UNITED ~~STATES~~STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of ~~the~~Report ~~Securities~~(Date ~~Exchange~~of ~~Act~~earliest ofevent ~~1934~~reported): November 08, 2024

Date of Report (Date of earliest event reported): September 9, 2024

INSTRUCTURE HOLDINGS, INC.

(Exact name of ~~registrant~~Registrant as ~~specified~~Specified in ~~its~~Its ~~charter~~Charter)

Delaware	~~001-40647~~	001-40647	84-4325548
(State or Other Jurisdiction of Incorporation)	(Commission File Number)		(IRS Employer Identification No.)
(State or Other Jurisdictionof Incorporation)		(Commission File Number)	(IRS EmployerIdentification No.)
6330 SOUTH 3000 EASTSUITE 700
SALT LAKE CITY, Utah			84121
(Address of Principal Executive Offices)			(Zip Code)

6330 SOUTH 3000 EAST SUITE 700
SALT LAKE CITY, UTAH		84121
(Address of Principal Executive Offices)		(Zip Code)

    Registrant’s Telephone Number, Including Area Code: 800 203-6755

   

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		~~Trading Symbol~~TradingSymbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		INST		The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 82.~~01.~~02 ~~Other~~Results ~~Events~~of Operations and Financial Condition.

AsThe ~~previously~~following ~~reported,~~are onthe ~~July 25,~~unaudited ~~2024,~~results of operations of Instructure Holdings, Inc., ~~a Delaware corporation~~ (the “Company”), ~~entered~~or ~~into an Agreement and Plan of Merger (the~~ “~~Merger Agreement~~Instructure”) ~~with~~as ~~Icon Parent Inc., a Delaware corporation (“Parent”), and Icon Acquisition Sub Inc., a Delaware corporation and a wholly owned subsidiary~~ of ~~Parent (“Merger Sub”). Parent~~ and ~~Merger~~for ~~Sub are each affiliates of investment funds managed by Kohlberg Kravis Roberts & Co. L.P., a leading global investment firm. Pursuant to~~ the ~~Merger~~three ~~Agreement,~~and ~~Merger~~nine ~~Sub~~months ~~will~~ended beSeptember ~~merged with and into the Company~~30, ~~with the Company surviving as a wholly owned subsidiary of Parent (the “Merger”)~~2024.

~~Under~~Key ~~the terms of the Merger Agreement, the completion of the Merger is subject to the satisfaction or waiver~~ Financials:(toDollars ~~the~~in ~~extent permissible pursuant to applicable law~~millions) of certain closing conditions, including the expiration or termination of any applicable waiting period pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). Effective as of 11:59 p.m. Eastern Time on September 9, 2024, the waiting period under the HSR Act expired with respect to the Merger.

The completion of the Merger remains subject to the satisfaction or waiver (to the extent permissible pursuant to applicable law) of other closing conditions, including, but not limited to, regulatory approvals in jurisdictions outside the United States. Completion of the Merger is currently expected to occur in the second half of 2024.


	Three months ended September 30,									Nine months ended September 30,
	2024			2023			Year-over-Year (% or bps)			2024			2023			Year-over-Year (% or bps)

Revenue	$	173.2		$	134.9			28.3	%	$	499.1		$	394.8			26.4	%
Income (loss) from Operations	$	(11.9	)	$	4.6			(361.2	)%	$	(19.2	)	$	(3.4	)		(456.5	)%
Non-GAAP Operating Income*	$	68.6		$	57.0			20.3	%	$	204.1		$	154.4			32.2	%
GAAP Net Loss	$	(24.7	)	$	(5.5	)		350.6	%	$	(66.8	)	$	(28.3	)		135.8	%
GAAP Net Loss Margin		(14.3	)%		(4.1	)%	(1,020) bps				(13.4	)%		(7.2	)%	(620) bps
Adjusted EBITDA*	$	70.1		$	58.2			20.5	%	$	208.4		$	157.7			32.1	%
Adjusted EBITDA Margin*		40.5	%		43.2	%	(270) bps				41.8	%		40.0	%	180 bps
Cash Flow from Operations	$	203.9		$	182.6			11.6	%	$	102.5		$	127.0			(19.4	)%
Adjusted Unlevered Free Cash Flow*	$	244.8		$	200.1			22.4	%	$	204.4		$	173.9			17.5	%
Remaining Performance Obligations ("RPO")	$	944.6		$	862.9			9.5	%	$	944.6		$	862.9			9.5	%

~~Cautionary~~*See ~~Statement~~“Non-GAAP ~~Regarding~~Financial ~~Forward~~Measures” for information regarding the Company’s use of non-~~Looking~~GAAP ~~Statements~~financial measures as well as reconciliations to the most closely comparable GAAP measures in this report.

