price, and a corresponding$0.5 million increase to goodwill.

Pro Forma Results (unaudited)

The pro forma combined financial information presented below was derived from historical financial records of Thryv and Keap and presents the operating results of the combined Company, as if the Keap Acquisition had occurred on January 1, 2023. The pro forma data gives effect to historical operating results with adjustments to interest expense, amortization expense, and depreciation expense and related tax effects.

The pro forma financial information is not necessarily indicative of the consolidated results of operations that would have been realized had the Keap Acquisition been completed as of January 1, 2023, nor is it meant to be indicative of future results of operations that the combined entity will achieve.

Note 3 Revenue Recognition

The Company has determined that each of its SaaS business management tools services and Print and Digital marketing services is distinct and represents a separate performance obligation. The client can benefit from each service on its own or together with other resources that are readily available to the client. Services are separately identifiable from other promises in the contract. Control over the Company’s Print services transfers to the client upon delivery of the published directories containing their advertisements to the intended market(s). Therefore, revenue associated with Print services is recognized at a point in time upon delivery to the intended market(s). The Company bills clientsfor Print advertising services monthly over the relative contract term. The difference between the timing of recognition of Print advertising revenue and monthly billing generates the Company’s unbilled receivables balance. The unbilled receivables balance is reclassified as billed accounts receivable through the passage of time as the clients are invoiced each month. SaaS and Digital marketing services are recognized using the series guidance. Under the series guidance, the Company's obligation to provide services is the same for each day under the contract, and therefore represents a single performance obligation. Revenue associated with SaaS and Digital marketing services is recognized over time using an output method to measure the progress toward satisfying a performance obligation.

Disaggregation of Revenue

The Company presents disaggregated revenue based on the type of service within its segment footnote. See Note 15, Segment Information.

Contract Assets and Liabilities

The timing of revenue recognition may differ from the timing of billing to the Company’s clients. These timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) as disclosed on the Company's consolidated balance sheets. Contract assets represent the Company's right to consideration when revenue recognized exceeds the receivable from the client because the consideration allocated to fulfilled performance obligations exceeds the Company’s right to payment, and the right to payment is subject to more than the passage of time. Contract liabilities represent remaining performance obligations that consist of advance payments and revenue deferrals resulting from the allocation of the consideration to performance obligations. The Company recognizes revenue on all of its remaining performance obligations within the next twelve months. For the three months ended March 31, 2025, the Company recognized revenue of $30.3 million that was recorded in Contract liabilities as of December 31, 2024. For the three months ended March 31, 2024, the Company recognized revenue of $28.5 million that was recorded in Contract liabilities as of December 31, 2023.

Note 4 Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to settle a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value:

Level 1— Quoted prices in active markets for identical assets or liabilities.

Level 2— Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.

Level 3— Unobservable inputs that reflect the Company's own assumptions incorporated into valuation techniques.

These valuations require significant judgment.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. When there is more than one input at different levels within the hierarchy, the fair value is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Assessment of the significance of a particular input to the fair value measurement in its entirety requires substantial judgment and consideration of factors specific to the asset or liability. Level 3 inputs are inherently difficult to estimate. Changes to these inputs can have a significant impact on fair value measurements. Assetsand liabilities measured at fair value using Level 3 inputs are based on one or more of the following valuation techniques: market approach, income approach or cost approach.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Certain of the Company’s non-financial assets are measured at fair value on a non-recurring basis. These assets primarily include goodwill, intangible assets, fixed assets, capitalized software, and operating lease right-of-use assets. These assets are subject to fair value adjustments in certain circumstances, such as when the net book value of an asset exceeds its fair value, resulting in an impairment charge.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Benefit Plan Assets

The fair value of benefit plan assets is measured and recorded on the Company's consolidated balance sheets using Level 2 inputs. See Note 9, Pensions.

Fair Value of Financial Instruments

The Company considers the carrying amounts of cash, trade receivables, and accounts payable to approximate fair value because of the relatively short period of time between the origination of these instruments and their expected realization or payment.

Additionally, the Company considers the carrying amounts of its ABL Facility (as defined in Note 8, Debt Obligations) and financing obligations to approximate their respective fair values due to their short-term nature and approximation of interest rates to market rates. These fair value measurements are considered Level 2. See Note 8, Debt Obligations.

The Term Loan (as defined in Note 8, Debt Obligations) is carried at amortized cost; however, the Company estimates the fair value of the Term Loan for disclosure purposes. The fair value of the Term Loan is determined based on quoted prices that are observable in the marketplace and is classified as a Level 2 measurement. See Note 8, Debt Obligations.

