Corpay (CPAY) 10-K risk factor changes: FY2017 vs FY2016

We believe that in [removed: 2016,] [added: 2017,] approximately 13% our consolidated revenue was directly influenced by the absolute price of fuel.

Approximately [removed: 11%] [added: 10%] of our consolidated revenue in [removed: 2016] [added: 2017] was derived from transactions where our revenue is tied to fuel-price spreads.

We are subject to the credit risk of our [removed: customers,] [added: customers] which range in size from [removed: small,] [added: small] sole proprietorships to [removed: large,] [added: large] publicly traded companies.

We use various methods to screen potential customers and establish appropriate credit limits, but these methods cannot eliminate all potential credit risks and may not always prevent us from approving customer applications that are not [removed: credit worthy] [added: credit-worthy] or are fraudulently completed.

Our bad debt expense was [removed: $35.9] [added: $44.9] million in [removed: 2016 compared to $24.6] [added: 2017 and $35.9] million in [removed: 2015.][added: 2016, or 7 bps in 2017 and 8 bps in 2016, respectively.]

[removed: We derived approximately 76% of our consolidated revenues from these] [added: Revenues for late] fees and [added: finance] charges [removed: during] [added: represent 6% of our consolidated revenue for] the year ended December 31, [removed: 2016.][added: 2017.]

In the fleet card business, our primary competitors in North America are [removed: small,] [added: small] regional and large independent fleet card providers, major oil companies and petroleum marketers that issue their own fleet [removed: cards] [added: cards,] and major financial services companies that provide card services to major oil companies and petroleum marketers.

Competitors in the hotel card business include travel agencies, online lodging discounters, internal corporate procurement and travel resources, and independent services [removed: companies, among others.][added: companies.]

Our primary competitors in Latin America are independent providers of [added: fleet cards and vouchers for] food, fuel, [removed: toll, transportation] [added: tolls,] and [removed: fleet cards] [added: transportation] and [removed: vouchers, commercial fleet cards offered by the] major oil companies and providers of card outsourcing services to major oil companies and petroleum [removed: marketers.][added: marketers who offer commercial fleet cards.]

Some of our existing and potential competitors have longer operating histories, greater brand name recognition, larger customer bases, more extensive customer relationships or greater financial and technical [removed: resources.][added: resources than we do.]

By providing these [removed: other] services that we do not provide, these competitors have an advantage of being able to bundle their products and services together and present them to existing customers with whom they have established relationships, sometimes at a discount.

In the fleet card business, major oil companies and petroleum marketers and large financial institutions may choose to integrate fuel-card services as a complement to their existing card products and services, as well as offer [removed: add on] [added: add-on] complementary services.

[added: Resulting combined entities could be at a competitive advantage if their fuel-card] products and services are effectively integrated and bundled into sales packages with their widely utilized non-fuel-card-related products and services.

During [removed: 2016,] [added: 2017,] our top three strategic relationships with major oil companies accounted for less than [removed: 7%] [added: 6%] of our consolidated revenue.

If these partners fail to maintain their [removed: brands,] [added: brands] or decrease the size of their branded networks, our ability to grow our business may be adversely affected.

Our competitors may be willing to bid for these contracts on pricing or other terms that we consider uneconomical in order to win [removed: this] business.

[removed: During] [added: In] 2016, we received notice from an oil partner that they did not intend to renew our current contract when it [removed: expires] [added: expired] at the end of 2017.

Additionally, in [removed: 2016,] [added: 2017,] we signed an agreement to [removed: manage] [added: extend] the [added: management of the] commercial fuel card program for a [removed: new] strategic partner.

We do not expect [removed: either of] these contracts to have a material impact on our business and operating results.

With respect to the [removed: closed-loop] [added: closed loop] networks we utilize, a portion of our growth is derived from acquiring new merchant relationships to serve our customers, [removed: as well as from our] new and enhanced product and service [removed: offerings] [added: offerings,] and cross-selling our products and services through existing merchant relationships.

If we are unable to maintain these relationships, our over-the-road [added: fuel] card businesses may be adversely affected.

[removed: The loss of existing major truck stop] merchant relationships or failure to continue such relationships on similar terms could adversely affect our ability to serve our over-the-road fuel card customers and our business and operating results.

Our operating results are materially affected by conditions in the economy generally, both in the [removed: United States] [added: U.S] and internationally.

Our transaction volume is correlated with general economic conditions, particularly in the [removed: United States,] [added: U.S.,] Europe, Russia, Latin America, Australia and New Zealand, and the amount of business activity in economies in which we operate.

As a result, a sustained deterioration in general economic conditions in the [removed: United States] [added: U.S.] or [removed: abroad,] [added: abroad] could have a material adverse effect on our revenue and profitability.

We are unable to predict the likely duration of [removed: the ongoing sluggish] [added: current] economic conditions in the [removed: United States,] [added: U.S.,] Europe, Russia, Latin America, Australia and New Zealand.

As a result, [removed: continued weakness] [added: weaknesses] in general economic conditions or increases in interest rates in key countries in which we [removed: operate,] [added: operate] could adversely affect our business and operating results.

For example, we have entered into the corporate payments, stored value card, vehicle maintenance management and telematics business in the [removed: United States] [added: U.S.] and Europe, and transaction processing, fuel, food, toll and transportation card and voucher businesses in Brazil and Mexico.

We may continue to enter [added: into] new lines of business and offer new products and services in the future.

The markets for our products and services are highly [removed: competitive,] [added: competitive] and characterized by technological change, frequent introduction of new products and services and evolving industry standards.

[added: Any failure to deliver an effective and secure product or service or any] performance issue that arises with a new product or service could result in significant processing or reporting errors or other losses.

We may rely on third parties to develop or co-develop our [removed: solutions,] [added: solutions] or to incorporate our solutions into broader platforms for the commercial payments industry.

[removed: Even if we are successful in developing new services and technologies, these new services and technologies may not achieve broad acceptance due to a] variety of factors, including a lack of industry-wide standards, competing products and services, or resistance to these changes from our customers.

At December 31, [removed: 2016,] [added: 2017,] we had approximately [removed: $3.85] [added: $4.47] billion of debt outstanding under our Credit Facility and Securitization Facility.

In addition, we and our subsidiaries may [removed: be able to] incur substantial additional indebtedness in the future.

We meet a significant portion of our working capital needs through a securitization facility, pursuant to which we sell accounts receivable to a special-purpose entity that in turn sells undivided participation interests in the accounts receivable to certain [added: purchasers, who finance their purchases through the issuance of short-term commercial paper.]

[removed: There can be no] assurance that the size of the facility can be expanded to meet these increased working capital needs.

For the year ended December 31, [removed: 2016,] [added: 2017,] approximately [removed: 30%] [added: 37%] of our revenue was denominated in currencies other than the U.S. dollar (primarily, British pound, Brazilian real, [added: Canadian dollar,] Russian ruble, Mexican peso, Czech koruna, Euro, Australian dollar and New Zealand dollar).

We have been an active business acquirer in the [removed: United States] [added: U.S.] and internationally, and, as part of our growth strategy, we expect to seek to acquire businesses, commercial account portfolios, technologies, services and products in the future.

We conduct a significant portion of our business in foreign countries and we expect to expand our operations into additional foreign countries where we may be adversely affected by operational and political risks that are greater than in the [removed: United States.][added: U.S.]

The loss of existing major truck stop

Even if we are successful in developing new services and technologies, these new services and technologies may not achieve broad acceptance due to a

There can be no

We renewed our Securitization Facility as of November 14, 2017, with an expiration date of November 14, 2020.

Our business depends heavily on the reliability of proprietary and third-party processing systems.

A system outage could adversely affect our business, financial condition or results of operations, including by damaging our reputation or exposing us to third-party liability.

To successfully operate our business, we must be able to protect our processing and other systems from interruption, including from events that may be beyond our control.

Events that could cause system interruptions include fire, natural disaster, unauthorized entry, power loss, telecommunications failure, computer viruses, terrorist acts and war.

Although we have taken steps to protect against data loss and system failures, there is still risk that we may lose critical data or experience system failures.

Our products and services are based on sophisticated software and computing systems that are constantly evolving.

We often encounter delays and cost overruns in developing changes implemented to our systems.

In addition, the underlying software may contain undetected errors, viruses or defects.

In addition, we rely on technologies supplied to us by third parties that may also contain undetected errors, viruses or defects that could adversely affect our business, financial condition or results of operations.

Although we attempt to limit our potential liability for warranty claims through disclaimers in our software documentation and limitation of liability provisions in our licenses and other agreements with our customers, we cannot assure that these measures will be successful in limiting our liability.

Although we are not aware of any material breach of our or our associated third parties’ computer systems or material losses relating to cyber-attacks or other information security breaches, we and others in our industry are regularly the subject of attempts by bad actors to gain unauthorized access to these computer systems and data or to obtain, change or destroy confidential data (including personal consumer information of individuals) through a variety of means, including computer viruses, malware and phishing.

Threats to our systems and our associated third parties’ systems can derive from human error, fraud or malice on the part of employees or third parties, or may result from accidental technological failure.

Computer viruses can be distributed and could infiltrate our systems or those of our associated third parties.

In addition, denial of service or other attacks could be launched against us for a variety of purposes, including to interfere with our services or create a diversion for other malicious activities.

Although we believe we have sufficient controls in place to prevent disruption and misappropriation

We could also be subject to liability for claims relating to misuse of personal information, such as unauthorized marketing purposes and violation of data privacy laws.

We cannot provide assurance that the contractual requirements related to security and privacy that we impose on our service providers who have access to customer and consumer data will be followed or will be adequate to prevent the unauthorized use or disclosure of data.

In addition, we have agreed in certain agreements to take certain protective measures to ensure the confidentiality of customer data.

The costs of systems and procedures associated with such protective measures may increase and could adversely affect our ability to compete effectively.

Any failure to adequately enforce or provide these protective measures could result in liability, protracted and costly litigation, governmental and card network intervention and fines and, with respect to misuse of personal information of our customers, lost revenue and reputational harm.

other national retailers already have a gift card solution in place, either in-house or with one of our competitors.

For more information about laws, regulations and enforcement activities that may adversely affect our products and services and the markets in which we operate, see “Business- Regulatory.”

Derivatives Regulations

Rules adopted under the Dodd-Frank Act by the Commodity Futures Trading Commission (the "CFTC"), as well as the provisions of the European Market Infrastructure Regulation and its technical standards, which are directly applicable in the member states of the European Union, have subjected certain of the foreign exchange derivative contracts we offer to our customers as part of Cambridge's business, to reporting, recordkeeping, and other requirements.

Additionally, certain foreign exchange derivatives transactions we may enter into in the future may be subject to centralized clearing requirements, or may be subject to margin requirements in the United States and European Union.

Other jurisdictions outside the United States and the European Union are considering, have implemented, or are implementing regulations similar to those described above.