~~This~~Balance ~~Current~~Sheet ~~Report on Form 8-K contains,~~ and ~~the~~Cash Company’s other filings and press releases may contain, forward-looking statements. All statements other than statements of historical fact, including statements about the proposed acquisition of the Company, are forward-looking statements. Forward-looking statements give the Company’s current expectations relating to the Merger and the transactions contemplated by the Merger Agreement (the “Transactions”), the Company’s financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely” and other words and terms of similar meaning. These forward-looking statements are based on management’s beliefs, as well as assumptions made by, and information currently available to, the Company. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected and are subject to a number of known and unknown risks and uncertainties, including: (i) the risk that the proposed Merger may not be completed in a timely manner or at all, which may adversely affect the Company’s business and the price of the Company’s common stock; (ii) the failure to satisfy any of the conditions to the consummation of the proposed Transactions, including the receipt of certain regulatory approvals; (iii) the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the Merger Agreement, including in circumstances requiring the Company to pay a termination fee; (iv) the effect of the announcement or pendency of the proposed Transactions on the Company’s business relationships, operating results and business generally; (v) risks that the proposed Transactions disrupt the Company’s current plans and operations; (vi) the Company’s ability to retain, hire and integrate skilled personnel including the Company’s senior management team and maintain relationships with key business partners and customers, and others with whom it does business, in light of the proposed Transactions; (vii) risks related to diverting management’s attention from the Company’s ongoing business operations; (viii) unexpected costs, charges or expenses resulting from the proposed Transactions; (ix) the ability to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the Merger; (x) potential litigation relating to the Merger that could be instituted against the parties to the Merger Agreement or their respective directors, managers or officers, including the effects of any outcomes related thereto; (xi) the impact of adverse general and industry-specific economic and market conditions; (xii) certain restrictions during the pendency of the Merger that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; (xiii) risks caused by delays in upturns or downturns being reflected in the Company’s financial position and results of operations; (xiv) the impact of inflation, rising interest rates, and global conflicts; (xv) uncertainty as to timing of completion of the proposed Merger; (xvi) risks that the benefits of the Merger are not realized when and as expected; and (xvii) other factors described under the heading “Risk Flow

~~Factors”~~As inof ~~the~~September ~~Company’s~~30, ~~Annual~~2024, ~~Report~~cash, cash equivalents, restricted cash, and funds held on ~~Form 10-K for~~behalf ~~the~~of ~~year~~customers ~~ended~~were $203.2 million and total debt was $1,167.3 million; compared to cash, cash equivalents, and restricted cash of $344.2 million and total debt of $491.3 million as of December 31, 2023. The decrease in cash, ~~and~~cash ~~the~~equivalents, ~~Company’s~~restricted ~~subsequent~~cash, ~~Quarterly~~and ~~Reports~~funds held on ~~Form 10-Q~~behalf of customers and increase in debt since December 31, ~~each~~ ~~filed~~2023 ~~with~~is ~~the~~primarily ~~Securities~~driven by cash spent and ~~Exchange~~debt ~~Commission~~incurred (in connection with the ~~“SEC”)~~Parchment and Scribbles acquisitions. ~~The~~As ~~Company~~of ~~cautions~~September ~~you~~30, ~~that~~2024, ~~the~~Instructure’s ~~important~~total ~~factors~~leverage ~~referenced~~ratio ~~above~~is ~~may~~4.4x ~~not~~(which ~~contain~~represents ~~all~~Total ofDebt ~~the~~to ~~factors~~trailing ~~that~~twelve ~~are~~month ~~important~~Adjusted toEBITDA) ~~you.~~and Innet ~~addition,~~leverage ~~the~~ratio ~~Company~~is ~~cannot~~3.6x ~~assure~~(which ~~you~~represents ~~that~~Net ~~the~~Debt ~~Company~~to ~~will~~trailing ~~realize~~twelve ~~the~~month ~~results~~Adjusted orEBITDA). ~~developments~~This ~~expected~~calculation orincludes ~~anticipated~~twelve ~~or,~~months ~~even~~of ifhistorical ~~substantially~~Instructure ~~realized,~~Adjusted ~~that~~EBITDA ~~they~~and ~~will~~eight ~~result~~months inof ~~the~~Parchment ~~consequences~~contribution orto ~~affect~~Adjusted ~~the~~EBITDA. ~~Company~~Net orcash ~~the~~provided ~~Company’s~~by ~~operations~~operating inactivities ~~the~~was ~~way~~$203.9 million for the ~~Company~~three ~~expects.~~months ~~The~~ended ~~forward-looking~~September ~~statements~~30, ~~included~~2024, incompared ~~this~~to ~~Current~~$182.6 ~~Report~~million onnet ~~Form 8-K are~~cash ~~made~~provided ~~only~~by asoperating ofactivities in the ~~date~~prior ~~hereof~~year period. ~~The~~This ~~Company~~increase ~~undertakes~~was noprimarily ~~obligation~~driven toby ~~update~~increased orcash ~~revise~~collections ~~any~~from ~~forward-looking~~customer ~~statements~~billings, ~~whether~~including asthe aimpact ~~result~~ of ~~new~~Parchment. ~~information,~~Adjusted ~~future~~Unlevered ~~events~~Free orCash ~~otherwise~~Flow was $244.8 million for the three months ended September 30, ~~except~~2024, ascompared ~~otherwise~~to ~~required~~$200.1 bymillion ~~law~~in the prior year period.

~~Additional~~Transaction ~~Information~~with ~~and Where to Find It~~ KKR

~~This~~Given ~~Current~~the ~~Report~~announcement ~~on Form 8-K is being~~ made inon ~~respect~~July of25, ~~the~~2024, ~~pending~~regarding ~~Merger~~Instructure’s ~~involving~~entry ~~the~~into ~~Company,~~a ~~Parent~~definitive ~~and~~agreement ~~Merger~~to ~~Sub.~~be ~~The~~acquired ~~Company~~by ~~has~~affiliates ~~prepared~~of ~~and~~investment ~~mailed~~funds amanaged ~~definitive~~by ~~information~~Kohlberg ~~statement~~Kravis ~~for~~Roberts ~~its~~& ~~stockholders~~Co. ~~containing~~L.P. ~~the~~(“KKR”), ~~information~~a ~~with~~leading ~~respect~~global toinvestment ~~the~~firm, ~~Merger~~Instructure ~~specified~~will innot ~~Schedule~~host ~~14C~~an ~~promulgated~~earnings ~~under~~conference ~~the~~call ~~Securities~~or ~~Exchange~~provide ~~Act~~financial ofguidance ~~1934,~~in asconjunction ~~amended,~~with ~~and~~this ~~describing the pending Merger~~report. ~~This~~For ~~Current~~further ~~Report~~detail on ~~Form 8-K is~~quarterly ~~not a substitute for the information statement~~performance, orplease ~~any~~refer ~~other~~to ~~document,~~Instructure’s ~~that~~Quarterly ~~the~~Report ~~Company~~on ~~may~~Form ~~file~~10-Q ~~with~~for the ~~SEC~~quarter orended ~~send~~September to30, ~~its~~2024, ~~stockholders~~filed intoday ~~connection~~ with the ~~Merger~~SEC.

