Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________

FORM 10-Q

_________________________________________

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _ to _

Commission file number 1-39595

Nerdy Inc Logo.jpg

NERDY INC.

(Exact name of registrant as specified in its charter)

Delaware		98-1499860
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
	101 S. Hanley Rd., Suite 300
	St. Louis, Missouri 63105
(Address of Principal Executive Offices) (Zip Code)

(314) 412-1227

(Registrant's telephone number, including area code)

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

Title of each class	Trading<br>Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	NRDY	New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share	NRDY-WT	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Indicate the numbers of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class A common stock, par value $0.0001 per share - 98,019,731 shares of common stock as of May 2, 2023

Class B common stock, par value $0.0001 per share - 69,241,655 shares of common stock as of May 2, 2023

Table of Contents

NERDY INC.

QUARTERLY REPORT ON FORM 10-Q

		Page
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited).	1
	Condensed Consolidated Statements of Operations (Unaudited).	1
	Condensed Consolidated Statements of Comprehensive Loss (Unaudited).	2
	Condensed Consolidated Balance Sheets (Unaudited).	3
	Condensed Consolidated Statements of Cash Flows (Unaudited).	4
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited).	5
	Notes to Condensed Consolidated Financial Statements (Unaudited).	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	19
Item 4.	Controls and Procedures.	19
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings.	20
Item 1A.	Risk Factors.	20
Item 6.	Exhibits.	20
	SIGNATURES	21

Table of Contents

PART I. FINANCIAL INFORMATION.

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED).

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(in thousands, except per share data)


	2023		2022
Revenue	$	49,180	$	46,925
Cost of revenue	15,290		14,152
Gross Profit	33,890		32,773
Sales and marketing expenses	15,560		22,946
General and administrative expenses	29,700		30,509
Operating Loss	(11,370)		(20,682)
Unrealized loss on derivatives, net	21,682		11,042
Interest income	(833)		(7)
Other expense, net	11		17
Loss before Income Taxes	(32,230)		(31,734)
Income tax expense	23		13
Net Loss	(32,253)		(31,747)
Net loss attributable to noncontrolling interests	(13,322)		(14,902)
Net Loss Attributable to Class A Common Stockholders	$	(18,931)	$	(16,845)
Loss per share of Class A Common Stock:
Basic and Diluted	$	(0.21)	$	(0.21)
Weighted-Average Shares of Class A Common Stock Outstanding:
Basic and Diluted	91,776		79,619

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

(in thousands)


	2023		2022
Net Loss	$	(32,253)	$	(31,747)
Foreign currency translation adjustments	34		(73)
Total Comprehensive Loss	(32,219)		(31,820)
Comprehensive loss attributable to noncontrolling interests	(13,308)		(14,936)
Total Comprehensive Loss Attributable to Class A Common Stockholders	$	(18,911)	$	(16,884)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

NERDY INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands)

	March 31,<br>2023		December 31,<br>2022
ASSETS
Current Assets
Cash and cash equivalents	$	96,520	$	90,715
Accounts receivable, net	6,333		11,596
Other current assets	4,182		5,345
Total Current Assets	107,035		107,656
Fixed assets, net	12,456		12,504
Goodwill	5,717		5,717
Intangible assets, net	3,465		3,574
Other assets	2,884		3,241
Total Assets	$	131,557	$	132,692
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	4,148	$	3,199
Deferred revenue	22,254		25,539
Other current liabilities	9,157		8,593
Total Current Liabilities	35,559		37,331
Other liabilities	35,594		14,311
Total Liabilities	71,153		51,642
Stockholders’ Equity
Class A common stock	10		9
Class B common stock	7		7
Additional paid-in capital	529,410		522,031
Accumulated deficit	(494,038)		(475,107)
Accumulated other comprehensive income (loss)	8		(12)
Total Stockholders’ Equity Excluding Noncontrolling Interests	35,397		46,928
Noncontrolling interests	25,007		34,122
Total Stockholders’ Equity	60,404		81,050
Total Liabilities and Stockholders’ Equity	$	131,557	$	132,692

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)

	Three Months Ended<br>March 31,
	2023		2022
Cash Flows From Operating Activities
Net Loss	$	(32,253)	$	(31,747)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation & amortization	1,553		1,422
Amortization of intangibles	150		157
Unrealized loss on derivatives, net	21,682		11,042
Non-cash stock-based compensation expense	11,049		12,490
Other changes in operating assets and liabilities:
Decrease in accounts receivable, net	5,263		841
Decrease in other current assets	1,163		575
Decrease in other assets	357		344
Increase in accounts payable	949		2,503
(Decrease) increase in deferred revenue	(3,285)		804
Increase in other current liabilities	686		1,764
Decrease in other liabilities	(520)		(1,126)
Net Cash Provided By (Used In) Operating Activities	6,794		(931)
Cash Flows From Investing Activities
Capital expenditures	(982)		(1,264)
Net Cash Used In Investing Activities	(982)		(1,264)
Cash Flows From Financing Activities
Payments to legacy Nerdy holders	—		(767)
Other	—		(49)
Net Cash Used In Financing Activities	—		(816)
Effect of Exchange Rate Change on Cash, Cash Equivalents, and Restricted Cash	(7)		(5)
Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash	5,805		(3,016)
Cash, Cash equivalents, and Restricted Cash, Beginning of Year	91,547		145,879
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	97,352	$	142,863
Supplemental Cash Flow Information
Non-cash stock-based compensation included in capitalized internal use software	$	524	$	606
Purchase of fixed assets included in accounts payable	—		88

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in thousands)


	2023		2022
Class A Common Stock
Beginning of period	$	9	$	8
Activity under stock compensation plans	1		—
End of period	10		8
Class B Common Stock
Beginning and end of period	7		7
Additional Paid-In Capital
Beginning of period	522,031		490,220
Non-cash stock-based compensation	11,247		12,697
Activity under stock compensation plans	(1)		(49)
Conversion of combined interests into Class A common stock	181		—
Rebalancing of ownership percentage between controlling and the noncontrolling interests	(4,048)		(5,598)
End of period	529,410		497,270
Accumulated Deficit
Beginning of period	(475,107)		(439,708)
Net loss	(18,931)		(16,845)
End of period	(494,038)		(456,553)
Accumulated Other Comprehensive Income (Loss)
Beginning of period	(12)		136
Foreign currency translation adjustments	20		(39)
End of period	8		97
Total Stockholders’ Equity Excluding Noncontrolling Interests	35,397		40,829
Noncontrolling Interests
Beginning of period	34,122		45,142
Net loss	(13,322)		(14,902)
Non-cash stock-based compensation	326		404
Foreign currency translation adjustments	14		(34)
Conversion of combined interests into Class A common stock	(181)		—
Rebalancing of ownership percentage between controlling and the noncontrolling interests	4,048		5,598
End of period	25,007		36,208
Total Stockholders’ Equity	$	60,404	$	77,037
Class A Common Stock - Shares
Beginning of period	95,296		83,913
Activity under stock compensation plans	2,130		764
Conversion of combined interests into Class A common stock	500		—
End of period	97,926		84,677
Class B Common Stock - Shares
Beginning of period	69,306		73,987
Activity under stock compensation plans	452		277
Conversion of combined interests into Class A common stock	(500)		—
End of period	69,258		74,264

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

NERDY INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share information and where indicated otherwise)

NOTE 1 — BASIS OF PRESENTATION

These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), under the rules and regulations of the United States (the “U.S.”) Securities and Exchange Commission (the “SEC”), and on a basis substantially consistent with the audited consolidated financial statements of Nerdy Inc. (herein referred to as “Nerdy,” the “Company,” “us,” “our,” or “we,” and unless otherwise stated or context otherwise indicates, all such references herein mean Nerdy and its consolidated subsidiaries) as of and for the year ended December 31, 2022. These unaudited condensed consolidated financial statements should be read in conjunction with such audited consolidated financial statements, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 28, 2023.

These unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments and accruals) that management considers necessary for a fair statement of the Company’s results of operations, comprehensive income (loss), financial condition, cash flows, and stockholders’ equity (deficit) for the interim periods presented. Interim results are not necessarily indicative of the results for any other interim period or for the entire year.

Nerdy Inc. was formed on September 20, 2021 in connection with a business combination between TPG Pace Tech Opportunities (“TPG Pace”) and Live Learning Technologies LLC (along with its wholly-owned subsidiaries, “Nerdy LLC”). Nerdy LLC is a holding company that is the sole owner of multiple operating companies, including its flagship business Varsity Tutors LLC (“Varsity Tutors”). As a result of the business combination and related transactions (the “Reverse Recapitalization”), Nerdy LLC merged with a wholly-owned subsidiary of Nerdy Inc., with Nerdy LLC surviving such merger. Nerdy Inc. is a holding company that has no material assets other than its ownership interests in Nerdy LLC and its indirect interests in the subsidiaries of Nerdy LLC, and has no independent means of generating revenue or cash flow.

Nerdy Inc. has the following classes of securities issued and outstanding: (i) Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), (ii) Class B common stock, par value $0.0001 per share (the “Class B Common Stock”), and (iii) warrants, each exercisable to purchase one share of Class A Common Stock at a price of $11.50 per share. The shares of Class B Common Stock are owned by the Legacy Nerdy Holders (as defined below), have voting rights only, and have no dividend or economic rights. The Company does not intend to list its Class B Common Stock on any stock exchange.

Nerdy Inc.’s warrants consist of TPG Pace’s previously outstanding private placement warrants and public warrants to purchase Class A ordinary shares that were converted into corresponding private placement warrants to purchase Class A Common Stock (the “Private Placement Warrant(s)”) and public warrants to purchase Class A Common Stock (the “Public Warrant(s)”). Each Private Placement Warrant and Public Warrant allows for the purchase of one share of Class A Common Stock at an exercise price of $11.50 per share. Additionally, Nerdy Inc. also issued warrants to purchase Class A Common Stock in connection with a forward purchase agreement (the “FPA Warrant(s)”). Each FPA Warrant allows for the purchase of one share of Class A Common Stock at an exercise price of $11.50 per share.

Nerdy LLC has the following securities issued and outstanding: (i) units (the “OpCo Units”) and (ii) warrants to purchase OpCo Units at an exercise price of $11.50 (the exercise of which would also result in the issuance of one corresponding share of Class B Common Stock) (the “OpCo Warrant(s)”). Members of Nerdy LLC are the legacy holders of Nerdy LLC historical common and preferred equity (the “Legacy Nerdy Holder(s)”) and Nerdy Inc.

The Private Placement Warrants, the Public Warrants, the FPA Warrants, and the OpCo Warrants are collectively referred to herein as the “Warrant(s).” At March 31, 2023 and December 31, 2022, the Company holds 22 of the total issued and outstanding Warrants.

Of the total shares and units issued and outstanding, there are 8,000 shares or units of (i) Class A Common Stock or (ii) OpCo Units (and a corresponding number of Class B Common Stock), as applicable, that will be subject to forfeiture if the achievement of certain stock price thresholds of the Class A Common Stock are not met within five years of the Reverse Recapitalization (assuming there is no change in control event) (the “Earnout(s)”). At March 31, 2023 and December 31, 2022, the Company holds 36 of the total issued and outstanding Earnouts.

Nerdy Inc. and Nerdy LLC will at all times maintain a one-to-one ratio between the number of shares of Class A and Class B Common Stock issued by Nerdy Inc. and the number of OpCo Units issued by Nerdy LLC.

The financial results of Nerdy LLC and its wholly-owned subsidiaries are consolidated with and into Nerdy Inc., and a portion of the consolidated net earnings (loss) of Nerdy LLC, which the Legacy Nerdy Holders are entitled to or are required to absorb, are allocated to the noncontrolling interests (the “NCI”). The Company has excluded Earnouts in the calculation of the

Table of Contents

ownership interests in Nerdy LLC as the Earnouts are subject to forfeiture, as discussed above. To the extent these price thresholds are met, the Earnouts will no longer be subject to forfeiture and the units will then be included in the calculation of the ownership interests in Nerdy LLC.

NOTE 2 — RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS

The Company has considered all new accounting pronouncements and has concluded that there are no new pronouncements (other than the ones described below) that had or will have an impact on the results of operations, comprehensive income (loss), financial condition, cash flows, and stockholders’ equity (deficit) based on current information.

