Ryan Specialty 10Q 2024 Q3 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________

FORM 10-Q

____________

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

OF 1934

For the quarterly period ended September 30, 2024

☐ 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: 001-40645

____________

RYAN SPECIALTY HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

____________


	Delaware		86-2526344
	(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

	155 N. Wacker Drive, Suite 4000
	Chicago, IL		60606
	(Address of principal executive offices)		(Zip Code)

(312) 784-6001

(Registrant’s telephone number, including area code)

____________

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


Title of each class	Trading symbol	Name of each exchange on which registered

Class A Common Stock, $0.001 par value per share	RYAN	The New York Stock Exchange (NYSE)

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 Exchange Act). Yes ☐ No ☒

On October 28, 2024, the Registrant had 261,841,819 shares of common stock outstanding, consisting of 125,171,615 shares of Class A common stock,

$0.001 par value, and 136,670,204 shares of Class B common stock, $0.001 par value.

Ryan Specialty Holdings, Inc.

INDEX


PART I. FINANCIAL INFORMATION		1

Item 1.	Financial Statements	1

	Consolidated Statements of Income (Loss) (Unaudited)	1

	Consolidated Statements of Comprehensive Income (Loss) (Unaudited)	2

	Consolidated Balance Sheets (Unaudited)	3

	Consolidated Statements of Cash Flows (Unaudited)	4

	Consolidated Statements of Stockholders’ Equity (Unaudited)	5

	Notes to the Consolidated Financial Statements (Unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	36

Item 3.	Quantitative and Qualitative Disclosure About Market Risk	57

Item 4.	Controls and Procedures	58

PART II. OTHER INFORMATION		59

Item 1.	Legal Proceedings	59

Item 1A.	Risk Factors	59

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59

Item 3.	Defaults Upon Senior Securities	59

Item 4.	Mine Safety Disclosures	59

Item 5.	Other Information	59

Item 6.	Exhibits	60

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities

Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements, other than statements of

historical fact included in this Quarterly Report on Form 10-Q, are forward-looking statements. Forward-looking

statements give our current expectations relating to our financial condition, results of operations, plans, objectives, future

performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to

historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,”

“plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely” and other words and terms of similar meaning in

connection with any discussion of the timing or nature of future operating or financial performance or other events. For

example, all statements we make relating to our estimated costs, expenditures, cash flows, growth rates and financial

results, any future dividends, our plans, anticipated amount and timing of cost savings relating to the restructuring plan, and

objectives for future operations, growth or initiatives, strategies or the expected outcome or impact of pending or

threatened litigation, are forward-looking statements. All forward-looking statements are subject to risks and uncertainties

that may cause actual results to differ materially from those that we expected, including:

•our failure to successfully execute our succession plan for Patrick G. Ryan or other members of our senior

management team or to recruit and retain revenue producers;

•the impact of breaches in security that cause significant system or network disruption or business interruption;

•the impact of improper disclosure of confidential, personal or proprietary data, misuse of information by

employees or counterparties, or as a result of cyberattacks;

•the potential loss of our relationships with insurance carriers or our clients, failure to maintain good relationships

with insurance carriers or clients, becoming dependent upon a limited number of insurance carriers or clients, or

the failure to develop new insurance carrier and client relationships;

•errors in, or ineffectiveness of, our underwriting models and the risks presented to our reputation and relationships

with insurance carriers, retail brokers, and agents;

•failure to maintain, protect, and enhance our brand or prevent damage to our reputation;

•unsatisfactory evaluation of potential acquisitions, the integration of acquired businesses, and/or introduction of

new products, lines of business, and markets;

•our inability to successfully recover upon experiencing a disaster or other interruption in business continuity;

•the impact of third parties that perform key functions of our business operations acting in ways that harm our

business;

•the cyclicality of, and the economic conditions in, the markets in which we operate and conditions that result in

reduced insurer capacity or a migration of business away from the E&S market and into the Admitted market;

•a reduction in insurer capacity to adequately and appropriately underwrite risk and provide coverage;

•our international operations expose us to various international risks, including required compliance with legal and

regulatory obligations, that are different, and at times more burdensome, than those set forth in the United States;

•changes in interest rates and deterioration of credit quality could reduce the value of our cash balances or interest

income;

•failure to maintain the valuable aspects of our Company’s culture;

•significant competitive pressures in each of our businesses;

•decreases in premiums or commission rates set by insurers, or actions by insurers seeking repayment of

commissions;

•decrease in the amount of supplemental or contingent commissions we receive;

•our inability to collect our receivables;

•disintermediation within the insurance industry and shifts away from traditional insurance markets;

•changes in the mode of compensation in the insurance industry;

•impairment of goodwill and intangibles;

•the impact on our operations and financial condition from the effects of a pandemic or the outbreak of a

contagious disease and resulting governmental and societal responses;

•the inability to maintain rapid growth and generate sufficient revenue to maintain profitability;

•the loss of clients or business as a result of consolidation within the retail insurance brokerage industry;

•the impact if our MGA or MGU programs are terminated or changed;

•the inability to achieve the intended results of our previously announced restructuring program;

•significant investment in our growth strategy and whether expectation of internal efficiencies are realized;

•our ability to gain internal efficiencies through the application of technology or effectively apply technology in

driving value for our clients or the failure of technology and automated systems to function or perform as

expected;

•the unavailability or inaccuracy of our clients’ and third parties’ data for pricing and underwriting insurance

policies;

•the competitiveness and cyclicality of the reinsurance industry;

•the occurrence of natural or man-made disasters;

•the economic and political conditions of the countries and regions in which we operate;

•the challenges with properly assessing, and managing the adoption and use of, artificial intelligence technologies;

•the failure or take-over by the FDIC of one of the financial institutions that we use;

•our inability to respond quickly to operational or financial problems or promote the desired level of cooperation

and interaction among our offices;

•our international operations expose us to various international risks, including exchange rate fluctuations;

•the impact of governmental regulations, legal proceedings, and governmental inquiries related to our business;

•being subject to E&O claims as well as other contingencies and legal proceedings;

•our handling of client funds and surplus lines taxes that exposes us to complex fiduciary regulations;

•the impact of infringement, misappropriation, or dilution of our intellectual property;

•the impact of the failure to protect our intellectual property rights, or allegations that we have infringed on the

intellectual property rights of others;

•changes in tax laws or regulations;

•decreased commission revenues due to proposed tort reform legislation;

•the impact of regulations affecting insurance carriers;

•our outstanding debt potentially adversely affecting our financial flexibility and subjecting us to restrictions and

limitations that could significantly affect our ability to operate;

•not being able to generate sufficient cash flow to service all of our indebtedness and being forced to take other

actions to satisfy our obligations under such indebtedness;

•being affected by further changes in the U.S. based credit markets;

•changes in our credit ratings;

•risks related to the payments required by our Tax Receivable Agreement;

•risks relating to our organizational structure that could result in conflicts of interests between the LLC

Unitholders, the Ryan Parties, and the holders of our Class A common stock; and

•other factors disclosed in the section entitled “Risk Factors” in our Annual Report on Form 10-K and our

Quarterly Reports on Form 10-Q.

We derive many of our forward-looking statements from our operating budgets and forecasts that are based on many

detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict

the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results.

Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are

disclosed under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition

and Results of Operations” in this Quarterly Report on Form 10-Q and under the Section entitled “Risk Factors” in the

Company’s Annual Report on Form 10-K for the year ended December 31, 2023. All written and oral forward-looking

iii

statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary

statements as well as other cautionary statements that are made from time to time in our filings with the SEC and other

public communications. You should evaluate all forward-looking statements made in this Quarterly Report on Form 10-Q

in the context of these risks and uncertainties.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject.

These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and

while we believe such information forms a reasonable basis for such statements, such information may be limited or

incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review

of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not

to unduly rely upon these statements.

We caution you that the important factors referenced above may not contain all of the factors that are important to you. In

addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if

substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The

forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date hereof. We

undertake no obligation to update or revise any forward-looking statement as a result of new information, future events or

otherwise, except as otherwise required by law.

Commonly Used Defined Terms

As used in this Quarterly Report on Form 10-Q, unless the context indicates or otherwise requires, the following terms

have the following meanings:

•“2030 Senior Secured Notes”: The 4.375% senior secured notes due 2030 issued on February 3, 2022.

•“2032 Senior Secured Notes”: The 5.875% senior secured notes due 2032 issued on September 19, 2024.

•“we,” “us,” “our,” the “Company,” “Ryan Specialty,” and similar references refer: (i) Following the consummation

of the Organizational Transactions, including our IPO, to Ryan Specialty Holdings, Inc., and, unless otherwise

stated, all of its subsidiaries, including the LLC, and (ii) prior to the completion of the Organizational Transactions,

including our IPO, to the LLC and, unless otherwise stated, all of its subsidiaries.

•“Adjusted Term SOFR”: Prior to January 19, 2024, the interest rate per annum based on the Secured Overnight

Financing Rate (“SOFR”) plus a Credit Spread Adjustment of 10 basis points, 15 basis points, or 25 basis points for

the one-month, three-month, or six-month borrowing periods, respectively, subject to a 75 basis point floor. After

January 19, 2024, the interest rate per annum no longer includes the Credit Spread Adjustment. After September 13,

2024, the 75 basis point floor was reduced to 0.

•“Admitted”: The insurance market comprising insurance carriers licensed to write business on an “admitted” basis by

the insurance commissioner of the state in which the risk is located. Insurance rates and forms in this market are

highly regulated by each state and coverages are largely uniform.

•“Binding Authority”: Our Binding Authority receives submissions for insurance directly from retail brokers,

evaluates price and makes underwriting decisions regarding these submissions based on narrowly prescribed

guidelines provided by carriers, and binds and issues policies on behalf of insurance carriers who retain the insurance

underwriting risk.

•“Board” or “Board of Directors”: The board of directors of Ryan Specialty.

•“Class C Incentive Units”: Class C common incentive units, initially of the LLC on and prior to September 30, 2021,

and then subsequently of New LLC, that are subject to vesting and will be exchangeable into LLC Common Units.

•“Credit Agreement”: The credit agreement, as amended, dated September 1, 2020, among Ryan Specialty, LLC and

JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto.

•“Credit Facility”: The Term Loan and the Revolving Credit Facility.

•“E&O”: Errors and omissions.

•“E&S”: Excess and surplus lines. In this insurance market, carriers are licensed on a “non-admitted” basis. The

excess and surplus lines market often offers carriers more flexibility in terms, conditions, and rates than does the

Admitted market.

•“Exchange Act”: Securities Exchange Act of 1934, as amended.

•“IPO”: Initial public offering.

•“LLC”: Ryan Specialty, LLC, together with its parent New LLC, and their subsidiaries.

•“LLC Common Units”: Non-voting common interest units initially of the LLC on and prior to September 30, 2021,

and then subsequently of New LLC or LLC, as the context requires.

•“LLC Operating Agreement”: The Seventh Amended and Restated Limited Liability Company Agreement of the

LLC.

•“LLC Units”: Class A common units and Class B common units of the LLC prior to the Organizational Transactions.

•“LLC Unitholders”: Holders of the LLC Units or the LLC Common Units, as the context requires.

•“MGA”: Managing general agent.

•“MGU”: Managing general underwriter.

•“New LLC”: New Ryan Specialty, LLC is a Delaware limited liability company and a direct subsidiary of Ryan

Specialty Holdings, Inc.

•“New LLC Operating Agreement”: The Amended and Restated Limited Liability Company Agreement of New LLC.

•“Onex”: Onex Corporation and its affiliates, a holder of LLC Units and Class B preferred units of the LLC held prior

to the Organizational Transactions, and one of our shareholders following the Organizational Transactions.

•“Organizational Transactions”: The series of organizational transactions completed by the Company in connection

with the IPO, as described in the Form 10-K filed with the SEC on March 16, 2022.

•“Revolving Credit Facility”: Prior to July 30, 2024, the $600 million revolving credit facility under the Company’s

Credit Agreement. After July 30, 2024, the $1,400 million revolving credit facility under the Company’s Credit

Agreement.

•“Ryan Parties”: Patrick G. Ryan and certain members of his family and various entities and trusts over which Patrick

G. Ryan and his family exercise control.

•“SEC”: The Securities and Exchange Commission.

•“Senior Secured Notes”: The 2030 Senior Secured Notes and the 2032 Senior Secured Notes.

•“Specialty”: One of the three Ryan Specialty primary distribution channels, which includes Wholesale Brokerage,

Binding Authority, and Underwriting Management.

•“Stock Option”: A non-qualified stock option award that gives the grantee the option to buy a specified number of

shares of Class A common stock at the grant date price.

•“Tax Receivable Agreement” or “TRA”: The tax receivable agreement entered into in connection with the IPO.

•“Term Loan”: Prior to September 13, 2024, the senior secured Term Loan B for $1.65 billion in principal amount

under the Company’s Credit Agreement. After September 13, 2024, the senior secured Term Loan B for $1.70

billion in principal amount under the Company’s Credit Agreement.

•“U.S. GAAP”: Accounting principles generally accepted in the United States of America.

•“Underwriting Management”: Our Underwriting Management Specialty administers a number of MGUs, MGAs,

and programs that offer commercial and personal insurance for specific product lines or industry classes.

Underwriters act with delegated underwriting authority based on varying degrees of prescribed guidelines as

provided by carriers, quoting, binding and issuing policies on behalf of Ryan Specialty’s carrier trading partners

which retain the insurance underwriting risk.

•“Wholesale Brokerage”: Our Wholesale Brokerage Specialty distributes a wide range and diversified mix of

specialty property, casualty, professional lines, personal lines and workers’ compensation insurance products, as a

broker between the carriers and retail brokerage firms.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Ryan Specialty Holdings, Inc.

Consolidated Statements of Income (Loss) (Unaudited)

(In thousands, except share and per share data)


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
REVENUE
Net commissions and fees	$588,129	$487,345	$1,806,264	$1,507,878
Fiduciary investment income	16,565	14,593	45,917	36,808
Total revenue	$604,694	$501,938	$1,852,181	$1,544,686
EXPENSES
Compensation and benefits	393,249	329,212	1,180,825	989,294
General and administrative	88,684	69,288	247,518	202,595
Amortization	39,182	29,572	97,711	79,125
Depreciation	2,467	2,201	6,820	6,570
Change in contingent consideration	(365)	1,848	813	4,358
Total operating expenses	$523,217	$432,121	$1,533,687	$1,281,942
OPERATING INCOME	$81,477	$69,817	$318,494	$262,744
Interest expense, net	49,388	31,491	109,916	89,840
(Income) from equity method investment in related party	(4,182)	(2,271)	(13,510)	(5,882)
Other non-operating loss	16,590	67	18,575	37
INCOME BEFORE INCOME TAXES	$19,681	$40,530	$203,513	$178,749
Income tax expense (benefit)	(8,962)	24,827	16,155	42,772
NET INCOME	$28,643	$15,703	$187,358	$135,977
Net income attributable to non-controlling interests, net of tax	11,054	20,750	106,447	97,786
NET INCOME (LOSS) ATTRIBUTABLE TO RYAN SPECIALTY HOLDINGS, INC.	$17,589	$(5,047)	$80,911	$38,191
NET INCOME (LOSS) PER SHARE OF CLASS A COMMON STOCK:
Basic	$0.15	$(0.04)	$0.67	$0.34
Diluted	$0.09	$(0.04)	$0.59	$0.34
WEIGHTED-AVERAGE SHARES OF CLASS A COMMON STOCK OUTSTANDING:
Basic	121,915,952	115,872,327	119,383,234	113,291,850
Diluted	272,686,269	115,872,327	271,283,392	124,883,523

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

(In thousands)


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
NET INCOME	$28,643	$15,703	$187,358	$135,977
Net income attributable to non-controlling interests, net of tax	11,054	20,750	106,447	97,786
NET INCOME (LOSS) ATTRIBUTABLE TO RYAN SPECIALTY HOLDINGS, INC.	$17,589	$(5,047)	$80,911	$38,191
Other comprehensive income (loss), net of tax:
Gain (loss) on interest rate cap	(2,891)	2,760	2,853	7,628
(Gain) on interest rate cap reclassified to earnings	(2,441)	(2,215)	(7,011)	(5,518)
Foreign currency translation adjustments	6,658	(567)	7,177	(179)
Change in share of equity method investment in related party other comprehensive income (loss)	(149)	(267)	985	270
Total other comprehensive income (loss), net of tax	$1,177	$(289)	$4,004	$2,201
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO RYAN SPECIALTY HOLDINGS, INC.	$18,766	$(5,336)	$84,915	$40,392

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Consolidated Balance Sheets (Unaudited)

(In thousands, except share and per share data)


	September 30, 2024	December 31, 2023
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$235,199	$838,790
Commissions and fees receivable – net	334,637	294,195
Fiduciary cash and receivables	3,357,047	3,131,660
Prepaid incentives – net	8,309	8,718
Other current assets	84,165	62,229
Total current assets	$4,019,357	$4,335,592
NON-CURRENT ASSETS
Goodwill	2,341,340	1,646,482
Customer relationships	1,283,489	572,416
Other intangible assets	69,167	38,254
Prepaid incentives – net	15,449	15,103
Equity method investment in related party	62,444	46,099
Property and equipment – net	45,703	42,427
Lease right-of-use assets	122,617	127,708
Deferred tax assets	486,432	383,816
Other non-current assets	32,505	39,312
Total non-current assets	$4,459,146	$2,911,617
TOTAL ASSETS	$8,478,503	$7,247,209
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$206,185	$136,340
Accrued compensation	325,120	419,560
Operating lease liabilities	21,489	21,369
Tax Receivable Agreement liabilities	22,721	—
Short-term debt and current portion of long-term debt	33,316	35,375
Fiduciary liabilities	3,357,047	3,131,660
Total current liabilities	$3,965,878	$3,744,304
NON-CURRENT LIABILITIES
Accrued compensation	52,261	24,917
Operating lease liabilities	148,487	154,457
Long-term debt	2,646,550	1,943,837
Tax Receivable Agreement liabilities	432,406	358,898
Deferred tax liabilities	21,162	55
Other non-current liabilities	110,227	41,097
Total non-current liabilities	$3,411,093	$2,523,261
TOTAL LIABILITIES	$7,376,971	$6,267,565
STOCKHOLDERS’ EQUITY
Class A common stock ($0.001 par value; 1,000,000,000 shares authorized, 125,096,524 and 118,593,062 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively)	125	119
Class B common stock ($0.001 par value; 1,000,000,000 shares authorized, 136,724,772 and 141,621,188 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively)	137	142
Class X common stock ($0.001 par value; 10,000,000 shares authorized, 640,784 shares issued and 0 outstanding at September 30, 2024 and December 31, 2023)	—	—
Preferred stock ($0.001 par value; 500,000,000 shares authorized, 0 shares issued and outstanding at September 30, 2024 and December 31, 2023)	—	—
Additional paid-in capital	500,518	441,997
Retained earnings	124,973	114,420
Accumulated other comprehensive income	7,080	3,076
Total stockholders’ equity attributable to Ryan Specialty Holdings, Inc.	$632,833	$559,754
Non-controlling interests	468,699	419,890
Total stockholders’ equity	$1,101,532	$979,644
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$8,478,503	$7,247,209

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Consolidated Statements of Cash Flows (Unaudited)

(In thousands)


	Nine Months Ended September 30,
	2024	2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$187,358	$135,977
Adjustments to reconcile net income to cash flows provided by operating activities:
(Income) from equity method investment in related party	(13,510)	(5,882)
Amortization	97,711	79,125
Depreciation	6,820	6,570
Prepaid and deferred compensation expense	25,220	8,882
Non-cash equity-based compensation	61,664	54,136
Amortization of deferred debt issuance costs	21,838	9,125
Amortization of interest rate cap premium	5,216	5,216
Deferred income tax expense (benefit)	(1,959)	11,745
Deferred income tax expense from reorganization	—	20,679
Loss on Tax Receivable Agreement	646	478
Changes in operating assets and liabilities, net of acquisitions:
Commissions and fees receivable – net	21,514	3,875
Accrued interest liability	2,260	(4,293)
Other current and non-current assets	(12,826)	10,935
Other current and non-current accrued liabilities	(146,724)	(86,233)
Total cash flows provided by operating activities	$255,228	$250,335
CASH FLOWS FROM INVESTING ACTIVITIES
Business combinations – net of cash acquired and cash held in a fiduciary capacity	(1,256,732)	(366,149)
Capital expenditures	(29,705)	(16,013)
Repayments of prepaid incentives	—	228
Total cash flows used in investing activities	$(1,286,437)	$(381,934)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Senior Secured Notes	595,200	—
Borrowings on Revolving Credit Facility	850,000	—
Repayments on Revolving Credit Facility	(850,000)	—
Debt issuance costs paid	(16,771)	—
Proceeds from term debt	107,625	—
Repayment of term debt	(8,250)	(12,375)
Payment of contingent consideration	—	(4,477)
Tax distributions to non-controlling LLC Unitholders	(65,833)	(52,633)
Receipt of taxes related to net share settlement of equity awards	26,502	7,786
Taxes paid related to net share settlement of equity awards	(18,516)	(7,091)
Dividends paid to Class A common shareholders	(66,507)	—
Distributions to non-controlling LLC Unitholders	(16,754)	—
Payment of accrued return on Ryan Re preferred units	(2,047)	—
Net change in fiduciary liabilities	90,700	36,832
Total cash flows provided by (used in) financing activities	$625,349	$(31,958)
Effect of changes in foreign exchange rates on cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity	5,641	(828)
NET CHANGE IN CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY	$(400,219)	$(164,385)
CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY—Beginning balance	1,756,332	1,767,385
CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY—Ending balance	$1,356,113	$1,603,000
Reconciliation of cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity
Cash and cash equivalents	235,199	754,370
Cash and cash equivalents held in a fiduciary capacity	1,120,914	848,630
Total cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity	$1,356,113	$1,603,000

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Consolidated Statements of Stockholders’ Equity (Unaudited)

(In thousands, except share data)


	Class A Common Stock		Class B Common Stock		Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income	Non- controlling Interests	Total Stockholders’ Equity
	Shares	Amount	Shares	Amount	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income	Non- controlling Interests	Total Stockholders’ Equity
Balance at December 31, 2023	118,593,062	$119	141,621,188	$142	$441,997	$114,420	$3,076	$419,890	$979,644
Net income	—	—	—	—	—	16,535	—	24,142	40,677
Issuance of common stock	9,449	—	—	—	—	—	—	—	—
Exchange of LLC equity for common stock	134,959	—	(134,959)	—	240	—	—	(240)	—
Class A common stock dividends and Dividend Equivalents	—	—	—	—	—	(42,418)	—	—	(42,418)
Distributions and Declared Distributions to non-controlling LLC Unitholders	—	—	—	—	—	—	—	(5,766)	(5,766)
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	(78)	—	—	—	(78)
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(22,177)	(22,177)
Change in share of equity method investment in related party other comprehensive income	—	—	—	—	—	—	1,510	2,270	3,780
Gain on interest rate cap, net	—	—	—	—	—	—	1,918	2,887	4,805
Foreign currency translation adjustments	—	—	—	—	—	—	(408)	(616)	(1,024)
Equity-based compensation	—	—	—	—	17,297	—	—	13	17,310
Balance at March 31, 2024	118,737,470	$119	141,486,229	$142	$459,456	$88,537	$6,096	$420,403	$974,753
Net income	—	—	—	—	—	46,787	—	71,251	118,038
Issuance of common stock	270,510	—	8,992	—	989	—	—	1,179	2,168
Exchange of LLC equity for common stock	331,150	—	(331,150)	—	598	—	—	(598)	—
Equity awards withheld for settlement of employee tax obligations	—	—	—	—	—	—	—	(284)	(284)
Class A common stock dividends and Dividend Equivalents	—	—	—	—	—	(13,764)	—	—	(13,764)
Distributions and Declared Distributions to non-controlling LLC Unitholders	—	—	—	—	—	—	—	(5,758)	(5,758)
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	709	—	—	(201)	508
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(22,829)	(22,829)
Change in share of equity method investment in related party other comprehensive income	—	—	—	—	—	—	(376)	(564)	(940)
Loss on interest rate cap, net	—	—	—	—	—	—	(744)	(1,116)	(1,860)
Foreign currency translation adjustments	—	—	—	—	—	—	927	1,382	2,309
Equity-based compensation	—	—	—	—	16,378	—	—	4,517	20,895
Balance at June 30, 2024	119,339,130	$119	141,164,071	$142	$478,130	$121,560	$5,903	$467,382	$1,073,236