Derivatives regulations have added costs to our business and any additional requirements, such as future registration requirements and increased regulation of derivative contracts, may result in additional costs or impact the way we conduct our hedging activities, as well as impact how we conduct our business within our international payments provider operations.

In particular, the CFTC has recently issued a proposed rule that, if adopted as proposed, would increase the likelihood that we will have to register one or more of our subsidiaries with the CFTC as swap dealers.

Swap dealers are subject to a comprehensive regulatory framework and compliance with this framework will lead to additional costs, including costs relating to regulatory capital and margin requirements, and may impact how we conduct our hedging activities and derivatives business with customers.

We are currently evaluating the impact the proposed rule, if adopted, would have on our hedging activities and operations.

Our compliance with these requirements has resulted, and may continue to result, in additional costs to our business and may impact our international payments provider business operations.

Furthermore, our failure to comply with these requirements could result in fines and other sanctions, as well as necessitate a temporary or permanent cessation to some or all of our derivative related activities.

Any such fines, sanctions or limitations on our business could adversely affect our operations and financial results.

Additionally, the regulatory regimes for derivatives in the United States and European Union, such as under the Dodd-Frank Act and the European Markets in Financial Instruments Directive known as "MiFID II," are continuing to evolve and changes to such regimes, our designation under such regimes, or the implementation of new rules under such regimes, such as future registration requirements and increased regulation of derivative contracts, may result in additional costs to our business.

Other jurisdictions outside the United States and the European Union are considering, have implemented, or are implementing regulations similar to those described above and these may result in greater costs to us as well.

We are subject to governmental regulation and other legal obligations, particularly related to privacy, data protection and information security, and we are subject to disparate consumer protection laws across different countries.

Revenues for late fees and finance charges represent 6% of our consolidated revenue for the year ended December 31, 2016.

Competitors in the mobile telematics business include the major car companies, wireless phone service providers and independent services companies, among others.

Resulting combined entities could be at a competitive advantage if their fuel-card

Any failure to deliver an effective and secure product or service or any

purchasers, who finance their purchases through the issuance of short-term commercial paper.

For example, Russia and the Ukraine are experiencing significant unrest, which could escalate into broader armed conflict and additional economic sanctions by the U.S., United Nations or other countries against Russia.

These include:

We cannot be certain that the investment and additional resources required to establish, acquire or integrate operations in other countries will produce desired levels of revenue or profitability.

Our products and services are based on proprietary and third-party network technology and processing systems that may encounter development delays and could be susceptible to undetected errors, viruses or defects.

Development delays, system errors, viruses or defects that result in service interruption or data loss could have a material adverse effect on our business, damage our reputation and subject us to third-party liability.

Further, our attempts to limit our potential liability, through disclaimers and limitation-of-liability provisions in our agreements, may not be successful.

We believe that future

impairments in the carrying value of goodwill and indefinite lived intangible assets.

In addition, our confidentiality agreements with employees, vendors, customers and other third parties may not effectively prevent disclosure or use of proprietary technology or confidential information and may not provide an adequate remedy in the event of such unauthorized use or disclosure.

While we monitor the

The

If our sponsor banks should stop providing sponsorship for us or

The FCPA prohibits improper payments or offers of payments to foreign governments and their officials and political parties by U.S. and other business entities for the purpose of obtaining or retaining business.

Our products are used in [removed: 53] [added: 56] countries around the world, with our primary geographies [removed: in] [added: being] the U.S., Brazil and the [removed: U.K.,] [added: United Kingdom,] which [added: combined] accounted for approximately [removed: 92%] [added: 90%] of our revenue in [removed: 2016.][added: 2017.]

We believe that our size and scale, [added: product breadth and specialization,] geographic reach, [added: proprietary networks, robust distribution capabilities and] advanced technology [removed: and our expansive suite of products, services, brands and proprietary networks] contribute to our [removed: leading] industry [added: leading] position.

[removed: We also use third-party] [added: Third-party] networks [removed: to deliver our payment programs and services in order] [added: are used] to broaden [removed: our card] [added: payment product] acceptance and use.

[removed: FleetCor’s] [added: FLEETCOR’s] predecessor company was organized in the United States in [removed: 1986.][added: 1986, and FLEETCOR had its initial public offering in 2010 (NYSE: FLT).]

[removed: In this report, we refer to this net revenue as “revenue.”] For the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014,] [added: 2015,] our North America and International segments generated the following revenue:

| | | [removed: 2016] [added: 2017] | | | | | | | [removed: 2015] [added: 2016] | | | | | | | [removed: 2014] [added: 2015] | | | | | |

Set forth below are revenues, net, net income and net income per diluted share for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014.][added: 2015.]

| (in [removed: thousands,] [added: millions,] except per share amounts) | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | |

| Net income | | $ | [removed: 452,385] [added: 740,200] | | | [added: | |] $ | [removed: 362,431] [added: 452,385] | | | [added: | |] $ | [removed: 368,707] [added: 362,431] | |

| Net income per diluted share | | $ | [removed: 4.75] [added: 7.91] | | | $ | [removed: 3.85] [added: 4.75] | | | $ | [removed: 4.24] [added: 3.85] | |

Revenue [removed: from transactions] is derived from our merchant and network relationships, as well as [removed: our] [added: from] customers and partners.

[removed: ][added: ]

From our customers and partners, we [removed: derive] [added: generate] revenue [removed: from] [added: through] a variety of program fees, including transaction fees, card fees, network fees and [removed: charges, which can be fixed fees, cost plus a mark-up or based on a percentage discount from retail prices.][added: charges.]

From our [removed: merchant] [added: merchants] and [removed: network relationships,] [added: third-party networks,] we [removed: derive] [added: generate] revenue mostly from the difference between the [removed: price] [added: amount] charged to a customer [removed: for a transaction] and the [removed: price] [added: amount] paid to the merchant or network for [removed: the same] [added: a given] transaction, as well as network fees and charges in certain businesses.

[removed: As illustrated in the table below, the price] [added: The amount] paid to a merchant or network may be calculated as (i) the merchant’s wholesale [removed: cost of the] product [added: cost] plus a markup; (ii) the transaction purchase [removed: price] [added: amount] less a percentage discount; or (iii) the transaction purchase [removed: price] [added: amount] less a fixed fee per unit.

[removed: |] Illustrative [removed: Revenue Model | | | | | |] Merchant Payment [removed: Methods | | | | | | | | | | | | | | | | |][added: Models]

| [removed: Retail Price | | $ | 3.00 | | |] i) Cost Plus Mark-up: | | | | | | ii) Percentage Discount: | | | | | | iii) Fixed Fee: | | | | |

| Wholesale Cost | | [removed: (2.86 | | ) | | Wholesale Cost | |] $ | 2.86 | | | Retail Price | | $ | 3.00 | | | Retail Price | | $ | 3.00 | |

| [removed: | | | | | |] Mark-up | | 0.05 | | | | Discount (3%) | | (0.09 | | ) | | Fixed Fee | | (0.09 | | ) |

| [removed: Merchant Commission | | $ | (0.05 | ) | |] Price Paid to Merchant | | $ | 2.91 | | | Price Paid to Merchant | | $ | 2.91 | | | Price Paid to Merchant | | $ | 2.91 | |

Set forth below are further breakdowns of revenue by [removed: geography, product] [added: geography] and [removed: source] [added: product] for the years ended December 31, 2016 and 2015 (in [removed: millions):][added: millions), which we believe is useful in understanding the results of our business.]

| | | Year Ended December 31, | | | | | | | | | | | | | | [added: | Year Ended December 31, | | | | | | | | | | | | | | |]

| | | [removed: 2016 | | |] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [added: 2015] | | |

| United States | | $ | 1,279 | | | 70 | % | | $ | 1,232 | | | 72 | % | [removed: |]

| United Kingdom | | 229 | | | | 13 | | | 248 | | | | 15 | [removed: |] [added: %] |

| Brazil | | 168 | | | | 9 | | | 85 | | | | 5 | [removed: |] [added: %] |

| Other | | 156 | | | | 8 | | | 138 | | | | 8 | [removed: |] [added: %] |

| Consolidated revenues, net | | $ | 1,832 | | | 100 | % | | $ | 1,703 | | | 100 | % | [removed: |]

| [added: (Unaudited)] | | 2016 | | | | | | | 2015 | | | | | | [removed: |]

| [removed: Fuel cards | | $ | 1,124 | | | 61 | %] [added: FUEL CARDS] | | [removed: $] | [removed: 1,116] | | | [removed: 66] | [removed: %] | |

| Gift | | 185 | | | | 10 | | | 170 | | | | 10 | [removed: |] [added: %] |

| Corporate payments | | 180 | | | | 10 | | | 162 | | | | 10 | [removed: |] [added: %] |

| Tolls | | 103 | | | | 6 | | | 9 | | | | 1 | [removed: |] [added: %] |

| Lodging | | 101 | | | | 5 | | | 92 | | | | 5 | [removed: |] [added: %] |

| Consolidated revenues, net | | $ | 1,832 | | | [removed: 100.0] [added: 100] | % | | $ | 1,703 | | | [removed: 100.0] [added: 100] | % | [removed: |]

| [added: (Unaudited)] | | 2016 | | | | | | | 2015 | | | | | | [removed: |]

| Late fees and finance [removed: charges] [added: charges2] | | [removed: 113] [added: 141] | | | | 6 | | | [removed: 110] [added: 118] | | | | 6 | | |

| Consolidated revenues, net | | $ | [removed: 1,832] [added: 2,250] | | | 100 | % | | $ | [removed: 1,703] [added: 1,832] | | | 100 | % | |

[removed: 1Interchange] [added: 4Interchange] revenue directly influenced by the absolute price of fuel and other interchange [removed: primarily] related to fuel products.

[removed: 2Interchange] [added: 5Interchange] revenue [removed: primarily] related to nonfuel products.

FLEETCOR is a leading global provider of commercial payment solutions.

We help businesses of all sizes control, simplify and secure payment of various domestic and cross-border payables using specialized payment products.

We serve businesses, merchants and partners in North America, Latin America, Europe, and Australasia.

FLEETCOR has two reportable segments, North America and International.

We report these two segments as they align with our senior executive organizational structure, reflect how we organize and manage our employees around the world, manage operating performance, contemplate the differing regulatory environments in North America versus other geographies, and help us isolate the impact of foreign exchange fluctuations on our financial results.

Our payment solutions provide our customers with a payment method designed to be superior to and more robust and effective than what they use currently, whether they use a competitor’s product or another alternative method such as cash or check.

Our solutions are comprised of payment products, networks and associated services.

Our payment products function like a charge card or prepaid card and tend to be specialized for specific spend categories, such as fuel or lodging, and/or specific customer groups, such as long haul transportation.

FLEETCOR’s five primary product lines are Fuel, Lodging, Tolls, Corporate Payments and Gift.