Recently Issued

In August 2020, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity,” which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. This ASU also removes certain settlement conditions that are required for equity-linked contracts to qualify for the derivative scope exception and it simplifies the diluted earnings (loss) per share calculation in certain areas. The Company is required to adopt this ASU on January 1, 2024. Early adoption is permitted. The Company is in the process of assessing the impact of this ASU.

Recently Adopted

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses. The new current expected credit losses (“CECL”) model generally calls for the immediate recognition of all expected credit losses and applies to loans, accounts and trade receivables, as well as other financial assets measured at amortized cost, loan commitments and off-balance sheet credit exposures, debt securities, and other financial assets measured at fair value through other comprehensive income and beneficial interests in securitized financial assets. This ASU replaces the current incurred loss model for measuring expected credit losses, requires expected losses on available for sale debt securities to be recognized through an allowance for credit losses rather than as a reduction in the amortized cost of the securities, and provides for additional disclosure requirements. The Company adopted this ASU on January 1, 2023 in accordance with the ASU. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements and related disclosures.

Table of Contents

NOTE 3 — NONCONTROLLING INTERESTS

As of March 31, 2023, Legacy Nerdy Holders owned 65,900 OpCo Units, excluding Earnouts, equal to 41.4% of the economic interest in Nerdy LLC, and 65,900 shares of Class B Common Stock, excluding Earnouts. As of December 31, 2022, Legacy Nerdy Holders owned 65,948 OpCo Units, excluding Earnouts, equal to 42.1% of the economic interest in Nerdy LLC, and 65,948 shares of Class B Common Stock, excluding Earnouts.

Nerdy Inc. owned 58.6% and 57.9% of the outstanding OpCo Units as of March 31, 2023 and December 31, 2022, respectively. For the three months ended March 31, 2023 and 2022, the financial results of Nerdy LLC and its subsidiaries were consolidated with and into Nerdy Inc., and the portions of the consolidated net losses of Nerdy LLC, which the Legacy Nerdy Holders absorbed, were allocated to NCI. At the end of each reporting period, Nerdy LLC equity attributable to Nerdy Inc. and the Legacy Nerdy Holders was rebalanced to reflect Nerdy Inc.’s and the Legacy Nerdy Holders’ ownership in Nerdy LLC.

The following table summarizes the changes in ownership of OpCo Units in Nerdy LLC, excluding Earnouts, for the periods presented.


	2023		2022
OpCo Units
Nerdy Inc.
Beginning of period	90,654		79,271
Vesting or exercise of equity awards	2,130		764
Conversion of Combined Interests into Class A Common Stock	500		—
End of period	93,284		80,035
Legacy Nerdy Holders
Beginning of period	65,948		70,629
Vesting or exercise of equity awards	452		277
Conversion of Combined Interests into Class A Common Stock	(500)		—
End of period	65,900		70,906
Total
Beginning of period	156,602		149,900
Vesting or exercise of equity awards	2,582		1,041
End of period	159,184		150,941
Ownership Percentage
Nerdy Inc.
Beginning of period	57.9	%	52.9	%
End of period	58.6	%	53.0	%
Legacy Nerdy Holders
Beginning of period	42.1	%	47.1	%
End of period	41.4	%	47.0	%

Table of Contents

NOTE 4 — REVENUE

The following table presents the Company’s revenue by business category for the periods presented.


	2023		%		2022		%
Consumer	$	40,335	82	%	$	38,918	83	%
Institutional	8,540		17	%	6,475		14	%
Other (a)	305		1	%	1,532		3	%
Revenue	$	49,180	100	%	$	46,925	100	%

(a)Other consists of EduNation Limited, a company incorporated in England and Wales, and other services.

Contract liabilities are reported within “Deferred revenue” on the Company’s Condensed Consolidated Balance Sheets. Deferred revenue consists of advanced payments from customers for performance obligations that have not been satisfied. Deferred revenue is recognized when the performance obligations have been completed. The Company expects to recognize substantially all of the deferred revenue balance in the next twelve months. The following table presents the Company’s “Accounts receivable, net” and “Deferred revenue” reported on the Condensed Consolidated Balance Sheets for the periods presented.

	March 31,<br>2023		December 31,<br>2022
Accounts receivable, net	$	6,333	$	11,596
Deferred revenue	$	22,254	$	25,539

“Accounts receivable, net” is reported net of reserves of $665 and $858 as of March 31, 2023 and December 31, 2022, respectively.

NOTE 5 — INCOME TAXES

Nerdy Inc. holds an economic interest in Nerdy LLC (see Notes 1 and 3), which is treated as a partnership for U.S. federal income tax purposes. As a partnership, Nerdy LLC is generally not subject to U.S. federal income tax under current U.S. tax laws as its net taxable income (loss) and any related tax credits are passed through to its members and included in their tax returns, even though such net taxable income (loss) or tax credits may not have actually been distributed. Nerdy Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to its distributive share of the net taxable income (loss) and any related tax credits of Nerdy LLC. The Company continues to maintain a full valuation allowance against the deferred tax assets at Nerdy Inc. as of March 31, 2023.

The effective income tax rate was (0.07)% and (0.04)% for the three months ended March 31, 2023 and 2022, respectively. The effective income tax rates differed significantly from the statutory rates in both periods, primarily as a result of changes in the valuation allowance and income tax benefit attributable to the NCI. Income tax expense reported for both the three months ended March 31, 2023 and 2022 represents amounts owed to state authorities.

NOTE 6 — LOSS PER SHARE

The following table sets forth the computation of basic and diluted net loss per share of Class A Common Stock.


	2023		2022
Net Loss Attributable to Class A Common Stockholders	$	(18,931)	$	(16,845)
Less: Undistributed net earnings attributable to participating securities	—		—
Net loss attributable to Class A Common Stockholders for basic and diluted loss per share	$	(18,931)	$	(16,845)
Weighted-average shares of Class A Common Stock for basic and diluted loss per share	91,776		79,619
Basic and Diluted loss per share of Class A Common Stock	$	(0.21)	$	(0.21)

Table of Contents

The following table details the securities that have been excluded from the calculation of weighted-average shares for diluted loss per share of Class A Common Stock for the periods presented as they were anti-dilutive.


	2023	2022
Stock options	974	3,297
Stock appreciation rights	6,417	7,092
Restricted stock awards	311	2,238
Restricted stock units	11,389	9,585
Restricted stock units - founder’s award	9,258	9,258
Warrants	19,311	19,311
Earnouts	7,964	7,964
Combined Interests that can be converted into shares of Class A Common Stock	65,900	70,906

NOTE 7 — CASH, CASH EQUIVALENTS, AND RESTRICTED CASH

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the Condensed Consolidated Balance Sheets to the Condensed Consolidated Statements of Cash Flows for the periods presented.

	March 31,<br>2023		December 31,<br>2022		March 31,<br>2022		December 31,<br>2021
Cash and cash equivalents	$	96,520	$	90,715	$	141,715	$	143,964
Restricted cash included in Other current assets	516		516		316		1,083
Restricted cash included in Other assets	316		316		832		832
Total Cash, Cash Equivalents, and Restricted Cash shown in the Condensed Consolidated Statements of Cash Flows	$	97,352	$	91,547	$	142,863	$	145,879

The Company includes amounts in restricted cash required to be set aside by contractual agreement. Restricted cash consists of cash collateralized letters of credit in support of its corporate office leases.

NOTE 8 — FIXED ASSETS, NET

The following table presents fixed assets and accumulated depreciation reported on the Condensed Consolidated Balance Sheets for the periods presented.

	March 31,<br>2023		December 31,<br>2022
Fixed assets	$	37,439	$	36,164
Accumulated depreciation	(24,983)		(23,660)
	$	12,456	$	12,504

The following table presents amortization expense related to capitalized internal use software and depreciation expense reported in the Condensed Consolidated Statements of Operations for the periods presented.


	Statement of Operations Location	2023		2022
Amortization expense related to capitalized internal use software	Cost of revenue	$	1,297	$	1,164
Depreciation expense	General and administrative expenses	256		258

Table of Contents

NOTE 9 — INTANGIBLE ASSETS, NET

The Company’s intangibles assets consist entirely of trade names. The following table presents the carrying amount and accumulated amortization related to trade names reported on the Condensed Consolidated Balance Sheets for the periods presented.

	March 31, 2023		December 31, 2022
Carrying amount	$	6,026	$	5,956
Accumulated amortization	(2,561)		(2,382)
	$	3,465	$	3,574

The following table presents amortization expense related to intangible assets reported in the Condensed Consolidated Statements of Operations for the periods presented.

		Three Months Ended<br>March 31,
	Statement of Operations Location		2023		2022
Amortization expense related to intangible assets	General and administrative expenses		$	150	$	157

NOTE 10 — DERIVATIVE FINANCIAL INSTRUMENTS

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company does not hold or issue financial instruments for speculative or trading purposes.

The Company has issued and outstanding Warrants and Earnouts to non-employees. The Warrants and Earnouts held by non-employees are not in the scope of ASC Topic 718, “Compensation—Stock Compensation” and are classified as derivative liabilities under ASC Topic 480, “Distinguishing Liabilities from Equity” or ASC Topic 815, “Derivatives and Hedging.” Derivative Warrant and Earnout liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require the creation of current liabilities. The Company does not offset derivative assets and liabilities within the Condensed Consolidated Balance Sheets.

At both March 31, 2023 and December 31, 2022, the number of Warrants and Earnouts contracts issued and outstanding to non-employees was 19,122 and 7,655, respectively.

The following table presents the balance sheet location and fair value of the Company’s derivative liability instruments on a gross basis, none of which are designated as hedging instruments under ASC Topic 815.

	Balance Sheet Location	March 31,<br>2023		December 31,<br>2022
Non-employee Warrants	Other liabilities	$	12,812	$	4,398
Non-employee Earnouts	Other liabilities	20,926		7,658
		$	33,738	$	12,056

The following table presents the effects of the Company’s derivative instruments in Condensed Consolidated Statements of Operations for the periods presented.


	Statement of Operations Location	2023		2022
Non-employee Warrants	Unrealized loss on derivatives, net	$	8,414	$	5,163
Non-employee Earnouts	Unrealized loss on derivatives, net	13,268		5,879
		$	21,682	$	11,042

Table of Contents

NOTE 11 — FAIR VALUE MEASUREMENTS

The following table represents the Company’s liabilities measured at fair value on a recurring basis and the basis for that measurement according to the levels in the fair value hierarchy in ASC Topic 820, “Fair Value Measurement.”

	March 31, 2023								December 31, 2022
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Non-employee Warrants	$	12,812	$	6,030	$	6,782	$	—	$	4,398	$	2,070	$	2,328	$	—
Non-employee Earnouts	20,926		—		—		20,926		7,658		—		—		7,658
	$	33,738	$	6,030	$	6,782	$	20,926	$	12,056	$	2,070	$	2,328	$	7,658

The Public Warrants issued to non-employees were valued using the market approach based upon the quoted market price of Nerdy Inc.’s Public Warrants at the end of each period and are categorized as Level 1. The Private Placement Warrants, FPA Warrants, and OpCo Warrants issued to non-employees were valued based upon the quoted price for similar liabilities (the Public Warrants issued to non-employees) in active markets at the end of each period. As such, the Private Placement Warrants, FPA Warrants, and OpCo Warrants issued to non-employees are categorized as Level 2.

The fair value of liabilities associated with the non-employee Earnouts was measured on a recurring basis using the Monte Carlo Option Pricing Method. The fair value measurement is categorized as Level 3, as the fair values utilize significant unobservable inputs. The following table summarizes the Level 3 activity measured on a recurring basis.

Balance, December 31, 2022	$	7,658
Mark-to-market loss on non-employee Earnouts	13,268
Balance, March 31, 2023	$	20,926

The fair value of each non-employee Earnout was estimated using the Monte Carlo Option Pricing Method at the end of each reporting period. Inherent in the Monte Carlo Option Pricing Method are assumptions related to expected stock-price volatility, expected life, risk-free interest rate, and dividend yield. The Company estimated expected stock-price volatility using the implied volatility from the Company’s Public Warrants. The risk-free interest rate was based on the U.S. Treasury zero-coupon yield curve for a maturity similar to the expected remaining life of the non-employee Earnouts. The expected life of the non-employee Earnouts was assumed to be equivalent to their remaining contractual term. The Company anticipated the dividend rate will remain at zero.