~~INVESTORS~~About ARE URGED TO CAREFULLY READ THE INFORMATION STATEMENT REGARDING THE PENDING MERGER AND ANY OTHER RELEVANT DOCUMENTS IN THEIR ENTIRETY BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PENDING MERGER. Instructure

~~The~~Instructure ~~Company’s~~(NYSE: ~~stockholders~~INST) ~~may~~is ~~obtain~~an ~~free~~education ~~copies~~technology ofcompany ~~the~~dedicated ~~documents~~to ~~the~~elevating ~~Company~~student ~~files~~success, ~~with~~amplifying the ~~SEC~~power ~~from~~of ~~the~~teaching, ~~SEC’s~~and ~~website~~inspiring ateveryone ~~www.sec.gov~~to orlearn ~~through~~together. ~~the~~Today ~~Investor Relations page of~~ the ~~Company’s~~Instructure ~~website~~Learning atPlatform ~~https://ir.instructure.com~~supports ~~under~~tens ~~the~~of ~~link~~millions ~~“Financials”~~of oreducators byand ~~contacting~~learners around the ~~Company’s~~world. ~~Investor~~Learn ~~Relations~~more ~~by e-mail~~ at ~~investors@~~www.instructure.com.

NoNon-GAAP ~~Offer~~Financial Measures

NoInstructure ~~person~~has ~~will~~provided ~~solicit~~in ~~proxies~~this report financial information that has not been prepared in ~~connection~~accordance with generally accepted accounting principles in the ~~proposed~~United ~~Transactions~~States ~~referenced~~(“GAAP”). In addition to Instructure’s results determined in ~~this~~accordance ~~Current~~with ~~Report~~GAAP, onInstructure ~~Form 8~~believes the following non-K, GAAP measures are useful in evaluating its operating performance and ~~this~~liquidity. ~~Current~~Instructure ~~Report~~believes onthat ~~Form 8~~non-~~K is~~GAAP ~~neither~~financial aninformation, ~~offer~~when taken collectively, may be helpful to ~~purchase~~investors ~~nor~~because ait ~~solicitation~~provides consistency and comparability with past financial performance and assists in comparisons with other companies, some of anwhich ~~offer~~use similar non-GAAP financial information to ~~sell~~supplement ~~securities~~their GAAP results. The non-GAAP financial information is presented for supplemental informational purposes only, and should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from similarly-titled non-GAAP measures used by other companies.

Instructure has updated the grouping of the presentation of the adjustments to Non-GAAP Operating Income, Adjusted EBITDA, Non-GAAP Net Income, Adjusted Unlevered Free Cash Flow, Non-GAAP Cost of Revenue, Non-GAAP Operating Expenses, and Non-GAAP Gross Profit to more closely conform to the Company’s strategies and initiatives. These measures are not being recasted.

A reconciliation of Instructure’s historical non-GAAP financial measures to the most directly comparable GAAP measures has been provided in the financial statement tables included in this report, and investors are encouraged to review the reconciliation.

Non-GAAP Operating Income; Non-GAAP Operating Income Margin. We define non-GAAP operating income as loss or income from operations excluding the impact of stock-based compensation, transaction costs, globalization costs, restructuring costs, technology modernization costs, other non-recurring costs, and amortization of acquisition-related intangibles. We believe non-GAAP operating income is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary for different companies for reasons unrelated to overall operating performance. Although we exclude the amortization of acquisition-related intangibles from the non-GAAP measure, management believes it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. Non-GAAP operating income margin is defined as non-GAAP operating income divided by revenue.

Adjusted EBITDA; Adjusted EBITDA Margin. EBITDA is defined as earnings before debt-related costs, including interest and loss on debt extinguishment, benefit for taxes, depreciation, and amortization. We further adjust EBITDA to exclude certain items of a significant or unusual nature, including stock-based compensation, transaction costs, globalization costs, restructuring costs, technology modernization costs, other non-recurring costs, effects of foreign currency transaction (gains) and losses, and amortization of acquisition-related intangibles. Although we exclude the amortization of acquisition-related intangibles from this non-GAAP measure, management believes that it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue.

Non-GAAP Net Income. We define non-GAAP net income as net loss excluding the impact of stock-based compensation, amortization of acquisition-related intangibles, loss on extinguishment of debt, transaction costs, globalization costs, restructuring costs, technology modernization costs, other non-recurring costs, and effects of foreign currency transaction (gains) and losses that we do not believe are reflective of our ongoing operations. The tax effects of the adjustments are calculated using the statutory tax rate, taking into consideration the nature of the item and the relevant taxing jurisdiction. We believe Non-GAAP net income is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary for different companies for reasons unrelated to overall operating performance. Although we exclude the amortization of acquisition-related intangibles from the non-GAAP measure, management believes it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. Basic non-GAAP net income per common share is computed by dividing non-GAAP net income by the weighted-average number of common shares outstanding for the period. Diluted non-GAAP net income per common share is computed by giving effect to all potentially dilutive common stock equivalents outstanding for the period.

