Priority Technology Holdings, Inc 10-K for FY2022

Priority Technology Holdings, Inc. (PRTH)

10-K 2023-03-23 For: 2022-12-31

Added on April 12, 2026

About this 10-K

Priority Technology Holdings, Inc filed this 10-K on March 23, 2023, covering the fiscal year ended December 31, 2022 (FY2022).

Headline figures

Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $663.64M; up 28.9% from $514.9M a year earlier
Net loss: $2.15M; compared with net income of $1.39M a year earlier
Diluted EPS: -$0.50; compared with -$0.34 a year earlier

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Delaware		47-4257046
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2001 Westside Parkway
Suite 155
Alpharetta,	Georgia	30004
(Address of principal executive offices)		(Zip Code)


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐


			Page
Cautionary Note Regarding Forward-Looking Statements and Terms Used in the Annual Report on Form 10-K			1
Commonly Defined Terms			3
Part I.	Item 1.	Business	5
	Item 1A.	Risk Factors	16
	Item 1B.	Unresolved Staff Comments	27
	Item 2.	Properties	27
	Item 3.	Legal Proceedings	27
	Item 4.	Mine Safety Disclosures	27
Part II.	Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	28
	Item 6.	Reserved	28
	Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	29
	Item 7A.	Qualitative and Quantitative Disclosure About Market Risk	37
	Item 8.	Financial Statements and Supplementary Data	38
		Notes to Consolidated Financial Statements	47
	Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	90
	Item 9A.	Controls and Procedures	90
	Item 9B.	Other Information	91
Part III.	Item 10.	Directors, Executive Officers and Corporate Governance	92
	Item 11.	Executive Compensation	92
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	92
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	92
	Item 14.	Principal Accounting Fees and Services	92
Part IV.	Item 15.	Exhibits, Financial Statement Schedules	93
	Item 16.	Form 10-K Summary	95

Signatures			96


Term						Definition
2018 Plan						Priority Technology Holdings, Inc. 2018 Equity Incentive Plan
2021 Stock Purchase Plan						Priority Technology Holdings, Inc. 2021 Employee Stock Purchase Plan
2021 Share Repurchase Program						Priority Technology Holdings, Inc. 2021 Share Repurchase Program
2022 Share Repurchase Program						Priority Technology Holdings, Inc. 2022 Share Repurchase Program
ACH						Automated clearing house
AML						Anti-money laundering
AP						Accounts payable
API						Application program interface
ASC						Accounting Standards Codification
ASU						Accounting Standards Update
ATI						Adjusted taxable income
B2B						Business-to-business
B2C						Business-to-consumer
BSA						Bank Secrecy Act of 1970, as amended by the USA Patriot Act of 2001
CARES Act						Coronavirus Aid, Relief, and Economic Security Act
CCPA						California Consumer Protection Act
CEO						The Company's Chairman and Chief Executive Officer
Common Stock						The Company's Common Stock, par value $.001
the Company						Priority Technology Holdings, Inc. and Subsidiaries
Credit Agreement						Credit and Guaranty Agreement dated April 27, 2021, by and between the Company and Truist Bank
CRM						Customer relationship management
Delayed Draw Term Loan						Delayed draw term loan facility under the credit agreement
Dodd-Frank Act						Dodd Frank Wall Street Reform and Consumer Protection Act of 2010
EBITDA						Earnings before interest, taxes, depreciation, and amortization
Electronic Payments						Payments with credit, debit and prepaid cards
EPS						Earnings (loss) per share
ESPP						Employee stock purchase plan
Exchange Act						Securities Exchange Act of 1934
EGC						Emerging Growth Company
FASB						Financial Accounting Standards Board
FBO						For the benefit of
FCA						United Kingdom's Financial Conduct Authority
FCRA						Fair Credit Reporting Act
Federal Reserve Board						Governors of the Federal Reserve System
FDIC						Federal Deposit Insurance Corporation
FFIEC						Federal Financial Institutions Examination Council
FI						Financial institution
FIFO						First in, first out
FinCEN						Financial Crimes Enforcement Network