The following table presents the assumptions used to remeasure the fair value of outstanding non-employee Earnouts liabilities for the periods presented.

	March 31,<br>2023	December 31,<br>2022
Expected term (in years)	3.48	3.72
Stock price of Class A Common Stock	$4.18	$2.25
Expected stock price volatility	83.0%	79.0%
Risk-free interest rate	3.7%	4.1%
Expected Dividends	—%	—%
Fair Value (per Earnout)	$2.73	$1.00

The Company’s financial assets and liabilities also include cash and cash equivalents, restricted cash, receivables, and accounts payable for which the carrying value approximates fair value due to their short maturities (less than 12 months). Certain assets and liabilities, including definite-lived assets and goodwill, are measured at fair value on a non-recurring basis. There were no fair value measurement adjustments recognized related to definite-lived assets or goodwill during the three months ended March 31, 2023 or 2022.

Table of Contents

NOTE 12 — RELATED PARTIES

Tax Receivable Agreement

Nerdy Inc. has a tax receivable agreement with certain Legacy Nerdy Holders (the “TRA Holder(s)”) (the “Tax Receivable Agreement”). The Tax Receivable Agreement generally provides for the payment by Nerdy Inc. to the TRA Holders of 85% of the net cash savings, if any, in U.S. federal, state, and local income tax that Nerdy Inc. actually realizes (or is deemed to realize in certain circumstances) as a result of: (i) certain increases in tax basis that occur as a result of (A) the Reverse Recapitalization (including as a result of cash received in the Reverse Recapitalization and debt repayment occurring in connection with the Reverse Recapitalization) or (B) exercises of the redemption or call rights set forth in the Nerdy LLC operating agreement; and (ii) imputed interest deemed to be paid by Nerdy Inc. as a result of, and additional basis arising from, any payments Nerdy Inc. makes under the Tax Receivable Agreement. Nerdy Inc. will retain the benefit of the remaining 15% of these net cash savings.

As of March 31, 2023, Nerdy Inc. has not recognized a liability of $110,575 under the Tax Receivable Agreement after concluding it was not probable that such Tax Receivable Agreement payments would be paid based on its estimates of Nerdy’s LLC future taxable income. Nerdy Inc. did not make any payments to the TRA Holders under the Tax Receivable Agreement during the three months ended March 31, 2023 or 2022. The amounts payable under the Tax Receivable Agreement will vary depending upon a number of factors, including the amount, character, and timing of the taxable income of the Company in the future. If the valuation allowance recorded against the deferred tax assets applicable to the tax attributes referenced above is released in a future period, the Tax Receivable Agreement liability may be considered probable at that time and recorded within earnings.

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity, and capital resources of Nerdy Inc. and its consolidated subsidiaries. This discussion should be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto included herein and our audited consolidated financial statements and notes thereto found in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Annual Report”), as filed with the United States Securities and Exchange Commission (the “SEC”) on February 28, 2023. In addition, the following discussion and analysis of Nerdy Inc.’s financial condition and results of operations also contains forward-looking statements that involve risks, uncertainties, and assumptions. Actual results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those set forth in the sections entitled “Item 1A. Risk Factors” in Part I of the 2022 Annual Report and “Item 1A. Risk Factors” in Part II of this report, as well as under the section “Cautionary Note On Forward-Looking Statements” below. Unless otherwise stated or the context otherwise indicates, all references in the succeeding paragraphs to “Nerdy,” “the Company,” “us,” “our” or “we” mean Nerdy Inc. and its consolidated subsidiaries.

OVERVIEW

We operate a platform for live online learning. Our mission is to transform the way people learn through technology. Our purpose-built proprietary platform leverages technology, including artificial intelligence (“AI”), to connect students, users, parents, guardians, and purchasers (“Learner(s)”) of all ages to tutors, instructors, subject matter experts, educators, and other professionals (“Expert(s)”), delivering superior value on both sides of the network. Our comprehensive learning destination provides learning experiences across numerous subjects and multiple formats, including Learning Memberships, one-on-one instruction, small group tutoring, small group classes, large format group classes, and adaptive self-study. Our flagship business, Varsity Tutors LLC (“Varsity Tutors”), is one of the nation’s largest platforms for live online tutoring and classes. Its solutions are available directly to Learners, as well as through schools and other institutions. Our platform offers Experts the opportunity to generate income from the convenience of home, while also increasing access for Learners by removing barriers to high-quality, live online learning. Our offerings include Varsity Tutors for Schools, a product suite (including High Dosage, Teacher Assigned, and On Demand tutoring) that leverages our platform capabilities to offer our online learning solutions directly to education systems. We have built a diversified business across the following audiences: K-8, High School, College, Graduate School, and Professional.

KEY OPERATING METRICS

We monitor the following key operating metrics to evaluate the growth of our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions.

We continue to make substantial progress in our transition from our Package model to Learning Memberships within our Consumer business. As a result of this transition, we are presenting Active Members (as defined below) as a new key operating metric. As Learning Memberships were first broadly sold in the second quarter of 2022, comparable Active Member counts for prior year periods will not be provided until the second quarter of 2023.

“Active Member(s)” is defined as the number of Learners with an active Learning Membership as of the date presented. Variations in the number of Active Members are due to changes in demand for our solutions, seasonality, testing schedules, the extension of Learning Memberships to additional Consumer audiences, and the launch of new membership options. As a result, we believe Active Members is a key indicator of our ability to attract, engage, and retain Learners. Active Members exclude EduNation Limited, a company incorporated in England and Wales (“First Tutors UK”), as well as our Institutional business.

Active Members in thousands	March 31,<br>2023
Active Members	32.9

“Active Experts” is defined as the number of Experts who have instructed one or more sessions in a given period. Active Experts also includes our Institutional business, but excludes First Tutors UK. The following table summarizes Active Experts for the periods presented.

	Three Months Ended<br>March 31,		Change
Active Expert in thousands:<br>favorable/(unfavorable)		2023	2022	%
Active Experts		10.2	11.3	(10)%

Table of Contents

RESULTS OF OPERATIONS


dollars in thousands	2023		%		2022		%
Revenue	$	49,180	100	%	$	46,925	100	%
Cost of revenue	15,290		31	%	14,152		30	%
Gross Profit	33,890		69	%	32,773		70	%
Sales and marketing expenses	15,560		32	%	22,946		49	%
General and administrative expenses	29,700		60	%	30,509		65	%
Operating Loss	(11,370)		(23)	%	(20,682)		(44)	%
Unrealized loss on derivatives, net	21,682		44	%	11,042		24	%
Interest income	(833)		(1)	%	(7)		—	%
Other expense, net	11		—	%	17		—	%
Loss before Income Taxes	(32,230)		(66)	%	(31,734)		(68)	%
Income tax expense	23		—	%	13		—	%
Net Loss	(32,253)		(66)	%	(31,747)		(68)	%
Net loss attributable to noncontrolling interests	(13,322)		(28)	%	(14,902)		(32)	%
Net Loss Attributable to Class A Common Stockholders	$	(18,931)	(38)	%	$	(16,845)	(36)	%

Revenue

Revenue growth was driven by the continued evolution towards ‘always on’ recurring revenue products, strong adoption of Learning Memberships, lifetime value expansion, and a return to year-over-year growth in our Consumer business coupled with the continued scaling of our Institutional business.

The following table presents our revenue by business category for the periods presented.


dollars in thousands	2023		%		2022		%
Consumer	$	40,335	82	%	$	38,918	83	%
Institutional	8,540		17	%	6,475		14	%
Other (a)	305		1	%	1,532		3	%
Revenue	$	49,180	100	%	$	46,925	100	%

(a)Other consists of First Tutors UK and other services.

Cost of Revenue and Gross Profit

The following table sets forth our cost of revenue and gross profit for the periods presented.

	Change
dollars in thousands;<br>favorable/(unfavorable)	2023			2022				%
Revenue	$	49,180		$	46,925			5%
Cost of revenue	15,290			14,152			(1,138)	(8)%
Gross Profit	$	33,890		$	32,773			3%
% Margin	69		%	70		%

All values are in US Dollars.

Cost of revenue increased due to higher expert costs of $1,005 thousand, primarily related to our Institutional business.

Gross margin of 69% for the three months ended March 31, 2023 was approximately 90 basis points lower than gross margin of 70% for the three months ended March 31, 2022. The increase in gross profit was primarily driven by gross margin expansion across our Consumer audience, which was offset by lower Institutional gross margin primarily due to higher than anticipated engagement with our new offerings.

Table of Contents

Operating Expenses

The following table sets forth our operating expenses for the periods presented.

	Change
dollars in thousands;<br>favorable/(unfavorable)	2023		2022			%
Sales and marketing expenses	$	15,560	$	22,946		32%
General and administrative expenses	29,700		30,509		809	3%
Total operating expenses	$	45,260	$	53,455		15%

All values are in US Dollars.

Sales and Marketing

Sales and marketing expenses for the three months ended March 31, 2023 and 2022 included stock-based compensation of $838 thousand and $1,075 thousand, respectively. Excluding these impacts in both periods, sales and marketing expenses decreased $7,149 thousand, or 33%. Additionally, excluding these impacts in both periods, sales and marketing expenses for the three months ended March 31, 2023 were 30% of revenue compared to 47% of revenue during the same period in 2022, an approximate 1700 basis point improvement year-over-year.

Sales and marketing spend and efficiency improvements were driven by the transition to Learning Memberships, including the continued expansion of lifetime value, our focus on optimizing the level of marketing spend, and a more efficient operating model in our Consumer business. We also delivered substantial Varsity Tutors for School revenue growth, yielding efficiencies from prior investments in the Institutional sales and go-to-market organization. As Learning Memberships become a greater percentage of total revenue and the Institutional business continues to scale, we expect continued improvements in sales and marketing leverage.

General and Administrative

General and administrative expenses for the three months ended March 31, 2023 and 2022 included non-cash stock based compensation of $10,211 thousand and $11,415 thousand, respectively. Excluding these impacts in both periods, general and administrative expenses increased $395 thousand, or 2%. Additionally, excluding these impacts in both periods, general and administrative expenses for the three months ended March 31, 2023 were 40% of revenue compared to 41% of revenue during the same period in 2022, an approximate 100 basis point improvement year-over-year.

Our investments in product development have allowed us to launch a suite of ‘always on’ subscription products including Learning Memberships for consumers, and our Teacher Assigned and On Demand offerings for institutional customers. Subscription offerings simplify both the sales process and the operating model needed to support customers. Combined with our ongoing efforts in automation, self-service capabilities, and the application of artificial intelligence and machine learning in our business, we have been able to generate operating efficiencies and remove significant costs from the business. We believe we will be able to further simplify our operating model while growing our business as we move throughout 2023.

Unrealized Loss on Derivatives, Net

During the three months ended March 31, 2023 and 2022, we recognized net losses of $21,682 thousand and $11,042 thousand, respectively, related to non-cash mark-to-market adjustments on our warrants and earnouts. Of the net loss recognized in the three months ended March 31, 2023, $8,414 thousand and $13,268 thousand related to warrants and earnouts, respectively. Of the net loss recognized in the three months ended March 31, 2022, $5,163 thousand and $5,879 thousand related to warrants and earnouts, respectively.

For additional information on our warrants and earnouts, see Note 10 within “Notes to Condensed Consolidated Financial Statements” in Part I, Item 1 of this report.

Interest Income

Interest income for the three months ended March 31, 2023 was $833 thousand, an increase from $7 thousand in the same period in 2022. This increase was driven by higher interest income on our cash balances during the current year period.

LIQUIDITY AND CAPITAL RESOURCES

Sources and Uses of Cash

As of March 31, 2023 and December 31, 2022, we had cash and cash equivalents totaling $96,520 thousand and $90,715 thousand, respectively. We have incurred cumulative losses from our operations, and we may incur additional losses in the future. Our operations have historically been financed primarily through capital contributions and debt financings. Despite our

Table of Contents

positive cash flows from operations realized for the three months ended March 31, 2023, it is possible that we may have to finance future operations primarily or in part from cash on hand. We are using the proceeds received from the reverse recapitalization to fund our operating and investing cash needs, and for continued investments in our growth strategies.