Additionally, we provide other payment products including fleet maintenance, employee benefits and long haul transportation-related services.

FLEETCOR uses both proprietary and third-party networks to deliver our payment solutions.

FLEETCOR owns and operates proprietary networks with well-established brands throughout the world, bringing incremental sales and loyalty to affiliated merchants.

In 2017, we processed approximately 3 billion transactions within these networks, of which approximately 1.4 billion were related to our Gift product line.

FLEETCOR capitalizes on its products’ specialization with sales and marketing efforts by deploying product-dedicated sales forces to target specific customer segments.

We market our products directly through multiple sales channels, including field sales, telesales and digital marketing, and indirectly through our partners, which include major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and referral partners.

In this report, we refer to this net revenue as “revenue".

We report our results from Cambridge (acquired in the third quarter of 2017) and CLS (acquired in the fourth quarter of 2017) in our North America segment.

The results of operations from the fuel card business acquired in Russia are included within our International segment.

As part of our plan to exit the telematics business, on July 27, 2017, we sold NexTraq, a U.S. fleet telematics business, which has historically been included in our North America segment.

| North America | | $ | 1,429 | | | 63.5 | % | | $ | 1,279 | | | 69.8 | % | | $ | 1,232 | | | 72.3 | % |

| International | | 821 | | | | 36.5 | % | | 552 | | | | 30.2 | % | | 471 | | | | 27.7 | % |

| | | $ | 2,250 | | | 100.0 | % | | $ | 1,832 | | | 100.0 | % | | $ | 1,703 | | | 100.0 | % |

| Revenues, net | | $ | 2,250 | | | $ | 1,832 | | | $ | 1,703 | |

| Adjusted net income | | $ | 799 | | | $ | 659 | | | $ | 593 | |

A transaction is defined as a purchase by a customer utilizing one of our payment products at a participating merchant.

The following diagram illustrates a typical transaction flow, which is representative of many, but not all, of our businesses.

The revenue we derive from transactions is generated from both customers and merchants.

Customers may include directly- and indirectly-sold commercial businesses as well as partners for whom we manage payment programs.

Merchants may include those merchants affiliated with our proprietary networks or those participating in the third-party networks we utilize.

These fees may be charged as fixed amounts, costs plus a mark-up, or based on a percentage of the transaction purchase amounts.

The following table provides illustrations of these three merchant payment models, which are representative of many, but not all, of our businesses.

| | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | |

For a transaction involving the purchase of fuel where the amount paid to the merchant is calculated under the cost plus markup model, we refer to the difference between the amount charged to the customer and the amount paid to the merchant as merchant revenue tied to fuel-price spreads.

In all other cases, we refer to the difference between the amount charged to the customer and the amount paid to the merchant for a given transaction as interchange revenue.

Revenue per transactions by segment is affected by the mix of products and acquisitions, which may result in revenue per transaction by product providing more meaningful data for analysis.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

Fleetcor is the global leader in workforce payment products.

We primarily go to market with our fuel card payments product solutions, corporate payments products, toll products, lodging cards and gift cards.

Our core products are primarily sold to businesses, retailers, major oil companies and marketers and government entities.

Our payment programs enable our customers to better manage and control their commercial payments, card programs, and employee spending and provide card-accepting merchants with a high volume customer base that can increase their sales and customer loyalty.

We also provide a suite of fleet related and workforce payment solution products, including mobile telematics services, fleet maintenance management and employee benefit and transportation related payments.

In 2016, we processed approximately 2.2 billion transactions on our proprietary networks and third-party networks (which includes approximately 1.3 billion transactions related to our SVS product, acquired with Comdata).

We provide our payment products and services in a variety of combinations to create customized payment solutions for our customers and partners.

We collectively refer to our suite of product offerings as workforce productivity enhancement products for commercial businesses.

We sell a range of customized fleet and lodging payment programs directly and indirectly to our customers through partners, such as major oil companies, leasing companies and petroleum marketers.

We refer to these major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and other referral partners with whom we have strategic relationships as our “partners.” We provide our customers with various card products that typically function like a charge card to purchase fuel, lodging, food, toll, transportation and related products and services at participating locations.

We support our products with specialized issuing, processing and information services that enable us to manage card accounts, facilitate the routing, authorization, clearing and settlement of transactions, and provide value-added functionality and data, including customizable card-level controls and productivity analysis tools.

In order to deliver our payment programs and services and process transactions, we own and operate proprietary “closed-loop” networks through which we electronically connect to merchants and capture, analyze and report customized information in North America and internationally.

To support our payment products, we also provide a range of services, such as issuing and processing, as well as specialized information services that provide our customers with value-added functionality and data.

Our customers can use this data to track important business productivity metrics, combat fraud and employee misuse, streamline expense administration and lower overall workforce and fleet operating costs.

Depending on our customers’ and partners’ needs, we provide these services in a variety of outsourced solutions ranging from a comprehensive “end-to-end” solution (encompassing issuing, processing and network services) to limited back office processing services.

In 2000, our current chief executive officer joined us and we changed our name to FleetCor Technologies, Inc. Since 2000, we have grown significantly through a combination of organic initiatives, product and service innovation and over 70 acquisitions of businesses and commercial account portfolios.

Our corporate headquarters are located in Norcross, Georgia.

As of December 31, 2016, we employed approximately 7,100 employees, approximately 2,270 of whom are located in the United States.

| North America | | $ | 1,279.1 | | | 69.8 | % | | $ | 1,232.0 | | | 72.3 | % | | $ | 668.3 | | | 55.7 | % |

| International | | 552.4 | | | | 30.2 | % | | 470.9 | | | | 27.7 | % | | 531.1 | | | | 44.3 | % |

| | | $ | 1,831.5 | | | 100.0 | % | | $ | 1,702.9 | | | 100.0 | % | | $ | 1,199.4 | | | 100.0 | % |

| | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | |

| Revenues, net | | $ | 1,831,546 | | | $ | 1,702,865 | | | $ | 1,199,390 | |

As illustrated in the diagram below, a transaction is defined as a purchase by a customer.

Our customers include holders of our card products and those of our partners, for whom we manage card programs, members of our proprietary networks who are provided access to our products and services and commercial businesses to whom we provide workforce payment productivity solutions.

Through our merchant and network relationships we primarily offer fuel cards, corporate cards, virtual cards, purchasing cards, T&E cards, gift cards, stored value payroll cards, vehicle maintenance, food, fuel, toll and transportation cards and vouchers or lodging services to our customers.

The following diagram illustrates a typical card transaction flow, but may also be applied to our vehicle maintenance, lodging and food, fuel, toll and transportation card and voucher products, substituting transactions for gallons.

This representative model is not applicable to all of our businesses.

The following table presents an illustrative revenue model for transactions with the merchant, which is primarily applicable to fuel based product transactions, but may also be applied to our vehicle maintenance, lodging and food, fuel, toll and transportation card and voucher products, substituting transactions for gallons.

This representative model may not include all of our businesses.

Illustrative Revenue Model for Fuel Purchases

(unit of one gallon)

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | |

| FleetCor Revenue | | $ | 0.14 | | | | | | | | | | | | | | | | | | | |

| Price Paid to Merchant | | $ | 2.91 | | | | | | | | | | | | | | | | | | | |

| Other | | 140 | | | | 8 | | | 154 | | | | 9 | | |

Revenue from our International segment was [removed: 30.2%, 27.7%] [added: 36.5%, 30.2%] and [removed: 44.3%] [added: 27.7%] of total revenue for the years ended December 31, [added: 2017,] 2016, [removed: 2015,] and [removed: 2014,] [added: 2015,] respectively.

Exchange rates and currency positions as of December 31, [removed: 2016] [added: 2017] were used to perform the sensitivity analysis.

Such analysis indicated that a hypothetical 10% change in foreign currency exchange rates would have increased or decreased consolidated operating income during the year ended December 31, [removed: 2016] [added: 2017] by approximately [removed: $24.8] [added: $34.2] million had the U.S. dollar exchange rate increased or decreased relative to the currencies to which we had exposure.

When exchange rates and currency positions as of December 31, [removed: 2015] [added: 2016] and [removed: 2014] [added: 2015] were used to perform this sensitivity analysis, the analysis indicated that a hypothetical 10% change in currency exchange rates would have increased or decreased consolidated operating income for the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014] [added: 2015] by approximately [removed: $22.5] [added: $24.8] million and [removed: $27.8] [added: $22.5] million, respectively.

Interest on amounts outstanding under the Credit Agreement (other than the [removed: term loan] [added: Term] B [removed: facility)] [added: loan)] accrues based on the British Bankers Association LIBOR Rate (the Eurocurrency Rate), plus a margin based on a leverage ratio, or our option, the Base Rate (defined as the rate equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) the prime rate announced by Bank of America, N.A., or (c) the Eurocurrency Rate plus 1.00%) plus a margin based on a leverage ratio.

Based on the amounts and mix of our fixed and floating rate debt (exclusive of our Securitization Facility) at December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014,] [added: 2015,] if market interest rates had increased or decreased an average of 100 basis points, our interest expense would have changed by [removed: $27.9] [added: approximately $34.7] million, [removed: $26.2] [added: $27.9] million and [removed: $31.6] [added: $26.2] million, respectively.

Foreign Earnings

Unhedged Cross-Currency Risk

With the acquisition of Cambridge in August 2017, we have additional foreign exchange risk and associated foreign exchange risk management requirements due to the nature of our international payments provider business.

The majority of Cambridge's revenue is from exchanges of currency at spot rates, which enable customers to make cross-currency payments.

In addition, Cambridge also writes foreign currency forward and option contracts for customers to facilitate future payments.

The duration of these derivative contracts at inception is generally less than one year.

Cambridge aggregates its foreign exchange exposures arising from customer contracts, including the derivative contracts described above, and hedges (economic hedge) the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties.

Under our $4.325 billion Credit Agreement, the Credit Agreement provides for senior secured credit facilities consisting of a revolving A credit facility in the amount of $1.285 billion, a term loan A facility in the amount of $2.690 billion and a term loan B facility in the amount of $350.0 million as of December 31, 2017.

The revolving credit facility consists of (a) a revolving A credit facility in the amount of $800.0 million, with sublimits for letters of credit and swing line loans, (b) a revolving B facility in the amount of $450.0 million for swing line loans and multi-currency borrowings and, (c) a revolving C facility in the amount of $35.0 million for multi-currency borrowings in Australian Dollars or New Zealand Dollars.

On January 20, 2017, we entered into the second amendment to the Credit Agreement, which established a new term B loan.

Interest on the term B loan facility accrues based on the Eurocurrency Rate or the Base Rate at 2.25% for Eurocurrency Loans and at 1.25% for Base Rate Loans.

In addition, the Company pays a quarterly commitment fee at a rate per annum ranging from 0.20% to 0.40% of the daily unused portion of the credit facility.