Finxera						Finxera Holdings, Inc.
FSOC						Financial Stability Oversight Council
GAAP						United States Generally Accepted Accounting Principles
Initial Term Loan						A senior secured first lien term loan facility in an aggregate principal amount of $300,000,000
IRA						Inflation Reduction Act
ISO						Independent sales organization
ISV						Independent software vendors
IT						Information technology
LIBOR						London Interbank Offered Rate
LIFO						Last in, first out
LLC						Limited Liability Company
Nasdaq						National Association of Securities Dealers Automated Quotations
NCI						Non-controlling interests
OFAC						Office of Foreign Assets Control
PHOT						Priority Hospitality Technology, LLC
PIK						Payment-in-kind
POS						Point-of-sale
PRET						Priority Real Estate Technology, LLC
PRTH						Priority Technology Holding's Nasdaq Capital Market trading symbol
Redeemable NCI's						Redeemable non-controlling preferred equity interests
ROU Asset						Right of use asset
RSU						Restricted stock units
SaaS						Software as a Service
SAR						Stock appreciation rights
SEC						Securities and Exchange Commission
SMB						Small and medium-sized businesses
SMS						Short message service
SEC						Securities and Exchange Commission
SOFR						Secured Overnight Financing Rate
SRC						Smaller reporting company
Tax Act						The Housing Assistance Tax Act of 2008
TCPA						Federal Telephone Consumer Protection Act of 1991
Term Facility						$620.0 million senior secured term loan facility issued under the Credit Agreement (including $320 million delayed draw facility).
Total Net Leverage Ratio						The ratio of consolidated total debt to the Consolidated Adjusted EBITDA (as defined in the Credit Agreement).
Total Preferred Equity Interest						up to $4.5 million of profits earned by PHOT, plus a preferred yield (6.0% per year)
Truist						Truist Bank
TSP						Technology service provider
U.S.						United States
VARs						Value-added resellers


Period	Number of securities to be issued upon exercise of outstanding options, warrants and rights(1)	Weighted-average exercise price of outstanding options, warrants and rights(2)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in the first column)
Equity Compensation Plans approved by security holders	2,689,353	$	6.88	3,505,286
Equity Compensation Plans not approved by security holders	—	$	—	—


Period	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
October 1-31, 2022	154,356	$	4.62	121,593	872,489
November 1-30, 2022	177,508	$	5.40	165,586	706,903
December 1-31, 2022	201,087	$	5.43	16,277	690,626
Total	532,951			303,456


(in thousands)	Years Ended December 31,				2022 vs 2021
	2022		2021			$ Change
Revenue Type:
Merchant card fees	$	553,037	$	468,764		$	84,273
Money transmission services	71,536		19,415			52,121
Outsourced services and other services	29,627		21,033			8,594
Equipment	9,441		5,689			3,752
Total revenues	$	663,641	$	514,901		$	148,740


			Page
Report of Independent Registered Public Accounting Firm			39
Consolidated Balance Sheets as of December 31, 2022 and December 31, 2021			41
Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020			42
Consolidated Statements of Changes in Stockholders' Deficit for the years ended December 31, 2022, 2021 and 2020			42
Consolidated Statements of Cash Flows for the years ended December 31, 2022, 2021 and 2020			44
Notes to Consolidated Financial Statements:			47
1. Nature of Business and Significant Accounting Policies			47
2. Acquisitions			59
3. Disposal of Business			62
4. Revenues			63
5. Settlement Assets and Customer/Subscriber Account Balances and Related Obligations			65
6. Notes Receivable			66
7. Property, Equipment and Software			67
8. Goodwill and Other Intangible Assets			68
9. Leases			70
10. Accounts Payable and Accrued Expenses			72
11. Debt Obligations			72
12. Redeemable Senior Preferred Stock and Warrants			74
13. Income Taxes			77
14. Stockholders' Deficit			79
15. Stock-based Compensation			80
16. Employee Benefit Plans			84
17. Related Party Transactions			84
18. Commitments and Contingencies			85
19. Fair Value			86
20. Segment Information			87
21. (Loss) Earnings per Common Share			89


Description of the Matter			Accrued residual commissions recorded by the Company and included on the Consolidated Balance Sheet were $35.9 million at December 31, 2022, and residual commission expenses included within costs of services on the Consolidated Statement of Operations were $383.5 million for the year ended December 31, 2022. As discussed in Note 1 of the consolidated financial statements, the Company accrues and pays commission expense for certain customer services and other services provided by its independent sales organizations (ISOs). Commissions are based on a percentage of the net revenues generated from the Company’s merchant customers, and these percentages vary based on the program type and transaction volume of each merchant. Auditing residual commissions was complex due to the non-standard nature of the pricing terms within the ISO contracts, the volume of contracts, the volume of transactions processed each month, and the degree of auditor judgment needed to design the nature and extent of audit procedures to obtain sufficient audit evidence.