Free Cash Flow, Unlevered Free Cash Flow and Adjusted Unlevered Free Cash Flow. We define free cash flow as net cash provided by operating activities less purchases of property and equipment and intangible assets, net of proceeds from disposals of property and equipment. We define unlevered free cash flow as free cash flow adjusted for cash paid for interest on outstanding debt and cash settled stock-based compensation. We define adjusted unlevered free cash flow as unlevered free cash flow adjusted for transaction costs, globalization costs, restructuring costs, technology modernization costs, and other non-recurring costs paid in cash. We believe free cash flow, unlevered free cash flow and adjusted unlevered free cash flow facilitate period-to-period comparisons of liquidity. We consider free cash flow, unlevered free cash flow and adjusted unlevered free cash flow to be important measures because they measure the amount of cash we generate and reflect changes in working capital.

Non-GAAP Cost of Revenue and Non-GAAP Operating Expenses. We define non-GAAP cost of revenue and non-GAAP operating expenses as GAAP cost of revenue and GAAP operating expenses, respectively, excluding the impact of stock-based compensation, transaction costs, globalization costs, restructuring costs, technology modernization costs, other non-recurring costs, and amortization of acquisition-related intangibles that we do not believe are reflective of our ongoing operations. Although we exclude the amortization of acquisition-related intangibles from the non-GAAP measures, management believes it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation.

Non-GAAP Gross Profit; Non-GAAP Gross Margin. We define non-GAAP gross profit as gross profit excluding the impact of stock-based compensation, transaction costs, globalization costs, restructuring costs, technology modernization costs, and amortization of acquisition-related intangibles. Non-GAAP Gross Margin is defined as Non-GAAP gross profit divided by revenue.

Subscription and Support Non-GAAP Gross Profit; Subscription and Support Non-GAAP Gross Margin. We define subscription and support Non-GAAP gross profit as subscription and support gross profit excluding the impact of stock-based compensation, transaction costs, globalization costs, restructuring costs, technology modernization costs, and amortization of acquisition-related intangibles. Subscription and support non-GAAP gross margin is defined as subscription and support non-GAAP gross profit divided by subscription and support revenue.

Net Debt; Net Leverage Ratio. We define net debt as total outstanding debt, less cash, cash equivalents, restricted cash, and funds held on behalf of customers. Management uses this supplemental non-GAAP measure to evaluate the Company’s leverage. Net leverage ratio is computed by dividing net debt by adjusted EBITDA.

Forward-Looking Statements

This report contains “forward-looking” statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company’s expectations relating to the proposed merger and related transactions, the Company’s growth, customer demand and application adoption, the Company’s research and development efforts and future application releases, and the Company’s business strategy.

These statements are not guarantees of future performance, but are based on management’s expectations as of the date of this report and assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements. Important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include the following: the risk that the proposed merger may not be completed in a timely manner or at all, which may adversely affect the Company’s business and the price of the common stock; the failure to satisfy any of the conditions to the consummation of the proposed merger, including the receipt of certain regulatory approvals; the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the merger agreement related to the proposed merger, including any circumstances requiring the Company to pay a termination fee; the effect of the pendency of the proposed merger on the Company’s business relationships, operating results and business generally; risks that the proposed merger disrupts the Company’s current plans and operations; the Company’s ability to retain, hire, and integrate skilled personnel including the Company’s senior management team and maintain relationships with key business partners and customers, and others with whom it does business, in light of the proposed merger; risks related to diverting management’s attention from the Company’s ongoing business operations; unexpected costs, charges or expenses resulting from the proposed merger; the ability to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the proposed merger; litigation relating to the proposed merger instituted against the parties to the merger agreement related to the proposed merger or their respective directors, managers or officers, including the effects of any outcomes related thereto; the impact of adverse general and industry-specific economic and market conditions; certain restrictions during the pendency of the merger that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; risks caused by delays in upturns or downturns being reflected in the Company’s financial position and results of operations; the impact of inflation, high interest rates, and global conflicts; uncertainty as to timing of completion of the proposed merger; risks that the benefits of the proposed merger are not realized when and as expected; the effects of increased usage of, or interruptions or performance problems associated with, our learning platform; our history of losses and expectation that we will not be profitable for the foreseeable future; or ability to acquire new customers and successfully retain existing customers; failure of the markets for our applications to develop at anticipated rates; failure to manage our growth effectively; and changes in the spending policies or budget priorities for government funding of Higher Education and K-12 institutions.

These and other important risk factors are described more fully in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and other documents filed with the Securities and Exchange Commission and could cause actual results to vary from expectations. All information provided in this report is as of the date hereof and Instructure undertakes no duty to update this information except as required by law.


INSTRUCTURE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
	September 30, 2024			December 31, 2023
Assets	(unaudited)
Current assets:
Cash and cash equivalents	$	187,512		$	341,047
Funds held on behalf of customers		14,783			—
Accounts receivable—net		98,894			67,193
Prepaid expenses		38,630			12,082
Deferred commissions		14,644			13,705
Other current assets		9,200			4,797
Total current assets		363,663			438,824
Property and equipment, net		16,002			13,479
Right-of-use assets		8,314			9,002
Goodwill		1,909,041			1,265,316
Intangible assets, net		609,983			399,712
Noncurrent prepaid expenses		1,905			4,182
Deferred commissions, net of current portion		14,099			13,816
Deferred tax assets		5,624			6,739
Other assets		5,395			6,908
Total assets	$	2,934,026		$	2,157,978
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	25,576		$	23,589
Customer fund deposits		14,783			—
Accrued liabilities		36,051			23,760
Lease liabilities		5,335			7,513
Long-term debt, current		6,525			4,013
Deferred revenue		374,431			291,784
Total current liabilities		462,701			350,659
Long-term debt, net of current portion		1,138,510			482,387
Deferred revenue, net of current portion		9,611			10,876
Lease liabilities, net of current portion		9,842			9,246
Deferred tax liabilities		45,678			14,420
Other long-term liabilities		4,431			4,898
Total liabilities		1,670,773			872,486
Stockholders’ equity:
Common stock		1,471			1,452
Additional paid-in capital		1,663,532			1,619,020
Accumulated deficit		(401,750	)		(334,980	)
Total stockholders’ equity		1,263,253			1,285,492
Total liabilities and stockholders’ equity	$	2,934,026		$	2,157,978