Cash Requirements

Our cash requirements within the next twelve months include working capital requirements, sales and marketing activities, and capital expenditures. We believe our cash on hand will be sufficient to satisfy these future requirements.

As of March 31, 2023, we had no debt obligations. Our cash requirements under our contractual obligations and commitments consist primarily of lease arrangements. For information on our lease obligations and the amount and timing of future payments, see Note 17 within “Notes to Consolidated Financial Statements” in Part II, Item 8 of our 2022 Annual Report. There have been no material changes to our leasing arrangements previously disclosed in our 2022 Annual Report.

The following table sets forth our cash flows for the periods presented.

	Three Months Ended<br>March 31,
dollars in thousands	2023		2022
Cash provided by (used in):
Operating activities	$	6,794	$	(931)
Investing activities	(982)		(1,264)
Financing activities	—		(816)
Effect of Exchange Rate Change on Cash, Cash equivalents, and Restricted Cash	(7)		(5)
Net Increase (Decrease) in Cash, Cash equivalents, and Restricted Cash	$	5,805	$	(3,016)

Operating Activities

Cash provided by operating activities for the three months ended March 31, 2023 was $6,794 thousand compared to cash used in operating activities of $931 thousand in the prior year period. The improvement in operating cash flow was driven by higher revenues, sales and marketing efficiency gains, the pull through of automation and workforce reduction actions stemming from our business model changes that streamline operations, and diligent cost oversight. Additionally, cash provided by operating activities in the current year period was positively impacted by favorable changes in working capital, primarily related to fluctuations in the timing of sales and collections of receivables. These positive impacts were partially offset by unfavorable changes in deferred revenue due to the transition to Learning Memberships in the current year period.

Investing Activities

Cash used in investing activities was $982 thousand and $1,264 thousand for the three months ended March 31, 2023 and 2022, respectively. Cash used in investing activities related to capital expenditures primarily for the development of internal use software and IT equipment.

Financing Activities

Cash provided by financing activities for the three months ended March 31, 2022 was $816 thousand, which primarily related to payments made to legacy Nerdy holders in connection with the reverse recapitalization.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our critical accounting policies and estimates are more fully described in our 2022 Annual Report. There have been no material changes to our critical accounting policies and estimates previously disclosed in our 2022 Annual Report.

RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS

See Note 2 within “Notes to Condensed Consolidated Financial Statements” in Part 1, Item 1 of this report for a discussion regarding recently issued and adopted accounting standards.

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

Certain statements in this report may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions, or strategies regarding the future, including our expectations with respect to: continued improvements in sales and marketing leverage; the growth of our Institutional business; simplifying our operations model while

Table of Contents

growing our business; and the sufficiency of our cash to fund future operations. Any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipates,” “approximately,” “believes,” “contemplates,” “continues,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “outlook,” “plans,” “possible,” “potential,” “predicts,” “projects,” “should,” “seeks,” “will,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Our financial condition, results of operations, and cash flows may differ materially from those in the forward-looking statements as a result of various factors, including:

•our limited operating history, which makes it difficult to predict our future financial and operating results;

•our history of net losses;

•risks associated with our shift to the Learning Membership model;

•risks associated with scaling up our Institutional business;

•risks associated with our intellectual property, including claims that we infringe on a third party’s intellectual property rights;

•risks associated with our classification of some individuals and entities we contract with as independent contractors;

•risks associated with the liquidity and trading of our securities;

•risks associated with payments that we may be required to make under the tax receivable agreement;

•risks associated with the terms of our warrants;

•litigation, regulatory, and reputational risks arising from the fact that many of our Learners are minors;

•changes in applicable laws or regulations;

•the possibility of cyber-related incidents and their related impacts on our business and results of operations;

•the possibility that we may be adversely affected by other economic, business, and/or competitive factors;

•risks associated with managing our rapid growth; and

•other risks and uncertainties included under “Risk Factors” within Part II, Item 1A of this report and in our 2022 Annual Report filed with the SEC on February 28, 2023.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report to conform these statements to actual results or to changes in our expectations. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors described in the section titled “Risk Factors” elsewhere in this report. Readers are urged to carefully review and consider the various disclosures made in this report and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

EMERGING GROWTH COMPANY STATUS

We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.

In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting

Table of Contents

standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.

We expect to remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of TPG Pace Tech Opportunities’ initial public offering, (b) in which we have total annual gross revenue of at least $1,235,000 thousand, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our shares of common stock that are held by non-affiliates equals or exceeds $700,000 thousand as of the prior June 30 or (2) the date on which we have issued more than $1,000,000 thousand in non-convertible debt securities during the prior three-year period.

SMALLER REPORTING COMPANY STATUS

We are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We expect to remain a smaller reporting company at the last day of the fiscal year as long as (i) the market value of our shares of common stock held by non-affiliates is less than $250,000 thousand as of the prior June 30, or (ii) our annual revenues are less than $100,000 thousand during the prior fiscal year and the market value of our shares of common stock held by non-affiliates is less than $700,000 thousand as of the prior June 30.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market Price Sensitivity

At both March 31, 2023 and December 31, 2022, we had warrant and earnout contracts issued and outstanding to non-employees of 19,122 thousand and 7,655 thousand, respectively. As of March 31, 2023 and December 31, 2022, a hypothetical 10% adverse change in the price of our public warrants would have increased the fair value of the liabilities related to these warrant contracts by approximately $1,281 thousand and $440 thousand, respectively. As of March 31, 2023 and December 31, 2022, a hypothetical 10% adverse change in the fair value of the earnouts, which is impacted by the price of our Class A common stock, would have increased the fair value of the liabilities related to these earnout contracts by approximately $2,093 thousand and $766 thousand, respectively.

For additional information regarding our warrants and earnout contracts issued and outstanding to non-employees, refer to Notes 10 within “Notes to Condensed Consolidated Financial Statements” in Part I, Item 1 of this report.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) of the Company, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of March 31, 2023. Based on that evaluation, the Company’s CEO and CFO concluded that, as of March 31, 2023, the Company’s disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and (ii) accumulated and communicated to our management, including CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Limitations on Effectiveness of Controls and Procedures

Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

Changes in Internal Control Over Financial Reporting

There were no significant changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2023, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION.

Table of Contents

ITEM 1. LEGAL PROCEEDINGS.

For disclosure of environmental proceedings with a governmental entity as a party pursuant to Item 103(c)(3)(iii) of Regulation S-K, we have elected to disclose matters where we reasonably believe such proceeding would result in monetary sanctions, exclusive of interest and costs, of $1,000 thousand or more. Applying this threshold, there are no such environmental proceedings to disclose as of and for the three months ended March 31, 2023.

ITEM 1A. RISK FACTORS.

In addition to the information set forth elsewhere in this Quarterly Report on Form 10-Q (the “Quarterly Report”), you should carefully consider the risk factors we previously disclosed in our Annual Report on Form 10-K, filed with the SEC on February 28, 2023, as of and for the year ended December 31, 2022 (the “2022 Annual Report”). As of the date of the Quarterly Report, there have been no material changes to the risk factors previously disclosed in our 2022 Annual Report. These risks could materially and adversely affect our business, financial condition, results of operations, and cash flows. However, these risks are not the only risks we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business, financial condition, results of operations, and cash flows.

ITEM 6. EXHIBITS.

The following exhibits are either provided with this Form 10-Q or are incorporated herein by reference.

Exhibit No.	Description
3.1	Certificate of Incorporation of Nerdy Inc. (incorporated by reference to Exhibit 3.1 filed with the Company’s Form 8-K filed on September 24, 2021 (File No. 001-39595)).
3.2	Bylaws of Nerdy Inc. (incorporated by reference to Exhibit 3.2 filed with the Company’s Form 8-K filed on September 24, 2021 (File No. 001-39595)).
†10.1	Consulting Agreement, Departure Agreement, and General Release, dated March 10, 2023, by and between Heidi Robinson and Nerdy Inc., Nerdy LLC, Varsity Tutors LLC, and Live Learning Technologies Shared Resources LLC.
31.1	Certification of Charles Cohn pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated May 9, 2023.
31.2	Certification of Jason Pello pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated May 9, 2023.
* 32.1	Certification of Charles Cohn and Jason Pello, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated May 9, 2023.
101	Interactive Data File (Form 10-Q for the quarterly period ended March 31, 2023 filed in iXBRL (Inline eXtensible Business Reporting Language)). The financial information contained in the iXBRL-related documents is “unaudited” and “unreviewed.”
104	The cover page from the Company’s Form 10-Q for the quarterly period ended March 31, 2023, formatted in iXBRL (Inline eXtensible Business Reporting Language) and contained in Exhibit 101.

† These exhibits constitute management contracts, compensatory plans, and arrangements.

* These certifications are deemed not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Nerdy Inc. has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Nerdy Inc.
Date: May 9, 2023	By:	/s/ Jason Pello
		Name: Jason Pello
		Title: Chief Financial Officer

Document

EXHIBIT 10.1

Consulting Agreement, Departure Agreement, and Release

This Consulting Agreement, Departure Agreement, and General Release (“Agreement”) is made and entered into on the date last below written by and between Nerdy Inc., a Delaware corporation; Nerdy LLC, a Delaware limited liability company, and its related and affiliated entities, including Varsity Tutors LLC, a Missouri limited liability company (“Varsity”), and Live Learning Technologies Shared Resources LLC (“LLTSR”, and collectively with Nerdy Inc., Nerdy LLC, and Varsity, the “Company”), all with their principal place of business at 101 S. Hanley Rd., Suite 300, Clayton, Missouri 63105, on the one hand, and Heidi Robinson (“Executive” or “Consultant”), whose principal residence is Bainbridge Island, WA 98110, on the other. The Company and Executive are sometimes referred to herein collectively as the “Parties” and individually as a “Party.”

WHEREAS, Executive executed an Executive Services Agreement dated October 19, 2021 (the “Executive Services Agreement”); and

WHEREAS, the Executive Services Agreement amended and superseded the Prior Executive Agreement (as defined therein and hereinafter the “Prior Executive Agreement”) in accordance with the terms of the Executive Services Agreement; and

WHEREAS, the Executive Services Agreement was Section II of a document that included (and was also signed/initialed and dated October 19, 2021, hereinafter the “Omnibus”):

Section I. Profits Interests Units (“PIU”) Rights, Earnout Shares, and Warrants Notice Acknowledgment, and Release (“Notice, Acknowledgment, and Release”); and

Section II. Executive Services Agreement; and

Section III. Schedule A(s): Converted PIUs and/or Cash Consideration (“Schedule As”);1 and

Section IV. Schedule B: Earnout Shares and Warrants (“Schedule B”); and

WHEREAS, the Prior Executive Agreement related to Executive’s role as Chief Product Officer, which was Executive’s same role under the Executive Services Agreement (although prior to the Departure Date, as defined below, Executive also effectively assumed the role leading the human resources and recruiting functions); and

WHEREAS, neither Party provided formal Notice (as defined in the Executive Services Agreement) to terminate the Executive Services Agreement or otherwise communicated a termination of Executive’s relationship with the Company; however, Executive was advised that the Executive Services Agreement would be terminated without Cause, unless the Parties formalized a relationship not contemplated by the Executive Services Agreement whereby Executive would become a consultant and advisor exclusively to the Company for a set term (with certain exceptions as more fully described below) in return for the compensation and benefits hereunder, enhanced equity vesting, and certain post-separation benefits set forth in the Executive Services Agreement; and

WHEREAS, despite the informal notification that the Executive Services Agreement would be terminated by the Company without cause, the Company and Executive agree that this Agreement amends and supersedes the Executive Services Agreement in accordance with the terms of this Agreement, specifically memorializing the exclusive consulting and advisor relationship of Consultant with respect to Company, the terms and conditions of