The following table sets forth the carrying amount and fair value of the Term Loan:

Note 5 Goodwill and Intangible Assets

Goodwill

The following table sets forth the changes in the carrying amount of the Company's goodwill for the three months ended March 31, 2025 and the year ended December 31, 2024.

(1) Keap was included in the Thryv SaaS reporting unit.

(2) Goodwill increased during thethree months ended March 31, 2025 in connection with a measurement period adjustment for the Keap Acquisition. See Note 2, Acquisitions.

Intangible Assets

The following tables set forth the details of the Company's intangible assets as of March 31, 2025 and December 31, 2024:

Amortization expense for intangible assets for the three months ended March 31, 2025 was$2.3 million. Amortization expense for intangible assets for the three months ended March 31, 2024 was $5.4 million.

Estimated aggregate future amortization expense by fiscal year for the Company's intangible assets is as follows:

Note 6 Allowance for Credit Losses

The following table sets forth the Company's allowance for credit losses as of March 31, 2025 and 2024:

(1) For the three months ended March 31, 2025 and 2024, the Company recorded a provision for credit losses of$3.8 million and $6.0 million, respectively, which is included in General and administrative expense in the Company's consolidated statements of operations and comprehensive income.

(2) For the three months ended March 31, 2025 and 2024, the deductions represent amounts written off as uncollectible, net of recoveries.

(3) As of March 31, 2025,$13.1 million of the allowance is attributable to Accounts receivable and less than$0.1 million is attributable to Contract assets. As of March 31, 2024, $17.8 million of the allowance is attributable to Accounts receivable and less than $0.1 million is attributable to Contract assets.

The Company’s exposure to expected credit losses depends on the financial condition of its clients and other macroeconomic factors. The Company maintains an allowance for credit losses based upon its estimate of potential credit losses. This allowance is based upon historical and current client collection trends, any identified client-specific collection issues, and current as well as expected future economic conditions and market trends.

Note 7 Accrued Liabilities

The following table sets forth additional financial information related to the Company's accrued liabilities as of March 31, 2025 and December 31, 2024:

Note 8 Debt Obligations

The following table sets forth the Company's outstanding debt obligations as of March 31, 2025 and December 31, 2024:

Term Loan

On May 1, 2024, the Company entered into a new Term Loan Credit Agreement (the “Term Loan”), the proceeds of which were used to refinance and pay off in full the Company’s previous term loan facility (the “Prior Term Loan”) and to pay fees and expenses related to the refinancing.

The Term Loan established a senior secured term loan facility (the “Term Loan Facility”) in an aggregate principal amount equal to $350.0 million, of which 40.0% was held by a related party who was an equity holder of the Company as of May 1, 2024. The Company defines a related party as any shareholder owning more than 5% of the Company's voting securities. As of March 31, 2025,40.0% of the Term Loan was held by a related party who was an equity holder of the Company as of that date.

The Term Loan Facility matures on May 1, 2029 and borrowings under the Term Loan Facility bear interest at a fluctuating rate per annum equal to, at the Company’s option, SOFR or base rate, in each case, plus an applicable margin per annum equal to (i)6.75% (for SOFR loans) and (ii)5.75% (for base rate loans). The Term Loan Facility requires mandatory amortization payments, paid quarterly commencing June 30, 2024, equal to (i) $52.5 million per year for the firsttwo years following the closing date of the Term Loan, and (ii) $35.0 million per year thereafter. As a result of $26.2 million of prepayments made through March 31, 2025, the Company's mandatory amortization payments for the next 12 months total$26.3 million.

The Term Loan, which was incurred by Thryv, Inc., the Company’s operating subsidiary, is secured by all the assets of Thryv, Inc., certain of its subsidiaries and the Company, and is guaranteed by the Company and certain of its subsidiaries.

The net proceeds from the Term Loan of $337.5 million (net of original issue discount costs of $6.3 million and third-party fees of $6.2 million) were used to repay the remaining $300.0 million outstanding principal balance of the Prior Term Loan, accrued interest of $3.8 million, and third-party fees of $0.6 million. The Company accounted for this transaction as a modification for lenders that were party to both the Prior Term Loan and Term Loan. The debt of the new lenders that were party to the Term Loan are new issuances, while the other lenders that were party to only the Prior Term Loan were accounted for as an extinguishment.