	Class A Common Stock		Class B Common Stock		Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income	Non- controlling Interests	Total Stockholders’ Equity
	Shares	Amount	Shares	Amount	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income	Non- controlling Interests	Total Stockholders’ Equity
Balance at June 30, 2024	119,339,130	$119	141,164,071	$142	$478,130	$121,560	$5,903	$467,382	$1,073,236
Net income	—	—	—	—	—	17,589	—	11,054	28,643
Issuance of common stock	1,123,824	1	32,262	—	3,307	—	—	3,670	6,978
Forfeiture of common stock	(1,883)	—	—	—	—	—	—	—	—
Exchange of LLC equity for common stock	4,635,453	5	(4,471,561)	(5)	8,005	—	—	(8,005)	—
Class A common stock dividends and Dividend Equivalents	—	—	—	—	—	(14,176)	—	—	(14,176)
Distributions and Declared Distributions to non-controlling LLC Unitholders	—	—	—	—	—	—	—	(5,622)	(5,622)
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	8,131	—	—	—	8,131
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(21,952)	(21,952)
Change in share of equity method investment in related party other comprehensive income	—	—	—	—	—	—	(149)	(204)	(353)
Loss on interest rate cap, net	—	—	—	—	—	—	(5,332)	(7,397)	(12,729)
Foreign currency translation adjustments	—	—	—	—	—	—	6,658	9,259	15,917
Equity-based compensation	—	—	—	—	2,945	—	—	20,514	23,459
Balance at September 30, 2024	125,096,524	$125	136,724,772	$137	$500,518	$124,973	$7,080	$468,699	$1,101,532

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Consolidated Statements of Stockholders’ Equity (Unaudited)

(In thousands, except share data)


	Class A Common Stock		Class B Common Stock		Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Non- controlling Interests	Total Stockholders’ Equity
	Shares	Amount	Shares	Amount	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Non- controlling Interests	Total Stockholders’ Equity
Balance at December 31, 2022	112,437,825	$112	147,214,275	$147	$418,123	$53,988	$6,035	$339,407	$817,812
Net income	—	—	—	—	—	13,160	—	23,297	36,457
Issuance of common stock	3,468	—	—	—	—	—	—	—	—
Exchange of LLC equity for common stock	792,358	1	(792,358)	(1)	1,430	—	—	(1,430)	—
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	(395)	—	—	—	(395)
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(15,382)	(15,382)
Change in share of equity method investment in related party other comprehensive income	—	—	—	—	—	—	214	370	584
Loss on interest rate cap, net	—	—	—	—	—	—	(2,251)	(3,889)	(6,140)
Foreign currency translation adjustments	—	—	—	—	—	—	285	498	783
Equity-based compensation	—	—	—	—	17,740	—	—	139	17,879
Balance at March 31, 2023	113,233,651	$113	146,421,917	$146	$436,898	$67,148	$4,283	$343,010	$851,598
Net income	—	—	—	—	—	30,078	—	53,739	83,817
Issuance of common stock	104,196	—	21,006	—	—	—	—	—	—
Exchange of LLC equity for common stock	1,871,084	2	(1,871,084)	(2)	3,474	—	—	(3,474)	—
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	449	—	—	—	449
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(21,992)	(21,992)
Change in share of equity method investment in related party other comprehensive income	—	—	—	—	—	—	323	545	868
Gain on interest rate cap, net	—	—	—	—	—	—	3,816	6,434	10,250
Foreign currency translation adjustments	—	—	—	—	—	—	103	176	279
Equity-based compensation	—	—	—	—	12,104	—	—	6,545	18,649
Balance at June 30, 2023	115,208,931	$115	144,571,839	$144	$452,925	$97,226	$8,525	$384,983	$943,918
Net income (loss)	—	—	—	—	—	(5,047)	—	20,750	15,703
Issuance of common stock	426,647	—	41,446	—	2,694	—	—	—	2,694
Exchange of LLC equity for common stock	2,586,950	3	(2,586,950)	(3)	4,804	—	—	(4,804)	—
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes	—	—	—	—	(32,970)	—	—	13,136	(19,834)
Distributions declared for non-controlling interest holders’ tax	—	—	—	—	—	—	—	(18,104)	(18,104)
Change in share of equity method investment in related party other comprehensive loss	—	—	—	—	—	—	(267)	(405)	(672)
Gain on interest rate cap, net	—	—	—	—	—	—	545	829	1,374
Foreign currency translation adjustments	—	—	—	—	(17)	—	(567)	(862)	(1,446)
Equity-based compensation	—	—	—	—	14,868	—	—	2,740	17,608
Balance at September 30, 2023	118,222,528	$118	142,026,335	$141	$442,304	$92,179	$8,236	$398,263	$941,241

See accompanying Notes to the Consolidated Financial Statements (Unaudited)

Ryan Specialty Holdings, Inc.

Notes to the Consolidated Financial Statements (Unaudited)

(Tabular amounts presented in thousands, except share and per share data)

1. Basis of Presentation

Nature of Operations

Ryan Specialty Holdings, Inc., (the “Company”) is a service provider of specialty products and solutions for insurance

brokers, agents, and carriers. These services encompass distribution, underwriting, product development, administration,

and risk management by acting as a wholesale broker and a managing underwriter or a program administrator with

delegated authority from insurance carriers. The Company’s offerings cover a wide variety of sectors including

commercial, industrial, institutional, governmental, and personal through one operating segment, Ryan Specialty. With the

exception of the Company’s equity method investment, the Company does not take on any underwriting risk.

The Company is headquartered in Chicago, Illinois, and has operations in the United States, Canada, the United Kingdom,

Europe, and Singapore. The Company’s Class A common stock is traded on the New York Stock Exchange under the

ticker symbol “RYAN”.

Organization

Ryan Specialty Holdings, Inc., was formed as a Delaware corporation on March 5, 2021, for the purpose of completing an

IPO and to carry on the business of the LLC. New Ryan Specialty, LLC, or New LLC, was formed as a Delaware limited

liability company on April 20, 2021, for the purpose of becoming, subsequent to our IPO, an intermediate holding

company between Ryan Specialty Holdings, Inc., and the LLC. The Company is the sole managing member of New LLC.

New LLC is a holding company with its sole material asset being a controlling equity interest in the LLC. The Company

operates and controls the business and affairs of the LLC through New LLC and, through the LLC, conducts its business.

Accordingly, the Company consolidates the financial results of New LLC, and therefore the LLC, and reports the non-

controlling interests of New LLC’s Common Units on its consolidated financial statements. As the LLC is substantively

the same as New LLC, for the purpose of this document, we will refer to both New LLC and the LLC as the “LLC”. As of

September 30, 2024, the Company owned 47.8% of the outstanding LLC Common Units.

Basis of Presentation

The accompanying unaudited consolidated interim financial statements and notes thereto have been prepared in accordance

with U.S. GAAP. Certain information and disclosures normally included in the financial statements prepared in accordance

with U.S. GAAP have been omitted pursuant to the rules and regulations of the SEC for interim financial information.

These consolidated interim financial statements should be read in conjunction with the audited consolidated financial

statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on February 28,

2024. Interim results are not necessarily indicative of results for the full fiscal year due to seasonality and other factors.

In the opinion of management, the unaudited consolidated interim financial statements include all normal recurring

adjustments necessary to present fairly the Company’s consolidated financial position, results of operations, and cash flows

for all periods presented. Certain prior period amounts in the Consolidated Statements of Cash Flows have been reclassified

to conform to the current year presentation.

Principles of Consolidation

The unaudited consolidated interim financial statements include the accounts of the Company and its subsidiaries that it

controls due to ownership of a majority voting interest or pursuant to variable interest entity (“VIE”) accounting. All

intercompany transactions and balances have been eliminated in consolidation.

The Company, through its intermediate holding company New LLC, owns a minority economic interest in, and operates

and controls the businesses and affairs of, the LLC. The LLC is a VIE of the Company and the Company is the primary

beneficiary of the LLC as the Company has both the power to direct the activities that most significantly impact the LLC’s

economic performance and has the obligation to absorb losses of, and receive benefits from, the LLC, which could be

significant to the Company. Accordingly, the Company has prepared these consolidated financial statements in accordance

with Accounting Standards Codification 810, Consolidation (“ASC 810”). ASC 810 requires that if an entity is the primary

beneficiary of a VIE, the assets, liabilities, and results of operations of the VIE should be included in the consolidated

financial statements of such entity. The Company’s relationship with the LLC results in no recourse to the general credit of

the Company and the Company has no contractual requirement to provide financial support to the LLC. The Company

shares in the income and losses of the LLC in direct proportion to the Company’s ownership percentage.

Use of Estimates

The preparation of the unaudited consolidated interim financial statements and notes thereto requires management to make

estimates, judgments, and assumptions that affect the amounts reported in the unaudited consolidated interim financial

statements and in the notes thereto. Such estimates and assumptions could change in the future as circumstances change or

more information becomes available, which could affect the amounts reported and disclosed herein.

Significant Accounting Policies

There have been no material changes in the Company’s significant accounting policies from those that were disclosed for

the year ended December 31, 2023, in the Company’s Annual Report on Form 10-K filed with the SEC on February 28,

2024.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07 Segment Reporting (Topic 280) — Improvements to Reportable

Segment Disclosures, which requires disclosure of incremental segment information on an annual and interim basis. This

ASU is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning

after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied retrospectively to

all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this

ASU on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740) — Improvements to Income Tax Disclosures,

which includes amendments that further enhance income tax disclosures, primarily through standardization and

disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. This ASU is effective for annual

periods beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the

impact of adopting this ASU on its consolidated financial statements and disclosures.

New Accounting Pronouncements Recently Adopted

In March 2024, the FASB issued ASU 2024-01 Compensation — Stock Compensation (Topic 718) — Scope Application of

Profits Interest and Similar Awards, which provides illustrative examples to demonstrate how an entity should apply the

scope guidance in paragraph 718-10-15-3 to determine whether profits interests and similar awards should be accounted for

in accordance with Topic 718. This ASU is effective for public companies for fiscal years beginning after December 15,

2024, but early adoption is permitted. The Company adopted this standard retrospectively on January 1, 2024, with no

material impact to the consolidated financial statements or disclosures.

In March 2024, the FASB issued ASU 2024-02 Codification Improvements — Amendments to Remove References to the

Concept Statements, which removes references to various FASB Concepts Statements in order to simplify the Codification

and draw a distinction between authoritative and nonauthoritative literature. This ASU is effective for public companies for

fiscal years beginning after December 15, 2024, but early adoption is permitted. The Company adopted this standard

prospectively on January 1, 2024, with no material impact to the consolidated financial statements or disclosures.

2. Revenue from Contracts with Customers

Disaggregation of Revenue

The following table summarizes revenue from contracts with customers by Specialty:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Wholesale Brokerage	$346,666	$308,872	$1,114,240	$976,338
Binding Authority	76,497	69,245	245,762	208,547
Underwriting Management	164,966	109,228	446,262	322,993
Total Net commissions and fees	$588,129	$487,345	$1,806,264	$1,507,878

Contract Balances

Contract assets, which arise primarily from the Company’s supplemental and contingent commission arrangements and

medical stop loss business, are included within Commissions and fees receivable – net on the Consolidated Balance Sheets.

The contract assets balance was $18.5 million and $13.4 million as of September 30, 2024 and December 31, 2023,

respectively. For contract assets, payment is typically due within one year of the completed performance obligation. The

contract liability balance related to deferred revenue, which is included in Accounts payable and accrued liabilities on the

Consolidated Balance Sheets, was $11.2 million and $7.8 million as of September 30, 2024 and December 31, 2023,

respectively. During the three and nine months ended September 30, 2024, $0.5 million and $7.1 million, respectively, of

the contract liabilities outstanding as of December 31, 2023, was recognized in revenue.

3. Mergers and Acquisitions

2024 Acquisitions

On May 1, 2024, the Company completed the acquisition of Castel Underwriting Agencies Limited (“Castel”), a managing

general underwriting platform headquartered in London, England, for cash consideration of $247.6 million, $2.2 million of

RYAN Class A common stock, and contingently returnable consideration of $4.9 million.

On August 30, 2024, the Company completed the acquisition of US Assure Insurance Services of Florida, Inc. (“US

Assure”), a program specializing in builder’s risk insurance headquartered in Jacksonville, Florida, for cash consideration

of $1,079.8 million and contingent consideration of $103.8 million.

On September 1, 2024, the Company completed the acquisition of certain assets of Greenhill Underwriting Insurance

Services, LLC (“Greenhill”), an MGU focused on the allied health industry headquartered in Houston, Texas, for cash

consideration of $11.7 million.

On September 13, 2024, the Company completed the acquisition of the Property and Casualty (“P&C”) MGUs owned by

Ethos Specialty Insurance, LLC (“Ethos P&C”) for cash consideration of $44.0 million. Ethos P&C is composed of eight

programs which underwrite on behalf of insurance carriers.

The $103.8 million of contingent consideration liabilities and $4.9 million of contingently returnable consideration

established for the acquisitions that occurred during the nine months ended September 30, 2024, were measured at the

estimated acquisition date fair value and were non-cash investing transactions. These arrangements are based on specified

revenue or EBITDA targets over the next three fiscal years.

The following table summarizes the estimated fair value of the aggregate assets and liabilities acquired during the nine

months ended September 30, 2024:


	Castel	US Assure	Greenhill	Ethos P&C	Total
Cash and cash equivalents	$10,294	$7,181	$314	$—	$17,789
Commissions and fees receivable – net	10,657	50,111	46	—	60,814
Fiduciary cash and receivables	119,333	122,136	3,222	—	244,691
Goodwill2	190,602	457,847	7,268	24,246	679,963
Customer relationships1	97,820	670,300	4,158	21,100	793,378
Other intangible assets	875	9,900	—	—	10,775
Lease right-of-use assets	1,269	2,256	—	—	3,525
Other current and non-current assets	1,277	606	—	—	1,883
Total assets acquired	$432,127	$1,320,337	$15,008	$45,346	$1,812,818
Accounts payable and accrued liabilities	1,138	9,284	—	—	10,422
Accrued compensation	43,538	3,084	49	1,371	48,042
Fiduciary liabilities	119,433	122,136	3,222	—	244,791
Operating lease liabilities	1,269	2,256	—	—	3,525
Deferred tax liabilities2	21,816	—	—	—	21,816
Total liabilities assumed	$187,194	$136,760	$3,271	$1,371	$328,596
Net assets acquired	$244,933	$1,183,577	$11,737	$43,975	$1,484,222

1 The acquired customer relationships have a weighted average amortization period of 13.8 years.

2 Includes a correction of an error to the purchase price allocation for the Castel acquisition, which resulted in an increase

to Deferred tax liabilities and Goodwill of $24.6 million. The table above shows the deferred tax liabilities net of deferred

tax assets of $2.8 million.

Estimated tax deductible goodwill of $545.6 million was generated as a result of the acquisitions above. The Company

recognized acquisition-related expenses, which include advisory, legal, accounting, valuation, and other costs related to

diligence, for the acquisitions above of $5.3 million and $11.4 million during the three and nine months ended

September 30, 2024, respectively, in General and administrative expense on the Consolidated Statements of Income (Loss).

In conjunction with the closing of the Castel acquisition, the deal-contingent foreign currency forward (the “Deal-

Contingent Forward”), as described in Note 11, Derivatives, was settled.

The Company recognized an aggregate $24.5 million and $33.8 million of revenue related to the acquisitions above from

their respective acquisition dates for the three and nine months ended September 30, 2024, respectively.

2023 Acquisitions

On January 3, 2023, the Company completed the acquisition of certain assets of Griffin Underwriting Services (“Griffin”),

a binding authority specialist and wholesale insurance broker headquartered in Bellevue, Washington, for cash

consideration of $115.5 million.

On July 1, 2023, the Company completed the acquisitions of certain assets of ACE Benefit Partners, Inc. (“ACE”), a

medical stop loss general agent headquartered in Eagle, Idaho, and Point6 Healthcare, LLC (“Point6”), a distributor of

medical stop loss insurance on behalf of retail brokers and third-party administrators headquartered in Plano, Texas, for an

aggregate $46.8 million of cash consideration and $2.3 million of contingent consideration. During nine months ended

September 30, 2024, a measurement period adjustment related to the initial valuation of contingent consideration of $0.6

million was recognized in Goodwill on the Consolidated Balance Sheets.

On July 3, 2023, the Company completed the acquisition of Socius Insurance Services (“Socius”), a national wholesale

insurance broker headquartered in Northern California, for $253.5 million of cash consideration, $5.8 million of contingent

consideration, and $2.7 million of RYAN Class A common stock.

On December 1, 2023, the Company completed the acquisition of AccuRisk Holdings, LLC (“AccuRisk”), a medical stop

loss MGU headquartered in Chicago, Illinois, for $98.3 million of cash consideration. During the nine months ended

September 30, 2024, a measurement period adjustment related to the initial valuation of contingent consideration of $0.3

million was recognized in Goodwill on the Consolidated Balance Sheets.

Estimates and assumptions used in the acquisition valuations are subject to change within the measurement period up to

one year from each acquisition date.

Unaudited Pro Forma Financial Information

The following unaudited pro forma financial information presents the combined results of operations of the Company as if

the 2024 and 2023 acquisitions, excluding Griffin as it is already included in the results of all periods presented, occurred

on January 1, 2023. The unaudited pro forma financial information is presented for informational purposes only and is not

indicative of the results of operations that would have been achieved if the acquisitions had taken place on the date

indicated or of results that may occur in the future. The pre-acquisition Castel and US Assure results included in the pro

forma figures below contain acquisition-related expenses that were not considered pro forma adjustments for the Company.


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Total revenue	$630,260	$565,699	$1,949,548	$1,746,130
Net income	8,333	25,225	130,932	27,902

The unaudited pro forma financial information includes adjustments of (i) incremental amortization expense on acquired

intangible assets of $12.5 million and $28.3 million for the three months ended September 30, 2024 and 2023, respectively,

and $61.4 million and $89.5 million for the nine months ended September 30, 2024 and 2023, respectively, (ii) a decrease

in transaction costs, including the loss related to the Deal-Contingent Forward for pro forma purposes, of $5.3 million and

$16.2 million for the three and nine months ended September 30, 2024, respectively, and an increase in such costs of $7.7

million for the nine months ended September 30, 2023, (iii) a decrease in financing costs and interest expense resulting

from the debt activity related to the US Assure acquisition of $23.9 million for the three months ended September 30, 2024

and an increase in such costs of $11.0 million and $63.0 million for the three and nine months ended September 30, 2023,

respectively, (iv) a decrease of $20.7 million of income tax expense related to the common control reorganizations as part

of the Socius acquisition for the three months ended September 30, 2023, and (v) incremental tax expenses related to the

pro forma adjustments of $8.9 million and $4.0 million for the three months ended September 30, 2024 and 2023,

respectively, and $3.3 million and $19.7 million for the nine months ended September 30, 2024 and 2023, respectively.

Contingent Consideration

Total consideration for certain acquisitions includes contingent consideration or contingently returnable consideration,

which are generally based on the EBITDA or revenue of the acquired business following a defined period after purchase.

Further information regarding fair value measurements of contingent consideration and contingently returnable

consideration is detailed in Note 13, Fair Value Measurements. The Company recognizes income or loss for the changes in

fair value of estimated contingent consideration and contingently returnable consideration within Change in contingent

consideration, and recognizes accretion of the discount on these assets or liabilities within Interest expense, net, on the

Consolidated Statements of Income (Loss). The table below summarizes the amounts recognized:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Change in contingent consideration	$(365)	$1,848	$813	$4,358
Interest expense, net	1,325	789	3,125	2,230
Total	$960	$2,637	$3,938	$6,588

As of September 30, 2024, the aggregate amounts of maximum consideration related to acquisitions were $483.1 million

related to contingent consideration and $20.1 million related to contingently returnable consideration.

4. Restructuring

In February 2023, the Company initiated the ACCELERATE 2025 program that will enable continued growth, drive

innovation, and deliver sustainable productivity improvements over the long term. The restructuring plan aims to reduce

costs and increase efficiencies through a focus on optimizing the Company’s operations and technology. In its expanded

form, the restructuring plan is expected to incur total restructuring costs of approximately $110.0 million through

December 31, 2024, and to generate annual savings of approximately $60.0 million in 2025. The total expected costs of the

plan include $55.0 million related to operations and technology optimization, $40.0 million related to employee

compensation and benefits, and $15.0 million related to asset impairment and other termination costs.

The table below presents the restructuring expense for the program incurred:


	Three Months Ended September 30,		Nine Months Ended September 30,		Inception-to- Date
	2024	2023	2024	2023	As of September 30, 2024
Operations and technology optimization	$6,828	$10,824	$17,714	$18,529	$43,709
Compensation and benefits	3,680	5,109	29,800	6,709	41,120
Asset impairment and other termination costs	318	544	318	11,057	11,375
Total	$10,826	$16,477	$47,832	$36,295	$96,204

For the three months ended September 30, 2024 and 2023, the Company recognized restructuring expenses of $5.7 million

and $11.6 million, respectively, including contractor costs, in Compensation and benefits, and $5.1 million and $4.9

million, respectively, in General and administrative expense on the Consolidated Statements of Income (Loss). For the nine

months ended September 30, 2024 and 2023, the Company recognized restructuring expenses of $35.7 million and $13.4

million, respectively, including contractor costs, in Compensation and benefits, and $12.1 million and $22.9 million,

respectively, in General and administrative expense on the Consolidated Statements of Income (Loss).

The table below presents a summary of changes in the restructuring liability:


	Operations and Technology Optimization	Compensation and Benefits	Asset Impairment and Other Termination Costs	Total
Balance at December 31, 2023	$5,886	$1,080	$—	$6,966
Accrued costs	36,140	29,800	318	66,258
Payments	(29,649)	(27,936)	—	(57,585)
Non-cash adjustments	—	—	(318)	(318)
Balance at September 30, 2024	$12,377	$2,944	$—	$15,321

Accrued costs in the table above include both costs expensed and capitalized during the period. As of September 30, 2024

and December 31, 2023, $11.1 million and $5.3 million, respectively, of the restructuring liability was included in

Accounts payable and accrued liabilities and $4.2 million and $1.7 million, respectively, was included in Current Accrued

compensation on the Consolidated Balance Sheets.

5. Receivables and Other Current Assets

Receivables

The Company had receivables of $334.6 million and $294.2 million outstanding as of September 30, 2024 and

December 31, 2023, respectively, which were recognized within Commissions and fees receivable – net on the

Consolidated Balance Sheets. Commission and fees receivable is net of an allowance for credit losses. The Company’s

allowance for credit losses is based on a combination of factors, including evaluation of historical write-offs, current

economic conditions, aging of balances, and other qualitative and quantitative analyses.

The following table provides a summary of changes in the Company’s allowance for expected credit losses:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Beginning of period	$3,153	$2,089	$2,458	$1,980
Write-offs	(1,225)	(441)	(2,510)	(1,342)
Increase in provision	1,691	869	3,671	1,879
End of period	$3,619	$2,517	$3,619	$2,517

Other Current Assets

Major classes of other current assets consist of the following:


	September 30, 2024	December 31, 2023
Prepaid expenses	$45,610	$25,762
Insurance recoverable	20,155	20,562
Other current receivables	18,400	15,905
Total Other current assets	$84,165	$62,229

Other current receivables contain service receivables from Geneva Re, Ltd. See Note 15, Related Parties, for further

information regarding related parties. See Note 14, Commitments and Contingencies, for further information on the

insurance recoverable.

