Priority Technology Holdings, Inc.

11. Stock-based Compensation

Stock-based compensation expense, which is included in salary and employee benefits within the Unaudited Consolidated Statements of Operations and Comprehensive Income, was as follows:

Income tax expense for stock-based compensation wasimmaterial for the three and six months ended June 30, 2026. Income tax benefit for stock-based compensation was $0.1 million and $0.8 million, respectively, for the three and six months ended June 30, 2025. No stock-based compensation has been capitalized in any period presented. Awards granted during the three and six months ended June 30, 2026 and 2025, were not material.

2018 Plan

The Company's 2018 Plan initially provided for the issuance of up to 6,685,696 shares of the Company's Common Stock. On March 17, 2022, and February 5, 2026, the Company's Board of Directors unanimously approved amendments to the 2018 Plan which was subsequently approved by our shareholders to increase the numbers of shares authorized for issuance under the plan by 2,500,000 and 8,000,000 shares respectively, resulting in 17,185,696 shares of the Company's Common Stock authorized for issuance under the plan.

As of June 30, 2026, the Company had 9,224,615 shares available for issuance under the 2018 Plan.

2021 Employee Stock Purchase Plan

The 2021 Employee Stock Purchase Plan ("ESPP") provides for up to 200,000 shares to be purchased under the plan. Shares issued under the plan may be authorized but unissued or reacquired shares of Common Stock. All non-executive employees based in the United States who work more than 20 hours per week and have been employed by the Company for at least 30 days may participate in the ESPP.

Under the ESPP, participants are offered, on the first day of the offering period, the option to purchase shares of Common Stock at a discount on the last day of the offering period. The offering period shall be for a period of three months and the first offering period began on January 10, 2022. The ESPP provides eligible employees the opportunity to purchase shares of the Company's Common stock at 95% of the lesser of the fair value on the first and last trading day of each offering period. The ESPP was amended by shareholder approval on June 13, 2025, to increase the number of shares available by 200,000.

As of June 30, 2026, the Company had 156,437 shares available for issuance under the 2021 Stock Purchase Plan.

Non-voting Incentive Units

The Company issued non-voting incentive units to certain employees and partners inseven subsidiaries. These non-voting incentive units were determined to be equity and are accounted for under ASC 718, Compensation - Stock Compensation. The non-voting incentive units are either fully vested when granted, or vest according to the service period and/or performance measure noted in the grant agreement. As the non-voting incentive units are vested, they are recognized as NCI to the Company, who is the majority owner of the subsidiaries.