Accordingly, total third-party fees paid were $6.2 million, of which $2.0 million was immediately charged to General and administrative expense on the Company's consolidated statement of operations and comprehensive income. The remaining third-party fees of $4.2 million were deferred as debt issuance costs and will be amortized to interest expense, over the term of the Term Loan, using the effective interest method. Additionally, there were unamortized debt issuance costs which include third-party fees and original issue discount costs of $7.8 million on the Prior Term Loan, of which $5.4 million was written off and recorded as a loss on early extinguishment of debt on the Company's consolidated statement of operations and comprehensive income. The remaining unamortized debt issuance costs of $2.4 million were deferred as debt issuance costs and will be amortized to interest expense, over the term of the Term Loan, using the effective interest method.

The Company has recorded accrued interest of $0.4 million and $0.3 million as of March 31, 2025 and December 31, 2024, respectively. Accrued interest is included in Other current liabilities on the Company's consolidated balance sheets.

Term Loan Covenants

The Term Loan Facility contains certain covenants that, subject to exceptions, limit or restrict the Company’s ability to, among others, incur additional indebtedness, guarantees and liens; make investments, loans and advances; dispose of assets and make sale-leaseback transactions; enter into swap agreements; make payments of dividends and other distributions; make payments in respect of certain indebtedness; enter into certain affiliate transactions and restrictive amendments to certain agreements; change its lines of business; amend certain material documents; consummate certain mergers, consolidations and liquidations; and use the proceeds of the term loans.

Additionally, the Company is required to maintain compliance with (a) a maximum “Total Net Leverage Ratio”, calculated as the ratio of “Consolidated Total Net Indebtedness” to “Consolidated EBITDA” (in each case, as defined in the Term Loan, which shall not be 3.0 to 1.0 as of the last day of each fiscal quarter and (b) a minimum “SaaS Revenue” (as defined in the Term Loan), which shall not be less than the quarterly thresholds set forth in the Term Loan Agreement as of the last day of each fiscal quarter. As of March 31, 2025, the Company was in compliance with its Term Loan covenants. The Company also expects to be in compliance with these covenants for the next twelve months.

ABL Facility

On May 1, 2024, the Company entered into a new Credit Agreement (the “ABL Credit Agreement”), which established a new $85.0 million asset-based revolving loan facility (the “ABL Facility”). The ABL Facility refinanced the Company’s previous asset-based revolving loan facility (the “Prior ABL Facility”). Proceeds of the ABL Facility may be used by the Company for ongoing general corporate purposes and working capital.

The ABL Facility matures on May 1, 2028 and borrowings under the ABL Facility bear interest at a fluctuating rate per annum equal to, at the Company’s option, SOFR or base rate, in each case, plus an applicable margin per annum, depending on the average excess availability under the ABL Facility, equal to (i)2.50% to 2.75% (for SOFR loans) and (ii)1.50% to 1.75% (for base rate loans). The fee for undrawn commitments under the ABL Facility is equal to 0.375% per annum.

The Company accounted for this transaction as an extinguishment of the Prior ABL Facility. Total third-party fees and lender fees of$1.3 million associated with the ABL Facility, were deferred as debt issuance costs and will be amortized as interest expense, over the term of the ABL Facility. Additionally, the unamortized debt issuance costs associated with the Prior ABL Facility of$1.2 million, were written off and recorded as a loss on early extinguishment of debt on the Company's consolidated statement of operations and comprehensive (loss) income.

As of March 31, 2025 and December 31, 2024, the Company had debt issuance costs with a remaining balance of$1.0 million and $1.1 million, respectively. These debt issuance costs are included in Other assets on the Company's consolidated balance sheets.

As of March 31, 2025, the Company had borrowing base availability of$26.4 million. As a result of certain restrictions in the Company's debt agreements, as of March 31, 2025, approximately$18.1 million was available to be drawn upon under the ABL Facility.

ABL Facility Covenants

The ABL Credit Agreement contains certain covenants that, subject to exceptions, limit or restrict the Company’s ability to, among others, incur additional indebtedness, guarantees and liens; make investments, loans and advances; dispose of assets and make sale-leaseback transactions; enter into swap agreements; make payments of dividends and other distributions; make payments in respect of certain indebtedness; enter into certain affiliate transactions and restrictive amendments to certain agreements; change its lines of business; amend certain material documents; consummate certain mergers, consolidations and liquidations; and use the proceeds of the revolving loans.