6. Leases

The Company has various non-cancelable operating leases with various terms through September 2038, primarily for office

space and office equipment. The following table provides additional information about the Company’s leases:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Lease costs
Operating lease costs	$7,669	$8,687	$23,408	$26,339
Short-term lease costs
Operating lease costs	228	234	675	635
Sublease income	(112)	(193)	(408)	(439)
Lease costs – net	$7,785	$8,728	$23,675	$26,535

Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases			$22,516	$23,245
Non-cash related activities
Right-of-use assets obtained in exchange for new operating lease liabilities			15,236	9,948
Amortization of right-of-use assets for operating lease activity			16,803	20,197
Weighted average discount rate (percent)
Operating leases			5.3 %	5.1 %
Weighted average remaining lease term (years)
Operating leases			7.8	8.3

7. Debt

Substantially all of the Company’s debt is carried at outstanding principal balance, less debt issuance costs and any

unamortized discount. The following table is a summary of the Company’s outstanding debt:


	September 30, 2024	December 31, 2023
Term debt
7-year term loan facility, periodic interest and quarterly principal payments, Adjusted Term SOFR + 2.25% as of September 30, 2024, Adjusted Term SOFR + 3.00% as of December 31, 2023, matures September 13, 2031	$1,677,446	$1,564,718
Senior secured notes
8-year senior secured notes, semi-annual interest payments, 4.38%, matures February 1, 2030	397,057	400,704
8-year secured notes, semi-annual interest payments, 5.88%, matures August 1, 2032	591,805	—
Revolving debt
5-year revolving loan facility, periodic interest payments, Adjusted Term SOFR + up to 2.50% as of September 30, 2024, Adjusted Term SOFR + up to 3.00% as of December 31, 2023, plus commitment fees of 0.25%-0.50%, matures July 30, 2029	714	377
Premium financing notes
Commercial notes, periodic interest and principal payments, 6.25%, expire May 1, 2025	4,642	—
Commercial notes, periodic interest and principal payments, 6.25%, expire June 1, 2025	871	—
Commercial notes, periodic interest and principal payments, 6.25%, expire June 21, 2025	3,932	—
Commercial notes, periodic interest and principal payments, 5.75%, expired May 1, 2024	—	2,251
Commercial notes, periodic interest and principal payments, 5.75%, expired June 1, 2024	—	622
Commercial notes, periodic interest and principal payments, 6.00%, expired June 19, 2024	—	2,485
Commercial notes, periodic interest and principal payments, 5.75%, expired June 21, 2024	—	2,855
Units subject to mandatory redemption	3,399	5,200
Total debt	$2,679,866	$1,979,212
Less: Short-term debt and current portion of long-term debt	(33,316)	(35,375)
Long-term debt	$2,646,550	$1,943,837

Term Loan

The original principal of the Term Loan was $1,650.0 million. As a result of the Seventh Amendment, as defined and

described below, the principal was increased to $1,700.0 million. As of September 30, 2024, $1,700.0 million of the

principal was outstanding, $6.2 million of interest was accrued, and the related unamortized deferred issuance costs were

$28.8 million. As of December 31, 2023, $1,596.4 million of the principal was outstanding, $1.1 million of interest was

accrued, and the related unamortized deferred issuance costs were $32.8 million.

On January 19, 2024, the Company entered into the fifth amendment (the “Fifth Amendment”) to the Credit Agreement. As

a result of the Fifth Amendment, the applicable interest rate of the Term Loan was reduced from Adjusted Term SOFR +

3.00% to Adjusted Term SOFR + 2.75% and no longer contains a credit spread adjustment. All other material provisions

remain unchanged. The portion of the debt related to the lenders that opted out of the repricing was considered

extinguished and their portion of the legacy debt issuance costs of $0.4 million was written off during the nine months

ended September 30, 2024, which was recognized in Interest expense, net on the Consolidated Statements of Income

(Loss). Additionally, the Company incurred third-party fees related to the repricing of $1.9 million for the nine months

ended September 30, 2024, which were recognized in Other non-operating loss on the Consolidated Statements of Income

(Loss).

On September 13, 2024, the Company entered into the seventh amendment (the “Seventh Amendment”) to the Credit

Agreement. As a result of the Seventh Amendment, the principal of the Term Loan was increased to $1,700.0 million, the

applicable interest rate of the Term Loan was reduced from Adjusted Term SOFR + 2.75% to Adjusted Term SOFR +

2.25%, the 0.75% floor on Adjusted Term SOFR was reduced to 0.00%, and the maturity date was extended to

September 13, 2031. Incremental debt issuance costs of $11.1 million were incurred and will be amortized over the

extended term of the loan. The portion of the debt related to the lenders that opted out of the Seventh Amendment was

considered extinguished and their portion of the legacy debt issuance costs of $8.3 million was written off during the three

and nine months ended September 30, 2024, which was recognized in Interest expense, net on the Consolidated Statements

of Income (Loss). Additionally, the Company incurred third-party fees related to the Seventh Amendment of $16.2 million

for the three and nine months ended September 30, 2024, which were recognized in Other non-operating loss on the

Consolidated Statements of Income (Loss).

Revolving Credit Facility

On July 30, 2024, the Company entered into the sixth amendment (the “Sixth Amendment”) to the Credit Agreement,

which provided for an increase in the borrowing capacity of the Revolving Credit Facility from $600.0 million to $1,400.0

million. The Sixth Amendment also extended the maturity date of the Revolving Credit Facility to July 30, 2029, and

reduced the applicable interest rate from Adjusted Term SOFR + up to 3.00% to Adjusted Term SOFR + up to 2.50%.

Incremental debt issuance costs of $7.9 million were incurred and will be amortized over the extended term of the facility.

The portion of the debt related to the lender that opted out of the Sixth Amendment was considered extinguished and its

portion of the legacy debt issuance costs of $0.1 million was written off during the three and nine months ended

September 30, 2024, which was recognized in Interest expense, net on the Consolidated Statements of Income (Loss).

The Revolving Credit Facility had a borrowing capacity of $1,400.0 million and $600.0 million as of September 30, 2024

and December 31, 2023, respectively. Due to the nature of the instrument, the deferred issuance costs related to the facility

of $10.1 million and $4.1 million as of September 30, 2024 and December 31, 2023, respectively, were recognized in Other

non-current assets on the Consolidated Balance Sheets. The commitments available to be borrowed under the Revolving

Credit Facility were $1,399.7 million and $599.7 million as of September 30, 2024 and December 31, 2023, respectively,

as the available amount of the facility was reduced by $0.3 million of undrawn letters of credit.

The Company pays a commitment fee on undrawn amounts under the facility of 0.25% - 0.50%. As of September 30, 2024

and December 31, 2023, the Company accrued $0.7 million and $0.4 million, respectively, of unpaid commitment fees

related to the Revolving Credit Facility in Short-term debt and current portion of long-term debt on the Consolidated

Balance Sheets.

Senior Secured Notes due 2030

In February 2022, the LLC issued $400.0 million of Senior Secured Notes. As of September 30, 2024 and December 31,

2023, accrued interest on the notes was $2.9 million and $7.3 million, respectively, and the related unamortized deferred

issuance costs plus discount were $5.9 million and $6.6 million, respectively.

Senior Secured Notes due 2032

On September 19, 2024, the LLC issued $600.0 million of Senior Secured Notes. As of September 30, 2024, accrued

interest on the notes was $1.2 million and the related unamortized deferred issuance costs were $9.4 million.

Bridge Facility

On July 31, 2024, the Company entered into a 364-day unsecured bridge term loan facility (the “Bridge Facility”), which

provided unsecured bridge financing of up to $500.0 million to finance a portion of the US Assure acquisition price. In lieu

of drawing under the Bridge Facility, the Company borrowed under the Revolving Credit Facility. Concurrent with the

completion of the US Assure acquisition on August 30, 2024, the Bridge Facility was terminated, and the Company

recognized $4.1 million of related deferred financing costs in Interest expense, net on the Consolidated Statements of

Income (Loss) during the three and nine months ended September 30, 2024.

Subsidiary Units Subject to Mandatory Redemption

Ryan Re Underwriting Managers, LLC (“Ryan Re”) has the obligation to settle its outstanding preferred units owned by

Patrick G. Ryan in the amount of the aggregate unreturned capital and unpaid dividends on June 13, 2034, 15 years from

original issuance. As these units are mandatorily redeemable, they are classified as Long-term debt on the Consolidated

Balance Sheets. The historical cost of the units is $3.3 million, which was valued using an implicit rate of 9.8%. Accretion

of the discount using the implicit rate is recognized as Interest expense, net in the Consolidated Statements of Income

(Loss). As of September 30, 2024 and December 31, 2023, interest accrued on these units was $0.1 million and $1.9

million, respectively. $2.0 million of accrued return on the Ryan Re preferred units was paid during the nine months ended

September 30, 2024. See Note 15, Related Parties, for further information on Ryan Re.

8. Stockholders’ Equity

Ryan Specialty’s amended and restated certificate of incorporation authorizes the issuance of up to 1,000,000,000 shares of

Class A common stock, 1,000,000,000 shares of Class B common stock, 10,000,000 shares of Class X common stock, and

500,000,000 shares of preferred stock, each having a par value of $0.001 per share.

The New LLC Operating Agreement requires that the Company and the LLC at all times maintain a one-to-one ratio

between the number of shares of Class A common stock issued by the Company and the number of LLC Common Units

owned by the Company, except as otherwise determined by the Company.

Class A and Class B Common Stock

Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is initially

entitled to 10 votes per share but, upon the occurrence of certain events as set forth in the Company’s amended and restated

certificate of incorporation, will be entitled to one vote per share in the future. All holders of Class A common stock and

Class B common stock vote together as a single class except as otherwise required by applicable law or our amended and

restated certificate of incorporation. Holders of Class B common stock do not have any right to receive dividends or

distributions upon the liquidation or winding up of the Company.

In accordance with the New LLC Operating Agreement, the LLC Unitholders are entitled to exchange LLC Common Units

for shares of Class A common stock or, at the Company’s election, for cash from a substantially concurrent public offering

or private sale (based on the price of our Class A common stock in such public offering or private sale). The LLC

Unitholders are also required to deliver to the Company an equivalent number of shares of Class B common stock to

effectuate such an exchange. Any shares of Class B common stock so delivered will be canceled. Shares of Class B

common stock are not issued for Class C Incentive Units that are exchanged for LLC Common Units as these LLC

Common Units are immediately exchanged for Class A common stock as discussed in Note 9, Equity-Based

Compensation.

Class X Common Stock

There were no shares of Class X common stock outstanding as of September 30, 2024 or December 31, 2023. Shares of

Class X common stock have no economic, voting, or dividend rights.

Preferred Stock

There were no shares of preferred stock outstanding as of September 30, 2024 or December 31, 2023. Under the terms of

the amended and restated certificate of incorporation, the Board is authorized to direct the Company to issue shares of

preferred stock in one or more series without stockholder approval. The Board has the discretion to determine the rights,

preferences, privileges, and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges,

and liquidation preferences, of each series of preferred stock.

Dividends

During the three months ended September 30, 2024, the Company’s Board of Directors declared a regular quarterly cash

dividend of $0.11 per share on the Company’s outstanding Class A common stock. During the nine months ended

September 30, 2024, $66.5 million of dividends, consisting of $27.1 million related to the special Q1 2024 dividend and

$39.4 million related to regular quarterly dividends, was paid on Class A common stock.

Non-controlling Interests

The Company is the sole managing member of the LLC. As a result, the Company consolidates the LLC in its consolidated

financial statements, resulting in non-controlling interests related to the LLC Common Units not held by the Company. As

of September 30, 2024 and December 31, 2023, the Company owned 47.8% and 45.6%, respectively, of the economic

interests in the LLC, while the non-controlling interest holders owned the remaining 52.2% and 54.4%, respectively, of the

economic interests in the LLC.

Weighted average ownership percentages for the applicable reporting periods are used to attribute net income (loss) and

other comprehensive income (loss) to the Company and the non-controlling interest holders. The non-controlling interest

holders’ weighted average ownership percentage was 57.4% and 56.1% for the three months ended September 30, 2024

and 2023, respectively, and 55.2% and 56.5% for the nine months ended September 30, 2024 and 2023, respectively.

During the three months ended September 30, 2024, the Company declared a regular quarterly cash distribution of $0.04

per unit on the LLC’s outstanding LLC Common Units. During the nine months ended September 30, 2024, $16.8 million

in distributions were paid to the non-controlling interest holders of the LLC Common Units.

9. Equity-Based Compensation

The Ryan Specialty Holdings, Inc., 2021 Omnibus Incentive Plan (the “Omnibus Plan”) governs, among other things, the

types of awards the Company can grant to employees as equity-based compensation awards. The Omnibus Plan provides

for potential grants of the following awards: (i) stock options, (ii) stock appreciation rights, (iii) restricted stock awards,

(iv) performance awards, (v) other stock-based awards, (vi) other cash-based awards, and (vii) analogous equity awards

made in equity of the LLC.

IPO-Related Awards

As a result of the Organizational Transactions, pre-IPO holders of LLC Units that were granted as incentive awards, which

had historically been classified as equity and vested pro rata over five years, were required to exchange their LLC Units for

either Restricted Stock or Restricted Common Units. Additionally, Reload Options or Reload Class C Incentive Units were

issued to employees in order to protect against the dilution of their existing awards upon exchange to the new awards.

Separately, certain employees were granted one or more of the following new awards: (i) Restricted Stock Units (“RSUs”),

(ii) Staking Options, (iii) Restricted LLC Units (“RLUs”), or (iv) Staking Class C Incentive Units. The terms of these

awards are described below. All awards granted as part of the Organizational Transactions and the IPO are subject to non-

linear transfer restrictions for at least the five-year period following the IPO.

Incentive Awards

As part of the Company’s annual compensation process, the Company issues certain employees and directors equity-based

compensation awards (“Incentive Awards”). Additionally, the Company offers Incentive Awards to certain new hires.

These Incentive Awards typically take the form of (i) RSUs, (ii) RLUs, (iii) Class C Incentive Units, (iv) Stock Options,

(v) Performance Stock Units (“PSUs”), and (vi) Performance LLC Units (“PLUs”). The terms of these awards are

described below.

Restricted Stock and Restricted Common Units

As part of the Organizational Transactions, certain existing employee unitholders were granted Restricted Stock or

Restricted Common Units in exchange for their LLC Units. The Restricted Stock and Restricted Common Units follow the

vesting schedule of the LLC Units for which they were exchanged. LLC Units historically vested pro rata over 5 years.


	Nine Months Ended September 30, 2024
	Restricted Stock	Weighted Average Grant Date Fair Value	Restricted Common Units	Weighted Average Grant Date Fair Value
Unvested at beginning of period	938,910	$21.15	1,122,564	$23.84
Granted	—	—	—	—
Vested	(457,906)	21.15	(869,906)	23.84
Forfeited	(1,883)	21.15	—	—
Unvested at end of period	479,121	$21.15	252,658	$23.84

Restricted Stock Units (RSUs)

IPO RSUs

Related to the IPO, the Company granted RSUs to certain employees. The IPO RSUs vest either pro rata over 5 years from

the grant date or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year

10.

Incentive RSUs

As part of the Company’s compensation process, the Company issues Incentive RSUs to certain employees. The Incentive

RSUs vest either 100% 3 or 5 years from the grant date, pro rata over 3 or 5 years from the grant date, over 5 years from

the grant date, with one-third of the grant vesting in each of years 3, 4 and 5, or over 7 years from the grant date, with 20%

vesting in each of years 3 through 7.

Upon vesting, RSUs automatically convert on a one-for-one basis into Class A common stock.


	Nine Months Ended September 30, 2024
	IPO RSUs		Incentive RSUs
	Restricted Stock Units	Weighted Average Grant Date Fair Value	Restricted Stock Units	Weighted Average Grant Date Fair Value
Unvested at beginning of period	3,359,778	$23.07	1,819,916	$38.02
Granted	—	—	794,643	52.72
Vested	(596,879)	22.81	(177,713)	37.73
Forfeited	(40,332)	22.77	(70,305)	40.07
Unvested at end of period	2,722,567	$23.13	2,366,541	$42.92

Stock Options

Reload and Staking Options

As part of the Organizational Transactions and IPO, certain employees were granted Reload Options or Staking Options

that entitle the award holder to future purchases of Class A common stock, on a one-for-one basis, at the IPO price of

$23.50. The Reload Options vest either 100% 3 years from the grant date or over 5 years from the grant date, with one-

third of the grant vesting in each of years 3, 4 and 5. In general, vested Reload Options are exercisable up to the tenth

anniversary of the grant date. The Staking Options vest over 10 years from the grant date, with 10% vesting in each of

years 3 through 9 and 30% vesting in year 10. In general, vested Staking Options are exercisable up to the eleventh

anniversary of the grant date.

Incentive Options

As part of the Company’s compensation process, the Company may issue Incentive Options to certain employees that

entitle the award holder to future purchases of Class A common stock, on a one-for-one basis, at the respective exercise

prices. The Incentive Options vest either over 5 years from the grant date, with one-third of the grant vesting in each of

years 3, 4 and 5 or pro rata over 7 years from the grant date. In general, vested Incentive Options are exercisable up to the

tenth anniversary of the grant date.


	Nine Months Ended September 30, 2024
	Reload Options1	Staking Options1	Incentive Options	Incentive Options Weighted Average Exercise Price
Outstanding at beginning of period	4,473,388	66,667	165,684	$34.39
Granted	—	—	150,000	52.38
Exercised	(508,613)	—	—	—
Forfeited	(17,611)	—	(11,002)	34.39
Outstanding at end of period	3,947,164	66,667	304,682	$43.25

1As the Reload and Staking Options were one-time grants at the IPO, the weighted average exercise price for any

movements in these awards will perpetually be $23.50. As such, the values are not presented in the table above.

The fair value of Incentive Options granted during the nine months ended September 30, 2024, was determined using the

Black-Scholes option pricing model with the following assumptions:


	Incentive Options
Volatility	25.0%
Time to maturity (years)	7.0
Risk-free rate	4.2%
Dividend yield	0.8%
Fair value per option	$17.09

The use of a valuation model for the Options requires management to make certain assumptions with respect to selected

model inputs. Expected volatility was calculated based on the observed volatility for comparable companies. The expected

time to maturity was based on the weighted-average vesting term and contractual term of the awards. The risk-free interest

rate was based on U.S. Treasury rates commensurate with the expected life of the award. The dividend yield was based on

the Company’s expected dividend rate.

As of September 30, 2024, there were 1,601,823 and 6,666 exercisable Staking and Reload Options, respectively, and no

exercisable Incentive Options. The aggregate intrinsic values and weighted average remaining contractual terms of Stock

Options outstanding and exercisable as of September 30, 2024, were as follows:


Aggregate intrinsic value ($ in thousands)
Reload Options outstanding		$169,294
Reload Options exercisable		68,702
Staking Options outstanding		2,859
Staking Options exercisable		286
Incentive Options outstanding		7,051
Incentive Options exercisable		—
Weighted-average remaining contractual term (in years)
Reload Options outstanding		6.6
Reload Options exercisable		6.5
Staking Options outstanding		7.8
Staking Options exercisable		7.8
Incentive Options outstanding		8.4
Incentive Options exercisable		—

Restricted LLC Units (RLUs)

IPO RLUs

Related to the IPO, the Company granted RLUs to certain employees that vest either pro rata over 5 years from the grant

date or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year 10.

Incentive RLUs

As part of the Company’s compensation process, the Company issues Incentive RLUs to certain employees. The Incentive

RLUs vest either 100% 3 years from the grant date, pro rata over 3 or 5 years from the grant date, or over 7 years from the

grant date, with 20% vesting in each of years 3 through 7.

Upon vesting, RLUs convert on a one-for-one basis into either LLC Common Units or Class A common stock at the

election of the Company.


	Nine Months Ended September 30, 2024
	IPO RLUs		Incentive RLUs
	Restricted LLC Units	Weighted Average Grant Date Fair Value	Restricted LLC Units	Weighted Average Grant Date Fair Value
Unvested at beginning of period	1,448,127	$25.09	482,329	$39.80
Granted	—	—	249,971	51.33
Vested	(154,589)	25.05	(45,588)	35.60
Forfeited	—	—	—	—
Unvested at end of period	1,293,538	$25.10	686,712	$44.30

Class C Incentive Units

Reload and Staking Class C Incentive Units

As part of the Organizational Transactions and IPO, certain employees were granted Reload Class C Incentive Units or

Staking Class C Incentive Units, which are profits interests. When the value of Class A common stock exceeds the

participation threshold, vested profits interests may be exchanged for LLC Common Units of equal value. On exchange,

the LLC Common Units are immediately redeemed on a one-for-one basis for Class A common stock. The Reload Class C

Incentive Units vest either 100% 3 years from the grant date or over 5 years from the grant date, with one-third of the grant

vesting in each of years 3, 4 and 5. The Staking Class C Incentive Units vest either pro rata over 5 years from the grant date

or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year 10.

Class C Incentive Units

As part of the Company’s compensation process, the Company issues Class C Incentive Units to certain employees, which

are profits interests. When the value of Class A common stock exceeds the participation threshold, vested profits interests

may be exchanged for LLC Common Units of equal value. On exchange, the LLC Common Units are immediately

redeemed on a one-for-one basis for Class A common stock. The Class C Incentive Units vest over 8 years from the grant

date, with 15% vesting in each of years 3 through 7 and 25% vesting in year 8, or over 7 years from the grant date, with

20% vesting in each of years 3 through 7.


	Nine Months Ended September 30, 2024
	Reload Class C Incentive Units	Staking Class C Incentive Units	Class C Incentive Units	Class C Incentive Units Weighted Average Participation Threshold
Unvested at beginning of period	3,911,490	1,876,669	495,822	$36.96
Granted	—	—	—	—
Vested	(2,958,895)	(271,666)	—	—
Forfeited	—	—	—	—
Unvested at end of period	952,595	1,605,003	495,822	$36.84

As the Reload and Staking Class C Incentive Units were one-time grants at the IPO, the weighted average participation

threshold for these awards will be consistent across any type of movement. The weighted average participation threshold

for Reload and Staking Class C Incentive Units was $23.38 and $23.50 as of September 30, 2024 and December 31, 2023,

respectively. The decrease in the participation thresholds for the various types of Class C Incentive Units was due to the

distributions declared to these awards during the nine months ended September 30, 2024.

Performance Based Awards

Performance Stock Units (PSUs) and Performance LLC Units (PLUs)

Certain employees were granted performance-based equity awards, either PSUs or PLUs, subject to the Company’s

achievement of several defined performance metrics including (i) an Adjusted EBITDAC Margin target, (ii) an Organic

Revenue Growth Compound Annual Growth Rate (“CAGR”) target, and (iii) total shareholder return (“TSR”) CAGR

targets. The TSR CAGR targets are measured from the grant date share price to the sum of (i) the average of (a) the volume

weighted average price (“VWAP”) of the Class A common stock for the fourth quarter of 2027 and (b) the VWAP of the

Class A common stock for the first quarter of 2028 and (ii) dividends paid to Class A common shareholders. The Adjusted

EBITDAC Margin and the Organic Revenue Growth CAGR targets as well as a minimum threshold for the TSR CAGR

target must be achieved for the awards to vest. If the Adjusted EBITDAC Margin or the Organic Revenue Growth CAGR

targets are not met, or the TSR CAGR is below the minimum threshold, the awards will be forfeited.

PSUs represent the right to receive Class A common shares and PLUs represent the right to receive LLC Common Units

upon vesting. If the Adjusted EBITDAC Margin and the Organic Revenue Growth CAGR targets are achieved, and the

TSR CAGR meets at least the minimum threshold, the TSR CAGR targets will determine how many Class A common

shares or LLC Common Units, as applicable, the awards vest into. Assuming the minimum threshold is met, the awards

will vest into between 75% and 150% of the applicable stock or units. The payout percentage between the TSR CAGR

range will be determined on a graduated basis. Confirmation of the targets will not occur until after the Company’s fiscal

year 2028 earnings are reported. If the targets are achieved, the awards will vest on April 1, 2029. The probability of

achieving the performance metrics is assessed each reporting period for expense purposes.


	Nine Months Ended September 30, 2024
	PSUs		PLUs
	Performance Stock Units	Weighted Average Grant Date Fair Value	Performance LLC Units	Weighted Average Grant Date Fair Value
Unvested at beginning of period	—	$—	—	$—
Granted	303,721	24.75	487,218	24.40
Vested	—	—	—	—
Forfeited	—	—	—	—
Unvested at end of period	303,721	$24.75	487,218	$24.40

The fair value of the performance-based awards granted during the nine months ended September 30, 2024, was

determined using the Monte Carlo simulation valuation model with the following assumptions:


	PSUs and PLUs
Volatility	24.7%
Time to maturity (years)	4.1
Risk-free rate	4.2%
Initial RYAN stock price	$52.38

The use of a valuation model for the PSUs and PLUs requires management to make certain assumptions with respect to

selected model inputs. Expected volatility was calculated based on the observed volatility for comparable companies. The

time to maturity was based on the stock price CAGR target through the first quarter of 2028. The risk-free interest rate was

based on U.S. Treasury rates commensurate with the performance period. The initial RYAN stock price is the base for the

stock price CAGR target. The difference in the grant date fair value of the PSUs and PLUs relates to the difference in

Dividend Equivalents and Distributions Declared (as defined below) each award is entitled to accrue.