Under our $3.36 billion Credit Facility, we have syndicated $2.02 billion and $300 million term loan agreements with a syndicate of term loan A and term loan B investors in the United States, respectively, as well as a revolving A credit facility of $1.0 billion and a revolving B credit facility of $35 million.

Our products are used in [removed: 53] [added: 56] countries around the world, with our primary geographies [removed: in] [added: being] the U.S., Brazil and the [removed: U.K.,] [added: United Kingdom,] which [added: combined] accounted for approximately [removed: 92%] [added: 90%] of our revenue in [removed: 2016.][added: 2017.]

[removed: We also] [added: Additionally, we] provide [removed: a suite of fleet related and workforce] [added: other] payment [removed: products,] [added: products] including [removed: mobile telematics services,] fleet [removed: maintenance management and] [added: maintenance,] employee [removed: benefit] [added: benefits] and [removed: transportation related payments.][added: long haul transportation-related services.]

We believe that our size and scale, [added: product breadth and specialization,] geographic reach, [added: proprietary networks, robust distribution capabilities and] advanced technology [removed: and our expansive suite of products, services, brands and proprietary networks] contribute to our [removed: leading] industry [added: leading] position.

We [removed: also] use [added: these] third-party networks [removed: to deliver our payment programs and services] in order to broaden our [removed: card] [added: payment product] acceptance and use.

Our customers can use [removed: this data] [added: these data, controls and tools] to [removed: track important business productivity metrics,] combat fraud and employee misuse, streamline expense administration and lower [removed: overall workforce and fleet] [added: their vehicle fleets’] operating costs.

[removed: These fleets include small and medium commercial] [added: This includes businesses with small- to medium-sized] fleets, which we believe represent an attractive segment of the global commercial fleet market given their relatively high use of less efficient payment products, such as cash and general purpose credit cards.

We distribute our [removed: commercial] [added: corporate] payment solutions through direct and indirect channels to businesses of all sizes and types across a broad number of industry [removed: verticals, including retail, healthcare, construction and hospitality.][added: verticals.]

[removed: FleetCor’s] [added: FLEETCOR’s] predecessor company was organized in the United States in [removed: 1986.][added: 1986, and FLEETCOR had its initial public offering in 2010 (NYSE: FLT).]

[removed: Our products] [added: Products] and services

We support [removed: these card] [added: our payment] products with specialized issuing, processing and information services that enable us to manage [removed: card] [added: customer] accounts, facilitate the routing, authorization, clearing and settlement of transactions, and provide value-added functionality and data, including customizable [removed: card-level] [added: user-level] controls and productivity analysis tools.

Depending on our [removed: customers] [added: customers’] and [removed: partners] [added: partners’] needs, we provide [removed: these] [added: our products and] services in a variety of [removed: outsourced solutions] [added: combinations] ranging from a comprehensive “end-to-end” solution (encompassing issuing, processing and network services) to limited back office processing services.

[removed: Our] [added: We offer a] broad suite of [removed: commercial payment] [added: corporate payments] solutions with vertical-specific [removed: applications] [added: applications, which] enable our [removed: corporate] customers to manage and control electronic payments across their enterprise, optimize corporate spending and offer innovative services that increase [added: employee efficiency and customer loyalty.]

[removed: We also provide a vehicle maintenance service offering that helps fleet customers to better manage their vehicle maintenance, service, and repair needs in the U.K.] In Mexico, we offer prepaid [removed: fuel and] food vouchers and cards that may be used as a form of payment in [removed: restaurants, grocery stores] [added: restaurants] and [removed: gas stations.][added: grocery stores.]

[removed: Additionally in] [added: In] Brazil, we have designed proprietary equipment which, when installed at the fueling site and on the vehicle and combined with our processing system, significantly reduces the likelihood of unauthorized and fraudulent transactions.

North America proprietary [removed: closed-loop] networks [added: for fuel payment products]

| • | Fuelman network—our primary proprietary fleet card network in the [removed: United States.] [added: U.S.] We have negotiated card acceptance and settlement terms with [removed: over] [added: approximately] 11,000 individual merchants, providing the Fuelman network with [removed: over 55,000] [added: approximately 59,000] fueling sites and [removed: over] [added: approximately] 28,000 maintenance sites across the country. |

| • | Comdata network—our network of truck stops and fuel merchants for the over-the-road trucking industry. We have negotiated card acceptance and settlement terms at over [removed: 6,800] [added: 8,100] truck stops and fuel merchants across the [removed: United States] [added: U.S.] and Canada. |

[removed: | • | Corporate Lodging Consultants network (CLC)—our proprietary] [added: Our] lodging [removed: network in the United States and Canada. The] [added: payment products operate on our proprietary] CLC Lodging [removed: network] [added: network, which] includes over [removed: 16,400 hotels. |][added: 16,700 hotels across the U.S. and Canada.]

| • | Allstar network—our proprietary fleet card network in the [removed: United Kingdom.] [added: U.K.] We have negotiated card acceptance and settlement terms with [removed: over] [added: approximately] 2,200 individual merchants, providing this network with over [removed: 7,400] [added: 7,300] fueling sites. |

| • | Keyfuels network—our proprietary fleet card network in the [removed: United Kingdom.] [added: U.K.] We have negotiated card acceptance and settlement terms with more than 500 individual merchants, providing the Keyfuels network with [removed: over 2,600] [added: approximately 2,800] fueling sites. |

| • | CCS network—our primary proprietary fleet card network in the Czech Republic and Slovakia. We have negotiated card acceptance and settlement terms with several major oil companies on a brand-wide basis, including MOL, Benzina, OMV, Slovnaft and Shell, and with [removed: over] [added: approximately] 1,100 other merchants, providing the CCS network at over 2,600 fueling sites and 800 other sites accepting our cards. |

| • | Petrol Plus Region (PPR) network—our primary proprietary fleet card network in Russia, Poland, Ukraine, Belarus, Kazakhstan and Moldova. We have negotiated card acceptance and settlement terms with [removed: approximately 650] [added: over 700] individual merchants, providing the PPR network with [removed: over] [added: approximately] 13,500 fueling sites across the region. |

| • | Efectivale [removed: network—our] [added: network—also our] proprietary [removed: fuel and] food card and voucher [removed: networks] [added: network] in Mexico. We have negotiated acceptance and settlement terms with over [removed: 52,000] [added: 56,700] individual merchants, providing the [removed: Mexican] network with over [removed: 6,200 fueling sites, 41,800] [added: 44,600] food locations and [removed: 4,000] [added: 5,800] restaurants. |

[removed: | • | RODOCRED network—our proprietary] [added: Our paper] toll [removed: network in Brazil. The] [added: vouchers are accepted for payment within our proprietary] RODOCRED [removed: network processes] toll [removed: transactions for] [added: network, on behalf of] more than [removed: 46,900] [added: 96,000] customers on all toll roads across Brazil. [removed: |]

[removed: | • | VB Distribution system—our] [added: Our] proprietary [removed: distribution network in Brazil for transportation cards, meal/grocery cards, and fuel cards. The] VB [added: Servicos, Comercio e Administracao LTDA (“VB”)] distribution network distributes cards [removed: for more than 25,000 clients] and [added: vouchers to employees on behalf of approximately 26,000 customers and] negotiates with more than [removed: 1,300] [added: 1,400] public transportation agencies across Brazil. [removed: |]

[removed: | • |] [added: Our electronic toll and parking payments product operates on our proprietary] Sem Parar [removed: network—our proprietary toll network in Brazil. The network processes] [added: network, which processed] toll transactions for more than 3.2 million customers on 99% of the toll roads across Brazil. [removed: |]

Third-Party networks [added: for fuel payments products]

| • | Major oil and fuel marketer networks—The proprietary networks of branded locations owned by our major oil and [removed: petroleum] [added: fuel] marketer partners in both North America and internationally are generally utilized to support the proprietary, branded card programs of these partners. |

| • | UTA network—UNION TANK Eckstein GmbH & Co. KG (UTA) operates a network of over [removed: 54,000] [added: 55,000] points of acceptance in 40 European countries, including more than [removed: 39,000] [added: 44,000] fueling sites. The UTA network is generally utilized by European transport companies that travel between multiple countries. |

| • | DKV network—DKV operates a network of over [removed: 60,000] [added: 65,000] fleet card-accepting locations across more than 40 countries throughout Europe. The DKV network is generally utilized by European transport companies that travel between multiple countries. |

| • | Carnet [removed: networks—In] [added: networks—A national debit network in] Mexico, [removed: we issue fuel cards and food cards that utilize the Carnet payment network,] which includes over [removed: 11,000] [added: 11,500] fueling [removed: sites, over 31,000 food locations and over 500,000 restaurants] [added: sites] across the country. |

Our [removed: agreements] [added: contracts] with our major oil company partners typically have initial terms of five to ten years with current remaining terms ranging from two to seven years.

No single partner represented more than 10% of our consolidated revenue in [removed: 2016, 2015 or 2014.][added: any year during the last four years.]

We distribute our [removed: commercial] [added: toll] payment [removed: solutions] [added: products] through direct and indirect channels to [removed: businesses] [added: customers] of all sizes and [removed: types] across a broad number of industry verticals.

We serve customers across numerous industry verticals, such as retail, healthcare, [removed: construction and hospitality as well as general commercial payment services in] [added: construction, manufacturing, hospitality,] energy, entertainment, insurance and trade finance.

We [added: generally] provide our [removed: commercial] [added: domestic corporate] payment solutions under contracts with our customers.

[removed: Terms such as exclusivity, mandatory minimum contract payments and pricing] [added: Pricing] terms vary based on [removed: scope of use,] usage volumes, incentives and contract duration.

When our [removed: commercial] [added: corporate] payment solutions include short term credit, our contracts for those solutions contain credit and collection terms.

We utilize proprietary and third-party databases to develop our prospect [removed: universe,] [added: universe] and segment those prospects by various characteristics, including industry, geography, size, and credit score, to identify potential customers.

| • | Field sales—Our field sales organizations are comprised of remote or local office-based sales representatives who conduct face-to-face sales presentations and product demonstrations with prospects, assist with post-sale program implementation and training, and provide in-person account management. Field sales representatives also attend and manage our marketing at tradeshows. Our field sales force is generally dedicated to [removed: a] specific [removed: product] [added: products] or service [removed: category,] [added: categories] and tend to target larger prospects. |

FLEETCOR is a leading global provider of commercial payment solutions.

We help businesses of all sizes control, simplify and secure payment of various domestic and cross-border payables using specialized payment products.

We serve businesses, merchants and partners in North America, Latin America, Europe, and Australasia.

FLEETCOR has two reportable segments, North America and International.

We report these two segments as they align with our senior executive organizational structure, reflect how we organize and manage our employees around the world, manage operating performance, contemplate the differing regulatory environments in North America versus other geographies, and help us isolate the impact of foreign exchange fluctuations on our financial results.