Additionally, the Company is required to maintain compliance with (a) a minimum “Fixed Charge Coverage Ratio”, calculated as the ratio of “Consolidated EBITDA” minus unfinanced capital expenditures to “Fixed Charges” (in each case, as defined in the ABL Credit Agreement), which shall not be less than 1.0 to 1.0 as of the last day of each fiscal quarter and (b) a minimum “Excess Availability” (as defined in the ABL Credit Agreement) of at least $8.5 million at all times. As of March 31, 2025, the Company was in compliance with its ABL Credit Agreement covenants. The Company also expects to be in compliance with these covenants for the next twelve months.

Note 9 Pensions

The Company maintains pension obligations associated with non-contributory defined benefit pension plans that are currently frozen and incur no additional service costs.

The Company immediately recognizes actuarial gains and losses in its operating results in the period in which the gains and losses occur. The Company estimates the interest cost component of net periodic pension cost by utilizing a full yield curve approach and applying the specific spot rates along the yield curve used in the determination of the benefit obligations of the relevant projected cash flows. This method provides a more precise measurement of interest costs by improving the correlation between projected cash flows to the corresponding spot yield curve rates.

Net Periodic Pension Cost

The following table details the other components of net periodic pension cost for the Company's pension plans:

Since all pension plans are frozen and no employees accrue future pension benefits under any of the pension plans, the rate of compensation increase assumption is no longer needed. The Company determines the weighted-average discount rate by applying a yield curve comprised of the yields on several hundred high-quality, fixed income corporate bonds available on the measurement date to expected future benefit cash flows.

During the three months ended March 31, 2025, the Company madeno contributions to the qualified plans and contributions and associated payments of$0.1 million to the non-qualified plans. During the three months ended March 31, 2024, the Company madeno cash contributions to the qualified plans, and contributions and associated payments of$0.1 millionto the non-qualified plans.

For fiscal year 2025, the Company expects to contribute approximately$6.0 million to the qualified plans and approximately $0.5 million to the non-qualified plans.

Note 10 Stock-Based Compensation and Stockholders' Equity

Stock-Based Compensation Expense

The following table sets forth stock-based compensation expense recognized by the Company in the following line items in the Company's consolidated statements of operations and comprehensive (loss) income during the periods presented:

The following table sets forth stock-based compensation expense by award type during the periods presented:

Restricted Stock Units

The following table sets forth the Company's restricted stock unit (“RSU”) activity during the three months ended March 31, 2025:

The Company grants RSUs to the Company's employees and non-employee directors under the Company’s 2020 Incentive Award Plan (the “2020 Plan”). Pursuant to the RSU award agreements, each RSU entitles the recipient toone share of the Company’s common stock, subject to time-based vesting conditions set forth in individual agreements.

The fair value of each RSU grant is determined based upon the market closing price of the Company’s common stock on the date of grant. The RSUs vest and are expensed on a straight-line basis over the requisite service period, which ranges betweenone year andthree years from the date of grant, subject to the continued employment of the employees and services of the non-employee board members.

As of March 31, 2025, the unrecognized stock-based compensation expense related to the unvested portion of the Company's RSU awards was approximately$21.7 million and is expected to be recognized over a weighted-average period of 2.21 years.

During the three months ended March 31, 2025, the Company issued an aggregate of 499,389 shares of common stock to employees and non-employee directors upon the vesting of RSUs previously granted under the 2020 Plan.

Performance-Based Restricted Stock Units

The following table sets forth the Company's performance-based restricted stock unit (“PSU”) activity during the three months ended March 31, 2025:

The Company also grants PSUs to employees under the Company’s 2020 Plan. Pursuant to the PSU Award Agreement, each PSU entitles the recipient to up to 1.5 shares of the Company’s common stock, subject to certain performance measures set forth in individual agreements.

The PSUs will vest, if at all, following the achievement of certain performance measures or market conditions over athree-year performance period, relative to certain performance and market conditions. The grant date fair value of PSUs that vest relative to a performance condition is measured based upon the market closing price of the Company’s common stock on the date of grant and expensed on a straight-line basis when it becomes probable that the performance conditions will be satisfied, net of forfeitures, over the service period of the awards, which is generally the vesting term ofthree years. Grant date fair value of PSUs that vest relative to a market condition is measured using a Monte Carlo simulation model and expensed on a straight-line basis, net of forfeitures, over the service period of the awards, which is generally the vesting term ofthree years. As of March 31, 2025, the nonvested balance of PSUs that vest based on performance and market conditions were 594,634 and 891,932 shares, respectively.