INSTRUCTURE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except per share data)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Revenue:
Subscription and support	$	160,193		$	123,110		$	462,419		$	360,159
Professional services and other		12,971			11,811			36,644			34,675
Total revenue		173,164			134,921			499,063			394,834
Cost of revenue:
Subscription and support		49,827			40,345			145,566			117,532
Professional services and other		8,955			7,082			26,009			21,016
Total cost of revenue		58,782			47,427			171,575			138,548
Gross profit		114,382			87,494			327,488			256,286
Operating expenses:
Sales and marketing		67,673			46,734			187,899			149,743
Research and development		31,874			20,688			90,650			65,872
General and administrative		26,719			15,522			68,094			44,113
Total operating expenses		126,266			82,944			346,643			259,728
Income (loss) from operations		(11,884	)		4,550			(19,155	)		(3,442	)
Other income (expense):
Interest income		1,284			1,360			4,301			3,021
Interest expense		(26,627	)		(10,868	)		(75,636	)		(30,642	)
Other income (expense)		2,681			(2,443	)		328			(1,965	)
Loss on extinguishment of debt		—			—			(189	)		—
Total other income (expense), net		(22,662	)		(11,951	)		(71,196	)		(29,586	)
Loss before income tax benefit		(34,546	)		(7,401	)		(90,351	)		(33,028	)
Income tax benefit		9,850			1,920			23,581			4,717
Net loss and comprehensive loss	$	(24,696	)	$	(5,481	)	$	(66,770	)	$	(28,311	)
Net loss per common share, basic and diluted	$	(0.17	)	$	(0.04	)	$	(0.46	)	$	(0.20	)
Weighted-average common shares used in computing basic and diluted net loss per common share		146,670			144,222			146,079			143,665


INSTRUCTURE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Operating Activities:
Net loss	$	(24,696	)	$	(5,481	)	$	(66,770	)	$	(28,311	)
Adjustments to reconcile net loss to net cash provided (used in) by operating activities:
Depreciation of property and equipment		1,481			1,186			4,223			3,481
Amortization of intangible assets		45,905			35,744			132,129			107,237
Amortization of deferred financing costs		1,411			300			3,863			889
Stock-based compensation		14,353			11,675			42,350			32,986
Deferred income taxes		(10,569	)		(3,387	)		(25,197	)		(7,793	)
Non-cash operating lease expense		847			1,045			1,063			3,348
Other		(1,520	)		2,489			(174	)		2,853
Changes in assets and liabilities:
Accounts receivable, net		124,499			114,737			(22,684	)		(22,597	)
Prepaid expenses and other assets		12,772			11,430			(26,010	)		(15,250	)
Deferred commissions		(308	)		1,074			(1,222	)		2,896
Accounts payable and accrued liabilities		(571	)		(5,847	)		2,991			(7,565	)
Deferred revenue		43,312			16,366			63,177			57,724
Lease liabilities		(1,705	)		(1,619	)		(2,012	)		(5,370	)
Other liabilities		(1,316	)		2,916			(3,274	)		2,520
Net cash provided by operating activities		203,895			182,628			102,453			127,048
Investing Activities:
Purchases of property and equipment		(2,433	)		(1,808	)		(6,179	)		(4,708	)
Proceeds from sale of property and equipment		8			7			30			42
Business acquisitions, net of cash acquired		(79,823	)		—			(901,562	)		—
Net cash used in investing activities		(82,248	)		(1,801	)		(907,711	)		(4,666	)
Financing Activities:
Proceeds from issuance of common stock from employee equity plans		2,755			2,723			5,983			6,018
Shares repurchased for tax withholdings on vesting of restricted stock units		(1,075	)		(1,961	)		(4,325	)		(4,949	)
Proceeds from issuance of term debt, net of discount		—			—			663,892			—
Repayments of long-term debt		(2,993	)		(1,250	)		(8,979	)		(3,750	)
Advances from revolving credit facility		—			—			70,000			—
Repayment of advances from revolving credit facility		(70,000	)		—			(70,000	)		—
Payments for financing costs		—			—			—			(84	)
Changes in customer fund deposits		6,052			—			6,441			—
Net cash provided by (used in) financing activities		(65,261	)		(488	)		663,012			(2,765	)
Foreign currency impacts on cash, cash equivalents, restricted cash, and funds held on behalf of customers		1,696			(1,523	)		1,287			(1,246	)
Net increase (decrease) in cash, cash equivalents, restricted cash, and funds held on behalf of customers		58,082			178,816			(140,959	)		118,371
Cash, cash equivalents, restricted cash, and funds held on behalf of customers, beginning of period		145,167			129,821			344,208			190,266
Cash, cash equivalents, restricted cash, and funds held on behalf of customers, end of period	$	203,249		$	308,637		$	203,249		$	308,637
Supplemental cash flow disclosure:
Cash paid for taxes	$	939		$	838		$	3,987		$	2,657
Cash paid for interest on outstanding debt	$	25,725		$	13,781		$	65,849		$	31,455
Non-cash investing and financing activities:
Capital expenditures incurred but not yet paid	$	110		$	75		$	110		$	75

The following provides a reconciliation of cash, cash equivalents, restricted cash, and funds held on behalf of customers to the amounts reported on the consolidated balance sheets. Restricted cash has been disclosed in Other assets as it is associated with letters of credit obtained to secure office space from our various lease agreements and other contractual cash collateral arrangements.