Our payment solutions provide our customers with a payment method designed to be superior to and more robust and effective than what they use currently, whether they use a competitor’s product or another alternative method such as cash or check.

Our solutions are comprised of payment products, networks and associated services.

FLEETCOR payment products function like a charge card or prepaid card, and tend to be specialized for specific spend categories, such as fuel or lodging, and/or specific customer groups, such as long haul transportation.

FLEETCOR’s five primary product lines are Fuel, Lodging, Tolls, Corporate Payments and Gift.

FLEETCOR uses both proprietary and third-party networks to deliver our payment solutions.

FLEETCOR owns and operates proprietary networks with well-established brands throughout the world, bringing incremental sales and loyalty to affiliated merchants.

Third-party networks are used to broaden payment product acceptance and use.

In 2017, we processed approximately 3 billion transactions within these networks, of which approximately 1.4 billion were related to our Gift product line.

FLEETCOR capitalizes on its products’ specialization with sales and marketing efforts by deploying product-dedicated sales forces to target specific customer segments.

We market our products directly through multiple sales channels, including field sales, telesales and digital marketing, and indirectly through our partners, which include major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and referral partners.

We offer specialized payment solutions predominately for commercial businesses.

Our payment solutions are intended to provide our customers with a payment method superior to that which they formerly used, whether they used a competitor’s product or another alternative method such as cash or check.

Our solutions are comprised of payment products, networks and associated services.

Our payment products typically function like a charge card or prepaid card.

FLEETCOR provides a variety of payment mechanisms such as a plastic card, electronic tag, or other form to the customer.

We issue credit to the customer (or accept prepaid funds from the customer) to allow for purchases using the payment product.

FLEETCOR then reports the purchases to the customer and invoices (or debits prepaid amounts) for payment of purchases made on the customer’s account.

Payment networks are integral to our solutions, as they allow us to electronically connect to merchants and capture transaction data from the point of sale.

We use both proprietary and third-party networks to deliver our payment solutions.

For our proprietary networks, FLEETCOR provides merchant acquiring services, which may include affiliation, contract management, point-of-sale terminals, reporting and settlement.

FLEETCOR owns and operates proprietary networks with well-established brands across 56 countries, bringing incremental sales and loyalty to affiliated merchants.

Third-party networks include MasterCard in the U.S. and Visa in the U.K. and continental Europe, the retail outlets of various partners, and proprietary

networks owned and operated by other partners.

Through our proprietary and third-party networks, we capture detailed transaction data and can often enable advanced purchase controls at the point-of-sale.

Our customers can use these data, controls and tools to lower their operating costs, and combat fraud and employee misuse and streamline expense administration.

Our solutions tend to be specialized for specific spend categories, such as fuel or lodging, and/or specific customer segments, such as long haul transportation.

This specialization is manifested in the purchase controls, merchant network, and reporting applicable to the spend category or customer segment.

For example, a fuel card could provide controls on the type of fuel purchased, be accepted only at gas stations for fuel purchases, and provide fuel usage and efficiency reports for a customer’s fleet of vehicles.

The combination of these specialized attributes allows our payment products to compete well against less specialized products such as cash or general purpose credit cards when it comes to controlling purchases within certain spend categories.

FLEETCOR’s five primary product lines are Fuel, Lodging, Tolls, Corporate Payments and Gift.

Additionally, we provide other payment products including fleet maintenance, employee benefits and long haul transportation-related services.

Fuel payment product line

Our fuel payment product line is our largest product category, representing approximately 49% of our revenue in 2017.

FLEETCOR offers fuel payment solutions to businesses and government entities who operate vehicle fleets, as well as to major oil companies, leasing companies and fuel marketers.

Our fuel payment products are most often in the form of plastic cards, but also include other forms such as electronic RFID tags and paper vouchers.

Fleetcor is the global leader in workforce payment products.

We primarily go to market with our fuel card payments product solutions, corporate payments products, toll products, lodging cards and gift cards.

Our core products are primarily sold to businesses, retailers, major oil companies and marketers and government entities.

Our payment programs enable our customers to better manage and control their commercial payments, card programs, and employee spending and provide card-accepting merchants with a high volume customer base that can increase their sales and customer loyalty.

In 2016, we processed approximately 2.2 billion transactions on our proprietary networks and third-party networks (which includes approximately 1.3 billion transactions related to our SVS product, acquired with Comdata, Inc. (“Comdata”).

We provide our payment products and services in a variety of combinations to create customized payment solutions for our customers and partners.

In order to deliver our payment programs and services and process transactions, we own and operate proprietary “closed-loop” networks through which we electronically connect to merchants and capture, analyze and report customized information.

To support our payment products, we also provide a range of services, such as issuing and processing, as well as specialized information services that provide our customers with value-added functionality and data.

We market our fleet payment products directly to a broad range of commercial fleet customers, oil companies, petroleum marketers and government entities.

Among these customers, we provide our products and services to commercial fleets of all sizes.

We also manage commercial fleet card programs for major oil companies, such as British Petroleum (BP) (including its subsidiary Arco), Shell and Speedway, and over 800 petroleum marketers.

Our indirect channel includes a broad range of value-added resellers (VARs) and other referral partners.

We refer to these major oil companies, leasing companies, petroleum marketers, VARs and other referral partners with whom we have strategic relationships as our “partners.” These partners collectively maintain hundreds of thousands of end-customer relationships with commercial fleets, commercial payment solutions customers and other businesses.

We collectively refer to our suite of product offerings as workforce productivity enhancement products for commercial businesses.

We sell a range of customized fleet and lodging payment programs directly and indirectly to our customers through partners, such as major oil companies, leasing companies and petroleum marketers.

We provide our customers with various card products that typically function like a charge card to purchase fuel, lodging, food, toll, transportation and related products and services at participating locations.

employee efficiency and customer loyalty.

Our commercial payment solutions offer integrated components that create a powerful combination of robust payment functionality, deep business insights and comprehensive technical capabilities and support services.

In addition, we offer a telematics solution that combines global positioning, satellite tracking and other wireless technology to allow fleet operators to monitor the capacity utilization and movement of their vehicles and drivers.

We market these payment products to small, medium and large businesses, which provide these cards and vouchers to their employees as benefits, as well as a tool to manage fuel expenses.

We offer a similar workforce payment product in Brazil related to public transportation and toll vouchers.

Also in Brazil, we offer an electronic toll and parking payments product to commercial and consumer customers, as well as a cardless fuel payments product offering at fueling sites throughout Brazil.

Other than our fuel card products and services and prepaid giftcard products, no other products or services accounted for 10% or more of consolidated revenues in any of the last three fiscal years.

Networks

In order to deliver our payment programs and services, we own and operate proprietary closed-loop networks in North America and internationally.

We also utilize the networks of our major oil and petroleum marketer partners in certain markets.

Our networks have well-established brands in local markets and proprietary technology that enable us to capture, transact, analyze and report value-added information pertinent to managing and controlling employee spending.

Examples of our networks include:

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| --- | --- |

| | |

| --- | --- |

| • | Commercial Fueling Network (CFN)—our “members only” fueling network in the United States and Canada. The CFN network is composed of over 2,500 fueling sites owned by a CFN member—the majority of which are unattended cardlock facilities. CFN provides fuel card authorization, transaction processing, cardlock site branding and reciprocal site access for over 220 independent petroleum marketers. Through a CFN affiliation, petroleum marketers can offer commercial fleets an integrated fuel card solution with access to over 55,000 locations via FleetCor’s Fuelman network. |

| • | Pacific Pride Fueling network (Pacific Pride)—our "franchise" fueling network in the United States composed of approximately 1,200 fueling sites owned by more than 250 franchisees. The Pacific Pride franchise offering includes a dynamic fleet card management system and provides franchisees' fleet customers access to Pacific Pride's network of unattended fueling facilities. Franchisees also benefit when fleet customers of other franchisees purchase fuel at their locations. Additionally, the PrideAdvantage fleet card providing fleet customers of franchisees access to over 55,000 locations via FleetCor’s Fuelman network. |

International proprietary closed-loop networks

| • | CTF network—our proprietary fuel controls network in Brazil. We have partnerships with BR Distribuidora (Petrobas) and Ipiranga Distribuidora, retail oil distributors, as well as other fuel providers, in Brazil. CTF’s processing system works at over 1,700 highway fueling sites through these partnerships and is integrated with two main banks, Banco Bradesco and Banco Itau. |

| • | 1link service network—our proprietary maintenance and repair network in the United Kingdom. The 1link network processes transactions for fleet customers through more than 9,400 service centres across the United Kingdom. |

| • | MasterCard network—In the United States and Canada, we issue corporate cards that utilize the MasterCard payment network, which includes over 178,000 fuel sites and 469,000 maintenance locations. Our co-branded MasterCard corporate cards, virtual card corporate payment solution, purchasing cards, T&E cards and multi-use cards have additional purchasing capabilities and can be accepted at approximately 10.7 million locations throughout the United States and Canada. We market these cards to customers who require card acceptance beyond our proprietary merchant locations. The MasterCard network delivers the ability to capture value-added transaction data at the point-of-sale and allows us to provide customers with fleet controls and reporting comparable to those of our proprietary fleet card networks. |

Customers and distribution channels

We provide our fleet products and services primarily to trucking companies, commercial fleet customers and our major oil company and petroleum marketer partners.

In the ordinary course of business, we are subject to various pending and potential legal actions, arbitration proceedings, claims, subpoenas, and matters relating to compliance with laws and regulations (collectively, legal proceedings).

Based on our current knowledge, management presently does not believe that the liabilities arising from these legal proceedings will have a material adverse effect on our consolidated financial condition, results of operations or cash flows.

However, it is possible that the ultimate resolution of these legal proceedings could have a material adverse effect on our results of operations and financial condition for any particular period.

Shareholder Class Action and Derivative Lawsuits

On June 14, 2017, a shareholder filed a class action complaint in the United States District Court for the Northern District of Georgia against the Company and certain of its officers and directors on behalf of all persons who purchased or otherwise acquired the Company’s stock between February 5, 2016 and May 2, 2017.

On October 13, 2017, the shareholder filed an amended complaint asserting claims on behalf of a putative class of all persons who purchased or otherwise acquired the Company's common stock between February 4, 2016 and May 3, 2017.

The complaint alleges that the defendants made false or misleading statements regarding fee charges and the reasons for its earnings and growth in certain press releases and other public statements in violation of the federal securities laws.

Plaintiff seeks class certification, unspecified monetary damages, costs, and attorneys’ fees.

The Company disputes the allegations in the complaint and intends to vigorously defend against the claims.

On July 10, 2017, a shareholder derivative complaint was filed against the Company and certain of the Company’s directors and officers in the United States District Court for the Northern District of Georgia seeking recovery on behalf of the Company.

The derivative complaint alleges that the defendants issued a false and misleading proxy statement in violation of the federal securities laws; that defendants breached their fiduciary duties by causing or permitting the Company to make allegedly false and misleading public statements concerning the Company’s fee charges, and financial and business prospects; and that certain defendants breached their fiduciary duties through allegedly improper sales of stock.