As of March 31, 2025, the unrecognized stock-based compensation expense related to the unvested portion of the Company's PSU awards was approximately$17.5 million and is expected to be recognized over a weighted-average period of 1.89 years.

During the three months ended March 31, 2025, the Company issued an aggregate of 165,455 shares of common stock to employees and non-employee directors upon the vesting of PSUs previously granted under the 2020 Plan.

Stock Options

As of March 31, 2025, there was no unrecognized stock-based compensation expense related to the unvested portion of the Company's stock options, as all granted stock options were fully vested on October 15, 2024.

During the three months ended March 31, 2025, the Company issued an aggregate of 274,493 shares of common stock to employees upon the exercise of options previously granted under the 2016 Stock Incentive Plan and 2020 Plan at exercise prices ranging from$3.68 to$13.82 per share.

During the three months ended March 31, 2024, the Company issued an aggregate of 270,943 shares of common stock to employees upon the exercise of options previously granted under the 2016 Stock Incentive Plan and 2020 Plan at exercise prices ranging from $3.68 to $13.82 per share.

Employee Stock Purchase Plan

During the three months ended March 31, 2025 and 2024, the Company issued no shares through the Employee Stock Purchase Plan (“ESPP”).

Share Repurchase Program

On April 30, 2024, the Board authorized a new share repurchase program (the “Share Repurchase Program”), under which the Company may repurchase up to $40 million in shares of common stock through April 30, 2029. The repurchase program is subject to market conditions, the periodic capital needs of the Company’s operating activities, and the continued satisfaction of all covenants under the Company’s Term Loan and ABL Credit Agreement. The Share Repurchase Program does not obligate the Company to repurchase shares and may be suspended, terminated, or modified at any time.

As of March 31, 2025, the Company had repurchased approximately $0.5 million, or 26,495 shares, of the Company's outstanding common stock under the Share Repurchase program and $39.5 million remains available for share repurchases. The acquired shares were recorded as Treasury stock upon repurchase.

Note 11 Earnings per Share

The following table sets forth the calculation of the Company's basic and diluted earnings per share for the three months ended March 31, 2025 and 2024:

The computation of weighted-average diluted shares outstanding excluded the following share amounts as their effect would have been anti-dilutive for the three months ended March 31, 2025 and 2024:

Note 12 Income Taxes

The Company’s effective tax rate (“ETR”) was 23.0% for the three months ended March 31, 2025 and 39.0% for the three months ended March 31, 2024. The Company's ETR differs from the U.S. Federal statutory rate of 21% primarily due to permanent differences, including state taxes, non-deductible executive compensation, non-U.S. taxing jurisdictions, tax credits, minimum taxes, change in valuation allowance due to expiring net operating losses, and the discrete impact of interest accrual on uncertain tax positions.

As of March 31, 2025 and December 31, 2024, the amount of unrecognized tax benefits was $18.8 million and $18.1 million, respectively, excluding interest and penalties, that if recognized, would impact the effective tax rate. As of March 31, 2025 and December 31, 2024, the Company had $11.9 million and $11.3 million, respectively, recorded for interest on the Company's consolidated balance sheets. The Company engages in continuous discussions and negotiations with tax authorities regarding tax matters in various jurisdictions. The Company expects to complete resolution of certain tax years with various tax authorities within the next 12 months. The Company believes it is reasonably possible that its existing gross unrecognized tax benefits may be reduced by up to $15.6 million within the next 12 months, affecting the Company’s ETR if realized. See Note 13, Contingent Liabilities.

Note 13 Contingent Liabilities

Litigation

The Company is subject to various lawsuits and other claims in the normal course of business. In addition, from time to time, the Company receives communications from government or regulatory agencies concerning investigations or allegations of noncompliance with laws or regulations in jurisdictions in which the Company operates.

The Company establishes reserves for the estimated losses on specific contingent liabilities for regulatory and legal actions where the Company deems a loss to be probable and the amount of the loss can be reasonably estimated. In other instances, losses are considered probable, but the Company is not able to make a reasonable estimate of the liability because of the uncertainties related to the outcome or the amount or range of potential loss. For these matters, disclosure is made when material, but no amount is reserved. The Company does not expect that the ultimate resolution of pending regulatory and legal matters in future periods will have a material adverse effect on the Company's consolidated statements of operations and comprehensive (loss) income, balance sheets or cash flows.