How We Addressed the Matter in Our Audit			To test accrued residual commissions and residual commission expenses, our audit procedures included, among others, testing the completeness and accuracy of the underlying data supporting the commission calculations and the accuracy of the calculations. We selected a sample of monthly ISO payments and, for each sample item, we compared the pricing terms included in the calculation to the respective ISO contract or other source documents, recalculated the related expense and accrual, and agreed the commission payment to evidence of cash disbursement. Additionally, for these monthly ISO payments, we selected a sample of merchant customers, obtained their monthly processing statements, which were generated by the Company’s third-party processors, and agreed the monthly payment volumes to the commission calculations.


	December 31, 2022		December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	18,454	$	20,300
Restricted cash	10,582		28,859
Accounts receivable, net of allowances of $1,143 and $555, respectively	78,113		58,423
Prepaid expenses and other current assets	11,832		15,807
Current portion of notes receivable, net of allowances of $0 and $0, respectively	1,471		272
Settlement assets and customer/subscriber account balances	532,018		479,471
Total current assets	652,470		603,132
Notes receivable, less current portion	3,191		105
Property, equipment and software, net	34,687		25,233
Goodwill	369,337		365,740
Intangible assets, net	288,794		340,211
Deferred income taxes, net	16,447		8,265
Other noncurrent assets	8,437		9,256
Total assets	$	1,373,363	$	1,351,942
Liabilities, Redeemable Senior Preferred Stock and Stockholders' Deficit
Current liabilities:
Accounts payable and accrued expenses	$	51,864	$	42,523
Accrued residual commissions	35,979		29,532
Customer deposits and advance payments	2,618		5,021
Current portion of long-term debt	6,200		6,200
Settlement and customer/subscriber account obligations	533,340		500,291
Total current liabilities	630,001		583,567
Long-term debt, net of current portion, discounts and debt issuance costs	598,926		604,105
Other noncurrent liabilities	11,643		18,349

Total liabilities	1,240,570		1,206,021
Commitments and contingencies (Note 18)
Redeemable senior preferred stock, net of discounts and issuance costs:
Redeemable senior preferred stock, $0.001 par value per share; 250,000 shares authorized; 225,000 issued and outstanding at December 31, 2022 and December 31, 2021	235,579		210,158
Stockholders' deficit:
Preferred stock, $0.001 par value per share; 100,000,000 shares authorized; none issued or outstanding at December 31, 2022 and December 31, 2021	—		—
Common Stock, $0.001 par value per share; 1,000,000,000 shares authorized; 78,385,685 and 77,460,312 shares issued at December 31, 2022 and December 31, 2021, respectively; and 76,044,629 and 76,739,896 shares outstanding at December 31, 2022 and December 31, 2021, respectively.	76		77
Treasury stock at cost, 2,341,056 and 720,416 shares at December 31, 2022 and December 31, 2021, respectively	(11,559)		(4,091)
Additional paid-in capital	9,650		39,835
Accumulated deficit	(102,208)		(100,058)
Total stockholders' deficit attributable to stockholders of PRTH	(104,041)		(64,237)
Non-controlling interest	1,255		—
Total stockholders' deficit	(102,786)		(64,237)
Total liabilities, redeemable senior preferred stock and stockholders' deficit	$	1,373,363	$	1,351,942