The complaint seeks unspecified monetary damages on behalf of the Company, corporate governance reforms, disgorgement of profits, benefits and compensation by the defendants, restitution, costs, and attorneys’ and experts’ fees.

On August 18, 2017, the court entered an order deferring the case pending a ruling on the defendants' motion to dismiss the putative shareholder class action, or until otherwise agreed to by the parties.

The defendants dispute the allegations in the complaint and intend to vigorously defend against the claims.

Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, and are in the stages of the proceedings where key factual and legal issues have not been resolved.

For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from the matters described above.

As of the date of this filing, we are not currently party to any legal proceedings or governmental inquiries or investigations that we consider to be material and we were not involved in any material legal proceedings that terminated during the fourth quarter.

We are and may become, however, subject to lawsuits from time to time in the ordinary course of our business.

For the Fiscal Year Ended December 31, [removed: 2016][added: 2017]

5445 Triangle Parkway, Suite 400, [removed: Norcross,] [added: Peachtree Corners,] Georgia 30092-2575

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate [removed: Web site,] [added: website,] if any, every Interactive Data File required to be submitted and posted 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 and post such files).

See the definitions of “large accelerated filer,” “accelerated [removed: filer” and] [added: filer,”] “smaller reporting company” [added: and "emerging growth company"] in Rule 12b-2 of the Exchange Act.

The aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately [removed: 12,916,568,362] [added: $13,172,593,947] as of June 30, [removed: 2016,] [added: 2017,] the last business day of the registrant’s most recently completed second fiscal quarter, based on the closing sale price as reported on the New York Stock Exchange.

As of February [removed: 10, 2017,] [added: 9, 2018,] there were [removed: 91,892,435] [added: 89,808,852] shares of common stock outstanding.

Portions of the registrant’s definitive Proxy Statement to be delivered to shareholders in connection with the Annual Meeting of Shareholders to be held on June [removed: 21, 2017] [added: 6, 2018] are incorporated by reference into Part III of this report.

For The Year Ended December 31, [removed: 2016][added: 2017]

| Item 1. | [removed: [Business](#s3B4853029586B734E2A62FA5D0089C9A)] [added: [Business](#sC8F89A1C5DDC558B83EC62A507852D3B)] | [removed: [4](#s3B4853029586B734E2A62FA5D0089C9A)] [added: [4](#sC8F89A1C5DDC558B83EC62A507852D3B)] |

| Item X. | [Executive Officers of the [removed: Registrant](#sDFA16C2EF7E8BAC0F7492FA5D02AD7DC)] [added: Registrant](#s9F194BF97DF45F5D9E8B1DCB7C0F01A1)] | [removed: [17](#sDFA16C2EF7E8BAC0F7492FA5D02AD7DC)] [added: [20](#s9F194BF97DF45F5D9E8B1DCB7C0F01A1)] |

| Item 1A. | [Risk [removed: Factors](#sE9E3ACF6C2F63F3206982FA5D05C0893)] [added: Factors](#s45B4B3FF829855A1AC4FFBE2ABAC13A7)] | [removed: [19](#sE9E3ACF6C2F63F3206982FA5D05C0893)] [added: [22](#s45B4B3FF829855A1AC4FFBE2ABAC13A7)] |

| Item 1B. | [Unresolved Staff [removed: Comments](#s133899BF7005CD729D5F2FA5D07EC59A)] [added: Comments](#s6F693DE7341A5A5EB195B4EB4DB7E0FC)] | [removed: [35](#s133899BF7005CD729D5F2FA5D07EC59A)] [added: [42](#s6F693DE7341A5A5EB195B4EB4DB7E0FC)] |

| Item 2. | [removed: [Properties](#s7D2E115B3049F9FB0E232FA5D0AF76FB)] [added: [Properties](#sC6F40AE28EAC5D53AC99BD9A129C486F)] | [removed: [36](#s7D2E115B3049F9FB0E232FA5D0AF76FB)] [added: [43](#sC6F40AE28EAC5D53AC99BD9A129C486F)] |

| Item 3. | [Legal [removed: Proceedings](#sCEEB28A282184B6812982FA5D0D02E68)] [added: Proceedings](#s023AC2EB942955E48AC7C4914372ED25)] | [removed: [37](#sCEEB28A282184B6812982FA5D0D02E68)] [added: [44](#s023AC2EB942955E48AC7C4914372ED25)] |

| Item 4. | [Mine Safety [removed: Disclosures](#s551455203470F6BE71A62FA5D102804F)] [added: Disclosures](#sEF16BE3E801E5823B388F7199357F4AE)] | [removed: [37](#s551455203470F6BE71A62FA5D102804F)] [added: [44](#sEF16BE3E801E5823B388F7199357F4AE)] |

| Item 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity [removed: Securities](#s4C55E6E05B2A92298F022FA5D1568676)] [added: Securities](#sA9A889D3D98050409BF147CC5A87E5C9)] | [removed: [38](#s4C55E6E05B2A92298F022FA5D1568676)] [added: [45](#sA9A889D3D98050409BF147CC5A87E5C9)] |

| Item 6. | [Selected Financial [removed: Data](#s34C718E9AAB1DD86C4532FA5CBF14481)] [added: Data](#s55469F1E4E305DC49990A70CC302153C)] | [removed: [41](#s34C718E9AAB1DD86C4532FA5CBF14481)] [added: [48](#s55469F1E4E305DC49990A70CC302153C)] |

| Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#sEDCD390BB0A8A15CA8742FA5CC2A548F)] [added: Operations](#s866E4200188D569C8A1FB74C2FA633DB)] | [removed: [42](#sEDCD390BB0A8A15CA8742FA5CC2A548F)] [added: [49](#s866E4200188D569C8A1FB74C2FA633DB)] |

| Item 7A. | [Quantitative and Qualitative Disclosures about Market [removed: Risk](#s4A793393DFA05D7E0F1E2FA5D1D2BB5E)] [added: Risk](#s2BC43C5477395A9998C748C666F74D54)] | [removed: [72](#s4A793393DFA05D7E0F1E2FA5D1D2BB5E)] [added: [80](#s2BC43C5477395A9998C748C666F74D54)] |

| Item 8. | [Financial Statements and Supplementary [removed: Data](#sD6C28F669A29FAF284022FA5D1FC6301)] [added: Data](#sB37D6C761C2B5F9FB82C9926DB29C757)] | [removed: [73](#sD6C28F669A29FAF284022FA5D1FC6301)] [added: [82](#sB37D6C761C2B5F9FB82C9926DB29C757)] |

| Item 9. | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#sBE51948606B46842DE172FA5D75849B1)] [added: Disclosure](#s6FC89E8F7EEF5E249B56A50C3F0026E6)] | [removed: [110](#sBE51948606B46842DE172FA5D75849B1)] [added: [121](#s6FC89E8F7EEF5E249B56A50C3F0026E6)] |

| Item 9A. | [Controls and [removed: Procedures](#s6DDA6C7BFDC89518D2892FA5D785F50B)] [added: Procedures](#s64A41C9D2E3D5DF7A1BB7C8AE58EBA66)] | [removed: [110](#s6DDA6C7BFDC89518D2892FA5D785F50B)] [added: [121](#s64A41C9D2E3D5DF7A1BB7C8AE58EBA66)] |

| Item 9B. | [Other [removed: Information](#s76A96001E33311FDEDCA2FA5D7A79B5C)] [added: Information](#s0EE83853BFEF559A9291B2F2D9DC3FA0)] | [removed: [111](#s76A96001E33311FDEDCA2FA5D7A79B5C)] [added: [122](#s0EE83853BFEF559A9291B2F2D9DC3FA0)] |

| Item 10. | [Directors, Executive Officers and Corporate [removed: Governance](#s2666B8329FDD203A4FE52FA5D7FAF194)] [added: Governance](#sAB0DC70701095CA4A5A177FDB67B1D00)] | [removed: [112](#s2666B8329FDD203A4FE52FA5D7FAF194)] [added: [123](#sAB0DC70701095CA4A5A177FDB67B1D00)] |

| Item 11. | [Executive [removed: Compensation](#s9914938025734E1C39F22FA5D82CB9CB)] [added: Compensation](#sB169937580C9591B9B28B4F3F2A8388C)] | [removed: [112](#s9914938025734E1C39F22FA5D82CB9CB)] [added: [123](#sB169937580C9591B9B28B4F3F2A8388C)] |

| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s84029B16DB868DAB00DC2FA5D84DA7C1)] [added: Matters](#s7F8BD335B38F5F2FB43E43371F883A39)] | [removed: [112](#s84029B16DB868DAB00DC2FA5D84DA7C1)] [added: [123](#s7F8BD335B38F5F2FB43E43371F883A39)] |

| Item 13. | [Certain Relationships and Related Transactions, and Director [removed: Independence](#s06B7578AF1DA5E06A5BB2FA5D87F511E)] [added: Independence](#s28658726477D5591B1117FE9F6AE5E53)] | [removed: [112](#s06B7578AF1DA5E06A5BB2FA5D87F511E)] [added: [123](#s28658726477D5591B1117FE9F6AE5E53)] |

| Item 14. | [Principal Accountant Fees and [removed: Services](#s82E4F279913B6BFB086D2FA5D8A1D070)] [added: Services](#s9ECAF822FA6A53FA9862DBEFCC4358E4)] | [removed: [112](#s82E4F279913B6BFB086D2FA5D8A1D070)] [added: [123](#s9ECAF822FA6A53FA9862DBEFCC4358E4)] |

| Item 15. | [Exhibits and Financial Statement [removed: Schedules](#s7693A399C5999A3B58082FA5D8F4267A)] [added: Schedules](#s9CEE945D9E4A54379100F4651D61E02D)] | [removed: [113](#s7693A399C5999A3B58082FA5D8F4267A)] [added: [124](#s9CEE945D9E4A54379100F4651D61E02D)] |

10-K 1 flt_10-kx12312017.htm 10-K

| 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.

| | [Signatures](#s0BD36FB40BE55CA587DC3418AC04E204) | [128](#s0BD36FB40BE55CA587DC3418AC04E204) |

10-K 1 flt_10-kx12312016.htm 10-K

| | [Signatures](#s530E1A93F568D6DC8A7E2FA5D926AF39) | [117](#s530E1A93F568D6DC8A7E2FA5D926AF39) |

The following table lists each of our material facilities and its location, use and approximate square footage, at December 31, [removed: 2016.][added: 2017.]