INSTRUCTURE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
	As of September 30,
	2024		2023
Cash and cash equivalents	$	187,512	$	304,858
Restricted cash		954		3,779
Funds held on behalf of customers		14,783		—
Total cash, cash equivalents, restricted cash, and funds held on behalf of customers	$	203,249	$	308,637

RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP OPERATING INCOME
(in thousands)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Income (loss) from operations	$	(11,884	)	$	4,550		$	(19,155	)	$	(3,442	)
Stock-based compensation		14,351			11,755			42,348			33,621
Transaction costs(1)		13,092			3,502			24,971			9,655
Globalization costs(2)		3,846			381			8,217			473
Restructuring costs(3)		1,328			541			8,982			5,282
Technology modernization costs(4)		1,944			543			6,456			1,453
Other non-recurring costs(5)		64			31			188			111
Amortization of acquisition-related intangibles		45,905			35,744			132,129			107,236
Non-GAAP operating income	$	68,646		$	57,047		$	204,136		$	154,389

GAAP operating margin		(6.9	)%		3.4	%		(3.8	)%		(0.9	)%
Non-GAAP operating margin		39.6	%		42.3	%		40.9	%		39.1	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP ADJUSTED EBITDA
(in thousands)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Net loss	$	(24,696	)	$	(5,481	)	$	(66,770	)	$	(28,311	)
Interest on outstanding debt and loss on debt extinguishment		26,627			10,868			75,825			30,640
Income tax benefit		(9,850	)		(1,920	)		(23,581	)		(4,717	)
Depreciation		1,481			1,186			4,223			3,481
Amortization		—			—			—			2
Stock-based compensation		14,351			11,755			42,348			33,621
Transaction costs(1)		13,092			3,502			24,971			9,655
Globalization costs(2)		3,846			381			8,217			473
Restructuring costs(3)		1,328			541			8,982			5,389
Technology modernization costs(4)		1,944			543			6,456			1,453
Other non-recurring costs(5)		64			31			188			111
Effects of foreign currency transaction (gains) and losses		(2,690	)		2,420			(343	)		1,672
Amortization of acquisition-related intangibles		45,905			35,744			132,129			107,236
Interest income		(1,271	)		(1,346	)		(4,232	)		(2,963	)
Adjusted EBITDA	$	70,131		$	58,224		$	208,413		$	157,742

Net loss margin		(14.3	)%		(4.1	)%		(13.4	)%		(7.2	)%
Adjusted EBITDA margin		40.5	%		43.2	%		41.8	%		40.0	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP NET INCOME
(in thousands, except per share data)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Net loss	$	(24,696	)	$	(5,481	)	$	(66,770	)	$	(28,311	)
Stock-based compensation		14,351			11,755			42,348			33,621
Amortization of acquisition-related intangibles		45,905			35,744			132,129			107,236
Loss on extinguishment of debt		—			—			189			—
Transaction costs(1)		13,092			3,502			24,971			9,655
Globalization costs(2)		3,846			381			8,217			473
Restructuring costs(3)		1,328			541			8,982			5,389
Technology modernization costs(4)		1,944			543			6,456			1,453
Other non-recurring costs(5)		64			31			188			111
Effects of foreign currency transaction (gains) and losses		(2,690	)		2,420			(343	)		1,672
Tax effects of adjustments(6)		(19,259	)		(13,680	)		(55,362	)		(39,693	)
Non-GAAP net income	$	33,885		$	35,756		$	101,005		$	91,606
Non-GAAP net income per common share, basic	$	0.23		$	0.25		$	0.69		$	0.64
Non-GAAP net income per common share, diluted	$	0.23		$	0.25		$	0.69		$	0.63
Weighted average common shares used in computing basic Non-GAAP net income per common share		146,670			144,222			146,079			143,665
Weighted average common shares used in computing diluted Non-GAAP net income per common share		147,647			145,638			146,722			145,190


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP GROSS PROFIT
(in thousands)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Gross profit	$	114,382		$	87,494		$	327,488		$	256,286
Stock-based compensation		1,614			1,062			4,558			2,951
Transaction costs(1)		112			336			548			1,011
Globalization costs(2)		1,160			—			2,427			—
Restructuring costs(3)		307			5			1,597			246
Technology modernization costs(4)		1,043			422			3,393			1,028
Amortization of acquisition-related intangibles		18,780			16,265			55,243			48,603
Non-GAAP gross profit	$	137,398		$	105,584		$	395,254		$	310,125

GAAP gross margin		66.1	%		64.8	%		65.6	%		64.9	%
Non-GAAP gross margin		79.3	%		78.3	%		79.2	%		78.5	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP SUBSCRIPTION AND SUPPORT GROSS PROFIT
(in thousands)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
Subscription and support gross profit	$	110,366		$	82,765		$	316,853		$	242,627
Stock-based compensation		750			459			2,107			1,312
Transaction costs(1)		78			337			401			984
Globalization costs(2)		873			—			1,548			—
Restructuring costs(3)		205			8			969			38
Technology modernization costs(4)		1,043			422			3,315			1,028
Amortization of acquisition-related intangibles		18,780			16,265			55,243			48,603
Non-GAAP subscription and support gross profit	$	132,095		$	100,256		$	380,436		$	294,592

GAAP subscription and support gross margin		68.9	%		67.2	%		68.5	%		67.4	%
Non-GAAP subscription and support gross margin		82.5	%		81.4	%		82.3	%		81.8	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF FREE CASH FLOW, UNLEVERED FREE CASH FLOW & ADJUSTED UNLEVERED FREE CASH FLOW
(in thousands)
(unaudited)
	Three months ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023