	Common Stock			Treasury Stock			Additional Paid-In Capital		Accumulated Deficit		Deficit Attributable to Stockholders		NCIs		Total
	Shares	$		Shares	$
January 1, 2020	67,061	$	68	451	$	(2,388)	$	3,651	$	(127,674)	$	(126,343)	$	5,654	$	(120,689)
Equity-classified stock-based compensation	—	—		—	—		2,118		—		2,118		—		2,118
Vesting of stock-based compensation	330	—		—	—		—		—		—		—		—
Redemption of NCI in subsidiary	—	—		—	—		—		—		—		(5,654)		(5,654)
Earnings attributable to redeemable and redeemed NCIs	—	—		—	—		—		—		—		45,398		45,398
Earnings distributed to redeemable and redeemed NCIs	—	—		—	—		—		—		—		(45,398)		(45,398)
Net income	—	—		—	—		—		25,661		25,661		—		25,661
December 31, 2020	67,391	$	68	451	$	(2,388)	$	5,769	$	(102,013)	$	(98,564)	$	—	$	(98,564)
Equity-classified stock-based compensation	—	—		—	—		2,888		—		2,888		—		2,888
Vesting of stock-based compensation	465	—		—	—		—		—		—		—		—
Liability-classified stock-based compensation converted to equity-classified	—	—		—	—		313		—		313		—		313
Issuance of Common Stock	7,551	7		—	—		34,381		—		34,388		—		34,388
Exercise of stock options	174	—		—	—		1,195		—		1,195		—		1,195
Fair value of NCI preferred units redemption, net of deferred tax benefit	—	—		—	—		(8,021)		—		(8,021)		—		(8,021)
Fair value of common shares issued for NCI redemption	1,428	2		—	—		9,962		—		9,964		—		9,964
Share repurchases and shares withheld of taxes	(269)			269	(1,703)				—		(1,703)		—		(1,703)
Warrants issued	—	—		—	—		11,357		—		11,357		—		11,357
Dividends on redeemable senior preferred stock	—	—		—	—		(16,164)		—		(16,164)		—		(16,164)
Accretion of unamortized issuance costs for redeemable senior preferred stock	—	—		—	—		(1,845)		—		(1,845)		—		(1,845)
Change in estimate of tax basis differences	—	—		—	—		—		566		566		—		566
Net income	—	—		—	—		—		1,389		1,389		—		1,389
December 31, 2021	76,740	$	77	720	$	(4,091)	$	39,835	$	(100,058)	$	(64,237)	$	—	$	(64,237)


Property, equipment and software			Estimated Useful Life
Furniture and fixtures			5 - 10 years
Equipment			3 - 8 years
Computer software			2 - 5 years
Leasehold improvements			3 - 10 years


Intangible Asset	Nature	Estimated Useful Life
ISO and Referral Partner Relationships	Acquired relationships with ISOs and referral partners	11 – 25 years
Residual Buyouts	Surrender of rights to receive commissions by ISOs	3 – 9 years
Customer Relationships	Acquired customer relationships	2 – 15 years
Merchant Portfolios	Acquired rights to a portfolio of merchants	5 – 10 years
Technology	Acquired proprietary software and website domains	7 – 10 years
Trade Names and Non-compete Agreements	Acquired trade names and non-compete agreements	5 – 12 years
Money Transmission Licenses	Acquired licenses to collect, store and send money in 46 U.S. states and two U.S. territories.	indefinite


(in thousands)
Consideration:
Cash	$	4,976
Amount withheld for inventory(1)	50
Total purchase consideration, inclusive of amount withheld for inventory	5,026
Fair value of class B shares issued in Ovvi(3)	1,255
Total enterprise value of business acquired(3)	$	6,281

Recognized amounts of assets acquired and liabilities assumed:
Accounts receivable	$	110
Inventory	142
Property, equipment and software, net	20
Goodwill(3)	3,989
Intangible assets(2)	2,021
Other non-current asset	152
Other non-current liability	(153)
Total enterprise value of business acquired(3)	$	6,281


(in thousands)	Years Ended December 31,				2022 vs 2021
	2022		2021			$ Change
Operating expenses
Cost of services (excludes depreciation and amortization)	$	436,753	$	359,885		$	76,868
Salary and employee benefits	65,077		43,818			21,259
Depreciation and amortization	70,681		49,697			20,984
Selling, general and administrative	34,965		28,408			6,557
Total operating expenses	$	607,476	$	481,808		$	125,668


(in thousands)	Years Ended December 31,						2022 vs 2021
	2022			2021				$ Change
Revenue	$	562,237		$	475,630			$	86,607
Operating expenses	507,371			422,746				84,625
Operating income	$	54,866		$	52,884			$	1,982
Operating margin	9.8		%	11.1		%
Depreciation and amortization	$	43,925		$	41,144			$	2,781
Key Indicators:
Merchant bankcard processing dollar value	$	59,440,491		$	53,411,622			$	6,028,869
Merchant bankcard transaction volume	636,576			578,102				58,474


(in thousands)	Years Ended December 31,						2022 vs 2021
	2022			2021				$ Change
Revenue	$	18,890		$	17,138			$	1,752
Operating expenses	18,682			17,003				1,679
Operating income	$	208		$	135			$	73
Operating margin	1.1		%	0.8		%
Depreciation and amortization	$	744		$	294			$	450
Key Indicators:
Merchant bankcard processing dollar value	$	526,812		$	323,502			$	203,310
Merchant bankcard transaction volume	304			220				84