Non-Employee Director Stock Grants

The Company grants RSUs to non-employee directors serving as members of the Company’s Board of Directors (“Director

Stock Grants”), with the exception of the one director appointed by Onex in accordance with Onex’s nomination rights

who has agreed to forgo any compensation for his service to the Board. The Director Stock Grants are fully vested upon

grant. The Company granted 22,935 Director Stock Grants with a weighted-average grant date fair value of $49.07 and

19,698 Director Stock Grants with a weighted-average grant date fair value of $40.86 during the nine months ended

September 30, 2024 and 2023, respectively.

Dividend Equivalents and Declared Distributions

A majority of the Company’s unvested equity-based compensation awards, with the exception of Options and Class C

Incentive Units, are entitled to accrue dividend equivalents if the award vests into Class A common stock (“Dividend

Equivalents”) or declared distributions if the award vests into LLC Common Units (“Declared Distributions”) over the

period the underlying award vests. The Dividend Equivalents and Declared Distributions will be paid in cash to award

holders at the time the underlying award vests. If an award holder forfeits their underlying award, the accrued Dividend

Equivalents or Declared Distributions will also be forfeited. Class C Incentive Units do not accrue cash distributions but

instead have their participation thresholds lowered by each distribution declared. Options do not participate in dividends.

As of September 30, 2024, the Company accrued $0.8 million and $0.1 million related to Dividend Equivalents and

Declared Distributions, respectively, in Accounts payable and accrued liabilities, and $2.4 million and $0.3 million related

to Dividend Equivalents and Declared Distributions, respectively, in Other non-current liabilities on the Consolidated

Balance Sheets.

Equity-Based Compensation Expense

As of September 30, 2024, the unrecognized equity-based compensation costs related to each type of equity-based

compensation award described above and the related weighted-average remaining expense period were as follows:


	Amount	Weighted Average Remaining Expense Period (Years)
Restricted Stock	$1,268	0.5
IPO RSUs	29,887	3.4
Incentive RSUs	62,355	2.4
Reload Options	1,216	0.7
Staking Options	253	3.9
Incentive Options	2,650	1.6
PSUs	6,607	4.3
Restricted Common Units	670	0.2
IPO RLUs	18,062	4.7
Incentive RLUs	21,336	2.0
Reload Class C Incentive Units	788	0.9
Staking Class C Incentive Units	9,797	4.2
Class C Incentive Units	5,882	3.8
PLUs	10,448	4.3
Total unrecognized equity-based compensation expense	$171,219

The following table includes the equity-based compensation the Company recognized by award type from the view of

expense related to pre-IPO and post-IPO awards. The table also presents the unrecognized equity-based compensation

expense as of September 30, 2024, in the same view.


	Recognized				Unrecognized
	Three Months Ended September 30,		Nine Months Ended September 30,		As of September 30, 2024
	2024	2023	2024	2023	As of September 30, 2024
IPO awards
IPO RSUs and Staking Options	$2,720	$3,654	$9,226	$12,599	$30,140
IPO RLUs and Staking Class C Incentive Units	2,146	2,738	7,277	8,866	27,859
Incremental Restricted Stock and Reload Options	622	1,156	2,485	3,723	1,850
Incremental Restricted Common Units and Reload Class C Incentive Units	586	1,779	3,018	5,779	1,257
Pre-IPO incentive awards
Restricted Stock	498	646	1,333	2,144	634
Restricted Common Units	4,733	308	5,095	1,224	201
Post-IPO incentive awards
Incentive RSUs	8,001	5,237	21,759	13,896	62,355
Incentive RLUs	2,058	1,214	5,671	3,329	21,336
Incentive Options	272	125	823	368	2,650
Class C Incentive Units	521	521	1,551	1,385	5,882
PSUs	391	—	910	—	6,607
PLUs	619	—	1,439	—	10,448
Other expense
Director Stock Grants	292	230	1,077	823	N/A
Total equity-based compensation expense	$23,459	$17,608	$61,664	$54,136	$171,219

10. Earnings (Loss) Per Share

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to Ryan Specialty Holdings, Inc., by

the weighted-average number of shares of Class A common stock outstanding during the period. Diluted earnings (loss) per

share is computed giving effect to potentially dilutive shares, including LLC equity awards and the non-controlling

interests’ LLC Common Units that are exchangeable into Class A common stock. As shares of Class B common stock do

not share in earnings and are not participating securities, they are not included in the Company’s calculation. A

reconciliation of the numerator and denominator used in the calculation of basic and diluted earnings (loss) per share of

Class A common stock is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Net income	$28,643	$15,703	$187,358	$135,977
Less: Net income attributable to non-controlling interests	11,054	20,750	106,447	97,786
Net income (loss) attributable to Ryan Specialty Holdings, Inc.	$17,589	$(5,047)	$80,911	$38,191
Numerator:
Net income (loss) attributable to Class A common shareholders	$17,589	$(5,047)	$80,911	$38,191
Add (less): Income attributed to substantively vested RSUs	369	(100)	(1,339)	687
Net income (loss) attributable to Class A common shareholders – basic	$17,958	$(5,147)	$79,572	$38,878
Add: Income attributed to dilutive shares	7,886	—	79,624	3,128
Net income (loss) attributable to Class A common shareholders – diluted	$25,844	$(5,147)	$159,196	$42,006
Denominator:
Weighted-average shares of Class A common stock outstanding – basic	121,915,952	115,872,327	119,383,234	113,291,850
Add: Dilutive shares	150,770,317	—	151,900,158	11,591,673
Weighted-average shares of Class A common stock outstanding – diluted	272,686,269	115,872,327	271,283,392	124,883,523
Earnings (loss) per share
Earnings (loss) per share of Class A common stock – basic	$0.15	$(0.04)	$0.67	$0.34
Earnings (loss) per share of Class A common stock – diluted	$0.09	$(0.04)	$0.59	$0.34

The following number of shares were excluded from the calculation of diluted earnings (loss) per share because the effect

of including such potentially dilutive shares would have been antidilutive:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Conversion of non-controlling interest LLC Common Units1	—	141,689,681	—	142,974,016
Conversion of vested Class C Incentive Units1	—	98,699	—	65,028
Restricted Stock	—	1,015,761	—	—
IPO RSUs	—	3,229,891	—	—
Incentive RSUs	—	1,776,309	—	—
Reload Options	—	4,548,194	—	—
Staking Options	—	66,667	—	—
Incentive Options	150,000	168,099	150,000	168,099
Restricted Common Units	—	1,239,232	—	—
IPO RLUs	—	1,448,127	—	—
Incentive RLUs	—	482,329	—	—
Reload Class C Incentive Units	—	3,911,490	—	—
Staking Class C Incentive Units	—	1,876,669	—	—
Class C Incentive Units	—	495,822	—	495,822

1Weighted average units outstanding during the period.

11. Derivatives

Deal-Contingent Foreign Currency Forward

On December 21, 2023, the Company entered into the Deal-Contingent Forward to manage the risk of appreciation of the

GBP-denominated purchase price of the acquisition of Castel. The Deal-Contingent Forward had a 200.0 million GBP

notional amount and was executed when the Castel acquisition closed on May 1, 2024. As the Deal-Contingent Forward

was an economic hedge and had not been designated as an accounting hedge, losses resulting from the Deal-Contingent

Forward were recognized through earnings in the periods incurred.

Interest Rate Cap

In April 2022, the Company entered into an interest rate cap agreement to manage its exposure to interest rate fluctuations

related to the Company’s Term Loan in the amount of $25.5 million. The interest rate cap has a $1,000.0 million notional

amount, 2.75% strike, and terminates on December 31, 2025. At inception, the Company formally designated the interest

rate cap as a cash flow hedge. As of September 30, 2024, the interest rate cap continued to be an effective hedge.

For the three months ended September 30, 2024 and 2023, the decrease of $16.4 million and $0.2 million, respectively, in

the fair value of the interest rate cap were recognized in Other comprehensive income (loss). For the nine months ended

September 30, 2024 and 2023, the decrease of $16.5 million and increase of $0.9 million, respectively, in the fair value of

the interest rate cap were recognized in Other comprehensive income (loss). As of September 30, 2024, the Company

expects $10.6 million of unrealized gains from the interest rate cap to be reclassified into earnings over the next twelve

months. See Note 16, Income Taxes, for further information on the tax effects on other comprehensive income (“OCI”)

related to the interest rate cap.

The location and gains (losses) on derivatives are reported on the Consolidated Statements of Income (Loss) as follows:


		Three Months Ended September 30,		Nine Months Ended September 30,
	Income Statement Caption	2024	2023	2024	2023
Change in the fair value of the Deal-Contingent Forward	General and administrative	$—	$—	$(4,532)	$—
Total impact of derivatives not designated as hedging instruments		$—	$—	$(4,532)	$—

Interest rate cap premium amortization	Interest expense, net	$(1,739)	$(1,739)	$(5,216)	$(5,216)
Amounts reclassified out of other comprehensive income related to the interest rate cap	Interest expense, net	6,689	6,317	19,740	16,381
Total impact of derivatives designated as hedging instruments		$4,950	$4,578	$14,524	$11,165

The location and fair value of derivatives are reported on the Consolidated Balance Sheets as follows:


	Balance Sheet Caption	September 30, 2024	December 31, 2023
Derivatives not designated as hedging instruments
Deal-Contingent Forward	Accounts payable and accrued liabilities	$—	$852
Derivatives designated as hedging instruments
Interest rate cap	Other non-current assets	$13,196	$29,667

See Note 13, Fair Value Measurements, for further information on the fair value of derivatives.

12. Variable Interest Entities

As discussed in Note 1, Basis of Presentation, the Company consolidates the LLC as a VIE under ASC 810. The

Company’s financial position, financial performance, and cash flows effectively represent those of the LLC as of and for

the nine months ended September 30, 2024, with the exception of Cash and cash equivalents of $42.2 million, Other

current assets of $7.8 million, Deferred tax assets of $486.3 million, Accounts payable and accrued liabilities of $0.8

million, Other non-current liabilities of $2.4 million, and the entire balance of the Tax Receivable Agreement liabilities of

$455.1 million on the Consolidated Balance Sheets, which are attributable solely to Ryan Specialty Holdings, Inc. As of

December 31, 2023, Cash and cash equivalents of $58.2 million, Deferred tax assets of $383.3 million, and the entire

balance of the Tax Receivable Agreement liabilities of $358.9 million on the Consolidated Balance Sheet were attributable

solely to Ryan Specialty Holdings, Inc.

13. Fair Value Measurements

Accounting standards establish a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair values as

follows:

Level 1: Observable inputs such as quoted prices for identical assets in active markets;

Level 2: Inputs other than quoted prices for identical assets in active markets, that are observable either directly or

indirectly; and

Level 3: Unobservable inputs in which there is little or no market data which requires the use of valuation techniques and

the development of assumptions.

The level in the fair value hierarchy within which the fair value measurement is classified is determined based on the

lowest level of input that is significant to the fair value measure in its entirety.

The carrying amount of financial assets and liabilities reported in the Consolidated Balance Sheets for commissions and

fees receivable – net, other current assets, accounts payable, short-term debt, and other accrued liabilities as of

September 30, 2024 and December 31, 2023, approximate fair value because of the short-term duration of these

instruments. The fair value of long-term debt, including the Term Loan, Senior Secured Notes, the units subject to

mandatory redemption, and any current portion of such debt, was $2,692.1 million and $1,976.5 million as of

September 30, 2024 and December 31, 2023, respectively. The fair value of the Term Loan and Senior Secured Notes

would be classified as Level 2 in the fair value hierarchy and the units subject to mandatory redemption would be classified

as Level 3. See Note 7, Debt, for the carrying values of the Company’s debt.

Derivative Instruments

Deal-Contingent Foreign Currency Forward

The Company entered into the Deal-Contingent Forward to manage the risk of appreciation of the GBP-denominated

purchase price of the Castel acquisition. The fair value of the Deal-Contingent Forward was determined by comparing the

contractual foreign exchange rates to forward market rates for various future dates, probability weighted for when the

acquisition was anticipated to close, and discounted to the valuation date. The lowest level of inputs used that are

significant in determining the fair value were considered Level 3 inputs. See Note 11, Derivatives, for further information

on the Deal-Contingent Forward.

Interest Rate Cap

The Company uses an interest rate cap to manage its exposure to interest rate fluctuations related to the Company’s Term

Loan. The fair value of the interest rate cap is determined using the market standard methodology of discounting the future

expected cash receipts that would occur if variable interest rates rise above the strike rate of the cap. The variable interest

rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived

from observable market interest rate curves and volatilities. The inputs used in determining the fair value of the interest rate

cap are considered Level 2 inputs. See Note 11, Derivatives, for further information on the interest rate cap.

Contingent Consideration

The fair values of contingent consideration and contingently returnable consideration are based on the present value of the

future expected payments to be made to the sellers and to be received from the sellers, respectively, of certain acquired

businesses in accordance with the provisions outlined in the respective purchase agreements, which are Level 3 fair value

measurements. In determining fair value, the Company estimates cash payments and receipts based on management’s

financial projections of the performance of each acquired business relative to the formula specified by each purchase

agreement. The Company utilizes Monte Carlo simulations to evaluate financial projections of each acquired business. The

Monte Carlo models consider forecasted revenue and EBITDA and market risk-adjusted revenue and EBITDA, which are

run through a series of simulations. As of September 30, 2024, the models used risk-free rates, expected volatility, and a

credit spread that ranged from 4.0% to 5.4%, 6.9% to 18.7%, and 1.0% to 2.4%, respectively. As of December 31, 2023,

the models used risk-free rates, expected volatility, and a credit spread that ranged from 4.9% to 5.4%, 7.0% to 21.7%, and

3.3% to 4.2%, respectively. The Company discounts the expected payments created by the Monte Carlo model to present

value using a risk-adjusted rate that takes into consideration the market-based rates of return that reflect the ability of the

acquired entity to achieve its targets. The discount rate ranges used to present value the cash payments were 5.2% to 6.8%

and 8.3% to 9.1% as of September 30, 2024 and December 31, 2023, respectively.

Each period, the Company revalues the contingent consideration and contingently returnable consideration associated with

certain prior acquisitions to their fair value and records the related changes of the fair value in Change in contingent

consideration in the Consolidated Statements of Income (Loss). Changes in contingent consideration result from changes in

the assumptions regarding probabilities of successful achievement of related EBITDA and revenue milestones, the

estimated timing in which milestones are achieved, and the discount rate used to estimate the fair value of the liability.

Contingent consideration may change significantly as the Company’s revenue growth rate and EBITDA estimates evolve

and additional data is obtained, impacting the Company’s assumptions. The use of different assumptions and judgments

could result in a different estimate of fair value which may have a material impact on the results from operations and

financial position. See Note 3, Mergers and Acquisitions, for further information on contingent consideration.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring

basis by fair value hierarchy input level:


	September 30, 2024			December 31, 2023
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
Assets
Interest rate cap	$—	$13,196	$—	$—	$29,667	$—
Contingently returnable consideration	—	—	5,587	—	—	—
Liabilities
Contingent consideration	—	—	150,131	—	—	41,050
Deal-Contingent Forward	—	—	—	—	—	852
Total assets and liabilities measured at fair value	$—	$13,196	$155,718	$—	$29,667	$41,902

Contingently returnable consideration of $1.3 million and $4.3 million was recorded in Other current assets and Other non-

current assets, respectively, on the Consolidated Balance Sheets as of September 30, 2024. Contingent consideration of

$44.1 million was recorded in Accounts payable and accrued liabilities on the Consolidated Balance Sheets as of

September 30, 2024. Contingent consideration of $106.0 million and $41.1 million was recorded in Other non-current

liabilities on the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively.

Level 3 Assets and Liabilities Measured at Fair Value

The following is a reconciliation of the beginning and ending balances of the Level 3 assets and liabilities measured at fair

value:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Assets
Balance at beginning of period	$4,868	$—	$—	$—
Newly established assets due to acquisitions	—	—	4,868	—
Total gains included in earnings	431	—	431	—
Total gains included in OCI	288	—	288	—
Balance at end of period	$5,587	$—	$5,587	$—
Liabilities
Balance at beginning of period	$44,971	$25,290	$41,902	$29,251
Newly established liability due to acquisitions	103,769	8,091	103,769	8,091
Total losses included in earnings	1,391	2,637	8,901	6,588
Settlements	—	—	(5,384)	(7,912)
Acquisition measurement period adjustments	—	—	943	—
Balance at end of period	$150,131	$36,018	$150,131	$36,018

For the nine months ended September 30, 2024, $5.4 million related to the loss on the settlement of the Deal-Contingent

Forward is presented in the operating section of the Consolidated Statements of Cash Flows. For the nine months ended

September 30, 2023, $3.4 million and $4.5 million settlements of contingent consideration are presented in the operating

and financing sections, respectively, of the Consolidated Statements of Cash Flows.

14. Commitments and Contingencies

Legal – E&O and Other Considerations

As an E&S and Admitted markets intermediary, the Company faces ordinary course of business E&O exposure. The

Company also has potential E&O risk if an insurance carrier with which Ryan Specialty placed coverage denies coverage

for a claim or pays less than the insured believes is the full amount owed. The Company seeks to resolve, through

commercial accommodations, certain matters to limit the economic exposure, including potential legal fees, and

reputational risk created by a disagreement between a carrier and the insured, as well as other E&O matters.

The Company utilizes insurance to provide protection from E&O liabilities that may arise during the ordinary course of

business. Ryan Specialty’s E&O insurance provides aggregate coverage for E&O losses up to $150.0 million in excess of a

per claim retention amount of $5.0 million. The Company’s aggregate coverage for E&O losses increased from $100.0

million to $150.0 million as of June 1, 2024. The Company’s per claim retention amount increased from $2.5 million to

$5.0 million as of June 1, 2023. The Company periodically determines a range of possible outcomes using the best

available information that relies, in part, on projecting historical claim data into the future. Loss contingencies of $5.7

million and $6.4 million were recorded for outstanding matters as of September 30, 2024 and December 31, 2023,

respectively. Loss contingencies exclude the impact of any loss recoveries. The Company recognized the net impact of the

loss contingencies and any loss recoveries of a $0.9 million benefit and $0.8 million expense for the three months ended

September 30, 2024 and 2023, respectively, and $0.8 million and $5.5 million expense for the nine months ended

September 30, 2024 and 2023, respectively, in General and administrative expense on the Consolidated Statements of

Income (Loss). The historical claim and commercial accommodation data used to project the current estimates may not be

indicative of future claim activity. Thus, the estimates could change in the future as more information becomes known,

which could materially impact the amounts reported and disclosed herein.

During 2022, the Company placed certain insurance policies through a trading partner with the understanding that the

policies were underwritten by highly rated insurance capital. The policies were instead underwritten by an insurance carrier

that was not considered satisfactory by the Company or the insureds. The Company committed to securing replacement

coverage, to the extent commercially available, from highly rated insurance companies on terms substantially similar to the

insurance coverage originally agreed upon. As a result of this unusual circumstance, the Company has and may continue to

incur losses (“Replacement Costs”) arising from the original placements. The Company has determined that it is probable

that it will be exposed to the Replacement Costs on policies placed with this trading partner. The Company recognized an

estimated loss contingency of $0.9 million and $0.2 million, respectively, as of September 30, 2024 and December 31,

2023, within Accounts payable and accrued liabilities on the Consolidated Balance Sheets. Relatedly, the Company has

obtained sufficient evidence from its E&O insurance carriers to conclude that a recovery of the claim for the Replacement

Costs, in excess of the $2.5 million retention, is probable. A loss recovery of $20.2 million and $20.6 million was recorded

as of September 30, 2024 and December 31, 2023, respectively, in Other current assets on the Consolidated Balance

Sheets. In the aggregate, the loss contingency and related loss recovery resulted in a $2.5 million expense recognized in

2022 and no further expense related to this matter has been recognized since.

It is at least reasonably possible that the estimate of Replacement Costs will change in the near term as policies are

adjusted. Further, exposure to additional losses may arise from policies that had expired prior to, or shortly after, the

discovery of this unusual circumstance, adjustable premiums arising from the addition or deletion of properties over the

policy term, unpaid covered claims, or other damages for losses incurred by our customers. An estimate of these potential

losses cannot be made at this time but could change in the future as more information becomes known.

15. Related Parties

Ryan Investment Holdings

Ryan Investment Holdings, LLC (“RIH”) was formed as an investment holding company designed to aggregate the funds

of Ryan Specialty and Geneva Ryan Holdings, LLC (“GRH”) for investment in Geneva Re Partners, LLC (“GRP”). GRH

was formed as an investment holding company designed to aggregate investment funds of Patrick G. Ryan and other

affiliated investors. Two affiliated investors are LLC Unitholders and directors of the Company, and another is an LLC

Unitholder and employee of the Company. Ryan Specialty does not consolidate GRH as the Company does not have a

direct investment in or variable interest in this entity.

The Company holds a 47% interest in RIH and GRH holds the remaining 53% interest. RIH has a 50% non-controlling

interest in GRP and the other 50% is owned by Nationwide Mutual Insurance Company. GRP wholly owns Geneva Re, Ltd

(“Geneva Re”), a Bermuda-regulated reinsurance company, and GR Bermuda SAC Ltd (the “Segregated Account

Company”). The Segregated Account Company has one segregated account, which is beneficially owned by a third-party

insurance company (the “Third-party Insurer”). RIH is considered a related party variable interest entity under common

control with the Company. The Company is not most closely associated with the variable interest entity and therefore does

not consolidate RIH. The assets of RIH are restricted to settling obligations of RIH, pursuant to Delaware limited liability

company statutes.

The Company is not required to contribute any additional capital to RIH, and its maximum exposure to loss on the equity

method investment is the total invested capital of $47.0 million. The Company may be exposed to losses arising from the

equity method investment as a result of underwriting losses recognized at Geneva Re or losses on Geneva Re’s investment

portfolio. RIH has committed to contribute additional capital to GRP over the next several years. Patrick G. Ryan, through

a trust of which he is the beneficiary and co-trustee, has committed to personally fund any such additional capital

contributions. Any such additional capital contributions under this commitment will not affect the relative ownership of

RIH’s common equity.

Geneva Re

The Company has a service agreement with Geneva Re to provide both administrative services to, as well as disburse

payments for costs directly incurred by, Geneva Re. These direct costs include compensation expenses incurred by

employees of Geneva Re. The Company had $0.4 million and $0.2 million due from Geneva Re under this agreement as of

September 30, 2024 and December 31, 2023, respectively.

Ryan Re Services Agreements with Geneva Re

Ryan Re, a wholly owned subsidiary of the Company, is party to a services agreement with Geneva Re to provide, among

other services, certain underwriting and administrative services to Geneva Re. Ryan Re receives a service fee equal to

115% of the administrative costs incurred by Ryan Re in providing these services to Geneva Re. Revenue earned from

Geneva Re was $0.3 million and $0.4 million for the three months ended September 30, 2024 and 2023, respectively, and

$1.1 million for the nine months ended September 30, 2024 and 2023. Receivables due from Geneva Re under this

agreement were $1.1 million and $0.7 million as of September 30, 2024 and December 31, 2023, respectively.

On April 2, 2023, Ryan Re entered into a services agreement with Geneva Re in accordance with which Ryan Re

subcontracted certain services to Geneva Re that Ryan Re is required to provide to the segregated account of the

Segregated Account Company on behalf of the Third-party Insurer. The Company incurred expense of $2.7 million and

$2.2 million during the three months ended September 30, 2024 and 2023, respectively, and $7.9 million and $5.4 million

during the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024 and December 31,

2023, the Company had prepaid expenses of $7.9 million and $5.3 million, respectively, related to this services agreement.

The prepaid expenses are included in Other currents assets on the Consolidated Balance Sheets.