Net cash provided by operating activities	$	203,895		$	182,628		$	102,453		$	127,048
Purchases of property and equipment		(2,433	)		(1,808	)		(6,179	)		(4,708	)
Proceeds from disposals of property and equipment		8			7			30			42
Free cash flow	$	201,470		$	180,827		$	96,304		$	122,382
Cash paid for interest on outstanding debt		25,725			13,781			65,849			31,455
Cash settled stock-based compensation		—			81			—			638
Unlevered free cash flow	$	227,195		$	194,689		$	162,153		$	154,475
Transaction costs(7)		10,630			1,509			20,943			9,874
Globalization costs(7)		3,907			281			8,848			373
Restructuring costs(7)		2,321			903			8,982			6,212
Technology modernization costs(7)		689			29			3,336			260
Other non-recurring costs(7)		66			2,649			184			2,749
Adjusted unlevered free cash flow	$	244,808		$	200,060		$	204,446		$	173,943


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NET DEBT
(in thousands)
(unaudited)
	September 30, 2024
Long-term principal, current	$	11,972
Long-term principal, net of current portion		1,155,299
Cash, cash equivalents, restricted cash, and funds held on behalf of customers		(203,249	)
Net debt	$	964,022

Gross leverage ratio		4.4
Net leverage ratio		3.6


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF TRAILING TWELVE MONTHS NON-GAAP ADJUSTED EBITDA
(in thousands)
(unaudited)
	Three months ended September 30,			Three months ended June 30,			Three months ended March 31,			Three months ended December 31
	2024			2024			2024			2023
Net loss	$	(24,696	)	$	(20,949	)	$	(21,125	)	$	(5,767	)
Interest on outstanding debt and loss on debt extinguishment		26,627			26,413			22,785			11,382
Income tax (benefit) expense		(9,850	)		(6,664	)		(7,067	)		459
Depreciation		1,481			1,399			1,343			1,305
Stock-based compensation		14,351			15,552			12,445			10,575
Transaction costs(1)		13,092			6,264			5,615			5,857
Globalization costs(2)		3,846			3,481			890			54
Restructuring costs(3)		1,328			2,724			4,930			2,085
Technology modernization costs(4)		1,944			2,246			2,266			817
Other non-recurring costs(5)		64			22			102			34
Effects of foreign currency transaction (gains) and losses		(2,690	)		515			1,832			(3,343	)
Amortization of acquisition-related intangibles		45,905			42,898			43,326			35,731
Interest income		(1,271	)		(563	)		(2,398	)		(2,716	)
Adjusted EBITDA	$	70,131		$	73,338		$	64,944		$	56,473


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP COST OF REVENUE
Three Months Ended September 30, 2024
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction Costs			Globalization costs			Restructuring costs			Technology Modernization costs			Amortization of acquired intangibles			Non-GAAP
Cost of Revenue:
Subscription and support	$	49,827	$	(750	)	$	(78	)	$	(873	)	$	(205	)	$	(1,043	)	$	(18,780	)	$	28,098
Professional services and other		8,955		(864	)		(34	)		(287	)		(102	)		—			—			7,668
Total cost of revenue	$	58,782	$	(1,614	)	$	(112	)	$	(1,160	)	$	(307	)	$	(1,043	)	$	(18,780	)	$	35,766


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP COST OF REVENUE
Three Months Ended September 30, 2023
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction Costs			Globalization costs		Restructuring costs			Technology Modernization costs			Amortization of acquired intangibles			Non-GAAP
Cost of Revenue:
Subscription and support	$	40,345	$	(459	)	$	(337	)	$	—	$	(8	)	$	(422	)	$	(16,265	)	$	22,854
Professional services and other		7,082		(603	)		1			—		3			—			—			6,483
Total cost of revenue	$	47,427	$	(1,062	)	$	(336	)	$	—	$	(5	)	$	(422	)	$	(16,265	)	$	29,337


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP COST OF REVENUE
Nine Months Ended September 30, 2024
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction Costs			Globalization costs			Restructuring costs			Technology Modernization costs			Amortization of acquired intangibles			Non-GAAP
Cost of Revenue:
Subscription and support	$	145,566	$	(2,107	)	$	(401	)	$	(1,548	)	$	(969	)	$	(3,315	)	$	(55,243	)	$	81,983
Professional services and other		26,009		(2,451	)		(147	)		(879	)		(628	)		(78	)		—			21,826
Total cost of revenue	$	171,575	$	(4,558	)	$	(548	)	$	(2,427	)	$	(1,597	)	$	(3,393	)	$	(55,243	)	$	103,809


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP COST OF REVENUE
Nine Months Ended September 30, 2023
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction Costs			Globalization costs		Restructuring costs			Technology Modernization costs			Amortization of acquired intangibles			Non-GAAP
Cost of Revenue:
Subscription and support	$	117,532	$	(1,312	)	$	(984	)	$	—	$	(38	)	$	(1,028	)	$	(48,603	)	$	65,567
Professional services and other		21,016		(1,639	)		(27	)		—		(208	)		—			—			19,142
Total cost of revenue	$	138,548	$	(2,951	)	$	(1,011	)	$	—	$	(246	)	$	(1,028	)	$	(48,603	)	$	84,709