1 The Schedule As in the Omnibus summarized the Subscription Agreements and Joinder documents entered into by Executive relating to the PIUs and the results of the transaction, setting forth (i) the number of PIUs held by Executive prior to the Business Combination, (ii) the Class B Shares and Nerdy LLC Units Executive received in exchange upon Closing, (iii) the Cash Secondary Payment Executive received after Closing and executing the Omnibus, and (iv) the vesting that applied to the Unvested Nerdy LLC Units Executive received. Capitalized terms not defined herein are taken from the Omnibus. There were five (5) Schedule As (each reflecting a separate grant of PIUs), of which (a) four (4) were four (4) year grants, two (2) of which fully vested (the July 18, 2016 grant that fully vested in July 2020 and the February 28, 2018 grants that fully vested in February 2022, respectively), with the other two (2) fully vesting in April 2023 and June 2024, respectively, and (b) one (1) grant with a five (5) year vesting schedules that does not fully vest until June 2024. The unvested Class B Shares at Continental are updated manually at or around the end of each month when they vest (and can be tracked through E*TRADE but the Class B shares themselves are actually held at Continental) and the vesting will continue to be updated in the ordinary course of doing so in the future (consistent with other holders of unvested Class B Shares and Nerdy LLC Units), unless forfeited.

the consulting and advisory relationship, and the terms and conditions of Consultant’s departure upon conclusion of the consulting and advisory relationship (all as more fully described below);2 and

WHEREAS, at the time of executing this Agreement, Executive’s title was Chief Product Officer and her Base Guaranteed Wage was $400,000 (on an annualized basis); and

WHEREAS, upon entering into this Agreement, Consultant shall become an advisor and consultant to the Company (and shall cease being an executive and an officer);3 and

WHEREAS, in accordance with the Notice, Acknowledgment, and Release, and Schedule As, Executive’s PIUs converted into Class B Shares of Nerdy Inc, and Nerdy LLC Units,4 as reflected in Schedule As, which also reflected the Vesting Schedule and the amount vested/unvested as of that date; and

WHEREAS, Executive received a grant of 400,000 restricted stock units (“RSUs”) on December 1, 2021, that was documented in a Restricted Stock Unit Award Grant Notice (“RSU Grant Notice 1”); and

WHEREAS, Executive received a grant of 258,979 RSUs on December 1, 2021, that was documented in a Restricted Stock Unit Award Grant Notice (“RSU Grant Notice 2”); and

WHEREAS, Executive received a grant of 628,571 RSUs on June 9, 2022, that was documented in a Restricted Stock Unit Award Grant Notice (“RSU Grant Notice 3” and collectively with RSU Grant Notice 1 and RSU Grant Notice 2, the “RSU Grant Notices”); and

WHEREAS, the RSU Grant Notices (and their respective vesting schedules) are reflected in Company’s stock administration provider, E*TRADE; and

WHEREAS, in accordance with Schedule B, Executive has 42,649 Class B Earnout Shares and 26,063 Class B Warrants; and

WHEREAS, Executive entered into a 10b5-1 Plan with a plan adopted date of June 14, 2022, a plan start date of September 24, 2022, and a plan end date of November 20, 2023, which was approved by Company and is currently in effect (the “10b5-1 Plan”); and

WHEREAS, all of Executive’s unvested equity is forfeited, other than the unvested equity that will not be forfeited as set forth herein once this Agreement is effective and while Consultant is engaged as a consultant and advisor to the Company hereunder (and thereby being in a service relationship), in which case Consultant’s previously granted Company equity subject to vesting on or before May 15, 2023 will continue to vest in accordance with the terms of those grants through May 15, 2023 (all as more specifically described herein); and

WHEREAS, if Consultant’s consulting and advising relationship with Company ceases for any of the reasons herein prior to May 15, 2023, Executive’s remaining unvested equity at the time the relationship ceases will cease vesting; and

WHEREAS, as of March 6, 2023, Executive has 134,283 unvested Class B Shares/Nerdy LLC Units with the vesting date and shares vested set forth in Continental and/or E*TRADE and all other Class B Shares/Nerdy LLC Units have vested, exclusive of any RSUs, warrants, and earnout shares that are tied to Class B Shares/Nerdy LLC Units and are separately addressed; and

WHEREAS, Executive was scheduled to have unvested Class B Shares/Nerdy LLC Units vest in accordance with their respective Schedule As (and as reflected in Continental and E*TRADE) on the dates and in the amounts indicated; however, all unvested equity as of the Departure Date is hereby forfeited, except the 32,375 Class B Shares/Nerdy LLC Units that are scheduled to vest on or before May 15, 2023 (all of which shall vest in accordance with their respective vesting schedules), if Executive executes this Agreement, does not revoke the Agreement, and is still in a service relationship with Company (as a consultant and advisor hereunder), or as otherwise provided in Sections 3, 5(b), and 9 herein; and

2 Only the terms that survive termination of the Executive Services Agreement will remain in effect.

3 For purposes of clarity, Executive was in a service relationship with Company prior to entering into this Agreement and will remain in a service relationship with Company as a consultant and advisor to the Company, subject to the terms and conditions herein.

4 For purposes of clarity, each Class B Share of Nerdy Inc., combined with one Nerdy LLC Unit is transferrable for one Class A Share of Nerdy Inc. (and must be maintained accordingly - e.g. they can only be transferred together in the same number for one Class A Share, which would be sold into the market).

WHEREAS, Executive was scheduled to have the RSU Grant Notices vest in accordance with their respective vesting schedules, provided any RSUs scheduled to vest after May 15, 2023 are forfeited hereunder, and, as it relates to those RSUs not forfeited (93,568 RSUs will remain subject to vesting in accordance with their vesting schedule) and subject to continued vesting hereunder, such vesting will continue to occur provided Executive is still in a service relationship with Company (as a consultant and advisor hereto), or as otherwise provided in Sections 3, 5(b) and 9 herein; and

WHEREAS, all Class B Shares/Nerdy Units and RSUs that are scheduled to vest after May 15, 2023 have been or shall be forfeited, as will all other unvested equity unless specifically identified herein as being subject to vesting hereunder; and

WHEREAS, Executive is currently subject to Company’s Insider Trading Policy (“ITP”) and will continue to be subject to the ITP during the term of Consultant’s relationship hereunder; and

WHEREAS, as more fully described herein, Executive shall be be subject to trading limitations on certain equity as more specifically set forth in Section 6 of the Agreement, in addition to whatever trading restrictions arise under the ITP, other than trades reflected in the 10b5-1 Plan; and

WHEREAS, Executive participated in the Company’s 401(k) Plan and will have whatever rights and obligations that exist under the terms and conditions thereunder as of the Departure Date (set forth below), including vesting of employer contributions; and

WHEREAS, Company and Executive desire to preserve the service relationship while altering the executive and officer relationship between them in a manner mutually beneficial to both Parties, including entering into this Agreement.

NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants and promises set forth herein, the adequacy of which is acknowledged by each of the Parties, it is hereby agreed as follows.

1.Cessation of Executive Relationship and Benefits Continuation Information. Executive’s relationship with Company as an Executive and officer shall cease March 6, 2023 (“Departure Date”), at which point Executive shall cease providing executive (including officer) services to Company (other than in the context of any cooperation required in the Executive Services Agreement and hereunder related to Executive’s prior roles as an executive and/or officer) and shall begin Consultant’s relationship with Company as a consultant and advisor (and thereby remain in a service relationship with Company) through December 31, 2023, subject to the termination provisions in Section 9.

Executive shall have a waivable period of twenty-one (21) days after the date on which this Agreement is delivered to Executive to consider whether or not to execute this Agreement. Executive may accept the offer contained in the Agreement at any time within the twenty-one (21) day period by signing it and delivering it to Company, unless withdrawn by the Company prior to acceptance. If Executive does so, the twenty-one (21) day period automatically ceases. If Executive does not accept the offer prior to the end of the twenty-one (21) day period, it shall be automatically revoked. The Releases in this Agreement (Section 20 and 21) shall be effective as of the eighth (8th) day after it is executed by Employee (“Effective Date”), provided the Agreement is not revoked by Executive pursuant to the “Age Claim Waiver” provisions in the Section entitled “Age Claim Waiver.” Notwithstanding the preceding, if Executive timely revokes the Releases (in Sections 20 and 21), Company shall have no further obligation to Executive under this Agreement.

The insurance benefits elected and enrolled in by Executive as of the Departure Date shall terminate as of March 31, 2023, subject to the terms and conditions of the applicable plan documents, and thereafter shall be subject to continuation under federal or state law, as applicable. Executive will be notified in writing of the benefits that may be continued under COBRA or applicable state law, and of the terms, conditions, and limitations of such continuation (consistent with applicable law). As further consideration, Company agrees to reimburse Executive’s out of pocket COBRA expense for benefit continuation during the same time Executive provides consulting and advisory services to Company hereunder (not to go beyond reimbursement for such continuation through December 31, 2023, if the services go to full term), provided that Executive timely elects COBRA and promptly submits receipts to Company indicating proof of payment for any such month(s) for which Executive seeks COBRA reimbursement costs.

2.Commencement of Consulting and Advisor Relationship. Consultant agrees to provide the services set forth herein and will report directly to the Chief Executive Officer or as otherwise directed by the Chief Executive Officer in connection with the performance of services under this Agreement and

shall fulfill any other duties reasonably associated with and requested by the Company in connection with the services. The consulting and advisor services provided by Consultant and the preparation of and the manner, means, and method of delivery of the services shall be developed solely by Consultant based on Consultant’s best judgments of the consulting and advisor services required to assist the Company. This includes human resources, recruitment, product, sales, supply, personnel matters, and other subject areas related to Executive’s tenure as Chief Product Officer and leading the human resources-related functions.

3.Independent Contractor. Consultant shall control and determine the method and means by which the services shall be rendered, including the preparation, content, and structure of the services and when, where, and how the services are to be provided and the sequence of providing the services. Consultant’s status under this Agreement is that of an independent contractor and not that of an employee, agent, or representative of Company for any purpose (other than as a holder of Company’s equity).

Nothing contained in this Agreement requires Company to utilize Consultant’s services; however, from the Departure Date through December 31, 2023 (the “Exclusivity Period”), Consultant shall exclusively provide services to Company hereunder, and Consultant shall not work for or provide services to any other person or entity, provided the Parties agree that Consultant may serve on a Board or work directly with family members, provided no such activities violate the other terms and conditions of this Agreement (including but not limited to any and all restrictive covenants under which Consultant is obligated to Company including those incorporated by reference from Section D of the Executive Services Agreement and the subsequent employer notification requirements in the ESA (hereinafter the “ESA Restrictive Covenants”)). If Consultant seeks to provide any other services during the Exclusivity Period, Consultant shall seek prior written approval from Company’s Chief Executive Officer, which approval can be granted or withheld at the Chief Executive Officer’s sole discretion.

The Parties will use commercially reasonable efforts to coordinate and schedule the services Consultant is providing hereunder in a manner that allows Consultant to pursue other personal activities. Company will use best efforts to recognize and accommodate Consultant’s scheduling of such other personal activities and to communicate with Consultant to schedule around such activities in a mutually beneficial manner. Nothing herein will be construed to create a partnership, joint venture, agency, or employment relationship between Consultant and Company.

This Agreement is NOT an employment agreement between Consultant and Company. Notwithstanding the foregoing, this Agreement shall have no effect on any part of any pre-existing or later entered into agreement by and between Consultant and Company regarding matters not addressed herein.

4.Professional Standards. Consultant acknowledges that many of the services are personal in nature and that the manner in which they are provided can affect the reputation of Company in the field of operating a live learning platform that seamlessly connects experts and learners in any subject, anywhere, anytime, and Consultant agrees to use commercially reasonable efforts to perform such services in a professional manner that one would expect from a professional.

5.Compensation. As full compensation for the services rendered by Consultant hereunder,

a. Company shall pay Consultant every other week the amount of approximately $15,384.61 (an annualized rate of $400,000, which actual payment amounts will be calculated consistent with Company’s usual payroll practices) through December 31, 2023, subject to the termination provisions in Section 9 and the terms associated with the particular type of termination; and

b. Consultant shall remain eligible to vest in 32,375 Class B Shares/Nerdy LLC Units and 93,568 RSUs (the “Continued Equity”), subject to: (x)(i) Consultant either remaining in service to Company pursuant to this Agreement on such vesting date or Consultant terminating this Agreement under Section 9(c) prior to such date, and (ii) Consultant satisfying Consultant’s obligations during the Exclusivity Period; (y) there not being a termination by Company under Section 9 during the Exclusivity Period; and (z) there not being a termination by Consultant under Section 9(d) during the Exclusivity Period. For the avoidance of doubt, Consultant will forfeit the Continued Equity if Consultant does not satisfy the terms of the Exclusivity Period or violates the ESA Restrictive Covenants (provided such Continued Equity would remain subject to forfeiture, clawback, or other remedies for breach of restrictive covenants as more fully described in Section 28).