Regulatory Matter

In October 2024, the Company received a subpoena from the Division of Enforcement of the SEC requesting documents and information related to the Company’s previously publicly announced strategic conversion of its clients from its digital Marketing Services solutions platform to its SaaS solutions platform. The Company is cooperating fully. The SEC noted that the investigation is a fact-finding inquiry and does not mean that it has concluded that anyone has violated the law.

Section 199 and Research and Development Tax Case

Section 199 of the Internal Revenue Code of 1986, as amended (the“Tax Code”), provided for deductions for manufacturing performed in the U.S. The Internal Revenue Service (“IRS”) took the position that directory providers were not entitled to claim the deductions because printing vendors had already claimed the deductions. The Tax Code also grants tax credits related to research and development expenditures. The IRS also took the position that the expenditures had not been sufficiently documented to be eligible for the tax credit. The Company disagreed with the IRS's positions.

The IRS challenged the Company's tax return position on both the Section 199 deduction and the tax credits. With respect to the tax years 2012 through June 2015 for the YP LLC partnership, the IRS sent 90-day notices to DexYP on August 29, 2018. In response, the Company filed three petitions (in the names of various related partners) in U.S. Tax Court challenging the IRS, and the IRS filed answers to those petitions. Thethree cases were consolidated by the court and were referred back to IRS Administrative Appeals for settlement negotiations, during which time the litigation was suspended. Several appeals conferences were held. The Company settled their claim for a Section 199 deduction on favorable terms. The Company and the IRS also reached an agreement regarding additional research and development tax credits for the tax years at issue whereby the IRS allowed more tax credits than were originally claimed on the tax returns. With respect to the tax year from July to December 2015 for the Print Media LLC partnership, the Company also filed a petition in the U.S. Tax Court to challenge the IRS denial of its Section 199 deductions.

As of March 31, 2025 and December 31, 2024, the Company has reserved $28.8 million and $28.3 million, respectively, in connection with the Section 199 disallowance and less than $0.1 million related to the research and development tax credit disallowance.

On May 22, 2023, the Company received a draft Appeals Settlement document (“Draft Settlement”) from the IRS relating to the IRC Section 199 tax case. Once finalized, the Draft Settlement will result in a decrease in the unrecognized tax benefit recorded for this tax position. During the year ended December 31, 2024, the Company recorded a measurement adjustment to the uncertain tax position liability to account for the new information received from the Draft Settlement. The settlement was finalized, and with respect to the YP LLC partnership the court entered its final decision on October 22, 2024, reflecting the parties' settlement. With respect to the litigation regarding the Print Media, LLC partnership, the Company successfully applied the terms of the IRS settlement for the YP LLC partnership to the dispute regarding the Print Media LLC partnership. On March 10, 2025, the parties filed a Proposed Stipulated Decision with the court reflecting their agreement. The parties are awaiting the court to enter its final decision in that case.

Note 14 Changes in Accumulated Other Comprehensive Loss

The following table summarizes the changes in accumulated other comprehensive loss, which is reported as a component of stockholders' equity, for the three months ended March 31, 2025 and 2024:

Note 15 Segment Information

The Company's chief operating decision maker (“CODM”) is the chief executive officer. The CODM monitors actual versus forecast results for segment adjusted EBITDA on a monthly basis to assess the performance of each segment and make decisions about allocating resources to each segment.

The Company manages its operations usingtwo operating segments, which are also its reportable segments: (1) Thryv SaaS and (2) Thryv Marketing Services.

The Company does not allocate assets to its segments and the CODM does not evaluate performance or allocate resources based on segment asset data, and therefore, such information is not presented.

The following tables summarize the operating results of the Company's reportable segments. Segment cost of services, Segment sales and marketing, and Segment general and administrative expenses presented below exclude the allocation of depreciation and amortization expense, stock-based compensation expense, restructuring and integration expenses, transactions costs and other expenses.

A reconciliation of the Company’s (Loss) income before income tax benefit (expense) to total Segment Adjusted EBITDA is as follows:

The following table sets forth the Company's disaggregation of Revenue based on services for the periods indicated:

Revenue by geography is based on the location of the customer. The following table sets forth the Company's disaggregation of Revenue based on geographic region for the periods indicated:

Revenue from customers located in Australia that was attributed to the International region was approximately 15.8% and 14.3% of total revenue for the three months ended March 31, 2025 and 2024, respectively. No other individual country from the International region contributed more than 10% of total revenue forthe three months ended March 31, 2025 and 2024.