(in thousands)	Years Ended December 31,						2022 vs 2021
	2022			2021				$ Change
Revenue	$	82,514		$	22,133			$	60,381
Operating expenses	51,577			15,370				36,207
Operating income	$	30,937		$	6,763			$	24,174
Operating margin	37.5		%	30.6		%
Depreciation and amortization	$	24,892		$	7,158			$	17,734
Key Indicators:
Merchant bankcard processing dollar value	$	1,760,518		$	52,376			$	1,708,142
Merchant bankcard transaction volume	2,779			549				2,230
Average number of billed clients	380,233			345,828				34,405


(in thousands, except per share amounts)	Years Ended December 31,
		2021		2020
Revenues		$	561,585	$	463,823
Operating income		$	21,619	$	32,548


(in thousands)
Gross cash consideration from buyer	$	180,000
Less working capital adjustment paid in cash	(584)
Net proceeds from buyer	179,416
Transaction costs incurred	(5,383)
Assets sold:
Intangible assets	(62,158)
Other assets sold, net of obligations assumed	(716)
Goodwill assigned to business sale	(2,683)
Other intangible assets	(1,237)
Pre-tax gain on sale of business	$	107,239


	Year Ended December 31, 2022
(in thousands)	Merchant Card Fees		Money Transmission Services		Outsourced and Other Services		Equipment		Total
Segment
SMB	$	549,646	$	—	$	3,150	$	9,441	$	562,237
B2B	3,391		—		15,499		—		18,890
Enterprise	—		71,536		10,978		—		82,514
Total revenues	$	553,037	$	71,536	$	29,627	$	9,441	$	663,641


	Year Ended December 31, 2021
(in thousands)	Merchant Card Fees		Money Transmission Services		Outsourced and Other Services		Equipment		Total
Segment
SMB	$	466,819	$	—	$	3,122	$	5,689	$	475,630
B2B	1,945		—		15,193		—		17,138
Enterprise	—		19,415		2,718		—		22,133
Total revenues	$	468,764	$	19,415	$	21,033	$	5,689	$	514,901


	Year Ended December 31, 2020
(in thousands)	Merchant Card Fees		Money Transmission Services		Outsourced and Other Services		Equipment		Total
Segment
SMB	$	364,163	$	—	$	2,465	$	3,893	$	370,521
B2B	1,795		—		19,127		—		20,922
Enterprise	11,388		—		1,511		—		12,899
Total revenues	$	377,346	$	—	$	23,103	$	3,893	$	404,342


(in thousands)
Year Ending December 31,
2023	$	1,471
2024	1,046
2025	907
2026	845
2027	393
Thereafter	—
Total	$	4,662


(in thousands)	Amount
Balance at January 1, 2021	106,832
C&H Financial Services, Inc. acquisition	13,804
Finxera acquisition	245,104
Balance at December 31, 2021	365,740
Final purchase price adjustment for Finxera	(392)
Ovvi acquisition	3,989
Balance at December 31, 2022	$	369,337


(in thousands, except weighted-average data)	December 31, 2022						Weighted-average Useful Life
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Other intangible assets:
ISO and referral partner relationships	$	175,300	$	(24,021)	$	151,279	14.8
Residual buyouts	132,325		(76,316)		56,009		6.6
Customer relationships	96,000		(83,298)		12,702		8.2
Merchant portfolios	76,423		(43,170)		33,253		6.7
Technology	50,963		(18,566)		32,397		8.4
Non-compete agreements	3,390		(3,390)		—		0.0
Trade names	3,183		(2,129)		1,054		11.6
Money transmission licenses(1)	2,100		—		2,100
Total gross carrying value	$	539,684	$	(250,890)	$	288,794	9.7


(in thousands)	Estimated Amortization Expense
Year Ending December 31,
2023	$	53,648
2024	35,872
2025	29,754
2026	28,939
2027	26,675
Thereafter	111,806
Total(1)	$	286,694


(in thousands, except weighted-average data)	Financial Statement Classification	December 31, 2022			December 31, 2021
Operating Lease ROU Assets:
Operating lease ROU Assets	Other noncurrent assets	$	4,593		$	6,262
Operating Lease Obligations:
Operating lease obligations - current	Accounts payable and accrued expenses	$	1,336		$	1,723
Operating lease obligations - noncurrent	Other noncurrent liabilities	4,110			5,596
Total operating lease obligations		$	5,446		$	7,319

Weighted-average remaining lease term in years		4.4			4.9
Weighted-average discount rate		6.9		%	6.9		%