6.Forfeiture of Remaining Unvested Equity. The Parties agree that all Class B Shares/LLC Units that are not scheduled to vest on or before May 15, 2023 and any RSUs that are not scheduled to

vest on or before May 15, 2023 have been or shall be forfeited upon execution of this Agreement, as will all other unvested equity that is not specifically identified herein as being subject to continued vesting hereunder. During the term of this Agreement, Consultant shall not sell more than 100,000 of any shares from converted Class B Shares/Nerdy LLC Units or shares of Class A Common Stock issued upon settlement of RSUs during any seven (7) day period thereafter, unless currently reflected in the 10b5-1 Plan.

7.No Reimbursement of Expenses. Except as set forth herein, Company shall not be responsible for nor shall it reimburse Consultant for any expenses Consultant incurs in providing the services during the term of this Agreement, unless agreed to in writing by the Parties. Consultant’s sole compensation is set forth in the Section entitled “Compensation.”

8.Equipment and Tools. Consultant is an independent contractor and shall be fully responsible to provide all tools and materials necessary for Consultant to carry out the services, and Consultant shall ensure that Consultant possesses materials as are reasonably necessary for Consultant to provide the services in a complete and professional manner.

9.Term of Agreement; Termination. The term of this Agreement shall commence on the Departure Date and shall continue through December 31, 2023 unless sooner terminated in accordance with this Agreement. Regardless of the nature of the termination of this Agreement, Consultant shall and hereby does grant to Company in that event all right, title, and interest, including all United States and international copyrights and all other intellectual property rights in the services and work performed in the form in which they exist on the date of termination, which form shall not materially differ from the status described in any reports that Consultant has submitted to Company. Moreover, after termination of this Agreement Consultant agrees to fully cooperate with Company in all matters related to the winding up of Consultant’s pending obligations and the orderly transfer of any such pending obligations to other employees or contractors of Company, which shall not exceed ten (10) business days.

a. The foregoing term notwithstanding, if Consultant is convicted of any crime or offense (other than with respect to traffic violations) or is reasonably determined to have engaged in serious misconduct in connection with the performance of the services, Company may terminate the Agreement immediately and without prior written notice to Consultant. Company may also terminate the Agreement upon written notice to Consultant if Consultant materially breaches any provision of this Agreement (or surviving provision of the Executive Services Agreement), including but not limited to the Exclusivity Period, or any non-disparagement, non-competition, non-solicitation, inventions, or proprietary rights and confidentiality provisions herein, referenced herein, or otherwise applicable) that, if curable, is not cured within ten (10) business days following written notice of such breach, which written notice shall set forth in reasonable detail the facts or circumstances constituting or giving rise to such material breach. If this Agreement is terminated by Company for any of the preceding reasons, Consultant shall be entitled to a total of three (3) months’ pay from the Departure Date (minus any amount previously paid pursuant to Section 5(a); but not less than zero) and the resulting equity treatment prescribed under the Continued Equity in Section 5(b) based upon the actual date of termination.

b. If this Agreement is terminated by Company for any reason other than those set forth in Section 10(a), Consultant shall be entitled to any remaining amounts under Section 5(a) (minus any amount previously paid pursuant to Section 5(a)) and vesting of all Continued Equity in Section 5(b).

c. Consultant may terminate this Agreement upon written notice to Company (pursuant to the Notice provision herein) if Company fails to timely remit when due payment required by Section 5 hereunder to Consultant, provided Company fails to cure the nonpayment issue raised in the notice within 15 business days, in which case Consultant shall be entitled to any remaining amounts under Section 5(a) (minus any amount previously paid pursuant to Section 5(a)) and vesting of all Continued Equity in Section 5(b).

d. If this Agreement is terminated by Consultant for any reason other than the reason set forth in the preceding paragraph, Consultant shall be entitled to a total of three (3) months pay from the Departure Date (minus any amount previously paid pursuant to Section 5(a); but not less than zero).

e. If Executive timely revokes the Releases (Sections 20 and 21), Company may terminate the Agreement without any further liability or obligation to Executive hereunder.

10.Contractor Tax Liability (post-Effective Date). Company shall not pay any federal, state, or local income tax, or any payroll tax of any kind and such taxes shall not be withheld or paid by the Company on Consultant’s behalf. Consultant acknowledges that Consultant shall not be treated as an

employee with respect to the services performed under this Agreement for any purpose, including federal or state tax purposes. Consultant understands and agrees that Consultant is responsible to pay Consultant’s income tax in accordance with federal, state, and local law and that all withholdings for taxes and social security and other required payments to be made on Consultant’s behalf shall be Consultant’s sole responsibility. Consultant acknowledges that Company will file all required reports with the Internal Revenue Service and appropriate state and local agencies, which may include Form K-1 and/or Form 1099-MISC and related state and local filings, in accordance with Company’s practices and in conjunction with advice from its outside tax advisors.

11.No Benefits. Consultant is an independent contractor and Consultant shall not be eligible for or entitled to any of Company’s pension, health, or other fringe benefit plans, if any, or any other benefits that Company may extend to its employees from time-to-time. The only benefits to which Consultant shall be eligible for or entitled to will be as expressly identified in this Agreement. Company is not obligated to obtain workers’ compensation or unemployment insurance on behalf of Consultant. Consultant shall comply with workers’ compensation and unemployment insurance laws concerning Consultant’s business, if applicable.

12.Executive Cooperation. During the term of this Agreement Executive agrees to reasonably cooperate with and provide assistance to Company and its legal counsel in connection with any litigation (including arbitration or administrative hearings) or investigations affecting Company, in which (in the reasonable judgment of Company) Executive’s assistance or cooperation is needed. If Company requests cooperation hereunder after the term of this Agreement, Company shall provide Consultant with reasonable compensation for such assistance, albeit the Parties acknowledge claims involving both Company and Executive may be treated differently depending on the particulars of the situation. The Company shall reimburse Executive for any and all reasonable expenses incurred by Executive in connection with such Company requested cooperation and assistance as it relates to cooperation solely for the benefit of Company (e.g. not if Executive is an independent party to or separately identified in any such proceeding), provided Executive notifies Company of such expenses before incurring them, obtains written approval from the Company regarding any such expenses, and agrees to reasonably coordinate with Company. The Parties further agree to pursue insurance coverage and consider a joint defense agreement, as appropriate, as well as providing Company the opportunity to incur such expenses directly (e.g. retaining counsel to represent the Company and Executive).

13.Executive Services Agreement; Departure Agreement. Consultant agrees to sign this Agreement (and the general release as required under the Executive Services Agreement) in order to be entitled to the benefits available to Executive in the event of a termination under the Executive Services Agreement. Consultant agrees that Consultant was not otherwise entitled to be engaged by Company as a consultant and advisor and was not otherwise entitled to the additional consideration set forth herein. The Compensation (as referenced in Section 5(a)) and the minimum three (3) month term of same (as referenced in Section 9(a) and 9(d)) includes and is in lieu of any accrued vacation, paid time off sick, or other paid leave to which Executive may have been entitled as of the Departure Date, as well as future bonuses, if any.

Except as otherwise provided herein, Executive shall not accrue any benefits, paid time off, vacation pay, 401(k) (including employee and Company contributions), holiday pay, personal days, etc. after the Departure Date. No other amounts are due Executive by Company, unless set forth herein.

14.Equity. The Parties agree that the number of Class B Shares/Nerdy LLC Units, Earnout Shares, Warrants, and RSUs held by Executive are accurately captured in this Agreement. Executive has no other equity in Company (other than what is set forth herein, assuming this Agreement is executed and not revoked).

15.Professional Accounting and Tax Services. Company hereby agrees to pay for Executive’s 2022 and 2023 tax years professional accounting and tax services provided by the Company’s tax accountant (currently E&Y, but Executive may instead use BDO if Executive has continued to use Company’s former tax accountant) in the same amount paid by Company for other current executives (for the 2021 tax year it was $7,900, but it is expected to return to $6,000 for all covered executives as the additional amount related to the 2021 transaction), to assist Executive with Executive’s accounting and tax filing related to Executive’s K-1 status with Company and determining Executive’s resulting tax obligations. Executive, like other current executives, will be responsible to pay any amounts beyond the set annual amount agreed to be paid by the Company for each executive (and each of the executives that have participated in this historically shall receive the same set amount). Executive has agreed to or hereby agrees to cooperate and authorize the Company to file a composite return for the 2022 and 2023 tax years

and to timely reimburse the Company for any payments made by Company on Executive’s behalf related to the Company’s tax filings, provided Company will provide Executive documentation with respect to the amounts advanced and how calculated. Company hereby reserves its rights with respect to advancing such tax payments and seeking repayment of same under the Operating Agreement; however, Executive authorizes Company to withhold $1,315.00 per pay period5 from Executive’s Compensation to satisfy any tax payments made by Company on Executive’s behalf related to the 2022 and 2023 tax years (with such amounts reported in calendar year 2023 and 2024 tax filings, respectively). The Parties agree to reconcile the withheld amounts related to 2022 and 2023 tax years as part of the Company completing and submitting its 20226 and 2023 federal and state taxes, with the Company refunding to Executive the difference between the amount withheld and a lower actual amount and Executive paying to Company any amounts in excess of the amount withheld that were advanced by Company on behalf of Executive, if any, once the final tax returns for the 2023 tax year are submitted (which should be on or about April 15, 2024).

16.Tutoring Services. From the date of this Agreement through December 31, 2023, Executive may continue to use any hours of tutoring services available through Varsity’s platform that remained in Executive’s account as of the date this Agreement was executed (as Executive was entitled to 52 hours annually). For 2024, the Company shall provide Executive with 52 hours of tutoring services (with additional hours available for purchase at the friends and family rate in place at the time of purchase). For 2025, Executive shall be eligible for the friends and family rate established by the Company, at whatever rate is then available for purposes of friends and family pricing, provided Executive has executed or executes the then current version of the standard Terms of Customer Account Use, is compliant therewith, and that the platform and service is available where Executive resides.

17.Non-Admission of Liability. Company and Executive agree that nothing contained in this Agreement is an admission or evidence of any wrongdoing by any Party. This Agreement may not be introduced into evidence except in a proceeding to enforce it.

18.Non-Disparagement. Executive agrees that Executive will not at any time after the Departure Date and for 36 months thereafter disparage, criticize, or make any negative comments regarding the Company (including its directors, officers, employees, and representatives) or take or omit to take any action the effect of which is to criticize or otherwise disparage them in any way. The Company agrees (through its Chief Executive Officer and/or Chief Legal Officer) to direct a request to each then current board member and each then current officer within one week after the Effective Date that they not disparage, criticize, or make any negative comments regarding the Executive. Executive further agrees that Executive will not interfere in any manner with the business of Company, or its directors, officers, employees, or representatives. Nothing in this Section 18 shall prohibit Executive or the Company from providing truthful information in response to a subpoena or other legal process.

19.Reinstatement and Professional Reference. Executive agrees that Executive does not wish, does not seek, and does waive any claim for reinstatement with Company and its successors and hereby agrees not to re-apply to Company at any time after this Agreement has been fully executed. Company will provide a neutral reference regarding Executive’s dates of service and title with Company, unless the reference is directed to Chuck Cohn, Company’s CEO, in which case a professional reference will be provided (in addition to supplying the information that would be provided as part of a neutral reference). Notwithstanding the preceding, with written consent and authorization from Executive, Executive may seek professional references from other representatives of Company (including officers and members of the Board of Directors), and those from whom such professional references are sought hereunder will not be prohibited from Company from providing such professional references.

20.Executive General Release. Executive, in consideration of the Compensation, Continued Equity vesting, and other valuable consideration outlined herein, and with the intent of binding Executive and Executive’s heirs, personal representatives, administrators, successors, and assigns, hereby releases, acquits and forever discharges Company and Company’s present, former, and future owners, directors, members, managers, officers, employees, agents, contractors, attorneys, divisions, subsidiaries, predecessors, successors, related companies, and members of all of them (the “Released Parties”), from

5 This is the same amount that was being held from Executive’s pay, per pay period prior to the Departure Date (reflected in pay statements as “personal tax” to address the same composite tax issue as set forth in this paragraph.