Company Leasing of Corporate Jets

In the ordinary course of its business, the Company charters executive jets for business purposes from Executive Jet

Management (“EJM”), a third-party service provider. Mr. Ryan indirectly owns aircraft that he leases to EJM for EJM’s

charter operations for which he receives remuneration from EJM. The Company pays market rates for chartering aircraft

through EJM, unless the particular aircraft chartered is Mr. Ryan’s, in which case the Company receives a discount below

market rates. Historically, the Company has been able to charter Mr. Ryan’s aircraft and make use of this discount. The

Company recognized expense related to business usage of aircraft of $0.2 million for the three months ended

September 30, 2024 and 2023, and $1.0 million and $0.9 million for the nine months ended September 30, 2024 and 2023,

respectively.

16. Income Taxes

The Company is taxed as a corporation for income tax purposes and is subject to federal, state, and local taxes with respect

to its allocable share of any net taxable income from the LLC. The LLC is a limited liability company taxed as a

partnership for income tax purposes, and its taxable income or loss is passed through to its members, including the

Company. The LLC is subject to income taxes on its taxable income in certain foreign countries, in certain state and local

jurisdictions that impose income taxes on partnerships, and on the taxable income of its U.S. corporate subsidiaries.

Effective Tax Rate

The Company’s effective tax rate from continuing operations was (45.50)% and 61.26% for the three months ended

September 30, 2024 and 2023, respectively, and 7.90% and 23.92% for the nine months ended September 30, 2024 and

2023, respectively. The effective tax rates for the three and nine months ended September 30, 2024, were lower than the

21% statutory rate primarily as a result of the vesting of IPO RSUs, exercising of Stock Options, and the income

attributable to the non-controlling interests. The effective tax rates for the three and nine months ended September 30,

2023, were higher than the 21% statutory rate primarily as a result of the $20.7 million non-cash deferred income tax

expense from the common control reorganization described below, which was recognized in Income tax expense in the

Consolidated Statements of Income (Loss) for the three and nine months ended September 30, 2023.

The Company does not believe it has any significant uncertain tax positions and therefore has no unrecognized tax benefits

as of September 30, 2024, that, if recognized, would affect the annual effective tax rate. The Company does not anticipate

material changes in unrecognized tax benefits within the next twelve-month period.

Deferred Taxes

The Company reported Deferred tax assets, net of deferred tax liabilities where appropriate, of $486.4 million and $383.8

million as of September 30, 2024 and December 31, 2023, respectively, on the Consolidated Balance Sheets. The increase

in the Deferred tax assets during the nine months ended September 30, 2024, was primarily related to exchanges of LLC

Common Units. As of September 30, 2024, the Company concluded that, based on the weight of all available positive and

negative evidence, the Deferred tax assets with respect to the Company’s basis difference in its investment in the LLC are

more likely than not to be realized. As such, no valuation allowance has been recognized against that basis difference.

Common Control Reorganization (“CCR”)

Subsequent to the acquisition of Socius, which was acquired by a wholly owned subsidiary of Ryan Specialty Holdings,

Inc., the Company converted Socius to an LLC (“Socius LLC”) and transferred Socius LLC to the LLC. This legal entity

reorganization was considered a transaction between entities under common control. The CCR resulted in deferred tax

liabilities of $64.5 million established and non-cash deferred income tax expense of $20.7 million for the three and nine

months ended September 30, 2023. Additionally, the difference between the carrying value and the fair value of the

investment transferred under common control resulted in an increase of $13.1 million to Non-controlling interests on the

Consolidated Statements of Stockholders’ Equity during the three months ended September 30, 2023.

Tax Receivable Agreement (TRA)

The Company is party to a TRA with current and certain former LLC Unitholders. The TRA provides for the payment by

the Company to the current and certain former LLC Unitholders of 85% of the net cash savings, if any, in U.S. federal,

state, and local income taxes that the Company realizes (or is deemed to realize in certain circumstances) as a result of (i)

certain increases in the tax basis of the assets of the LLC resulting from purchases or exchanges of LLC Common Units

(“Exchange Tax Attributes”), (ii) certain tax attributes of the LLC that existed prior to the IPO (“Pre-IPO M&A Tax

Attributes”), (iii) certain favorable “remedial” partnership tax allocations to which the Company becomes entitled (if any),

and (iv) certain other tax benefits related to the Company entering into the TRA, including certain tax benefits attributable

to payments that the Company makes under the TRA (“TRA Payment Tax Attributes”). The Company recognizes a

liability on the Consolidated Balance Sheets based on the undiscounted estimated future payments under the TRA. The

amounts payable under the TRA will vary depending upon a number of factors, including the amount, character, and timing

of the taxable income of the Company in the future.

Based on current projections, the Company anticipates having sufficient taxable income to be able to realize the benefits

and has recorded Tax Receivable Agreement liabilities of $455.1 million related to these benefits on the Consolidated

Balance Sheets as of September 30, 2024. The following summarizes activity related to the Tax Receivable Agreement

liabilities:


	Exchange Tax Attributes	Pre-IPO M&A Tax Attributes	TRA Payment Tax Attributes	TRA Liabilities
Balance at December 31, 2023	$194,668	$85,814	$78,416	$358,898
Exchange of LLC Common Units	68,931	5,287	21,365	95,583
Accrued interest	—	—	646	646
Balance at September 30, 2024	$263,599	$91,101	$100,427	$455,127

During the nine months ended September 30, 2024 and 2023, increases to the TRA liabilities of $95.6 million and $63.2

million, respectively, due to exchanges of LLC Common Units for Class A common stock were recognized in Additional

paid-in capital on the Consolidated Statements of Stockholders’ Equity. During the nine months ended September 30, 2024

and 2023, increases to the TRA liabilities of $0.6 million and $0.5 million, respectively, due to accrued interest were

recognized in Other non-operating loss on the Consolidated Statements of Income (Loss).

Other Comprehensive Income (Loss)

The following table summarizes the tax effects on the components of Other comprehensive income (loss):


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
(Gain) loss on interest rate cap	$1,022	$(914)	$(1,009)	$(2,583)
Gain on interest rate cap reclassified to earnings	863	733	2,479	1,866
Foreign currency translation adjustments	(2,357)	188	(2,540)	54
Change in share of equity method investment in related party	52	88	(348)	(96)

17. Accumulated Other Comprehensive Income

Changes in the balance of Accumulated other comprehensive income, net of tax, were as follows:


	Gain (Loss) on Interest Rate Cap	Foreign Currency Translation Adjustments	Change in EMI Other Comprehensive Income (Loss) 1	Total
Balance at December 31, 2023	$4,697	$982	$(2,603)	$3,076
Other comprehensive income (loss) before reclassifications	10,540	(1,024)	3,780	13,296
Amounts reclassified to earnings	(5,735)	—	—	(5,735)
Other comprehensive income (loss)	$4,805	$(1,024)	$3,780	$7,561
Less: Non-controlling interests	2,887	(616)	2,270	4,541
Balance at March 31, 2024	$6,615	$574	$(1,093)	$6,096
Other comprehensive income (loss) before reclassifications	3,840	2,309	(940)	5,209
Amounts reclassified to earnings	(5,700)	—	—	(5,700)
Other comprehensive income (loss)	$(1,860)	$2,309	$(940)	$(491)
Less: Non-controlling interests	(1,116)	1,382	(564)	(298)
Balance at June 30, 2024	$5,871	$1,501	$(1,469)	$5,903
Other comprehensive income (loss) before reclassifications	(6,902)	15,917	(353)	8,662
Amounts reclassified to earnings	(5,827)	—	—	(5,827)
Other comprehensive income (loss)	$(12,729)	$15,917	$(353)	$2,835
Less: Non-controlling interests	(7,397)	9,259	(204)	1,658
Balance at September 30, 2024	$539	$8,159	$(1,618)	$7,080


	Gain (Loss) on Interest Rate Cap	Foreign Currency Translation Adjustments	Change in EMI Other Comprehensive Income (Loss) 1	Total
Balance at December 31, 2022	$8,065	$157	$(2,187)	$6,035
Other comprehensive income (loss) before reclassifications	(2,218)	783	584	(851)
Amounts reclassified to earnings	(3,922)	—	—	(3,922)
Other comprehensive income (loss)	$(6,140)	$783	$584	$(4,773)
Less: Non-controlling interests	(3,889)	498	370	(3,021)
Balance at March 31, 2023	$5,814	$442	$(1,973)	$4,283
Other comprehensive income (loss) before reclassifications	15,260	279	868	16,407
Amounts reclassified to earnings	(5,010)	—	—	(5,010)
Other comprehensive income	$10,250	$279	$868	$11,397
Less: Non-controlling interests	6,434	176	545	7,155
Balance at June 30, 2023	$9,630	$545	$(1,650)	$8,525
Other comprehensive income (loss) before reclassifications	6,958	(1,429)	(672)	4,857
Amounts reclassified to earnings	(5,584)	—	—	(5,584)
Other comprehensive income	$1,374	$(1,429)	$(672)	$(727)
Less: Non-controlling interests	829	(862)	(405)	(438)
Balance at September 30, 2023	$10,175	$(22)	$(1,917)	$8,236

1Change in share of equity method investment in related party other comprehensive income (loss) on the Consolidated

Statements of Comprehensive Income (Loss).

18. Supplemental Financial Information

Interest Income

The Company earned interest income of $5.6 million and $7.1 million during the three months ended September 30, 2024

and 2023, respectively, and $19.0 million and $23.0 million during the nine months ended September 30, 2024 and 2023,

respectively, on its operating Cash and cash equivalents. Interest income is recognized in Interest expense, net on the

Consolidated Statements of Income (Loss).

Supplemental Cash Flow Information

The following represents the supplemental cash flow information of the Company:


	Nine Months Ended September 30,
	2024	2023
Cash paid for:
Interest	$119,901	$116,620
Income taxes, net of refunds	24,641	9,812
Non-cash investing and financing activities:
Non-controlling interest holders’ tax distributions declared but unpaid	$1,137	$—
Tax Receivable Agreement liabilities	95,583	63,249
Dividend Equivalents and Declared Distributions liabilities	3,586	—
Contingently returnable consideration	4,868	—
Contingent consideration liabilities	103,769	8,091

19. Subsequent Events

The Company has evaluated subsequent events through October 31, 2024, and has concluded that no events have occurred

that require disclosure other than the events listed below.

On October 1, 2024, the Company completed the acquisition of certain assets of EverSports & Entertainment Insurance,

Inc., an MGU focused on sports, leisure, and entertainment headquartered in Carmel, Indiana, for approximately $45.0

million cash consideration. This acquisition will include contingent consideration in its final purchase price, however, the

Company has not yet completed the valuation of the contingent consideration or the purchase price allocation to the

acquired assets and liabilities as of the date of this filing.

On October 30, 2024, the Company’s Board of Directors approved a quarterly cash dividend of $0.11 per share of

outstanding Class A common stock. The quarterly dividend will be payable on November 26, 2024, to shareholders of

record of Class A common stock as of the close of business on November 12, 2024. Any future dividends will be subject to

the approval of the Company’s Board of Directors.

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

OPERATIONS

The following discussion and analysis summarizes the significant factors affecting the consolidated operating results,

financial condition, liquidity, and cash flows of the Company as of and for the periods presented below. The following

discussion and analysis should be read in conjunction with our Consolidated Financial Statements and the related notes

included elsewhere in this Quarterly Report on Form 10-Q and in the Annual Report on Form 10-K for the year ended

December 31, 2023, which was filed with the SEC on February 28, 2024. The discussion contains forward-looking

statements that are based on the beliefs of management, as well as assumptions made by, and information currently

available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking

statements as a result of various factors, including those discussed below and in our Annual Report on Form 10-K,

particularly in the sections entitled “Risk Factors” and “Information Concerning Forward-Looking Statements.”

The following discussion provides commentary on the financial results derived from our unaudited financial statements for

the three and nine months ended September 30, 2024 and 2023 prepared in accordance with U.S. GAAP. In addition, we

regularly review the following Non-GAAP measures when assessing performance: Organic revenue growth rate, Adjusted

compensation and benefits expense, Adjusted compensation and benefits expense ratio, Adjusted general and

administrative expense, Adjusted general and administrative expense ratio, Adjusted EBITDAC, Adjusted EBITDAC

margin, Adjusted net income, Adjusted net income margin, and Adjusted diluted earnings per share. See “Non-GAAP

Financial Measures and Key Performance Indicators” for further information.

Overview

Founded by Patrick G. Ryan in 2010, we are a service provider of specialty products and solutions for insurance brokers,

agents, and carriers. We provide distribution, underwriting, product development, administration, and risk management

services by acting predominantly as a wholesale broker and a managing underwriter or a program administrator with

delegated authority from insurance carriers. Our mission is to provide industry-leading innovative specialty insurance

solutions for insurance brokers, agents, and carriers.

For retail insurance agents and brokers, we assist in the placement of complex or otherwise hard-to-place risks. For

insurance and reinsurance carriers, we predominantly work with retail and wholesale insurance brokers to source, onboard,

underwrite, and service these same types of risks. A significant majority of the premiums we place are bound in the E&S

market, which includes Lloyd’s of London. There is often significantly more flexibility in terms, conditions, and rates in

the E&S market relative to the Admitted or “standard” insurance market. We believe that the additional freedom to craft

bespoke terms and conditions in the E&S market allows us to best meet the needs of our trading partners, provide unique

solutions, and drive innovation. We believe our success has been achieved by providing best-in-class intellectual capital,

leveraging our trusted and long-standing relationships, and developing differentiated solutions at a scale unmatched by

many of our competitors.

Significant Events and Transactions

Corporate Structure

We are a holding company and our sole material asset is a controlling equity interest in New LLC, which is also a holding

company and its sole material asset is a controlling equity interest in the LLC. The Company operates and controls the

business and affairs of, and consolidates the financial results of, the LLC through New LLC. We conduct our business

through the LLC. As the LLC is substantively the same as New LLC, for the purpose of this discussion we will refer to

both New LLC and the LLC as the “LLC.”

The LLC is a limited liability company taxed as a partnership for income tax purposes, and its taxable income or loss is

passed through to its members, including the Company. The LLC is subject to income taxes on its taxable income in certain

foreign countries, in certain state and local jurisdictions that impose income taxes on partnerships, and on the taxable

income of its U.S. corporate subsidiaries. As a result of our ownership of LLC Common Units, we are subject to U.S.

federal, state, and local income taxes with respect to our allocable share of any taxable income of the LLC and are taxed at

the prevailing corporate tax rates. We intend to cause the LLC to make distributions in an amount that is at least sufficient

to allow us to pay our tax obligations and operating expenses, including distributions to fund any ordinary course payments

due under the Tax Receivable Agreement. See “Liquidity and Capital Resources - Tax Receivable Agreement” for

additional information about the TRA.

ACCELERATE 2025 Program

During the first quarter of 2023 we initiated the ACCELERATE 2025 program that will enable continued growth, drive

innovation, and deliver sustainable productivity improvements over the long term. The program, in its expanded scope, will

result in approximately $110.0 million of cumulative one-time charges through 2024, funded through operating cash flow.

Restructuring costs are estimated to be approximately evenly split between General and administrative expense, relating to

third-party professional services, lease and contract terminations costs, and other expenses and Compensation and benefits

expense, predominately relating to third-party contractor and other workforce-related costs. We expect the program, in its

expanded scope, to generate annual savings of approximately $60.0 million in 2025. See “Note 4, Restructuring” of the

unaudited quarterly consolidated financial statements for further discussion.

For the nine months ended September 30, 2024, we incurred restructuring costs of $47.8 million. Combined with

restructuring costs incurred during 2023, we have incurred restructuring costs of $96.2 million since the first quarter of

2023, representing the inception of the plan. Of the cumulative $96.2 million in costs, $37.9 million was general and

administrative with the remaining balance being workforce-related. While the current results of the ACCELERATE 2025

program are in line with expectations, changes to the total savings estimate and timing of the ACCELERATE 2025

program may evolve as we continue to progress through the plan and evaluate other potential opportunities. The actual

amounts and timing may vary significantly based on various factors.

Acquisitions

On May 1, 2024, the Company completed the acquisition of Castel Underwriting Agencies Limited (“Castel”), an MGU

platform. Castel is headquartered in London, England with additional offices in the Netherlands and Belgium and

operations in Singapore.

On August 30, 2024, the Company completed the acquisition of US Assure Insurance Services of Florida, Inc. (“US

Assure”), a program specializing in builder’s risk insurance headquartered in Jacksonville, Florida.

On September 1, 2024, the Company completed the acquisition of certain assets of Greenhill Underwriting Insurance

Services, LLC (“Greenhill”), an MGU focused on the allied health industry headquartered in Houston, Texas.

On September 13, 2024, the Company completed the acquisition of the Property and Casualty (“P&C”) MGUs owned by

Ethos Specialty Insurance, LLC (“Ethos P&C”). Ethos P&C comprises eight programs which underwrite on behalf of

insurance carriers.

On October 1, 2024, the Company completed the acquisition of certain assets of EverSports & Entertainment Insurance,

Inc., an MGU focused on sports, leisure and entertainment risks based in Carmel, Indiana.

On October 2, 2024, the Company completed the acquisition of certain assets of the European managing general agent,

Geo Underwriting Europe BV, a financial lines MGA based in Rotterdam, Netherlands, with operations in Germany.

Key Factors Affecting Our Performance

Our historical financial performance has been, and we expect our financial performance in the future to be, driven by our

ability to:

Pursue Strategic Acquisitions

We have successfully integrated businesses complementary to our own to increase both our distribution reach and our

product and service capabilities. We continuously evaluate acquisitions and intend to further pursue targeted acquisitions

that complement our product and service capabilities or provide us access to new markets. We have previously made, and

intend to continue to make, acquisitions with the objective of enhancing our human capital and product and service

capabilities, entering natural adjacencies, and expanding our geographic presence. Our ability to successfully pursue

strategic acquisitions is dependent upon a number of factors, including sustained execution of a disciplined and selective

acquisition strategy which requires acquisition targets to have a cultural and strategic fit, competition for these assets,

purchase price multiples that we deem appropriate and our ability to effectively integrate targeted companies or assets and

grow our business. We do not have agreements or commitments for any material acquisitions at this time.

Deepen and Broaden our Relationships with Retail Broker Trading Partners

We have deep engagement with our retail broker trading partners, and we believe we have the ability to transact in even

greater volume with nearly all of them. For example, in 2023, our revenue derived from the Top 100 firms (as ranked by

Business Insurance) expanded faster than our Organic revenue growth rate of 15.4% (beginning in the first quarter of 2024,

the Company changed its method of calculating Organic revenue growth rate, a non-GAAP measure, see “Non-GAAP

Financial Measures and Key Performance Indicators - Organic Revenue Growth Rate” for more information). Our ability

to deepen and broaden relationships with our retail broker trading partners and increase sales is dependent upon a number

of factors, including client satisfaction with our distribution reach and our product capabilities, retail brokers continuing to

require or desire our services, competition, pricing, economic conditions, and spending on our product offerings.

Build Our National Binding Authority Specialty

We believe there is substantial opportunity to continue to grow our Binding Authority Specialty, as we believe that both

M&A consolidation and panel consolidation are in the early stages in the binding authority market. Our ability to grow our

Binding Authority Specialty is dependent upon a number of factors, including a continuing ability to secure sufficient

capital support from insurers, the quality of our services and product offerings, marketing and sales efforts to drive new

business prospects and execution, new product offerings, the pricing and quality of our competitors’ offerings, and the

growth in demand for the insurance products.

Invest in Operation and Growth

We have invested heavily in building a durable business that is able to adapt to the continuously evolving E&S market and

intend to continue to do so. We are focused on enhancing the breadth of our product and service offerings as well as

developing and launching new solutions to address the evolving needs of the specialty insurance industry and markets. Our

future success is dependent upon a number of factors, including our ability to successfully develop, market, and sell

existing and new products and services to both new and existing trading partners.

Generate Commission Regardless of the State of the E&S Market

We earn commissions, which are calculated as a percentage of the total insurance policy premium, and fees. Changes in the

insurance market or specialty lines that are our focus, characterized by a period of increasing (or declining) premium rates,

could positively (or negatively) impact our profitability.

Managing Changing Macroeconomic Conditions

Growth in certain lines of business, such as project-based construction and M&A transactional liability insurance, is

partially dependent on a variety of macroeconomic factors inasmuch as binding the underlying insurance coverage is

subject to the underlying activity occurring. In periods of economic growth and liquid credit markets, this underlying

activity can accelerate and provide tailwinds to our growth. In periods of economic decline and tight credit markets, this

underlying activity can slow or be delayed and provide headwinds to our growth. We believe over the long term these lines

of business will continue to grow.

Leverage the Growth of the E&S Market

The growing relevance of the E&S market has been driven by the rapid emergence of large, complex, high-hazard, and

otherwise hard-to-place risks across many lines of insurance. This trend continued in 2023, with $80 billion of insured

catastrophe losses, mostly driven by a record setting year, both in frequency and severity, for severe convective storms

(“SCS”) with 21 SCS events above $1 billion in losses, which together accounted for $58 billion in losses. The year also

included hurricane losses on both the East and West coasts of the US, and sizable wildfire losses. Additionally, these risks

include the potential for more severe hurricanes that occur with greater frequency, more devastating wildfires, more

frequent flooding, escalating jury verdicts and social inflation, geographic shifts in population density, a proliferation of

cyber threats, novel health risks, risks associated with large sports and entertainment venues, building and labor cost

inflation relative to insured value, and the transformation of the economy to a “digital first” mode of doing business. We

believe that as the complexity of the E&S market continues to escalate, wholesale brokers and managing underwriters that

do not have sufficient scale, or the financial and intellectual capital to invest in the required specialty capabilities, will

struggle to compete effectively. This will further the trend of market share consolidation among the wholesale firms that do

have these capabilities. We will continue to invest in our intellectual capital to innovate and offer custom solutions and

products to better address these evolving market fundamentals.

Although we believe this growth will continue, we recognize that the growth of the E&S market might not be linear as

risks can and do shift between the E&S and non-E&S markets as market factors change and evolve. For example, we

benefited from a rapid increase in both the flow of property risks into the wholesale channel and the premium rate charged

for those risks in 2023 as the frequency and severity of catastrophe losses, attritional losses and secondary perils such as

severe convective storms, economic inflation, concentration of exposures, higher retentions of risk, and higher reinsurance

costs applied pressure to insurers and capacity tightened. If industry trends reverse, it may open opportunities for rates to

decline or retailers to place some of that coverage directly.

Components of Results of Operations

Revenue

Net Commissions and Fees

Net commissions and fees are derived primarily from our three Specialties and are paid for our role as an intermediary in

facilitating the placement of coverage in the insurance distribution chain. Net commissions and policy fees are generally

calculated as a percentage of the total insurance policy premium placed, although fees can often be a fixed amount

irrespective of the premium, and we also receive supplemental commissions based on the volume placed or profitability of

a book of business. We share a portion of these net commissions and policy fees with the retail insurance broker and

recognize revenue on a net basis. Additionally, carriers may also pay us a contingent commission or volume-based

commission, both of which represent forms of contingent or supplemental consideration associated with the placement of

coverage and are based primarily on underwriting results, but may also contain considerations for only volume, growth,

and/or retention. Although we have compensation arrangements called contingent commissions in all three Specialties that

are based in whole or in part on the underwriting performance, we do not take any direct insurance risk other than through

our equity method investment in Geneva Re through Ryan Investment Holdings, LLC. We also receive loss mitigation and

other fees, some of which are not dependent on the placement of a risk.

In our Wholesale Brokerage and Binding Authority Specialties, we generally work with retail insurance brokers to secure

insurance coverage for their clients, who are the ultimate insured party. Our Wholesale Brokerage and Binding Authority

Specialties generate revenues through commissions and fees from clients, as well as through supplemental commissions,

which may be contingent commissions or volume-based commissions from carriers. Commission rates and fees vary

depending upon several factors, which may include the amount of premium, the type of insurance coverage provided, the

particular services provided to a client or carrier, and the capacity in which we act. Payment terms are consistent with

current industry practice.

In our Underwriting Management Specialty we utilize delegated authority granted to us by carriers and we generally work

with retail insurance brokers and often other wholesale brokers to secure insurance coverage for the ultimate insured party.