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP OPERATING EXPENSES
Three Months Ended September 30, 2024
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction costs			Globalization costs			Restructuring costs			Technology Modernization costs			Other non-recurring costs			Amortization of acquired intangibles			Non-GAAP		GAAP % of revenue			Non-GAAP % of revenue
Operating expenses:
Sales and marketing	$	67,673	$	(4,170	)	$	(1,152	)	$	(368	)	$	(208	)	$	—					$	(27,120	)	$	34,655		39.1	%		20.0	%
Research and development		31,874		(4,469	)		(926	)		(2,105	)		(257	)		(901	)					(5	)		23,211		18.4	%		13.4	%
General and administrative		26,719		(4,098	)		(10,902	)		(213	)		(556	)		—			(64	)		—			10,886		15.4	%		6.3	%
Total operating expenses	$	126,266	$	(12,737	)	$	(12,980	)	$	(2,686	)	$	(1,021	)	$	(901	)	$	(64	)	$	(27,125	)	$	68,752		72.9	%		39.7	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP OPERATING EXPENSES
Three Months Ended September 30, 2023
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction costs			Globalization costs			Restructuring costs			Technology Modernization costs			Other non-recurring costs			Amortization of acquired intangibles			Non-GAAP		GAAP % of revenue			Non-GAAP % of revenue
Operating expenses:
Sales and marketing	$	46,734	$	(3,145	)	$	(179	)	$	—		$	(212	)	$	—		$	—		$	(19,475	)	$	23,723		34.6	%		17.6	%
Research and development		20,688		(3,792	)		(1,216	)		(368	)		(126	)		(35	)		—			(4	)		15,147		15.3	%		11.2	%
General and administrative		15,522		(3,756	)		(1,767	)		(13	)		(203	)		(85	)		(31	)		—			9,667		11.5	%		7.2	%
Total operating expenses	$	82,944	$	(10,693	)	$	(3,162	)	$	(381	)	$	(541	)	$	(120	)	$	(31	)	$	(19,479	)	$	48,537		61.4	%		36.0	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP OPERATING EXPENSES
Nine Months Ended September 30, 2024
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction costs			Globalization costs			Restructuring costs			Technology Modernization costs			Other non-recurring costs			Amortization of acquired intangibles			Non-GAAP		GAAP % of revenue			Non-GAAP % of revenue
Operating expenses:
Sales and marketing	$	187,899	$	(11,612	)	$	(2,786	)	$	(1,136	)	$	(2,644	)	$	—		$	—		$	(76,873	)	$	92,848		37.7	%		18.6	%
Research and development		90,650		(13,047	)		(2,700	)		(3,851	)		(1,539	)		(2,726	)		—			(13	)		66,774		18.2	%		13.4	%
General and administrative		68,094		(13,131	)		(18,937	)		(803	)		(3,202	)		(337	)		(188	)		—			31,496		13.6	%		6.3	%
Total operating expenses	$	346,643	$	(37,790	)	$	(24,423	)	$	(5,790	)	$	(7,385	)	$	(3,063	)	$	(188	)	$	(76,886	)	$	191,118		69.5	%		38.3	%


INSTRUCTURE HOLDINGS, INC.
RECONCILIATION OF NON-GAAP OPERATING EXPENSES
Nine Months Ended September 30, 2023
(in thousands)
(unaudited)
	GAAP		Stock-based compensation expense			Transaction costs			Globalization costs			Restructuring costs			Technology Modernization costs			Other non-recurring costs			Amortization of acquired intangibles			Non-GAAP		GAAP % of revenue			Non-GAAP % of revenue
Operating expenses:
Sales and marketing	$	149,743	$	(9,142	)	$	(1,946	)	$	—		$	(1,814	)	$	—		$	—		$	(58,620	)	$	78,221		37.9	%		19.7	%
Research and development		65,872		(10,446	)		(4,009	)		(451	)		(2,104	)		(165	)		2			(13	)		48,686		16.7	%		12.3	%
General and administrative		44,113		(11,082	)		(2,686	)		(21	)		(1,124	)		(258	)		(113	)		—			28,829		11.2	%		7.3	%
Total operating expenses	$	259,728	$	(30,670	)	$	(8,641	)	$	(472	)	$	(5,042	)	$	(423	)	$	(111	)	$	(58,633	)	$	155,736		65.8	%		39.3	%

FOOTNOTES

(1)

Represents expenses incurred with third parties as part of the Company’s merger and acquisition activity, including due diligence, closing and post-closing integration activities. For the three and nine months ended September 30, 2024, also includes expenses incurred in connection with the proposed merger.

(2)

Represents one-time expenses incurred in the Company's recent efforts to develop and mobilize a global workforce to better support its broadening customer base and expanding international operations.

(3)

Consists of restructuring-related costs, including executive recruiting, severance charges, and other workforce realignment costs. In addition to lease termination costs and disposal of fixed asset charges related to the Company's real estate consolidation efforts. The Company continues to execute a remote-first strategy, closing offices, inclusive of those acquired in merger and acquisition activity, and reducing office space globally. Beginning in 2023, the Company began restructuring its executive team.

(4)

Includes costs that are one-time in nature related to technology modernization to allow the Company's customers and users to have a more cohesive experience on its learning platform as a result of the various technologies acquired from historical acquisitions.

(5)

Represents expenses incurred for services provided by Thoma Bravo and their affiliates.

(6)

The table above includes the tax effects of the adjustments calculated by using the statutory tax rate, taking into consideration the nature of the item and the relevant taxing jurisdiction.

(7)

Represents the cash impacts of transaction costs, globalization costs, restructuring costs, technology modernization costs, and other non-recurring costs, as previously defined above.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

				INSTRUCTURE HOLDINGS, INC.
			Instructure Holdings, Inc.
Date: September 11, 2024				By:	/s/ Matthew A. Kaminer
Date:	November 8, 2024	By:	/s/ Matthew A. Kaminer
					Name: Matthew A. Kaminer
			Matthew A. KaminerChief Legal Officer
					Title: Chief Legal Officer

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