6 In the event Executive has a positive balance associated with the 2022 tax year, the positive balance will be rolled forward to cover tax advances made on Executive’s behalf for the 2023 tax year, all of which will fully reconciled in conjunction with the filing of the 2023 tax year taxes on or about April 15, 2024 (provided Company will do interim reconciliations and evaluate if an adjustment to withholdings is justified, at Company’s discretion).

and against any and all claims, charges, demands, rights of action, liabilities (including attorneys’ fees and costs actually incurred), judgments, jury verdicts, or lawsuits arising on or before the Effective Date, including but not limited to:

1.any and all claims related to Executive’s service with Company, including but not limited to, any and all actions arising under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq. (including the Older Workers Benefit Protection Act), the Employee Retirement Income Security Act of 1974, as amended, 29 U.S.C. §1001 et seq., the Family and Medical Leave Act, 29 U.S.C. §2601 et seq., the Occupational Safety and Health Act, the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq., the Worker Adjustment Retraining Notification Act, 29 U.S.C. §2101 et seq., the Americans with Disabilities Act, 42 U.S.C. §12101 et seq., the Missouri Human Rights Act, §213.010 R.S.Mo. et seq., the Missouri Service Letter Statute, §290.140 R.S.Mo., retaliation for exercise of rights under the Missouri Workers’ Compensation Act, §287.010 R.S.Mo. et seq., the Missouri Equal Pay Law, §290.400 R.S.Mo. et seq., the Missouri Handicap Discrimination Statute, §209.150 R.S.Mo., the Missouri Genetic Testing Information Bias Law, §375.1300 R.S.Mo. et seq., the Missouri Smokers Rights Law, §290.145 R.S.Mo. et seq., and any other federal, state, or local law or regulation;

2.any and all rights to or claims for compensation (including, but not limited to, salary, severance or vacation pay, bonuses, incentives, pension, insurance, paid time off, or any other fringe benefits or compensation of any kind whatsoever) except as provided for in this Agreement, rights to or claims for liquidated damages, rights to or claims for reinstatement, rights to or claims for contract, compensatory, exemplary or punitive damages, rights to or claims for injunctive relief, rights to or claims for front pay, rights to or claims for expenses, costs, or attorneys’ fees; and

3.any and all claims that Executive now has, or may have, whether known or unknown, for any losses, damages or injuries whether anticipated or unanticipated, or which Executive’s heirs, personal representatives, administrators, successors, and assigns hereinafter can, shall, or may have, both known or unknown, against the Released Parties resulting from, arising out of or connected directly or indirectly with Executive’s service and agreements with Company and the termination thereof, including but not limited to, actual or implied breach of contract, violation of public policy, fraud, negligence, wrongful or retaliatory discharge, defamation, breach of any covenant of good faith and fair dealing, violation of any statutes, administrative rules, regulations or codes, misrepresentation of any kind, intentional infliction of emotional distress, negligent infliction of emotional distress, or any other claims sounding in tort, claims for punitive or consequential damages, and any claim or cause of action that could have been asserted therein, and any act, omission, transaction, dealing, conduct or negotiation of any kind in connection with Executive’s executive service with Company or service as an Officer of the Company or the termination thereof.

4.any and all claims relating to Executive’s role as an owner or member of Company, the Articles of Organization (including all versions thereof), the Operating Agreement (including all versions thereof), the Subscription Agreement and Joinder, the conversion of the profits interest units into Class B Shares and Nerdy LLC Units as part of the Business Combination, or arising out of any act or omission occurring prior to the date of this Agreement that could have been asserted in a court of law.

Executive hereby expressly waives the benefit of any statute or rule of law, which, if applied to this Agreement, would otherwise exclude from its binding effect any claims not now known by Executive to exist. Executive further acknowledges, understands, and agrees that any claims Executive may have against the Released Parties are dropped for all purposes and all times. Company and Executive agree that to the extent Executive may have a right to file or participate in a claim or charge against Company that is not releasable, this Agreement shall not be intended to release, waive or otherwise extend to such a right, if any.

Notwithstanding anything to the contrary in the foregoing, this Release does not extend to the obligations created, confirmed, amended, or extended by this Agreement, including any claim to enforce this Agreement, and any claims that arise hereafter related to the equity memorialized herein, to the extent such claims or causes of action are initiated by another shareholder or member and arise out of actions or failures to act that affect more than one owner or member. Furthermore, this Release shall not extend to any claim arising out of actions that have been concealed and were not discoverable with reasonable due diligence prior to execution of this Agreement solely as it relates to Executive’s status as a shareholder, Company’s performance of this Agreement, or to any obligations created, confirmed, amended, or extended by this Agreement. Furthermore, this Release shall not extend to any claim for indemnification or fiduciary insurance pursuant to (i) the Articles of Organization (including all versions thereof), (ii) the Operating Agreement (including all versions thereof), or (iii) other agreements with the Company, provided any such claim shall be subject to the applicable terms and conditions of the applicable document/agreement (and subject to any statutory limitations).

21.Age Claim Waiver. Executive understands that there is included within the Release given by Executive in the immediately preceding section a release and waiver of all rights and claims Executive may have under the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. (the “ADEA”). In order to comply with the ADEA, Company hereby advises Executive as follows:

a. Executive has the right, and is encouraged to, consult with an attorney prior to executing this Agreement.

b. The waiver and release of rights and claims under the ADEA pertains only to rights and claims arising on or before the Effective Date of this Agreement, but not to rights and claims under the ADEA that arise after the Effective Date of this Agreement.

c. Notwithstanding any other provisions hereof, the release of rights and claims in this Agreement shall not become effective until seven (7) days have passed following the date on which it is executed by Executive. During said 7-day period, Executive may revoke the release of rights and claims in this Agreement by notice in writing to Company (pursuant to the Notice provision herein), in which case the release of rights and claims in this Agreement shall be null and void and unenforceable by either party, and Executive shall not be entitled to receive the any consideration from Company whatsoever.

d. Executive shall have a period of twenty-one (21) days after the date on which this Agreement is delivered to Executive to consider whether or not to execute it.

Executive represents and warrants that Executive freely and knowingly, and after due consideration and having the opportunity to consult with an attorney, enters into this Agreement intending to waive, settle, and release all claims Executive has or might have against Company as of the Effective Date. Nothing in this Agreement shall have the effect or be interpreted as having the effect of imposing any condition precedent, penalty, or other limitation adversely affecting Executive’s right to challenge the validity of the ADEA waiver and release.

22.Executive Covenant Not to Sue. Executive further understands that by signing this Agreement, Executive is agreeing to not file any claims or lawsuits against the Released Parties with any court or government agency. Executive further understands that this Agreement does not limit Executive’s ability to communicate with any government agency or otherwise participate in any investigation or proceeding that may be conducted by any government agency, including providing documents or other information, provided if Executive is requested to participate in any lawsuit, other proceeding, or investigation conducted by any government agency against any of the Released Parties, then to the extent permitted by law, Executive agrees to immediately notify Company’s Chief Legal Officer, unless prohibited from doing so by law. The Parties agree that to the extent, if any, Executive may have any non-waivable rights to file or participate in a claim or charge against any of the Released Parties, this Agreement shall not be intended to waive such a right. However, even if Executive has a right to file or participate in a claim (this waiver is not intended to cover whistleblower claims) or charge against any of the Released Parties, Executive agrees that Executive shall not obtain, and hereby waives Executive’s right to, any relief of any kind from such non-whistleblower claim or charge.

23.Executive Acknowledgements, Representations, and Warranties. As a material inducement for the Company to enter into this Agreement, Executive represents and warrants that, as of the date of this Agreement, Executive is aware of no liabilities, obligations, or claims (absolute, accrued, fixed or contingent, matured or unmatured, or otherwise), including liabilities, obligations or claims that may become known or which arise only after the date of this Agreement and that result from actions, omissions, or occurrences of Executive, that Executive has not disclosed to Company.

1.Executive also acknowledges and agrees that Executive was paid all compensation that was due through the Departure Date (or as included herein) and that Executive has not been retaliated against for asserting rights or claims under local, state, or federal law.

2.Executive further represents and warrants that Executive has returned to Company all physical materials or media (of any style or format) containing (in whole or in part) versions or copies of software code, licensor code, licensor documentation, compiled code, source codes, etc. (including electronic copies of same or copies attached to e-mail messages), whether provided by Company or created by or for the benefit of Company.

3.Upon the termination of this Agreement, Executive will return all Confidential Information as that term is defined in the Executive Services Agreement to Company or Company’s counsel or will certify that Executive has permanently destroyed it.

4.Executive no longer has any profits interest units, which have been converted to Class B Shares and Nerdy LLC Units in accordance with the Notice, Acknowledgement, and Release.

5.Executive has not engaged in any business in competition with Company from its inception through the date of this Agreement and has not and will not own, operate, or conduct any business using any trademark or business name, or any name similar to or including any portion of Company’s name.

6.Executive has incurred no debt or obligation on behalf of the Company except those that Executive has specifically notified Company of in writing prior to the execution of this Agreement.

7.Executive authorizes the dismissal with prejudice of any and all pending claims, suits, or administrative charges hereafter brought by Executive that have arisen out of or in any way relate to any of the matters released herein to be entered on Executive’s behalf without further notice.

8.Executive has not undertaken any material actions or omitted to take any material actions that may interfere with Company’s future success.

9.There has been no “Change of Control” as that term is defined in the Executive Services Agreement prior to the Departure Date.

10.Executive was not otherwise entitled to the Continued Equity that is subject to vesting hereunder (and subject to the particular terms and conditions of this Agreement as it relates to same) and is not eligible for any acceleration of vesting of equity.

11.The Recitals to this Agreement are true and complete.

12.This Agreement is enforceable in accordance with its terms.

24.Confidentiality of Terms. Executive represents and agrees that Executive will keep the terms, amount, and fact of this Agreement and any prior offers of or demands for severance pay and all matters pertaining to Executive’s departure, including but not limited to the reasons therefore and the negotiations pertaining thereto, completely confidential, and will not disclose, divulge or publicize, directly or indirectly, to any third party the terms and conditions of this Agreement or any matters pertaining to Executive’s departure except as may be necessary to establish or assert rights hereunder or as may be required by law or applicable regulation; provided, however, that Executive may, on a confidential basis, disclose this Agreement to Executive’s spouse, financial advisors, and attorneys. Executive also acknowledges that the Company must file this Agreement under applicable securities laws.

25.Confidential Information. Executive will not at any time, except as it relates to providing consulting services hereunder, as authorized by Company in writing, or as required by any law, rule, or regulation after providing prior written notice to Company within sufficient time for Company to object to production or disclosure or quash subpoenas related to the same, directly or indirectly, use for Executive’s benefit or for the benefit of others, or disclose, communicate, divulge, furnish to, or convey to any other person, firm, or company, any secret or confidential information, knowledge or data of Company or that of third parties obtained by Executive during the period of Executive’s relationship with Company, and such information, knowledge or data includes, without limitation, the following: (1) secret or confidential matters of a technical nature such as, but not limited to, methods, know-how, formulations, compositions, processes, computer programs, and similar items or research projects involving such items, (2) secret or confidential matters of a business nature such as, but not limited to, marketing policies or strategies, information about costs, profits, marketing, customers, or experts, lists of customers or experts, personnel information, and financial information, and (3) secret or confidential matters pertaining to future developments such as, but not limited to, research and development or future marketing.

26.Return of Property. Any documents and property in any way related to Company, its employees and/or its customers shall be and remain the sole and exclusive property of Company (“Company Documents”) and any Company Documents in the possession of Executive will be returned to Company before the Effective Date and the return of such Company Documents shall be a condition

precedent to the payment of the Compensation. The term “document” is used in the broadest sense and includes, but is not limited to meaning, any writing or recording, graphic or other matter, whether produced, reproduced or stored on any medium. Executive also swears and affirms that Executive has not retained for Executive’s own purposes or provided to any third parties any Company property that Executive created or obtained during the course of Executive’s relationship with Company, whether as original or copies. If Executive fails to return any Company hardware and/or software, Company may pause its obligations hereunder and shall not be obligated to provide any of the consideration hereunder,as well as pursue any and all other remedies available hereunder or at law.