Our Underwriting Management Specialty generates revenues through commissions and fees from clients and through

contingent commissions from carriers. Commission rates and fees vary depending upon several factors including the

premium, the type of coverage, and additional services provided to the client. Payment terms are consistent with current

industry practice.

Fiduciary Investment Income

Fiduciary investment income consists of interest earned on insurance premiums and surplus lines taxes that are held in a

fiduciary capacity, in cash and cash equivalents, until disbursed.

Expenses

Compensation and Benefits

Compensation and benefits is our largest expense. It consists of (i) salary, incentives and benefits to employees, and

commissions to our producers and (ii) equity-based compensation associated with the grants of awards to employees,

executive officers, and directors. We operate in competitive markets for human capital and we need to maintain

competitive compensation levels in order to maintain and grow our talent base.

General and Administrative

General and administrative expense includes travel and entertainment expenses, office expenses, accounting, foreign

exchange, legal, insurance and other professional fees, and other costs associated with our operations. Our occupancy-

related costs and professional services expenses, in particular, generally increase or decrease in relative proportion to the

number of our employees and the overall size and scale of our business operations.

Amortization

Amortization expense consists primarily of amortization related to intangible assets we acquired in connection with our

acquisitions. Intangible assets consist of customer relationships, trade names, and internally developed software.

Interest Expense, Net

Interest expense, net consists of interest payable on indebtedness, amortization of the Company’s interest rate cap, imputed

interest on contingent consideration, and amortization of deferred debt issuance costs, offset by interest income on the

Company’s Cash and cash equivalents balances and payments received in relation to the interest rate cap.

Other Non-Operating Loss (Income)

For the nine months ended September 30, 2024, Other non-operating loss (income) consisted of expense related to term

loan modifications and TRA contractual interest and related charges offset by sublease income. For the nine months ended

September 30, 2023, Other non-operating income included sublease income offset by TRA contractual interest and related

charges.

Income Tax Expense (Benefit)

Income tax expense (benefit) includes tax on the Company’s allocable share of any net taxable income from the LLC, from

certain state and local jurisdictions that impose taxes on partnerships, as well as earnings from our foreign subsidiaries and

C-Corporations subject to entity level taxation.

Non-Controlling Interests

Net income and Other comprehensive income (loss) are attributed to the non-controlling interests based on the weighted-

average LLC Common Units outstanding during the period and is presented on the Consolidated Statements of Income

(Loss). Refer to “Note 8, Stockholders’ Equity” of the unaudited quarterly consolidated financial statements for more

information.

Results of Operations

Below is a summary table of the financial results and Non-GAAP measures that we find relevant to our business

operations:


	Three Months Ended September 30,		Change		Nine Months Ended September 30,		Change
(in thousands, except percentages and per share data)	2024	2023	$	%	2024	2023	$	%
Revenue
Net commissions and fees	$588,129	$487,345	$100,784	20.7 %	$1,806,264	$1,507,878	$298,386	19.8 %
Fiduciary investment income	16,565	14,593	1,972	13.5	$45,917	$36,808	9,109	24.7
Total revenue	$604,694	$501,938	$102,756	20.5 %	$1,852,181	$1,544,686	$307,495	19.9 %
Expenses
Compensation and benefits	393,249	329,212	64,037	19.5	1,180,825	989,294	191,531	19.4
General and administrative	88,684	69,288	19,396	28.0	247,518	202,595	44,923	22.2
Amortization	39,182	29,572	9,610	32.5	97,711	79,125	18,586	23.5
Depreciation	2,467	2,201	266	12.1	6,820	6,570	250	3.8
Change in contingent consideration	(365)	1,848	(2,213)	NM	813	4,358	(3,545)	(81.3)
Total operating expenses	$523,217	$432,121	$91,096	21.1 %	$1,533,687	$1,281,942	$251,745	19.6 %
Operating income	$81,477	$69,817	$11,660	16.7 %	$318,494	$262,744	$55,750	21.2 %
Interest expense, net	49,388	31,491	17,897	56.8	109,916	89,840	20,076	22.3
(Income) from equity method investment in related party	(4,182)	(2,271)	(1,911)	84.1%	(13,510)	(5,882)	(7,628)	NM
Other non-operating loss	16,590	67	16,523	NM	18,575	37	18,538	NM
Income before income taxes	$19,681	$40,530	$(20,849)	(51.4 %)	$203,513	$178,749	$24,764	13.9 %
Income tax expense (benefit)	(8,962)	24,827	(33,789)	NM	16,155	42,772	(26,617)	(62.2)
Net income	$28,643	$15,703	$12,940	82.4 %	$187,358	$135,977	$51,381	37.8 %
GAAP financial measures
Total revenue	$604,694	$501,938	$102,756	20.5 %	$1,852,181	$1,544,686	$307,495	19.9 %
Net commissions and fees	588,129	487,345	100,784	20.7	1,806,264	1,507,878	298,386	19.8
Compensation and benefits	393,249	329,212	64,037	19.5	1,180,825	989,294	191,531	19.4
General and administrative	88,684	69,288	19,396	28.0	247,518	202,595	44,923	22.2
Net income	28,643	15,703	12,940	82.4	187,358	135,977	51,381	37.8
Compensation and benefits expense ratio (1)	65.0 %	65.6 %			63.8 %	64.0 %
General and administrative expense ratio (2)	14.7 %	13.8 %			13.4 %	13.1 %
Net income margin (3)	4.7 %	3.1 %			10.1 %	8.8 %
Earnings (loss) per share (4)	$0.15	$(0.04)			$0.67	$0.34
Diluted earnings (loss) per share (4)	$0.09	$(0.04)			$0.59	$0.34
Non-GAAP financial measures*
Organic revenue growth rate	11.8 %	15.0 %			13.3 %	15.0 %
Adjusted compensation and benefits expense	$343,442	$296,400	$47,042	15.9%	$1,057,424	$911,926	$145,498	16.0 %
Adjusted compensation and benefits expense ratio	56.8 %	59.1 %			57.1 %	59.0 %
Adjusted general and administrative expense	$70,991	$58,560	$12,431	21.2%	$199,583	$166,606	$32,977	19.8 %
Adjusted general and administrative expense ratio	11.7 %	11.7 %			10.8 %	10.8 %
Adjusted EBITDAC	$190,261	$146,978	$43,283	29.4%	$595,174	$466,154	$129,020	27.7 %
Adjusted EBITDAC margin	31.5 %	29.3 %			32.1 %	30.2 %
Adjusted net income	$113,633	$86,631	$27,002	31.2%	$369,604	$282,144	$87,460	31.0 %
Adjusted net income margin	18.8 %	17.3 %			20.0 %	18.3 %
Adjusted diluted earnings per share	$0.41	$0.32			$1.34	$1.04

NM represents “Not Meaningful.”

(1)Compensation and benefits expense ratio is defined as Compensation and benefits expense divided by Total revenue.

(2)General and administrative expense ratio is defined as General and administrative expense divided by Total revenue.

(3)Net income margin is defined as Net income divided by Total revenue.

(4)See “Note 10, Earnings (Loss) Per Share” of the unaudited quarterly consolidated financial statements for further

discussion of how these metrics are calculated.

*These measures are Non-GAAP. Please refer to the section entitled “Non-GAAP Financial Measures and Key

Performance Indicators” below for definitions and reconciliations to the most directly comparable GAAP measure.

Comparison of the Three Months Ended September 30, 2024 and 2023

Revenue

Total Revenue

Total revenue increased by $102.8 million, or 20.5 %, from $501.9 million to $604.7 million for the three months ended

September 30, 2024, as compared to the same period in the prior year. The following were the principal drivers of the

increase:

•$56.8 million, or 11.3%, of the period-over-period change in Total revenue was due to organic revenue growth.

Organic revenue growth represents the change in Net commissions and fees revenue, as compared to the same

period for the year prior, adjusted for Net commissions and fees attributable to recent acquisitions during the

first twelve months of Ryan Specialty’s ownership, and other adjustments such as the removal of the impact of

contingent commissions and the impact of changes in foreign exchange rates. In aggregate, our net commission

rates were consistent period-over-period. Also, we grew our client relationships, in aggregate, within each of

our three Specialties. The growth of these relationships is due to the combination of a growing E&S market

and winning new business from competitors. Growth in the quarter was balanced across our property and

casualty portfolios within our three Specialties, driven by an increase in the flow of risks into the E&S market;

•$33.4 million, or 6.7%, of the period-over-period change in Total revenue was due to the acquisitions of

AccuRisk, Castel, US Assure, Greenhill, and Ethos P&C, all of which were completed within twelve months of

September 30, 2024;

•$10.6 million, or 2.1%, of the period-over-period change in Total revenue was due to changes in contingent

commissions and the impact of foreign exchange rates on the Company’s Net commissions and fees; and

•$2.0 million, or 0.4%, of the period-over-period change in Total revenue was due to an increase in Fiduciary

investment income, caused by a rise in interest rates and a rise in fiduciary balances compared to the prior year.


	Three Months Ended September 30,
(in thousands, except percentages)	2024	% of total	2023	% of total	Change
Wholesale Brokerage	$346,666	59.0 %	$308,872	63.4 %	$37,794	12.2 %
Binding Authorities	76,497	13.0	69,245	14.2	7,252	10.5
Underwriting Management	164,966	28.0	109,228	22.4	55,738	51.0
Total net commissions and fees	$588,129		$487,345		$100,784	20.7 %

Wholesale Brokerage net commissions and fees increased by $37.8 million, or 12.2%, period-over-period, primarily due to

strong organic growth within the Specialty for the quarter.

Binding Authority net commissions and fees increased by $7.3 million, or 10.5%, period-over-period, primarily due to

strong organic growth within the Specialty for the quarter.

Underwriting Management net commissions and fees increased by $55.7 million, or 51.0%, period-over-period, primarily

due to strong organic growth within the Specialty for the quarter as well as contributions from the AccuRisk, Castel, US

Assure, Greenhill, and Ethos P&C acquisitions.

The following table sets forth our revenue by type of commission and fees:


	Three Months Ended September 30,
(in thousands, except percentages)	2024	% of total	2023	% of total	Change
Net commissions and policy fees	$555,282	94.4 %	$470,085	96.4 %	$85,197	18.1 %
Supplemental and contingent commissions	20,455	3.5	8,592	1.8	11,863	138.1
Loss mitigation and other fees	12,392	2.1	8,668	1.8	3,724	43.0
Total net commissions and fees	$588,129		$487,345		$100,784	20.7 %

Net commissions and policy fees grew 18.1%, in line with the overall net commissions and fee revenue growth of 20.7%,

for the three months ended September 30, 2024, as compared to the same period in the prior year. The main drivers of this

growth continue to be the acquisition of new business and expansion of ongoing client relationships in response to the

increasing demand for new, complex E&S products as well as the inflow of risks from the Admitted market into the E&S

market and an increase in the premium rate for risks placed. In aggregate, we experienced stable commission rates period-

over-period.

Supplemental and contingent commissions increased 138.1% period-over-period driven by the performance of risks placed

on eligible business earning profit-based or volume-based commissions.

Loss mitigation and other fees increased 43.0% period-over-period primarily due increased capital markets activity, certain

fees related to the ACE, Point6, and AccuRisk acquisitions completed in the second half of 2023, and captive management

and other risk management service fees from the placement of alternative risk insurance solutions.

Expenses

Compensation and Benefits

Compensation and benefits expense increased by $64.0 million, or 19.5%, from $329.2 million to $393.2 million for the

three months ended September 30, 2024, compared to the same period in 2023. The following were the principal drivers of

this increase:

•Commissions increased $21.5 million, or 14.9%, period-over-period, driven by the 20.7% increase in Net

commissions and fees;

•An increase of $17.5 million was driven by Acquisition-related expense and Acquisition related long-term

incentive compensation related to recently completed acquisitions;

•An increase of $9.1 million was driven by Equity-based compensation expense related to both recent grants as

well as modification expense of $4.6 million associated with the removal of equity transfer restrictions for an

executive officer of the Company; and

•The remaining increase of $15.9 million was driven by (i) the addition of 623 employees compared to the

same period in the prior year, and (ii) growth in the business. Overall headcount increased to 4,917 full-time

employees as of September 30, 2024, from 4,294 as of September 30, 2023.

The net impact of revenue growth and the factors above resulted in a Compensation and benefits expense ratio decrease of

0.6% from 65.6% to 65.0% period-over-period.

In general, we expect to continue experiencing a rise in commissions, salaries, incentives, and benefits expense

commensurate with our expected growth in business volume, revenue, and headcount.

General and Administrative

General and administrative expense increased by $19.4 million, or 28.0%, from $69.3 million to $88.7 million for the three

months ended September 30, 2024, as compared to the same period in the prior year. The following were the principal

drivers of this increase:

•$6.8 million of increased Acquisition-related expense associated with recent and prospective acquisitions; and

•$12.6 million was driven by growth in the business. Such expenses incurred to accommodate both organic and

inorganic revenue growth include IT, travel and entertainment, occupancy, and insurance.

The net impact of revenue growth and the factors listed above resulted in a General and administrative expense ratio

increase of 0.9% from 13.8% to 14.7% period-over-period.

Amortization

Amortization expense increased by $9.6 million, or 32.5%, from $29.6 million to $39.2 million for the three months ended

September 30, 2024, compared to the same period in the prior year. The main driver of the increase was the amortization of

intangible assets from recent acquisitions. Our intangible assets increased by $760.8 million when comparing the balance

as of September 30, 2024, to the balance as of September 30, 2023.

Interest Expense, Net

Interest expense, net increased $17.9 million, or 56.8%, from $31.5 million to $49.4 million for the three months ended

September 30, 2024, compared to the same period in the prior year. The main driver of the increase in Interest expense, net

for the three months ended September 30, 2024, was an increase in debt from recent acquisition activity. For the three

months ended September 30, 2024, the reduction to Interest expense, net related to our interest rate cap was $5.0 million.

For the three months ended September 30, 2024 and 2023, the reduction to Interest expense, net related to interest income

earned on operating cash balances of $5.7 million and $7.1 million, respectively.

Other Non-Operating Loss

Other non-operating loss increased by $16.5 million to a loss of $16.6 million for the three months ended September 30,

2024, as compared to a loss of $0.1 million in the same period in the prior year. For the three months ended September 30,

2024, Other non-operating loss consisted of $16.2 million of term loan modification expense and $0.5 million of TRA

contractual interest and related charges offset by $0.1 million of sublease income. For the three months ended

September 30, 2023, Other non-operating income included $0.3 million of TRA contractual interest and related charges

offset by $0.2 million of sublease income.

Income Before Income Taxes

Income before income taxes decreased $20.8 million from $40.5 million to $19.7 million for the three months ended

September 30, 2024, compared to the same period in the prior year as a result of the factors described above.

Income Tax Expense (Benefit)

Income tax expense (benefit) decreased $33.8 million from expense of $24.8 million to a benefit of $9.0 million for the

three months ended September 30, 2024, compared to the same period in the prior year primarily as a result of $20.7

million of income tax expense recognized as a result of the Common Control Reorganization (“CCR”) subsequent to the

Socius acquisition in the third quarter of 2023 and a $10.9 million income tax benefit recognized as a result of Equity-

based compensation awards vesting in the third quarter of 2024.

Net Income

Net income increased $12.9 million from $15.7 million to $28.6 million for the three months ended September 30, 2024,

compared to the same period in the prior year as a result of the factors described above.

Comparison of the Nine Months Ended September 30, 2024 and 2023

Revenue

Total Revenue

Total revenue increased by $307.5 million, or 19.9%, from $1,544.7 million to $1,852.2 million for the nine months ended

September 30, 2024, as compared to the same period in the prior year. The following were the principal drivers of the

increase:

•$196.1 million, or 12.7%, of the period-over-period change in Total revenue was due to organic revenue

growth. Organic revenue growth represents the change in Net commissions and fees revenue, as compared to

the same period for the year prior, adjusted for Net commissions and fees attributable to recent acquisitions

during the first twelve months of Ryan Specialty’s ownership, and other adjustments such as the removal of the

impact of contingent commissions and the impact of changes in foreign exchange rates. In aggregate, our net

commission rates were consistent period-over-period. Also, we grew our client relationships, in aggregate,

within each of our three Specialties. The growth of these relationships is due to the combination of a growing

E&S market and winning new business from competitors. Growth in the quarter was balanced across our

property and casualty portfolios within our three Specialties, driven by an increase in the flow of risks into the

E&S market;

•$87.7 million, or 5.7%, of the period-over-period change in Total revenue was due to the acquisitions of

AccuRisk, Castel, US Assure, Greenhill, and Ethos P&C, all of which were completed within twelve months of

September 30, 2024;

•$14.6 million, or 0.9%, of the period-over-period change in Total revenue was due to changes in contingent

commissions and the impact of foreign exchange rates on the Company’s Net commissions and fees; and

•$9.1 million, or 0.6%, of the period-over-period change in Total revenue was due to an increase in Fiduciary

investment income, caused by a rise in interest rates and a rise in fiduciary balances compared to the prior year.


	Nine Months Ended September 30,
(in thousands, except percentages)	2024	% of total	2023	% of total	Change
Wholesale Brokerage	$1,114,240	61.7 %	$976,338	64.7 %	$137,902	14.1 %
Binding Authorities	245,762	13.6	$208,547	13.8	37,215	17.8
Underwriting Management	446,262	24.7	$322,993	21.4	123,269	38.2
Total Net commissions and fees	$1,806,264		$1,507,878		$298,386	19.8 %

Wholesale Brokerage net commissions and fees increased by $137.9 million, or 14.1% period-over-period, primarily due to

strong organic growth within the Specialty for the quarter.

Binding Authority net commissions and fees increased by $37.2 million, or 17.8%, period-over-period, primarily due to

strong organic growth within the Specialty for the quarter.

Underwriting Management net commissions and fees increased by $123.3 million, or 38.2%, period-over-period, primarily

due to strong organic growth within the Specialty for the quarter as well as contributions from the AccuRisk, Castel, US

Assure, Greenhill, and Ethos P&C acquisitions.

The following table sets forth our revenue by type of commission and fees:


	Nine Months Ended September 30,
(in thousands, except percentages)	2024	% of total	2023	% of total	Change
Net commissions and policy fees	$1,706,781	94.5 %	$1,437,239	95.3 %	$269,542	18.8 %
Supplemental and contingent commissions	58,618	3.2	46,281	3.1	12,337	26.7
Loss mitigation and other fees	40,865	2.3	24,358	1.6	16,507	67.8
Total net commissions and fees	$1,806,264		$1,507,878		$298,386	19.8 %

Net commissions and policy fees grew 18.8%, in line with the overall net commissions and fee revenue growth of 19.8%

for the nine months ended September 30, 2024, as compared to the same period in the prior year. The main drivers of this

growth continue to be the acquisition of new business and expansion of ongoing client relationships in response to the

increasing demand for new, complex E&S products as well as the inflow of risks from the Admitted market into the E&S

market and an increase in the premium rate for risks placed. In aggregate, we experienced stable commission rates period-

over-period.

Supplemental and contingent commissions increased 26.7% period-over-period driven by the performance of risks placed

on eligible business earning profit-based or volume-based commissions.

Loss mitigation and other fees increased 67.8% period-over-period primarily due increased capital markets activity, certain

fees related to the ACE, Point6, and AccuRisk acquisitions completed in the second half of 2023, and captive management

and other risk management service fees from the placement of alternative risk insurance solutions.

Expenses

Compensation and Benefits

Compensation and benefits expense increased by $191.5 million, or 19.4%, from $989.3 million to $1,180.8 million for the

nine months ended September 30, 2024, compared to the same period in 2023. The following were the principal drivers of

this increase:

•Commissions increased $73.3 million, or 15.9%, period-over-period, driven by the 19.8% increase in Net

commissions and fees;

•An increase of $22.3 million was driven by Restructuring and related expense associated with the

ACCELERATE 2025 program;

•An increase of $17.2 million was driven by Acquisition-related expense and Acquisition related long-term

incentive compensation related to recently completed acquisitions;

•An increase of $16.6 million was driven by Equity-based compensation expense related to both recent grants

as well as modification expense of $4.6 million associated with the removal of equity transfer restrictions for

an executive officer of the Company; and

•The remaining increase of $62.1 million was driven by (i) the addition of 623 employees compared to the

same period in the prior year, and (ii) growth in the business. Overall headcount increased to 4,917 full-time

employees as of September 30, 2024, from 4,294 as of September 30, 2023.

The net impact of revenue growth and the factors above resulted in a Compensation and benefits expense ratio decrease of

0.2% from 64.0% to 63.8% period-over-period.

In general, we expect to continue experiencing a rise in commissions, salaries, incentives, and benefits expense

commensurate with our expected growth in business volume, revenue, and headcount.

General and Administrative

General and administrative expense increased by $44.9 million, or 22.2%, from $202.6 million to $247.5 million for the

nine months ended September 30, 2024, as compared to the same period in the prior year. The following were the principal

drivers of this increase:

•$32.9 million was driven by growth in the business. Such expenses incurred to accommodate both organic and

inorganic revenue growth include IT, travel and entertainment, occupancy, and insurance;

•$23.6 million of increased acquisition-related expense associated with recent and prospective acquisitions; and

•These increases were partially offset by an $11.6 million decline in Restructuring and related expense

associated with ACCELERATE 2025.

The net impact of revenue growth and the factors listed above resulted in a General and administrative expense ratio

increase of 0.3% from 13.1% to 13.4% period-over-period.

Amortization

Amortization expense increased by $18.6 million, or 23.5%, from $79.1 million to $97.7 million for the nine months ended

September 30, 2024, compared to the same period in the prior year. The main driver of the increase was the amortization of

intangible assets from recent acquisitions. Our intangible assets increased by $760.8 million when comparing the balance

as of September 30, 2024, to the balance as of September 30, 2023.

Interest Expense, Net

Interest expense, net increased $20.1 million, or 22.3%, from $89.8 million to $109.9 million for the nine months ended

September 30, 2024, compared to the same period in the prior year. The main driver of the increase in Interest expense, net

for the three months ended September 30, 2024, was an increase in debt from recent acquisition activity. For the nine

months ended September 30, 2024, the reduction to Interest expense, net related to our interest rate cap was $14.5 million.

For the nine months ended September 30, 2024, and 2023, the reduction to Interest expense, net related to interest income

earned on operating cash balances was $19.0 million and $23.0 million, respectively.

Other Non-Operating Loss

Other non-operating loss increased by $18.5 million to a loss of $18.6 million for the nine months ended September 30,

2024, as compared to a de minimis loss in the same period in the prior year. For the nine months ended September 30,

2024, Other non-operating loss consisted of $18.1 million of expense related to term loan modifications and $0.8 million of

TRA contractual interest and related charges offset by $0.4 million of sublease income. For the nine months ended

September 30, 2023, Other non-operating loss included $0.5 million of TRA contractual interest and related charges offset

by $0.4 million of sublease income.

Income Before Income Taxes

Income before income taxes increased $24.8 million from $178.7 million to $203.5 million for the nine months ended

September 30, 2024, compared to the same period in the prior year as a result of the factors described above.

Income Tax Expense (Benefit)

Income tax expense (benefit) decreased $26.6 million from $42.8 million to $16.2 million for the nine months ended

September 30, 2024, compared to the same period in the prior year primarily as a result of $20.7 million of income tax

expense recognized as a result of the CCR subsequent to the Socius acquisition in the third quarter of 2023 and $10.9

million of income tax benefit recognized as a result of Equity-based compensation awards vesting in the third quarter of

2024.

Net Income

Net income increased $51.4 million from $136.0 million to $187.4 million for the nine months ended September 30, 2024,

compared to the same period in the prior year as a result of the factors described above.

Non-GAAP Financial Measures and Key Performance Indicators

In assessing the performance of our business, we use non-GAAP financial measures that are derived from our consolidated

financial information, but which are not presented in our consolidated financial statements prepared in accordance with

GAAP. We consider these non-GAAP financial measures to be useful metrics for management and investors to facilitate

operating performance comparisons from period to period by excluding potential differences caused by variations in capital

structures, tax positions, depreciation, amortization, and certain other items that we believe are not representative of our

core business. We use the following non-GAAP measures for business planning purposes, in measuring our performance

relative to that of our competitors, to help investors to understand the nature of our growth, and to enable investors to

evaluate the run-rate performance of the Company. Non-GAAP financial measures should be viewed as supplementing,

and not as an alternative or substitute for, the consolidated financial statements prepared and presented in accordance with

GAAP. The footnotes to the reconciliation tables below should be read in conjunction with the unaudited consolidated

quarterly financial statements. Industry peers may provide similar supplemental information but may not define similarly

named metrics in the same way we do and may not make identical adjustments.