| Norcross, Georgia | Corporate headquarters and operations | [removed: 81,000] [added: 98,000] | |

| Covington, Louisiana | Corporate accounting and treasury | [removed: 13,600] [added: 24,000] | |

| Wichita, Kansas | CLC operations and customer support | [removed: 31,100] [added: 38,000] | |

| [removed: Atlanta, Georgia] [added: Birmingham, United Kingdom] | [removed: NexTraq] [added: EPYX headquarters,] sales, operations and customer support | [removed: 36,800] [added: 14,800] | |

| Brentwood, Tennessee | Comdata sales, operations and customer support | [removed: 228,000] [added: 135,000] | |

| Nashville, Tennessee | Comdata operations | [removed: 38,320] [added: 38,300] | |

| Prague, Czech Republic | CCS headquarters and Shell Europe (Germany, Austria, Poland, Hungary, Switzerland, Czech Republic and [removed: Slovakia)] [added: Slovakia, France, Belgium, Netherlands and Luxembourg)] operations, credit and collections, customer [removed: service and] [added: service,] sales [added: and finance] | [removed: 35,000] [added: 38,400] | |

| Mexico City, Mexico(1) | [removed: FleetCor] [added: FLEETCOR] Mexico headquarters and operations | [removed: 22,500] [added: 27,500] | |

| London, United Kingdom | Europe headquarters [added: (including Cambridge Europe)] | [removed: 2,800] [added: 7,540] | |

| Swindon, United Kingdom | Allstar [removed: and Shell Europe (Belgium, Netherlands and France)] operations, sales and customer support | 18,300 | |

| Auckland, New Zealand | CardLink headquarters, sales, operations and customer support | [removed: 12,100] [added: 7,200] | |

| [removed: Nuernberg,] [added: Nuremberg,] Germany | Shell Europe sales | [removed: 4,300] [added: 6,900] | |

[removed: We also] [added: Additionally, we] lease a number of minor additional facilities, including local sales and operations offices less than [removed: 2,400] [added: 3,250] square feet, small storage facilities and a small number of service stations in the United Kingdom; which are not included in the above list.

| Lexington, Kentucky | CLS operations | 60,100 | |

| New York, New York | Cambridge U.S. headquarters | 5,900 | |

| Bala Cynwyd, Pennsylvania | Cambridge global exchange division | 4,800 | |

| Rostov-on-Don, Russia | Gazprom headquarters and operations | 10,600 | |

| Toronto, Canada | Cambridge global headquarters | 27,600 | |

We also own approximately 1.5 acres of land in Nashville, Tennessee, for employee parking.

| | | | |

| Tampa, Florida | NexTraq sales | 8,300 | |

| Birmingham, United Kingdom | EPYX headquarters, sales, operations and customer support | 12,500 | |

_____________________

Our common stock is traded on the New York Stock Exchange (NYSE) under the symbol [removed: “FLT”.][added: “FLT.” As of December 31, 2017, there were 146 holders of record of our common stock.]

The table set forth below provides the [removed: intraday] [added: intra-day] high and low sales prices per share of our common stock for the four quarters during [removed: 2016] [added: 2017] and [removed: 2015.][added: 2016.]

On February 4, 2016, [removed: the Company’s] [added: our] Board of Directors approved a stock repurchase program (the "Program") under which [removed: the Company] [added: we] may begin purchasing up to [added: an aggregate of] $500 million of [removed: its] [added: the outstanding] common stock over the [removed: next] [added: following] 18 month period.

[removed: The following table presents information with respect to] [added: We did not make any] purchases of common stock [removed: of the Company made] during the three months ended December 31, [removed: 2016 by the Company] [added: 2017] as defined in Rule 10b-18(a)(3) under the Exchange [removed: Act:][added: Act.]

The following graph assumes $100 invested on December [removed: 15, 2010 (the date our shares first commenced trading),] [added: 31, 2012,] at the closing price [removed: ($27.25)] [added: ($53.65)] of our common stock on that day, and compares (a) the percentage change of our cumulative total stockholder return on the common stock (as measured by dividing (i) the difference between our share price at the end and the beginning of the period presented by (ii) the share price at the beginning of the periods presented) with (b) (i) the Russell 2000 Index and (ii) the S&P 500® Data Processing & Outsourced Services.

[removed: ][added: ]

| 2017: | | | | | | | | |

| First Quarter | | $ | 171.78 | | | $ | 142.62 | |

| Second Quarter | | 157.36 | | | | 121.52 | | |

| Third Quarter | | 157.40 | | | | 138.43 | | |

| Fourth Quarter | | 194.51 | | | | 153.45 | | |

On July 27, 2017, the Company's Board of Directors authorized an increase in the size of the Program by an additional $250 million and an extension of the Program by an additional 18 months.

On November 1, 2017, the Company announced that its Board of Directors had authorized an increase in the size of the Program by an additional $350 million, resulting in total aggregate repurchases authorized under the Program of $1.1 billion.

Since the beginning of the Program, 4,114,104 shares for an aggregate purchase price of $590 million have been repurchased.

| 12/31/2012 | | $ | 100.00 | | | $ | 100.00 | | | $ | 100.00 | |

| 3/31/2013 | | $ | 142.91 | | | $ | 112.03 | | | $ | 112.20 | |

| 6/30/2013 | | $ | 151.54 | | | $ | 115.09 | | | $ | 118.85 | |

| 9/30/2013 | | $ | 205.33 | | | $ | 126.42 | | | $ | 130.25 | |

| 12/31/2013 | | $ | 218.40 | | | $ | 137.00 | | | $ | 151.76 | |

| 3/31/2014 | | $ | 214.54 | | | $ | 138.11 | | | $ | 144.46 | |

| 6/30/2014 | | $ | 245.67 | | | $ | 140.46 | | | $ | 144.86 | |

| 9/30/2014 | | $ | 264.90 | | | $ | 129.71 | | | $ | 146.72 | |

| 12/31/2014 | | $ | 277.19 | | | $ | 141.84 | | | $ | 170.19 | |

| 3/31/2015 | | $ | 281.30 | | | $ | 147.50 | | | $ | 173.97 | |

| 6/30/2015 | | $ | 290.89 | | | $ | 147.64 | | | $ | 175.73 | |

| 9/30/2015 | | $ | 256.51 | | | $ | 129.59 | | | $ | 172.99 | |

| 12/31/2015 | | $ | 266.41 | | | $ | 133.74 | | | $ | 188.13 | |

| 3/30/2016 | | $ | 277.26 | | | $ | 131.16 | | | $ | 188.59 | |

| 6/30/2016 | | $ | 266.78 | | | $ | 135.62 | | | $ | 185.00 | |

| 9/30/2016 | | $ | 323.82 | | | $ | 147.37 | | | $ | 199.67 | |

| 12/31/2016 | | $ | 263.78 | | | $ | 159.78 | | | $ | 199.15 | |

| 3/31/2017 | | $ | 282.26 | | | $ | 163.17 | | | $ | 216.67 | |

| 6/30/2017 | | $ | 268.80 | | | $ | 166.64 | | | $ | 232.21 | |

| 9/30/2017 | | $ | 288.48 | | | $ | 175.53 | | | $ | 259.13 | |

| 12/31/2017 | | $ | 358.68 | | | $ | 180.79 | | | $ | 280.89 | |

As of December 31, 2016, there were 102 holders of record of our common stock.

| 2015: | | | | | | | | |

| First Quarter | | $ | 158.45 | | | $ | 135.73 | |

| Second Quarter | | 165.67 | | | | 149.75 | | |

| Third Quarter | | 164.61 | | | | 135.16 | | |

| Fourth Quarter | | 157.97 | | | | 134.55 | | |

Any stock repurchases may be made at times and in such amounts as deemed appropriate.

The timing and amount of stock repurchases, if any, will depend on a variety of factors including the stock price, market conditions, corporate and regulatory requirements, and any additional constraints related to material inside information the Company may possess.

Any repurchases have been and are expected to be funded by available cash flow from the business and working capital.

There were 1,259,145 common shares totaling $187.7 million repurchased under the Program during 2016.

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | |

| Period | | Total Number of Shares Purchased | | | Average Price Paid Per Share | | | | Total Number of Shares Purchased as Part of the Publicly Announced Plan | | | Maximum Value that May Yet be Purchased Under the Publicly Announced Plan (in thousands) | | |

| October 1, 2016 through December 31, 2016 | | 1,000,000 | | | $ | 152.17 | | | 1,259,145 | | | $ | 312,348 | |

| 12/15/2010 | | $ | 100.00 | | | $ | 100.00 | | | $ | 100.00 | |

| 12/31/2010 | | $ | 113.03 | | | $ | 102.78 | | | $ | 95.88 | |

| 3/31/2011 | | $ | 119.85 | | | $ | 109.79 | | | $ | 103.77 | |

| 6/30/2011 | | $ | 108.37 | | | $ | 106.71 | | | $ | 110.66 | |

| 9/30/2011 | | $ | 96.37 | | | $ | 83.84 | | | $ | 101.70 | |

| 12/31/2011 | | $ | 109.61 | | | $ | 96.43 | | | $ | 117.85 | |

| 3/31/2012 | | $ | 142.28 | | | $ | 108.06 | | | $ | 131.46 | |

| 6/30/2012 | | $ | 128.59 | | | $ | 103.92 | | | $ | 134.19 | |

| 9/30/2012 | | $ | 164.40 | | | $ | 108.99 | | | $ | 142.49 | |

| 12/31/2012 | | $ | 196.88 | | | $ | 110.54 | | | $ | 150.85 | |

| 3/31/2013 | | $ | 281.36 | | | $ | 123.84 | | | $ | 169.26 | |

| 6/30/2013 | | $ | 298.35 | | | $ | 127.22 | | | $ | 179.29 | |

| 9/30/2013 | | $ | 404.26 | | | $ | 139.75 | | | $ | 196.49 | |

| 12/31/2013 | | $ | 429.98 | | | $ | 151.44 | | | $ | 228.94 | |

| 3/31/2014 | | $ | 422.39 | | | $ | 152.67 | | | $ | 217.93 | |

| 6/30/2014 | | $ | 483.67 | | | $ | 155.26 | | | $ | 218.52 | |

| 9/30/2014 | | $ | 521.54 | | | $ | 143.38 | | | $ | 221.34 | |

| 12/31/2014 | | $ | 545.72 | | | $ | 156.79 | | | $ | 256.74 | |

| 3/31/2015 | | $ | 553.83 | | | $ | 163.04 | | | $ | 262.43 | |

| 6/30/2015 | | $ | 572.70 | | | $ | 163.20 | | | $ | 265.08 | |

| 9/30/2015 | | $ | 505.03 | | | $ | 143.25 | | | $ | 260.96 | |

| 12/31/2015 | | $ | 524.51 | | | $ | 147.83 | | | $ | 283.80 | |

| 3/30/2016 | | $ | 545.87 | | | $ | 144.99 | | | $ | 284.49 | |

| 6/30/2016 | | $ | 525.25 | | | $ | 149.92 | | | $ | 279.08 | |

| 9/30/2016 | | $ | 637.54 | | | $ | 162.90 | | | $ | 301.21 | |

We derived the consolidated statement of income and other financial data for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014] [added: 2015] and the selected consolidated balance sheet data as of December 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] from the audited consolidated financial statements included elsewhere in this report.