(in thousands)
Year Ending December 31,	Amount Due
2023	$	1,704
2024	1,308
2025	1,188
2026	1,302
2027	958
Thereafter	—
Total future minimum lease payments	6,460
Amount representing interest	(1,014)
Total future minimum lease payments, net of interest	$	5,446


(in thousands)			Revolving Credit Facility
December 31,	Term Facility				Total Principal Due
2023	$	6,200	$	—	$	6,200
2024	6,200		—		6,200
2025	6,200		—		6,200
2026	6,200		12,500		18,700
2027	585,900		—		585,900

Total	$	610,700	$	12,500	$	623,200


	Twelve Months Ended December 31,
(in thousands)	2022		2021		2020
Interest expense(1)	$	53,554	$	36,485	$	44,839


(in thousands)	Year Ended December 31, 2022		Year Ended December 31, 2021
Dividends paid in cash(1)	$	16,800	$	7,460
Accumulated dividends accrued as part of the carrying value of redeemable senior preferred stock	16,794		8,704
Dividends declared	$	33,594	$	16,164


Redemption Date			Redemption Price
Prior to April 27, 2023			100% of liquidation preference (i.e., $1,000 per share) plus any accrued and unpaid dividends and the make-whole amount (i.e., present value of additional 2% of the liquidation preference plus any accrued and unpaid dividends thereon through the redemption date plus 102% of the amount of dividends that will accrue from the redemption date through April 27, 2023)
April 27, 2023 - April 26, 2024			102% of the sum of the (a) outstanding liquidation preference plus (b) any accrued and unpaid dividends through and including the applicable redemption date
April 27, 2024 and thereafter			100% of the sum of the (a) outstanding liquidation preference plus (b) any accrued and unpaid dividends through and including the applicable redemption date


(in thousands)	For the Years Ended December 31,
	2022		2021		2020
U.S. current income tax expense (benefit)
Federal	$	10,411	$	(2,321)	$	4,766
State and local	2,546		(379)		3,173
Foreign	349		1		—
Total current income tax (benefit) expense	$	13,306	$	(2,699)	$	7,939
U.S. deferred income tax expense (benefit)
Federal	$	(5,001)	$	(1,343)	$	3,875
State and local	(2,970)		(1,213)		(915)
Foreign	15		(3)		—
Total deferred income tax (benefit) expense	$	(7,956)	$	(2,559)	$	2,960
Total income tax expense (benefit)	$	5,350	$	(5,258)	$	10,899


	As of December 31,
(in thousands)	2022		2021
Deferred Tax Assets:
Accruals and reserves	$	1,510	$	1,751

Intangible assets	15,600		9,673
Net operating loss carryforwards	749		820
Interest limitation carryforwards	15,142		10,786
Other	4,107		3,332
Gross deferred tax assets	37,108		26,362
Valuation allowance	(15,462)		(10,781)
Total deferred tax assets	21,646		15,581
Deferred Tax Liabilities:
Prepaid assets	(1,101)		(1,191)
Investments in partnership	(41)		—
Property and equipment	(4,057)		(6,125)
Total deferred tax liabilities	(5,199)		(7,316)
Net deferred tax assets	$	16,447	$	8,265


(in thousands)
Balance as of January 1, 2022	$	537
Additions based on tax positions related to the current year	—
Additions based on positions of prior years	—
Reductions for tax positions of prior years	(66)
Reductions related to lapse of the applicable statutes of limitations	(169)
Settlements	—
Balance as of December 31, 2022	$	302


	Years Ended December 31,
in thousands, except share data, which is in whole units	2022		2021
Number of shares purchased(1)	1,309,374		162,715
Average price paid per share	$	4.42	$	5.87
Total Investment(1)	$	5,791	$	1,023






Common Stock available for issuance at January 1, 2020						4,796,176
Stock options granted						(15,000)
Stock options forfeited						220,045
RSUs granted						(1,031,740)
RSU granted with performance goals that have not been determined						(128,624)
RSUs forfeited						21,277
Common Stock available for issuance at December 31, 2020						3,862,134

Stock options forfeited						50,589
Stock options expired						53,870
RSUs granted						(711,987)
RSUs forfeited						1,957
Shares withheld for taxes(1)						106,477
Common Stock available for issuance at December 31, 2021						3,363,040
New shares authorized for issuance						2,500,000
Stock options forfeited						221,733
RSUs granted						(3,223,949)
RSUs forfeited						353,196
Shares withheld for taxes(1)						291,266
Common Stock available for issuance at December 31, 2022						3,505,286