Organic Revenue Growth Rate

Organic Revenue Growth Rate is defined as the percentage change in Net commissions and fees, as compared to the same

period for the prior year, adjusted to eliminate revenue attributable to acquisitions for the first twelve months of ownership,

and other items such as contingent commissions and the impact of changes in foreign exchange rates.

For the avoidance of doubt, prior period references in the tables below represent the same period in the prior year. A

reconciliation of Organic revenue growth rate to Net commissions and fees growth rate, the most directly comparable

GAAP measure, for each of the periods indicated is as follows (in percentages):


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands, except percentages)	2024	2023	2024	2023
Current period Net commissions and fees revenue	$588,129	$487,345	$1,806,264	$1,507,878
Less: Current period contingent commissions	(14,842)	(4,487)	(44,741)	(30,624)
Net Commissions and fees revenue excluding contingent commissions	$573,287	$482,858	$1,761,523	$1,477,254

Prior period Net commissions and fees revenue	$487,345	$407,551	$1,507,878	$1,284,459
Less: Prior year contingent commissions	(4,487)	(3,039)	(30,624)	(24,978)
Prior period Net commissions and fees revenue excluding contingent commissions	$482,858	$404,512	$1,477,254	$1,259,481

Change in Net commissions and fees revenue excluding contingent commissions	$90,429	$78,346	$284,269	$217,773
Less: Mergers and acquisitions Net commissions and fees revenue excluding contingent commissions	(33,416)	(16,980)	(87,690)	(28,563)
Impact of change in foreign exchange rates	(196)	(739)	(521)	350
Organic revenue growth (Non-GAAP)	$56,817	$60,628	$196,058	$189,560

Net commissions and fees revenue growth rate (GAAP)	20.7 %	19.6 %	19.8 %	17.4 %
Less: Impact of contingent commissions (1)	(2.0)	(0.2)	(0.6)	(0.1)
Net commissions and fees revenue excluding contingent commissions growth rate (2)	18.7 %	19.4 %	19.2 %	17.3 %
Less: Mergers and acquisitions Net commissions and fees revenue excluding contingent commissions (3)	(6.9)	(4.2)	(5.9)	(2.3)
Impact of change in foreign exchange rates (4)	0.0	(0.2)	0.0	0.0
Organic Revenue Growth Rate (Non-GAAP)	11.8 %	15.0 %	13.3 %	15.0 %

(1)Calculated by subtracting Net commissions and fees revenue growth rate from net commissions and fees revenue

excluding contingent commissions growth rate.

(2)Calculated by dividing the change in Total net commissions & fees revenue excluding contingent commissions by prior

year net commissions and fees excluding contingent commissions.

(3)Calculated by taking the mergers and acquisitions net commissions and fees revenue excluding contingent

commissions, representing the first 12 months of net commissions and fees revenue generated from acquisitions,

divided by prior period net commissions and fees revenue excluding contingent commissions.

(4)Calculated by taking the change in foreign exchange rates divided by prior period net commissions and fees revenue

excluding contingent commissions.

Adjusted Compensation and Benefits Expense and Adjusted Compensation and Benefits Expense Ratio

We define Adjusted compensation and benefits expense as Compensation and benefits expense adjusted to reflect items

such as (i) equity-based compensation, (ii) acquisition and restructuring related compensation expense, and (iii) other

exceptional or non-recurring items, as applicable. The most comparable GAAP financial metric is Compensation and

benefits expense. Adjusted compensation and benefits expense ratio is defined as Adjusted compensation and benefits

expense as a percentage of Total revenue. The most comparable GAAP financial metric is Compensation and benefits

expense ratio.

A reconciliation of Adjusted compensation and benefits expense and Adjusted compensation and benefits expense ratio to

Compensation and benefits expense and Compensation and benefits expense ratio, the most directly comparable GAAP

measures, for each of the periods indicated, is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands, except percentages)	2024	2023	2024	2023
Total revenue	$604,694	$501,938	$1,852,181	$1,544,686
Compensation and benefits expense	$393,249	$329,212	$1,180,825	$989,294
Acquisition-related expense	(3,785)	(1,546)	(5,171)	(3,331)
Acquisition related long-term incentive compensation	(15,775)	(550)	(17,039)	(1,702)
Restructuring and related expense	(5,693)	(11,538)	(35,676)	(13,407)
Amortization and expense related to discontinued prepaid incentives	(1,095)	(1,571)	(3,851)	(4,793)
Equity-based compensation	(17,385)	(8,280)	(39,656)	(23,106)
Initial public offering related expense	(6,074)	(9,327)	(22,008)	(31,029)
Adjusted compensation and benefits expense (1)	$343,442	$296,400	$1,057,424	$911,926
Compensation and benefits expense ratio	65.0 %	65.6 %	63.8 %	64.0 %
Adjusted compensation and benefits expense ratio	56.8 %	59.1 %	57.1 %	59.0 %

(1)Adjustments to Compensation and benefits expense are described in the definition of Adjusted EBITDAC to Net

income in “Adjusted EBITDAC and Adjusted EBITDAC Margin.”

Adjusted General and Administrative Expense and Adjusted General and Administrative Expense Ratio

We define Adjusted general and administrative expense as General and administrative expense adjusted to reflect items

such as (i) acquisition and restructuring general and administrative related expense and (ii) other exceptional or non-

recurring items, as applicable. The most comparable GAAP financial metric is General and administrative expense.

Adjusted general and administrative expense ratio is defined as Adjusted general and administrative expense as a

percentage of Total revenue. The most comparable GAAP financial metric is General and administrative expense ratio.

A reconciliation of Adjusted general and administrative expense and Adjusted general and administrative expense ratio to

General and administrative expense and General and administrative expense ratio, the most directly comparable GAAP

measures, for each of the periods indicated is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands, except percentages)	2024	2023	2024	2023
Total revenue	$604,694	$501,938	$1,852,181	$1,544,686
General and administrative expense	$88,684	$69,288	$247,518	$202,595
Acquisition-related expense	(12,560)	(5,790)	(35,779)	(12,196)
Restructuring and related expense	(5,133)	(4,938)	(12,156)	(23,793)
Adjusted general and administrative expense (1)	$70,991	$58,560	$199,583	$166,606
General and administrative expense ratio	14.7 %	13.8 %	13.4 %	13.1 %
Adjusted general and administrative expense ratio	11.7 %	11.7 %	10.8 %	10.8 %

(1)Adjustments to General and administrative expense are described in the definition of Adjusted EBITDAC to Net

income in “Adjusted EBITDAC and Adjusted EBITDAC Margin.”

Adjusted EBITDAC and Adjusted EBITDAC Margin

We define Adjusted EBITDAC as Net income before Interest expense, net, Income tax expense (benefit), Depreciation,

Amortization, and Change in contingent consideration, adjusted to reflect items such as (i) equity-based compensation, (ii)

acquisition and restructuring related expenses, and (iii) other exceptional or non-recurring items, as applicable.

Acquisition-related expense includes one-time diligence, transaction-related, and integration costs. In 2024, Acquisition-

related expense includes a $4.5 million charge for the nine months ended September 30, 2024, related to a deal-contingent

foreign exchange forward contract associated with the Castel acquisition. The remaining charges in both years represent

typical one-time diligence, transaction-related, and integration costs. Acquisition-related long-term incentive compensation

arises from changes to long-term incentive plans associated with acquisitions. Restructuring and related expense consists of

compensation and benefits, occupancy, contractors, professional services, and license fees related to the ACCELERATE

2025 program. The compensation and benefits expense included severance as well as employment costs related to services

rendered between the notification and termination dates and other termination payments. See “Note 4, Restructuring” of the

unaudited quarterly consolidated financial statements for further discussion of ACCELERATE 2025. The remaining costs

that preceded the restructuring plan were associated with professional services costs related to program design and

licensing costs. Amortization and expense is composed of charges related to discontinued prepaid incentive programs. For

the three months ended September 30, 2024, Other non-operating loss was composed of $16.2 million of expense related to

a term loan modification and $0.5 million of TRA contractual interest and related charges offset by $0.1 million of sublease

income. For the three months ended September 30, 2023, Other non-operating loss included $0.3 million of TRA

contractual interest and related charges offset by $0.2 million of sublease income. For the nine months ended

September 30, 2024, Other non-operating loss consisted of $18.1 million of expense related to term loan modifications and

$0.8 million of TRA contractual interest and related charges offset by $0.4 million of sublease income. For the nine months

ended September 30, 2023, Other non-operating loss included $0.5 million of TRA contractual interest and related charges

offset by $0.4 million of sublease income. Equity-based compensation reflects non-cash equity-based expense. For the

three months ended September 30, 2024, Equity-based compensation included $4.6 million of expense associated with the

removal of equity transfer restrictions for an executive officer of the Company. IPO related expenses include

compensation-related expense primarily related to the expense for new awards issued at IPO as well as expense related to

the revaluation of existing equity awards at IPO.

Total revenue less Adjusted compensation and benefits expense and Adjusted general and administrative expense is

equivalent to Adjusted EBITDAC. For a breakout of compensation and general and administrative costs for each addback,

refer to the Adjusted compensation and benefits expense and Adjusted general and administrative expense tables above.

The most directly comparable GAAP financial metric to Adjusted EBITDAC is Net income. Adjusted EBITDAC margin is

defined as Adjusted EBITDAC as a percentage of Total revenue. The most comparable GAAP financial metric is Net

income margin.

A reconciliation of Adjusted EBITDAC and Adjusted EBITDAC margin to Net income and Net income margin, the most

directly comparable GAAP measures, for each of the periods indicated is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands, except percentages)	2024	2023	2024	2023
Total revenue	$604,694	$501,938	$1,852,181	$1,544,686
Net income	$28,643	$15,703	$187,358	$135,977
Interest expense, net	49,388	31,491	109,916	89,840
Income tax expense (benefit)	(8,962)	24,827	16,155	42,772
Depreciation	2,467	2,201	6,820	6,570
Amortization	39,182	29,572	97,711	79,125
Change in contingent consideration	(365)	1,848	813	4,358
EBITDAC	$110,353	$105,642	$418,773	$358,642
Acquisition-related expense	16,345	7,336	40,950	15,527
Acquisition related long-term incentive compensation	15,775	550	17,039	1,702
Restructuring and related expense	10,826	16,476	47,832	37,200
Amortization and expense related to discontinued prepaid incentives	1,095	1,571	3,851	4,793
Other non-operating loss	16,590	67	18,575	37
Equity-based compensation	17,385	8,280	39,656	23,106
IPO related expenses	6,074	9,327	22,008	31,029
(Income) from equity method investments in related party	(4,182)	(2,271)	(13,510)	(5,882)
Adjusted EBITDAC	$190,261	$146,978	$595,174	$466,154
Net income margin	4.7 %	3.1 %	10.1 %	8.8 %
Adjusted EBITDAC margin	31.5 %	29.3 %	32.1 %	30.2 %

Adjusted Net Income and Adjusted Net Income Margin

We define Adjusted net income as tax-effected earnings before amortization and certain items of income and expense,

gains and losses, equity-based compensation, acquisition related long-term incentive compensation, acquisition-related

expenses, costs associated with the IPO, and certain exceptional or non-recurring items. The most comparable GAAP

financial metric is Net income. Adjusted net income margin is calculated as Adjusted net income as a percentage of Total

revenue. The most comparable GAAP financial metric is Net income margin.

Following the IPO, the Company is subject to United States federal income taxes, in addition to state, local, and foreign

taxes, with respect to our allocable share of any net taxable income of the LLC. For comparability purposes, this

calculation incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the

Company owned 100% of the LLC.

A reconciliation of Adjusted net income and Adjusted net income margin to Net income and Net income margin, the most

directly comparable GAAP measures, for each of the periods indicated is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands, except percentages)	2024	2023	2024	2023
Total revenue	$604,694	$501,938	$1,852,181	$1,544,686
Net income	$28,643	$15,703	$187,358	$135,977
Income tax expense (benefit)	(8,962)	24,827	16,155	42,772
Amortization	39,182	29,572	97,711	79,125
Amortization of deferred debt issuance costs (1)	15,402	3,045	21,838	9,125
Change in contingent consideration	(365)	1,848	813	4,358
Acquisition-related expense	16,345	7,336	40,950	15,527
Acquisition related long-term incentive compensation	15,775	550	17,039	1,702
Restructuring and related expense	10,826	16,476	47,832	37,200
Amortization and expense related to discontinued prepaid incentives	1,095	1,571	3,851	4,793
Other non-operating loss	16,590	67	18,575	37
Equity-based compensation	17,385	8,280	39,656	23,106
IPO related expenses	6,074	9,327	22,008	31,029
(Income) from equity method investments in related party	(4,182)	(2,271)	(13,510)	(5,882)
Adjusted income before income taxes (2)	$153,808	$116,331	$500,276	$378,869
Adjusted income tax expense (3)	(40,175)	(29,700)	(130,672)	(96,725)
Adjusted net income	$113,633	$86,631	$369,604	$282,144
Net income margin	4.7 %	3.1 %	10.1 %	8.8 %
Adjusted net income margin	18.8 %	17.3 %	20.0 %	18.3 %

(1)Interest expense, net includes amortization of deferred debt issuance costs.

(2)Adjustments to Net income are described in the definition of Adjusted EBITDAC to Net income in “Adjusted

EBITDAC and Adjusted EBITDAC Margin.”

(3)The Company is subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect

to our allocable share of any net taxable income of the LLC. For the three and nine months ended September 30, 2024,

this calculation of adjusted income tax expense is based on a federal statutory rate of 21% and a combined state income

tax rate net of federal benefits of 5.12% on 100% of our adjusted income before income taxes as if the Company owned

100% of the LLC. For the three and nine months ended September 30, 2023, this calculation of adjusted income tax

expense is based on a federal statutory rate of 21% and a combined state income tax rate net of federal benefits of

4.53% on 100% of our adjusted income before income taxes as if the Company owned 100% of the LLC.

Adjusted Diluted Earnings Per Share

We define Adjusted diluted earnings per share as Adjusted net income divided by diluted shares outstanding after adjusting

for the effect if 100% of the outstanding LLC Common Units (together with the shares of Class B common stock), vested

Class C Incentive Units, and unvested equity awards were exchanged into shares of Class A common stock as if 100% of

unvested equity awards were vested. The most directly comparable GAAP financial metric is Diluted earnings per share.

A reconciliation of Adjusted diluted earnings per share to Diluted earnings per share, the most directly comparable GAAP

measure, for each of the periods indicated is as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Earnings (loss) per share of Class A common stock – diluted	$0.09	$(0.04)	$0.59	$0.34
Less: Net income attributed to dilutive shares and substantively vested RSUs (1)	(0.03)	—	(0.29)	(0.03)
Plus: Impact of all LLC Common Units exchanged for Class A shares (2)	0.05	0.10	0.39	0.20
Plus: Adjustments to Adjusted net income (3)	0.31	0.28	0.67	0.54
Plus: Dilutive impact of unvested equity awards (4)	(0.01)	(0.02)	(0.02)	(0.01)
Adjusted diluted earnings per share	$0.41	$0.32	$1.34	$1.04

(Share count in '000)
Weighted-average shares of Class A common stock outstanding – diluted	272,686	115,872	271,283	124,884
Plus: Impact of all LLC Common Units exchanged for Class A shares (2)	—	141,690	—	142,974
Plus: Dilutive impact of unvested equity awards (4)	3,467	15,115	4,445	4,390
Adjusted diluted earnings per share diluted share count	276,153	272,677	275,728	272,248

(1)Adjustment removes the impact of Net income attributed to dilutive awards and substantively vested RSUs to arrive at

Net income attributable to Ryan Specialty Holdings, Inc. For the three months ended September 30, 2024 and 2023, this

removes $8.3 million and $(0.1) million of Net income (loss), respectively, on 272.7 million and 115.9 million

Weighted-average shares of Class A common stock outstanding - diluted, respectively. For the nine months ended

September 30, 2024 and 2023, this removes $78.3 million and $3.8 million of Net income, respectively, on 271.3

million and 124.9 million Weighted-average shares of Class A common stock outstanding - diluted, respectively. See

“Note 10, Earnings Per Share” of the unaudited quarterly consolidated financial statements.

(2)For comparability purposes, this calculation incorporates the Net income that would be distributable if all LLC

Common Units (together with shares of Class B common stock) and vested Class C Incentive units were exchanged for

shares of Class A common stock. For the three months ended September 30, 2024 and 2023, this includes $11.1 million

and $20.8 million of Net income, respectively, on 272.7 million and 257.6 million Weighted-average shares of Class A

common stock outstanding - diluted, respectively. For the nine months ended September 30, 2024 and 2023, this

includes $106.4 million and $97.8 million of Net income, respectively, on 271.3 million and 267.9 million Weighted-

average shares of Class A common stock outstanding - diluted, respectively. For the three months ended September 30,

2023, 141.7 million weighted average outstanding LLC Common Units were considered dilutive and included in the

257.6 million Weighted-average shares of Class A common stock outstanding - diluted within Diluted EPS. For the

nine months ended September 30, 2023, 143.0 million weighted average outstanding LLC Common Units were

considered dilutive and included in the 267.9 million Weighted-average shares of Class A common stock outstanding -

diluted within Diluted EPS. See “Note 10, Earnings Per Share” of the unaudited quarterly consolidated financial

statements.

(3)Adjustments to Adjusted net income are described in the footnotes of the reconciliation of Adjusted net income to Net

income in “Adjusted Net Income and Adjusted Net Income Margin” on 272.7 million and 257.6 million Weighted-

average shares of Class A common stock outstanding - diluted for the three months ended September 30, 2024 and

2023, respectively, and on 271.3 million and 267.9 million Weighted-average shares of Class A common stock

outstanding- diluted for the nine months ended September 30, 2024 and 2023, respectively.

(4)For comparability purposes and to be consistent with the treatment of the adjustments to arrive at Adjusted net income,

the dilutive effect of unvested equity awards is calculated using the treasury stock method as if the weighted-average

unrecognized cost associated with the awards was $0 over the period, less any unvested equity awards determined to be

dilutive within the Diluted EPS calculation disclosed in “Note 10, Earnings Per Share” of the unaudited quarterly

consolidated financial statements. For the three months ended September 30, 2024 and 2023, 3.5 million and 15.1

million shares were added to the calculation, respectively. For the nine months ended September 30, 2024 and 2023, 4.4

million were added to the calculation.

Liquidity and Capital Resources

Liquidity describes the ability of a company to generate sufficient cash flows to meet the cash requirements of its business

operations. We believe that the balance sheet and strong cash flow profile of our business provides adequate liquidity. The

primary sources of liquidity are Cash and cash equivalents on the Consolidated Balance Sheets, cash flows provided by

operations, and debt capacity available under our Revolving Credit Facility, Term Loan, and Senior Secured Notes. The

primary uses of liquidity are operating expenses, seasonal working capital needs, business combinations, capital

expenditures, obligations under the TRA, taxes, distributions to LLC Unitholders, and dividends to Class A common

stockholders. We believe that Cash and cash equivalents, cash flows from operations, and amounts available under our

Revolving Credit Facility will be sufficient to meet liquidity needs, including principal and interest payments on debt

obligations, capital expenditures, and anticipated working capital requirements, for the next 12 months and beyond. Our

future capital requirements will depend on many factors including continuance of historical working capital levels and

capital expenditure needs, investment in de novo offerings, and the flow of deals in our merger and acquisition program.

On February 27, 2024, our Board declared a one-time special cash dividend of $0.23 per share on our outstanding Class A

common stock. In addition, the Board initiated a regular quarterly dividend of $0.11 per share on our outstanding Class A

common stock. The special dividend of $0.23 and $0.07 of the regular quarterly dividend were funded by current and prior

tax distributions from the LLC that are in excess of both the corporate income taxes payable by the Company as well as the

Company’s obligations pursuant to the Tax Receivable Agreement. The remaining $0.04 of the regular quarterly dividend

was funded by free cash flow from the LLC and paid to all holders of the Class A common stock and LLC Common Units.

We may be required to seek additional equity or debt financing. In the event that additional financing is required from

outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital

or generate cash flows necessary to expand our operations, this could reduce our ability to compete successfully and harm

the results of our operations.

Cash and cash equivalents on the Consolidated Balance Sheets include funds available for general corporate purposes.

Fiduciary cash and receivables cannot be used for general corporate purposes. Insurance premiums, claims funds, and

surplus lines taxes are held in a fiduciary capacity and the obligation to remit these funds are recorded as Fiduciary

liabilities on the Consolidated Balance Sheets. We recognize fiduciary amounts due to others as Fiduciary liabilities and

fiduciary amounts collectible and held on behalf of others, including insurance carriers, other insurance intermediaries,

surplus lines taxing authorities, clients, and insurance policy holders, as Fiduciary cash and receivables on the Consolidated

Balance Sheets.

In our capacity as an insurance broker or agent, we collect premiums from insureds and, after deducting our commission,

remit the premiums to the respective insurance markets and carriers. We also collect claims prefunding or refunds from

carriers on behalf of insureds, which are then returned to the insureds, and surplus lines taxes, which are then remitted to

surplus lines taxing authorities. Insurance premiums, claims funds, and surplus lines taxes are held in a fiduciary capacity.

The levels of Fiduciary cash and receivables and Fiduciary liabilities can fluctuate significantly depending on when we

collect the premiums, claims prefunding, and refunds, make payments to markets, carriers, surplus lines taxing authorities,

and insureds, and collect funds from clients and make payments on their behalf, and upon the impact of foreign currency

movements. Fiduciary cash, because of its nature, is generally invested in very liquid securities with a focus on

preservation of principal. To minimize investment risk, we maintain cash holdings pursuant to an investment policy which

contemplates all relevant rules established by states with regard to fiduciary cash and is approved by our Board of

Directors. The policy requires broad diversification of holdings across a variety of counterparties utilizing limits set by our

Board of Directors, primarily based on credit rating and type of investment. Fiduciary cash and receivables included cash

of $1,120.9 million and $848.6 million as of September 30, 2024 and 2023, respectively, and fiduciary receivables of

$2,236.1 million and $1,672.4 million as of September 30, 2024 and 2023, respectively. While we may earn interest

income on fiduciary cash held in cash and investments, the fiduciary cash may not be used for general corporate purposes.

Of the $235.2 million of Cash and cash equivalents on the Consolidated Balance Sheet as of September 30, 2024, $74.7

million was held in fiduciary accounts representing collected revenue and was available to be transferred to operating

accounts and used for general corporate purposes.

Credit Facilities

We expect to have sufficient financial resources to meet our business requirements for the next 12 months. Although cash

from operations is expected to be sufficient to service our activities, including servicing our debt and contractual

obligations, and financing capital expenditures, we have the ability to borrow under our Revolving Credit Facility to

accommodate any timing differences in cash flows. Additionally, under current market conditions, we believe that we

could access capital markets to obtain debt financing for longer-term funding, if needed.

On September 1, 2020, we entered into the Credit Agreement with leading institutions, including JPMorgan Chase Bank,

N.A., the Administrative Agent, for Term Loan borrowings totaling $1,650.0 million and a Revolving Credit Facility

totaling $300.0 million, in connection with financing the acquisition of All Risks, Ltd. Borrowings under our Revolving

Credit Facility are permitted to be drawn for our working capital and other general corporate financing purposes and those

of certain of our subsidiaries. Borrowings under our Credit Agreement are unconditionally guaranteed by various

subsidiaries and are secured by a lien and security interest in substantially all of our assets.

On July 26, 2021, we entered into an amendment to our Credit Agreement, which provided for an increase in the size of

our Revolving Credit Facility from $300.0 million to $600.0 million. Interest on the upsized Revolving Credit Facility bore

interest at the Eurocurrency Rate (LIBOR) plus a margin that ranged from 2.50% to 3.00%, based on the first lien net

leverage ratio defined in our Credit Agreement. No other significant terms under our agreement governing the Revolving

Credit Facility were changed in connection with such amendment.

