Priority Technology Holdings, Inc. Completes Acquisition of Finxera to Create the Premier Payments and Banking as a Service Platform

Combined Pro Forma 2021 Revenue of $547 to $570 Million and Combined Pro Forma Adjusted EBITDA of $131 to $136 Million Before Synergies

Priority Technology Holdings, Inc. (PRTH), a leading payments technology company helping customers collect, store and send money, announced that it has completed the acquisition of Finxera Holdings, Inc. (“Finxera”), a pioneer in the fintech industry that launched and operated one of the first Banking as a Service (“BaaS”) platforms.

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“With the completion of the Finxera acquisition, we now have the premier platform to collect, store and send money with a full breadth of payment and virtual banking capabilities. The Priority suite of services is truly unique and differentiated as Priority becomes one of a handful of companies with nationwide money transmitter licensing that allows us to act as a fully licensed custodian of funds for consumers and enterprises,” said Tom Priore, Chairman and Chief Executive Officer of Priority.  “The adoption of banking and payments across our diverse revenue divisions has already begun. Our complete offering of payment authorization, settlement, account ledgering and disbursement of funds sets us apart from traditional merchant acquirers and delivers on our customers’ increasing demands for one-stop payment and banking solutions. Backed by the industry’s premier payments and BaaS platform, Priority is extremely well positioned to compete and drive long-term value for our shareholders.”

Finxera shareholders, including funds managed by Stone Point Capital LLC (“Stone Point“) and members of the Finxera management team, will retain meaningful equity positions in Priority.  Sanj Goyle, Finxera’s Founder and CEO and Praveer Kumar, Finxera’s Co-Founder and CTO, will be assuming prominent roles with Priority. “We’ve been working closely together for well over a year and we’re quite far along in the process of becoming one company. Our teams share a combined desire to become the world’s premier partner for payments and banking services and are excited to leverage our combined assets into new and exciting verticals,” said Goyle.

Priore concluded, “Sanj and Praveer’s strong leadership and Stone Point’s ongoing support of Priority provides meaningful depth to our organization as we continue to execute on our strategy to be a major force in powering payments.”

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Pro-Forma Highlights

Based on forecasted 2021 financial results of Priority and Finxera, the pro forma full year 2021 results of the combined company, before synergies, are expected to be:

• Revenue of $547 to $570 million
• Adjusted EBITDA of $131 to $136 million
• Free cash flow (adjusted EBITDA less cash outflows for interest, taxes, capital expenditures, and dividends) of $62 to $65 million
• Net leverage ratio below 4.25x

Use of Non-GAAP Financial Information

Priority supplements its consolidated financial statements presented on a GAAP basis with certain non-GAAP financial information, including adjusted EBITDA, free cash flow and net leverage ratio, to provide investors with greater insight, increase transparency and allow for a more comprehensive understanding of the information used by management in its financial and operational decision-making. Priority has not provided a reconciliation of the expected adjusted EBITDA, free cash flow or net leverage ratio contribution by Finxera to the comparable GAAP measures because it is unable to quantify certain amounts that would be required to be included in Finxera’s contribution to such comparable measures without unreasonable efforts due to the unavailability of the information needed to calculate reconciling items. In addition, Priority believes such reconciliation would imply a degree of precision that would be confusing or misleading to investors. The non-GAAP financial measures disclosed by Priority in this press release should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP, and the financial results prepared in accordance with GAAP and reconciliations from these results should be carefully evaluated.

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