Priority Technology Holdings Inc

15. Segment Information

The Company'sthree reportable segments included SMB Payments, B2B Payments and Enterprise Payments:

•SMB Payments: Provides full-service acquiring and payment-enabled solutions for B2C transactions, leveraging Priority's proprietary software platform, distributed through ISO, direct sales and vertically focused ISV channels.

•B2B Payments: Provides market-leading AP automation solutions to corporations, software partners and industry leading FIs (including Citibank, Visa and Mastercard) in addition to improving cash flows by providing instant access to working capital.

•Enterprise Payments: Provides embedded finance and BaaS solutions to customers to modernize legacy platforms and accelerate software partners' strategies to monetize payments.

Corporate includes costs of corporate functions and shared services not allocated to our reportable segments.

The Company's chief operating decision makers ("CODM") are our CEO and CFO. Historically, the CODM used operating income (loss) as the measure of segment profit or loss to allocate resources. However, during the quarter ended June 30, 2024, the segment performance measure was updated to adjusted earnings before interest expense, income tax and depreciation and amortization expenses ("Adjusted EBITDA") to have consistent measure of results across the organization.

Adjusted EBITDA represents EBITDA (i.e. earnings before interest, income tax, and depreciation and amortization expenses) adjusted for certain non-cash costs, such as stock-based compensation and the write-off of the carrying value of investments or other assets, as well as debt extinguishment and modification expenses and other expenses and income items considered non-recurring, such as acquisition integration expenses, certain professional fees, and litigation settlements.

Segment level assets information is not provided or subject to review by the CODM and therefore not provided.

Due to the recent acquisitions, growth, implementation of a shared services model and management of a single unified commerce engine across our payments infrastructure, the costs of operating overhead and shared services became less identifiable at the segment level. Therefore, the process of review of the CODM was updated during the quarter ended June 30, 2024. Operating overhead and shared costs are managed centrally and included in the corporate segment. All comparative periods have been recasted to reflect this update.

Information on reportable segments and reconciliations to income before income taxes are as follows:

(1)The significant expense categories and amounts align with the segment level information regularly provided to the CODM.

(2)Other operating expenses including salary and employee benefits, and selling, general and administrative expenses.

(3)Other segment items for each reportable segment include other income, net, intersegment revenue and stock based compensation expense.

(4)Adjustment for corporate items include:

(5)Other items include other income net, stock based compensation expense, and selling general and administrative (non-recurring expense)

(1)The significant expense categories and amounts align with the segment level information regularly provided to the CODM.

(2)Other operating expenses including salary and employee benefits, and selling, general and administrative expenses.

(3)Other segment items for each reportable segment include other income, net, intersegment revenue and stock based compensation expense.

(4)Adjustment for corporate items include:

(5)Other items include other income net, stock based compensation expense, and selling general and administrative (non-recurring expense)