On February 3, 2022, the LLC issued $400.0 million of 8-year Senior Secured Notes. The notes have a 4.375% interest rate

and will mature on February 1, 2030.

On April 29, 2022, we entered into the Fourth Amendment to the Credit Agreement on our Term Loan and Revolving

Credit Facility to transition its LIBOR rate to a Benchmark Replacement of Adjusted Term SOFR plus a Credit Spread

Adjustment of 10 basis points, 15 basis points, or 25 basis points for the one-month, three-month, or six-month borrowing

periods, respectively.

On January 19, 2024, we entered into the Fifth Amendment (the “Repricing Amendment”) to the Term Loan’s Credit

Agreement. As a result of the Repricing Amendment, the applicable interest rate of the Term Loan was reduced from

Adjusted Term SOFR + 3.00% to Adjusted Term SOFR + 2.25% and no longer contains a credit spread adjustment. All

other material provisions remain unchanged.

On July 30, 2024, the Company entered into the Sixth Amendment to the Credit Agreement, which provided for an

increase in borrowing capacity under the Revolving Credit Facility from $600.0 million to $1,400.0 million. The

amendment also extended the maturity date of the Revolving Credit Facility to July 30, 2029, and reduced the applicable

interest rate from Adjusted Term SOFR plus a margin of 2.50% to 3.00% to Adjusted Term SOFR plus a margin of 2.00%

to 2.50%, based on the first lien net leverage ratio defined in the Credit Agreement.

On September 13, 2024, the Company entered into the Seventh Amendment to the Credit Agreement, which refinanced the

existing Term Loan in the aggregate principal amount of $1,588.1 million outstanding as of June 30, 2024, and increased

the size of the Term Loan by $111.9 million to $1,700.0 million as of September 30, 2024. In addition to increasing the

size of the Term Loan, the Seventh Amendment reduced the applicable interest rate of the Term Loan from Adjusted Term

SOFR plus a margin of 2.75% to Adjusted Term SOFR plus a margin of 2.25% and lowered the 75 basis point floor on

Adjusted Term SOFR to a 0 basis point floor. Upon achievement of a stable (or better) corporate family rating from

Moody’s of Ba3 or better, the applicable interest rate of the Term Loan will be revised to Adjusted Term SOFR plus a

margin of 2.00%.

On September 19, 2024, the LLC issued $600.0 million of 8-year Senior Secured Notes. These notes carry a 5.875%

interest rate and will mature on August 1, 2032.

As of September 30, 2024, the interest rate on the Term Loan was 2.25% plus Adjusted Term SOFR.

As of September 30, 2024, the Company was in compliance with all of the covenants under the Credit Agreement and there

were no events of default for the nine months ended September 30, 2024.

Tax Receivable Agreement

The Company is party to a TRA with current and certain former LLC Unitholders. The TRA provides for the payment by

the Company, to current and certain former LLC Unitholders, of 85% of the net cash savings, if any, in U.S. federal, state,

and local income taxes that the Company realizes (or is deemed to realize in certain circumstances) as a result of (i) certain

increases in the tax basis of the assets of the LLC resulting from purchases or exchanges of LLC Common Units

(“Exchange Tax Attributes”), (ii) certain tax attributes of the LLC that existed prior to the IPO (“Pre-IPO M&A Tax

Attributes”), (iii) certain favorable “remedial” partnership tax allocations to which the Company becomes entitled to (if

any), and (iv) certain other tax benefits related to the Company entering into the TRA, including tax benefits attributable to

payments that the Company makes under the TRA (“TRA Payment Tax Attributes”). The Company recognizes a liability

on the Consolidated Balance Sheets based on the undiscounted estimated future payments under the TRA.

Due to the uncertainty of various factors, we cannot precisely quantify the likely tax benefits we will realize as a result of

the LLC Common Unit exchanges and the resulting amounts we are likely to pay out to current and certain former LLC

Unitholders pursuant to the TRA; however, we estimate that such tax benefits and the related TRA payments may be

substantial. As set forth in the table below, and assuming no changes in the relevant tax law and that we earn sufficient

taxable income to realize all cash tax savings that are subject to the TRA, we expect future payments under the TRA as a

result of transactions as of September 30, 2024 will be $455.1 million in aggregate. Future payments in respect to

subsequent exchanges would be in addition to these amounts and are expected to be substantial. The foregoing amounts are

merely estimates and the actual payments could differ materially. In the highly unlikely event of an early termination of the

TRA (e.g., a default by the Company or a Change of Control) the Company is required to pay to each holder of the TRA an

early termination payment equal to the discounted present value of all unpaid TRA payments. The Company has not made,

and is not likely to make, an election for an early termination. We expect to fund future TRA payments with tax

distributions from the LLC that come from cash on hand and cash generated from operations.


(in thousands)	Exchange Tax Attributes	Pre-IPO M&A Tax Attributes	TRA Payment Tax Attributes	TRA Liabilities
Balance at December 31, 2023	$194,668	$85,814	$78,416	$358,898
Exchange of LLC Common Units	68,931	5,287	21,365	95,583
Accrued interest	—	—	646	646
Balance at September 30, 2024	$263,599	$91,101	$100,427	$455,127

Total expected estimated tax savings from each of the tax attributes associated with the TRA as of September 30, 2024,

were $535.4 million consisting of (i) Exchange Tax Attributes of $310.1 million, (ii) Pre-IPO M&A Tax Attributes of

$107.2 million, and (iii) TRA Payment Tax Attributes of $118.1 million. The Company will retain the benefit of 15% of

these cash savings.

Comparison of Cash Flows for the Nine Months Ended September 30, 2024 and 2023

Cash and cash equivalents decreased $519.2 million from $754.4 million at September 30, 2023, to $235.2 million at

September 30, 2024. A summary of the Company’s cash flows provided by and used for continuing operations from

operating, investing, and financing activities is as follows:

Cash Flows From Operating Activities

Cash flows provided by operating activities for the nine months ended September 30, 2024, were $255.2 million, an

increase of $4.9 million compared to the nine months ended September 30, 2023. This increase in cash flows provided by

operating activities was driven by an increase in Net income of $51.4 million, an increase of $18.6 million in Amortization,

and an increase of $16.3 million in Prepaid and deferred compensation expense offset by the change in Other current and

non-current assets and Other current and non-current accrued liabilities of $84.3 million and Deferred income tax expense

(benefit) decline of $34.4 million. The change in Other current and non-current accrued liabilities was primarily driven by

an increase in acquisition contingent consideration payments. The change in Deferred income tax expense (benefit) was

driven by $20.7 million of Deferred income tax expense from reorganization related to the CCR subsequent to the Socius

acquisition in the third quarter of 2023 and $10.9 million of Deferred income tax benefit recognized as a result of Equity-

based compensation award vesting recognized in the third quarter of 2024.

Cash Flows From Investing Activities

Cash flows used for investing activities during the nine months ended September 30, 2024, were $1,286.4 million, an

increase of $904.5 million compared to the $381.9 million of cash flows used for investing activities during the nine

months ended September 30, 2023. The main driver of the cash flows used for investing activities in the nine months ended

September 30, 2024 was $1,256.7 million for Business combinations - net of cash acquired and cash held in a fiduciary

capacity and $29.7 million of Capital expenditures, compared to $366.1 million for Business combinations - net of cash

acquired and cash held in a fiduciary capacity and $16.0 million of Capital expenditures for the nine months ended

September 30, 2023.

Cash Flows From Financing Activities

Cash flows provided by financing activities during the nine months ended September 30, 2024, were $625.3 million, an

increase of $657.3 million compared to cash flows used in financing activities of $32.0 million during the nine months

ended September 30, 2023. The main drivers of cash flows provided by financing activities during the nine months ended

September 30, 2024 were Proceeds from Senior Secured Notes of $595.2 million, Proceeds from term debt of $107.6

million, and Net change in fiduciary liabilities of $90.7 million offset by Dividends paid to Class A common shareholders

of $66.5 million, Tax distributions to non-controlling LLC Unitholders of $65.8 million, Debt issuance costs paid of $16.8

million, Distributions to non-controlling LLC Unitholders of $16.8 million, Repayment of term debt of $8.3 million, and

Payment of accrued return on Ryan Re preferred units of $2.0 million. The main drivers of cash flows used in by financing

activities during the nine months ended September 30, 2023, were Tax distributions to non-controlling LLC Unitholders of

$52.6 million, Repayment of term debt of $12.4 million, and the Payment of contingent consideration of $4.5 million offset

by the Net change in fiduciary liabilities of $36.8 million.

Contractual Obligations and Commitments

Our principal commitments consist of contractual obligations in connection with investing and operating activities. These

obligations are described within “Note 7, Debt” in the notes to our unaudited consolidated financial statements, where we

provide further description on provisions that create, increase, or accelerate obligations, or other pertinent data to the extent

necessary for an understanding of the timing and amount of the specified contractual obligations.

Within Current accrued compensation and Non-current accrued compensation we have various long-term incentive

compensation agreements accrued for. These agreements are typically associated with an acquisition. Below we have

outlined the liabilities accrued as of September 30, 2024, the projected future expense, and the projected timing of future

cash outflows associated with these arrangements.


Long-term Incentive Compensation Agreements
(in thousands)	September 30, 2024
Current accrued compensation	$6,452
Non-current accrued compensation	15,649
Total liability	$22,101
Projected future expense	22,660
Total projected future cash outflows	$44,761


Projected Future Cash Outflows
(in thousands)
2024	$—
2025	9,701
2026	2,715
2027	18,390
Thereafter	$13,955

Within “Note 3, Mergers and Acquisitions” in the notes to our unaudited consolidated financial statements we discuss

various contingent consideration arrangements and their impact. Below we have outlined the liabilities accrued as of

September 30, 2024, the projected future expense, and the projected timing of future cash outflows associated with these

contingent consideration agreements.


Contingent Consideration
(in thousands)	September 30, 2024
Current accounts payable and accrued liabilities	$44,161
Other non-current liabilities	105,970
Total liability	$150,131
Projected future expense	19,383
Total projected future cash outflows	$169,514


Projected Future Cash Outflows
(in thousands)
2024	$—
2025	45,635
2026	1,826
2027	122,053
Thereafter	$—

Critical Accounting Policies and Estimates

The methods, assumptions, and estimates that we use in applying the accounting policies may require us to apply

judgments regarding matters that are inherently uncertain. We consider an accounting policy to be a critical estimate if (i)

the Company must make assumptions that were uncertain when the judgment was made and (ii) changes in the estimate

assumptions, or selection of a different estimate methodology, could have a significant impact on our financial position and

the results that we will report in the consolidated financial statements. While we believe that the estimates, assumptions,

and judgments are reasonable, they are based on information available when the estimate was made. The accounting

policies that we believe reflect our more significant estimates, judgments, and assumptions that are most critical to

understanding and evaluating our reported financial results are: revenue recognition, business combinations, goodwill and

intangibles, income taxes, and tax receivable agreement liabilities.

Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial

Condition and Results of Operations—Critical Accounting Policies” in the Annual Report on Form 10-K for the year

ended December 31, 2023, filed with the SEC on February 28, 2024. Additionally, the changes, if any, to our critical

accounting policies and estimates disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023, are

included in “Note 1, Basis of Presentation,” to our unaudited consolidated financial statements.

Recent Accounting Pronouncements

For a description of recently adopted accounting pronouncements and recently issued accounting standards not yet adopted

(if any), see “Note 1, Basis of Presentation” in the notes to our unaudited consolidated financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are exposed to various market risks in our day-to-day operations. Market risk is the potential loss arising from adverse

changes in market rates and prices, such as interest and foreign currency exchange rates.

Foreign Currency Risk

For the nine months ended September 30, 2024, approximately 4% of revenues were generated from activities in the

United Kingdom, Europe, and Canada. We are exposed to currency risk from the potential changes between the exchange

rates of the US Dollar, Canadian Dollar, British Pound, Euro, Swedish Krona, Danish Krone, and other European

currencies. The exposure to foreign currency risk from the potential changes between the exchange of USD and other

currencies is immaterial.

Interest Rate Risk and Credit Risk

Certain of the Company’s revenues, expenses, assets, and liabilities are exposed to the impact of interest rate changes.

Interest rate risk and credit risk to counterparties generated from the Company’s Cash and cash equivalents, and Cash and

cash equivalents held in a fiduciary capacity, will fluctuate with the general level of interest rates.

As of September 30, 2024, we had $1,700.0 million of outstanding principal on our Term Loan borrowings, which bears

interest on a floating rate, subject to a 0.0% floor. We are subject to Adjusted Term SOFR interest rate changes and

exposure in excess of the floor. The fair value of the Term Loan approximates the carrying amount as of September 30,

2024 and December 31, 2023, as determined based upon information available.

On April 7, 2022, the Company entered into an interest rate cap agreement to manage its exposure to interest rate

fluctuations related to the Company’s Term Loan for an upfront cost of $25.5 million. The interest rate cap has a $1,000.0

million notional amount, 2.75% strike, and terminates on December 31, 2025.

Based on the below balances as of September 30, 2024, the impact of a hypothetical 100 basis point (BPS) increase or

decrease in quarter-end prevailing short-term interest rates for one year would be:


(in thousands)	Balance at September 30, 2024	100 BPS Increase	100 BPS Decrease
Cash and cash equivalents	$235,199	$(2,352)	$2,352
Term Loan principal outstanding (1)	1,700,000	17,000	(17,000)
Interest rate cap notional amount (2)	1,000,000	(10,000)	10,000
Net exposure to Interest expense, net		$4,648	$(4,648)

Cash and cash equivalents held in a fiduciary capacity	1,120,900	11,209	$(11,209)
Net exposure to Fiduciary investment income		$11,209	$(11,209)

Impact to Net income		$6,561	$(6,561)

(1)To the extent SOFR falls below 0.0%, the impact of the change in interest rates is zero.

(2)To the extent interest rates fall below 2.75%, the impact of the change in interest rates is zero.

In addition to interest rate risk, our cash investments and fiduciary cash holdings are subject to potential loss of value due

to counterparty credit risk. To minimize this risk, the Company and its subsidiaries hold funds pursuant to an investment

policy approved by our Board. The policy mandates the preservation of principal and liquidity and requires broad

diversification with counter-party limits assigned based primarily on credit rating and type of investment. The Company

carefully monitors its cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity, and plans to

further restrict the portfolio as appropriate with respect to market conditions. The majority of Cash and cash equivalents

and Cash and cash equivalents held in a fiduciary capacity are held in demand deposit accounts and short-term investments,

consisting principally of AAA-rated money market funds and treasury bills, having original maturities of 90 days or less.

Other financial instruments consist of Cash and cash equivalents, Commissions and fees receivable – net, Other current

assets, and Accounts payable and accrued liabilities. The carrying amounts of Cash and cash equivalents, Commissions and

fees receivable – net, and Accounts payable and accrued liabilities approximate fair value because of the short-term nature

of the instruments.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Securities

Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that

information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is

recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure

controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that

information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is

accumulated and communicated to our management, including our principal executive and principal financial officers, as

appropriate, to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive

officer and principal financial officer have concluded that as of September 30, 2024, our disclosure controls and procedures

were effective at the reasonable assurance level.

Changes in Internal Control

There have been no changes in internal control over financial reporting during the quarter ended September 30, 2024, that

have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations of Internal Control Over Financial Reporting

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives as

specified above. Management does not expect, however, that our disclosure controls and procedures will prevent or detect

all errors and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and

can provide only reasonable, not absolute, assurance that its objectives will be met. 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.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we may be involved in various legal proceedings and subject to claims that arise in the ordinary course

of business. Although the results of litigation and claims are inherently unpredictable and uncertain, we are not presently a

party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken

together have a material adverse effect on our business, operating results, cash flows or financial condition.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed under the heading “Risk Factors” in our annual report on

Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 28, 2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER

PURCHASES OF EQUITY SECURITIES

In connection with the acquisition of minority interests held in subsidiaries of Ryan Specialty Underwriting Managers

International Limited (f/k/a Castel Underwriting Agencies Limited), the Company issued (1) 98,553 shares of the

Company’s Class A common stock on September 13, 2024, to certain of the minority interest holders at a volume weighted

average price of $64.46 per share and (2) 10,403 shares of the Company’s Class A common stock on September 20, 2024,

to certain of the minority interest holders at a volume weighted average price of $63.73 per share. The issuance was made

in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities

Act”) set forth in Regulation D promulgated under the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Insider Trading Arrangements and Policies

During the quarter ended September 30, 2024, (i) Mark Katz, Executive Vice President, General Counsel and Corporate

Secretary, adopted a “Rule 10b5-1 trading arrangement” (as such term is defined in Item 408(a) of Regulation S-K)

intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a “10b5-1 Plan”) on

September 14, 2024 to sell up to 30,000 shares of the Company’s Class A common stock that are either held directly or

issuable upon conversion of LLC common units, between the first potential sale date on December 13, 2024 and the

expiration of his 10b5-1 Plan on March 31, 2025 and (ii) Nicholas Cortezi, a Director, adopted a 10b5-1 Plan on September

14, 2024 to sell up to 500,000 shares of the Company’s Class A common stock issuable upon conversion of LLC common

units between the first potential sale date on December 13, 2024 and the expiration of his 10b5-1 Plan on August 15, 2025.

Item 6. Exhibits

The following is a list of all exhibits filed or furnished as part of this report:


Exhibit Number		Description

3.1		Amended and Restated Certificate of Incorporation of the Ryan Specialty Holdings, Inc., dated July 21, 2021 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on July 27, 2021).

3.2		Certificate of Amendment to Amended and Restated Certificate of Incorporation of Ryan Specialty Holdings, Inc., dated June 3, 2022 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on June 8, 2022).

3.3		Amended and Restated Bylaws of Ryan Specialty Holdings, Inc., dated July 21, 2021 (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K filed on June 8, 2022).

4.1		Registration Rights Agreement, dated July 26, 2021, by and among Ryan Specialty Holdings, Inc., and the other signatories party thereto (incorporated by reference to Exhibit 4.1 to the Registrant’s Form 8-K filed on July 27, 2021).

4.2		Indenture, dated as of February 3, 2022, by and among Ryan Specialty, LLC, the guarantors party thereto and U.S. Bank National Association as trustee and as notes collateral agent (incorporated by reference to Exhibit 4.1 to the Registrant’s Form 8-K filed on February 7, 2022).

4.3		Form of 4.375% Senior Secured Notes due 2030 (incorporated by reference to Exhibit A to Exhibit 4.1 to the Registrant’s Form 8-K filed on February 7, 2022).

4.4		Indenture, dated as of September 19, 2024, by and among Ryan Specialty, LLC, the guarantors party thereto and U.S. Bank National Association as trustee and as notes collateral agent (incorporated by reference to Exhibit 4.1 to the Registrant’s Form 8-K filed on September 19, 2024).

4.5		Form of 5.875% Senior Secured Notes due 2032 (incorporated by reference to Exhibit A to Exhibit 4.1 to the Registrant’s Form 8-K filed on September 19, 2024).

10.1		Amended and Restated Tax Receivable Agreement, dated as of August 9, 2022, by and among Ryan Specialty Holdings, Inc., and the other signatories party thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed on August 12, 2022).

10.2		Eighth Amended and Restated Limited Liability Company Agreement of Ryan Specialty, LLC, dated as of July 5, 2023, by and among Ryan Specialty, LLC, and the other signatories party thereto, (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed on November 03, 2023).

10.3		Form of Director and Officer Indemnification Agreement, by and among Ryan Specialty Holdings, Inc., and the other signatories party thereto (incorporated by reference to Exhibit 10.4 to the Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on June 21, 2021).

10.4		Indemnification Agreement, by and among Ryan Specialty Holdings, Inc., and Patrick G. Ryan, dated as of July 26, 2021 (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 8-K filed on July 27, 2021).

10.5		Director Nomination Agreement, dated as of July 26, 2021, by and among Ryan Specialty Holdings, Inc., and the other signatories party thereto (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8- K filed on July 27, 2021).

10.6		Ryan Specialty Holdings, Inc. 2021 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.7 to the Registrant’s Quarterly Report on Form 10-Q filed on August 12, 2022).

10.7		First Amendment to the Ryan Specialty Holdings, Inc. 2021 Omnibus Incentive Plan, (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 10-K filed on March 1, 2023).

10.8		Ryan Specialty Holdings, Inc. Form of Class C Common Incentive Unit Grant Agreement (Staking Unit) (incorporated by reference to Exhibit 10.6 to the Registrant’s Registration Statement on Form S-8 filed on July 23, 2021).


10.9		Ryan Specialty Holdings, Inc. Form of Class C Common Incentive Unit Grant Agreement (Reload Unit) (incorporated by reference to Exhibit 10.7 to the Registrant’s Registration Statement on Form S-8 filed on July 23, 2021).

10.10		Ryan Specialty Holdings, Inc. Form of Common Unit Grant Agreement (incorporated by reference to Exhibit 10.8 to the Registrant’s Registration Statement on Form S-8 filed on July 23, 2021).

10.11		Ryan Specialty Holdings, Inc., Form of Restricted Stock Unit Agreement (Non-Employee Directors) (incorporated by reference to Exhibit 10.15 to the Registrant’s Form 10-K filed on March 16, 2022).

10.12		Ryan Specialty Holdings, Inc. Form of Restricted LLC Unit Agreement (2022), (incorporated by reference to Exhibit 10.11 to the Registrant’s Form 10-K filed on February 28, 2024).

10.13		Ryan Specialty Holdings, Inc. Form of Class C Common Incentive Unit Grant Agreement (PSI Units), (incorporated by reference to Exhibit 10.12 to the Registrant’s Form 10-K filed on February 28, 2024).

10.14		Ryan Specialty Holdings, Inc. Form of Performance-Based Restricted Stock Unit Agreement (DELTA PSUS), (incorporated by reference to Exhibit 10.14 to the Registrant’s Form 10-Q filed on May 30, 2024).

10.15		Ryan Specialty Holdings, Inc. Form of Performance-Based Restricted LLC Unit Agreement (DELTA PLUS), (incorporated by reference to Exhibit 10.15 to the Registrant’s Form 10-K filed on February 28, 2024).

10.16		Seventh Amendment to the Credit Agreement, dated September 13, 2024, including Exhibit A, a conformed copy of the Credit Agreement, dated as of September 1, 2020, among Ryan Specialty, LLC and JPMorgan Chase Bank, N.A., as administrative agent and the other lenders party thereto, as amended March 30, 2021, July 26, 2021, August 13, 2021, April 29, 2022, January 19, 2024, July 30, 2024 and September 13, 2024, filed herewith.

10.17		Third Amended and Restated Limited Liability Company Operating Agreement of New Ryan Specialty, LLC, dated as of July 5, 2023, by and among New Ryan Specialty, LLC, and the other signatories party thereto, (incorporated by reference to Exhibit 10.20 to the Registrant’s Quarterly Report on Form 10-Q filed on November 03, 2023).

10.18		First Amendment to the Third Amended and Restated Limited Liability Company Operating Agreement of New Ryan Specialty, LLC, dated as of April 30, 2024, by and among New Ryan Specialty, LLC, and the other signatories party thereto, (incorporated by reference to Exhibit 10.18 to the Registrant’s Quarterly Report on Form 10-Q filed on August 02, 2024).

10.19		Ryan Specialty Group Services, LLC Executive Severance Plan, (incorporated by reference to Exhibit 10.15 to the Registrant’s Form 10-K filed on February 28, 2024).

31.1		Certification of the Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.

31.2		Certification of the Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.

32.1*		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, filed herewith.

32.2*		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, filed herewith.

97.1		Clawback Policy Pursuant to Rule 10D-1 under the Exchange Act, (incorporated by reference to Exhibit 97.1 to the Registrant’s Form 10-K filed on February 28, 2024).

101.INS		Inline XBRL (Extensible Business Reporting Language) Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*The certifications furnished in Exhibit 32.1 and Exhibit 32.2 hereto are deemed to accompany this Quarterly Report on

Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as

amended, except to the extent that the registrant specifically incorporates it by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this

report to be signed on its behalf by the undersigned thereunto duly authorized.


	RYAN SPECIALTY HOLDINGS, INC. (Registrant)

Date: October 30, 2024	By:	/s/ Janice M. Hamilton

		Janice M. Hamilton
		Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

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Ryan Specialty (RYAN) 10-Q2024 Q3 Quarterly report

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