ESA Restrictive Covenants. Executive expressly agrees and understands that the ESA Restrictive Covenants that survive termination remain in effect. Executive further agrees to the ESA Restrictive Covenants being incorporated herein by this reference and that such restrictions shall be binding during the term of this Agreement and the post termination terms therein shall be extended (or tolled) until the termination of this Agreement. For purposes of clarity, entering into this Agreement shall not constitute a termination of the Executive Services Agreement for purposes of the ESA Restrictive Covenants that survive by their terms, such that they will remain in effect during this Agreement (as Executive’s services hereunder during the term of the Agreement constitute a relationship with Company for purposes of the ESA Restrictive Covenants) and for the period of time set forth in the Executive Services Agreement after the relationship under this Agreement terminates.

28.Remedies and Indemnification. In the event of any breach of this Agreement by either Party, the Parties shall be entitled to all remedies provided at law or in equity. Certain rights set forth in this Agreement cannot be reasonably or adequately compensated by damages in an action at law, and Executive agrees that in such event, Company shall be entitled to injunctive and other equitable relief in the event of, or to prevent, a breach of any provision of this Agreement by Executive (including any and all remedies in the Section entitled “Specific Performance”).

Consultant further agrees that in the event Consultant breaches any of the restrictive covenants herein including the ESA Restrictive Covenants, Consultant shall forfeit, be responsible for the equivalent value of the Continued Equity, or the Continued Equity shall be subject to clawback, in addition to any other remedies the Company may pursue under this Agreement. Company shall have the right to determine what remedy or remedies to pursue hereunder at its sole discretion.

Additionally, Executive shall defend, indemnify, protect, and hold harmless Company (including its agents, members, employees, managers, officers, or assigns) from and against all claims, demands, liabilities, damages, losses and out-of-pocket expenses (including reasonable attorneys’ fees), orders, awards, caused by, as a result of or arising out of (i) Executive’s failure to perform any of the agreements, duties, or obligations of Executive contained in this Agreement or (ii) a breach of any agreement, covenant, representation, or warranty made by Executive in this Agreement. In addition to Company’s right to indemnification hereunder, Company shall also be entitled to a return of all but $50,000.00 of the Compensation paid to Executive as part of this Agreement as partial damages for any violation of Section 22 entitled the “Executive Covenant Not to Sue”, in addition to any other damages resulting therefrom and the specific performance available hereunder, provided to the extent Executive may have an unwaivable or non-releasable right to file or participate in a claim or charge of any kind in connection with Executive’s relationship with Company against any of the parties released hereunder, this Agreement shall not be intended to waive such a right. If Executive or anyone acting on Executive’s behalf initiates or prosecutes any administrative, judicial, or other action arising out of or in any way related to any claims, demands, damages, charges, or causes of action released in this Agreement, Executive shall reimburse Company for the full amount of the Compensation and Continued Equity vesting except for $50,000.00, and shall be liable for payment of all other costs and expenses, including reasonable attorneys’ fees, incurred by Company as a result of any such action or breach.

29.Entire Agreement, Amendments. Executive acknowledges and re-affirms that Executive remains bound by ESA Restrictive Covenants as set forth in Section 27,7 as well as the Nerdy LLC Second Amended and Restated Operating Agreement, which remains in full force and effect, except as expressly modified herein and to the documents governing Nerdy Inc. The provisions hereof, in conjunction with the surviving terms and conditions of the Executive Services Agreement and the Operating Agreement (including documents referenced therein or related thereto), constitute the entire and only agreements between the Parties with respect to the subject matter hereof and supersede all prior agreements, commitmen

7 The Company and Executive amended and superseded the Executive Services Agreement in accordance with the terms of this Agreement, specifically memorializing the consulting and advisor relationship of Consultant with respect to Company, the terms and conditions of the consulting and advisory relationship, and the terms and conditions of Consultant’s departure upon conclusion of the consulting and advisory relationship.

ts, representations, understandings, or negotiations, oral or written, and all other communications relating to the subject matter hereof. No amendment or modification of any provision of this Agreement will be effective unless set forth in a document that purports to amend this Agreement and is executed by all Parties hereto.

30.Binding Effect; Third Party Beneficiaries. This Agreement shall inure to the benefit of and shall be binding upon the Parties hereto and their respective heirs, legal representatives, successors, and permitted assigns. Varsity Tutors LLC, LLT, Nerdy Inc., are each a third party beneficiary to this Agreement and are each entitled to the rights and benefits hereunder and may enforce the provisions hereof as if any were a Party hereto. Except as expressly set forth herein, this Agreement is not intended to confer any rights or remedies upon any other person or entity.

31.Acknowledgement. Executive acknowledges that Executive has read this entire Agreement and fully understands its terms and conditions; that Executive was advised to obtain legal counsel and/or representation to review this Agreement and that Executive has had the opportunity to do so; that no other representations have been made to Executive other than those contained herein; and that Executive enters into this Agreement of Executive’s own free will and choice with no undue influence, fraud, pressure, duress, or coercion by Company.

32.Assignment. Neither Party shall sell, transfer, assign, or subcontract any right or obligation hereunder except as expressly provided herein without the prior written consent of each other Party. Any act in derogation of the foregoing shall be null and void.

33.Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.

34.Venue and Jurisdiction. Any action or proceeding relating to this Notice and the terms and conditions herein, the plan documents that govern the equity herein, or the transactions that are the subject of this Notice may be brought in the Delaware Court of Chancery (or, only if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, in a U.S. federal court sitting in the State of Delaware, or if the U.S. federal courts do not have jurisdiction with regard to the matter, in a Delaware state court other than the Court of Chancery), and any applicable appellate court, but in no other court. Each Party (i) consents to the personal jurisdiction of each of those courts in any action or proceeding of the type described in the preceding sentence, (ii) agrees not to seek to transfer any such action or proceeding to any other court, whether because of inconvenience of the forum or for any other reason and (iii) agrees that process in any such action or proceeding may be served by registered mail or in any other manner permitted by the rules of the court in which the action or proceeding is brought. EACH PARTY IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING, WHETHER AT LAW OR IN EQUITY, BROUGHT BY ANY OF THEM IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS NOTICE.

35.Waivers. No waiver by any Party hereto of any condition or provision of this Agreement to be performed by another party shall be valid unless in writing, and no such valid waiver shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

36.Notice. All notices provided for in this Agreement shall be in writing and shall be given either (a) by actual delivery of the notice to the Party entitled thereto or (b) by depositing the same with the United States Postal Service, certified mail, return receipt requested, postage prepaid, to the address of the Party entitled thereto. The notice shall be deemed to have been received in case (a) on the date of its actual receipt by the Party entitled thereto or in case (b) two (2) days after the date of its deposit with the United States Postal Service. As it relates to notice to Company hereunder, in order to be effective, notice must be sent to either the Chief Legal Officer or the Chief Financial Officer of Company,

37.Severability. The provisions of this Agreement shall be deemed severable, and the invalidity or unenforceability of any one or more of the provisions hereof shall not affect the validity and enforceability of the other provisions hereof. In addition, if any section hereof is found to be partially enforceable, then it shall be enforced to that extent. A court with jurisdiction over the matters contained in this Agreement shall have the authority to revise the language hereof to the extent necessary to make any such section or covenant of this Agreement enforceable to the fullest extent permitted by law.

38.Specific Performance. The Parties mutually agree that Company shall be entitled to obtain specific performance and may sue in any court set forth in Section 34 of this Agreement to enjoin any breach, threatened or actual, of the covenants and promises contained in those provisions of this Agreement entitled “Non-Disparagement,” “Executive Covenant Not to Sue,” “Confidentiality of Terms,” “Confidential Information,” “Return of Property”, and “ESA Restrictive Covenants“; and that, in connection with any such litigation, Company may also sue to obtain damages for default under or breach of the provision of any of said provisions.

39.Costs and Expenses. If either Party shall commence a proceeding against the other to enforce and/or recover damages for breach of this Agreement, to the extent awarded by a judge or via court proceedings, the prevailing Party in such proceeding shall be entitled to recover from the other Party all reasonable costs and expenses of enforcement and collection of any and all remedies and damages, or all reasonable costs and expenses of defense, as the case may be. The foregoing costs and expenses shall include reasonable attorneys’ fees.

40.Recitals and Definitions. The Recitals (and definitions set forth therein and throughout ) are hereby made a part of this Agreement and are incorporated fully herein.

41.Headings. The sections and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

42.Counterparts. This agreement may be executed in any number of counterparts, and each such counterpart shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement.

[remainder of page intentionally left blank]

IN WITNESS WHEREOF, Executive has executed this Agreement and Company has caused this Agreement to be executed by its duly authorized representatives.

COMPANY: Nerdy Inc., Nerdy LLC, Varsity Tutors LLC,

and Live Learning

Technologies Shared Resources LLC

Christopher C. Swenson, Chief Legal Officer

/s/ Christopher C. Swenson

Date: March 10, 2023

EXECUTIVE: Heidi Robinson

/s/ Heidi Robinson

Date: March 10, 2023

Document

EXHIBIT 31.1

Certification pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Charles Cohn, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Nerdy Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2023	By:	/s/ Charles Cohn
		Name: Charles Cohn
		Title: President and Chief Executive Officer

Document

EXHIBIT 31.2

Certification pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Jason Pello, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Nerdy Inc.;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2023	By:	/s/ Jason Pello
		Name: Jason Pello
		Title: Chief Financial Officer

Document

EXHIBIT 32.1

Certification Pursuant to

18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

The undersigned, the Chief Executive Officer of Nerdy Inc. (the “Company”), hereby certifies that, to his knowledge on the date hereof:

(a)the quarterly report on Form 10-Q for the period ended March 31, 2023, filed on the date hereof with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(b)information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 9, 2023	By:	/s/ Charles Cohn
		Name: Charles Cohn
		Title: President and Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to Nerdy Inc. and will be retained by Nerdy Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Certification Pursuant to

18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

The undersigned, the Chief Financial Officer of Nerdy Inc. (the “Company”), hereby certifies that, to his knowledge on the date hereof:

(b)information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 9, 2023	By:	/s/ Jason Pello
		Name: Jason Pello
		Title: Chief Financial Officer

10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the quarterly period ended March 31, 2023

For the transition period from _______ to _______

Commission file number 1-39595

NERDY INC.

(314) 412-1227

Class A common stock, par value $0.0001 per share - 98,019,731 shares of common stock as of May 2, 2023

Class B common stock, par value $0.0001 per share - 69,241,655 shares of common stock as of May 2, 2023

NERDY INC.

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION.

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED).

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(in thousands, except per share data)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

NERDY INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

NERDY INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

NERDY INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

NOTE 1 — BASIS OF PRESENTATION

NOTE 2 — RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS

Recently Issued

Recently Adopted

NOTE 3 — NONCONTROLLING INTERESTS

NOTE 4 — REVENUE

NOTE 5 — INCOME TAXES

NOTE 6 — LOSS PER SHARE

NOTE 7 — CASH, CASH EQUIVALENTS, AND RESTRICTED CASH

NOTE 8 — FIXED ASSETS, NET

NOTE 9 — INTANGIBLE ASSETS, NET

NOTE 10 — DERIVATIVE FINANCIAL INSTRUMENTS

NOTE 11 — FAIR VALUE MEASUREMENTS

NOTE 12 — RELATED PARTIES

Tax Receivable Agreement

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

OVERVIEW

KEY OPERATING METRICS

RESULTS OF OPERATIONS

Revenue

Cost of Revenue and Gross Profit

Operating Expenses

Sales and Marketing

General and Administrative

Unrealized Loss on Derivatives, Net

Interest Income

LIQUIDITY AND CAPITAL RESOURCES

Sources and Uses of Cash

Cash Requirements

Financing Activities

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

EMERGING GROWTH COMPANY STATUS

SMALLER REPORTING COMPANY STATUS

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market Price Sensitivity

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Limitations on Effectiveness of Controls and Procedures

Changes in Internal Control Over Financial Reporting

PART II. OTHER INFORMATION.

ITEM 1. LEGAL PROCEEDINGS.

ITEM 1A. RISK FACTORS.

ITEM 6. EXHIBITS.

For the transition period from _ to _