We derived the selected historical financial data for the years ended December 31, [removed: 2013] [added: 2014] and [removed: 2012] [added: 2013] and the selected consolidated balance sheets as of December 31, [removed: 2014, 2013] [added: 2015, 2014] and [removed: 2012] [added: 2013] from our audited consolidated financial statements that are not included in this report.

| (in thousands, except per share data) | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Revenues, net | | $ | [removed: 1,831,546] [added: 2,249,538] | | | $ | [removed: 1,702,865] [added: 1,831,546] | | | $ | [removed: 1,199,390] [added: 1,702,865] | | | $ | [removed: 895,171] [added: 1,199,390] | | | $ | [removed: 707,534] [added: 895,171] | |

| Merchant commissions | | [removed: 104,345] [added: 113,133] | | | | [removed: 108,257] [added: 104,345] | | | | [removed: 96,254] [added: 108,257] | | | | [removed: 68,143] [added: 96,254] | | | | [removed: 58,573] [added: 68,143] | | |

| Processing | | [removed: 355,414] [added: 429,613] | | | | [removed: 331,073] [added: 355,414] | | | | [removed: 173,337] [added: 331,073] | | | | [removed: 134,030] [added: 173,337] | | | | [removed: 115,446] [added: 134,030] | | |

| Selling | | [removed: 131,443] [added: 170,717] | | | | [removed: 109,075] [added: 131,443] | | | | [removed: 75,527] [added: 109,075] | | | | [removed: 57,346] [added: 75,527] | | | | [removed: 46,429] [added: 57,346] | | |

| General and administrative | | [removed: 283,625] [added: 387,694] | | | | [removed: 297,715] [added: 283,625] | | | | [removed: 205,963] [added: 297,715] | | | | [removed: 142,283] [added: 205,963] | | | | [removed: 110,122] [added: 142,283] | | |

| Depreciation and amortization | | [removed: 203,256] [added: 264,560] | | | | [removed: 193,453] [added: 203,256] | | | | [removed: 112,361] [added: 193,453] | | | | [removed: 72,737] [added: 112,361] | | | | [removed: 52,036] [added: 72,737] | | |

| Other operating, net | | [removed: (690] [added: 61] | | [removed: )] | | [removed: (4,242] [added: (690] | | ) | | [removed: (29,501] [added: (4,242] | | ) | | [removed: —] [added: (29,501] | | [added: )] | | — | | |

| Operating income | | [removed: 754,153] [added: 883,760] | | | | [removed: 667,534] [added: 754,153] | | | | [removed: 565,449] [added: 667,534] | | | | [removed: 420,632] [added: 565,449] | | | | [removed: 324,928] [added: 420,632] | | |

| [removed: Equity method investment] [added: Investment] loss | | [removed: 36,356] [added: 53,164] | | | | [removed: 57,668] [added: 36,356] | | | | [removed: 8,586] [added: 57,668] | | | | [removed: —] [added: 8,586] | | | | — | | |

| Other [removed: expense (income),] [added: (income) expense,] net | | [added: (173,436 | | ) | |] 2,982 | | | | 2,523 | | | | (700 | | ) | | 602 | | | [removed: | 1,121 | | |]

| Interest expense, net | | [removed: 71,896] [added: 107,146] | | | | [removed: 71,339] [added: 71,896] | | | | [removed: 28,856] [added: 71,339] | | | | [removed: 16,461] [added: 28,856] | | | | [removed: 13,017] [added: 16,461] | | |

| Loss on [removed: early] extinguishment of debt | | [removed: —] [added: 3,296] | | | | — | | | | [removed: 15,764] [added: —] | | | | [removed: —] [added: 15,764] | | | | — | | |

| Total other [added: (income)] expense | | [removed: 111,234] [added: (9,830] | | [added: )] | | [removed: 131,530] [added: 111,234] | | | | [removed: 52,506] [added: 131,530] | | | | [removed: 17,063] [added: 52,506] | | | | [removed: 14,138] [added: 17,063] | | |

| Income before income taxes | | [removed: 642,919] [added: 893,590] | | | | [removed: 536,004] [added: 642,919] | | | | [removed: 512,943] [added: 536,004] | | | | [removed: 403,569] [added: 512,943] | | | | [removed: 310,790] [added: 403,569] | | |

| Provision for income taxes | | [removed: 190,534] [added: 153,390] | | | | [removed: 173,573] [added: 190,534] | | | | [removed: 144,236] [added: 173,573] | | | | [removed: 119,068] [added: 144,236] | | | | [removed: 94,591] [added: 119,068] | | |

| Net income | | $ | [removed: 452,385] [added: 740,200] | | | $ | [removed: 362,431] [added: 452,385] | | | $ | [removed: 368,707] [added: 362,431] | | | $ | [removed: 284,501] [added: 368,707] | | | $ | [removed: 216,199] [added: 284,501] | |

| [removed: Earnings] [added: Basic earnings] per [removed: share, basic] [added: share] | | $ | [removed: 4.89] [added: 8.12] | | | $ | [removed: 3.94] [added: 4.89] | | | $ | [removed: 4.37] [added: 3.94] | | | $ | [removed: 3.48] [added: 4.37] | | | $ | [removed: 2.59] [added: 3.48] | |

| [removed: Earnings] [added: Diluted earnings] per [removed: share, diluted] [added: share] | | $ | [removed: 4.75] [added: 7.91] | | | $ | [removed: 3.85] [added: 4.75] | | | $ | [removed: 4.24] [added: 3.85] | | | $ | [removed: 3.36] [added: 4.24] | | | $ | [removed: 2.52] [added: 3.36] | |

| [removed: Weighted average] [added: Basic] shares [removed: outstanding, basic] | | [removed: 92,597] [added: 91,129] | | | | [removed: 92,023] [added: 92,597] | | | | [removed: 84,317] [added: 92,023] | | | | [removed: 81,793] [added: 84,317] | | | | [removed: 83,328] [added: 81,793] | | |

| [removed: Weighted average] [added: Diluted] shares [removed: outstanding, diluted] | | [removed: 95,213] [added: 93,594] | | | | [removed: 94,139] [added: 95,213] | | | | [removed: 86,982] [added: 94,139] | | | | [removed: 84,655] [added: 86,982] | | | | [removed: 85,736] [added: 84,655] | | |

| (in thousands) | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Cash and cash equivalents | | $ | [removed: 475,018] [added: 913,595] | | | $ | [removed: 447,152] [added: 475,018] | | | $ | [removed: 477,069] [added: 447,152] | | | $ | [removed: 338,105] [added: 477,069] | | | $ | [removed: 283,649] [added: 338,105] | |

| Restricted cash(1) | | [removed: 168,752] [added: 217,275] | | | | [removed: 167,492] [added: 168,752] | | | | [removed: 135,144] [added: 167,492] | | | | [removed: 48,244] [added: 135,144] | | | | [removed: 53,674] [added: 48,244] | | |

| Total assets | | [removed: 9,626,732] [added: 11,318,359] | | | | [removed: 7,889,806] [added: 9,626,732] | | | | [removed: 8,524,701] [added: 7,889,806] | | | | [removed: 3,908,717] [added: 8,524,701] | | | | [removed: 2,721,870] [added: 3,908,717] | | |

| Total debt | | [removed: 3,858,233] [added: 4,518,616] | | | | [removed: 2,935,000] [added: 3,858,233] | | | | [removed: 3,593,717] [added: 2,935,000] | | | | [removed: 1,486,378] [added: 3,593,717] | | | | [removed: 925,092] [added: 1,486,378] | | |

| Total stockholders’ equity | | [removed: 3,084,038] [added: 3,676,522] | | | | [removed: 2,830,047] [added: 3,084,038] | | | | [removed: 2,618,562] [added: 2,830,047] | | | | [removed: 1,223,502] [added: 2,618,562] | | | | [removed: 913,822] [added: 1,223,502] | | |

| Weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | |

(1) Restricted cash represents customer deposits repayable on demand, as well as collateral received from customers for cross-currency transactions.

(1) Restricted cash represents customer deposits repayable on demand.

| [Reports of Independent Registered Public Accounting [removed: Firm](#s93A89BF5FDEC7B49DAF82FA5D21EC735)] [added: Firm](#s0FE3416C0DBE521E94B6F524D9F8A8B2)] | [removed: [74](#s93A89BF5FDEC7B49DAF82FA5D21EC735)] [added: [83](#s0FE3416C0DBE521E94B6F524D9F8A8B2)] |

| [Consolidated Balance Sheets at December 31, [removed: 2016] [added: 2017] and [removed: 2015](#sC2DDE842B1DF88D1F72C2FA5C5813279)] [added: 2016](#sDAC348FFAFA158529EF35ADDEA5AD039)] | [removed: [76](#sC2DDE842B1DF88D1F72C2FA5C5813279)] [added: [85](#sDAC348FFAFA158529EF35ADDEA5AD039)] |

| [Consolidated Statements of Income for the Years Ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#sB98642C4D60FFA002A7F2FA5C558FA68)] [added: 2015](#s40244BF79C8753D89E67A686BB21202B)] | [removed: [77](#sB98642C4D60FFA002A7F2FA5C558FA68)] [added: [86](#s40244BF79C8753D89E67A686BB21202B)] |

| [Consolidated Statements of Comprehensive Income for the Years Ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#s85F01D164BAB8DBB75F02FA5C5F0B67B)] [added: 2015](#sB241F3EB9DBD55EC8E4AE81C8ABD26B8)] | [removed: [78](#s85F01D164BAB8DBB75F02FA5C5F0B67B)] [added: [87](#sB241F3EB9DBD55EC8E4AE81C8ABD26B8)] |

| [Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#s44AA855BAD6F0E31D9552FA5C4D6C6E5)] [added: 2015](#s779FD8AC342159CF89FFD1FB51D809F6)] | [removed: [79](#s44AA855BAD6F0E31D9552FA5C4D6C6E5)] [added: [88](#s779FD8AC342159CF89FFD1FB51D809F6)] |

| [Consolidated Statements of Cash Flows for the Years Ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#s829958ECC28F70AFFDF12FA5C4A98819)] [added: 2015](#s1625077018815047A7CC5D98D2ADA521)] | [removed: [80](#s829958ECC28F70AFFDF12FA5C4A98819)] [added: [89](#s1625077018815047A7CC5D98D2ADA521)] |

[removed: | [Notes] [added: Notes] to Consolidated Financial [removed: Statements](#s03A15DA55D9150407D042FA5D36BD12C) | [82](#s03A15DA55D9150407D042FA5D36BD12C) |][added: Statements]

[removed: The] [added: To the Shareholders and the] Board of Directors [removed: and Stockholders] of FleetCor Technologies, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheets of FleetCor Technologies, Inc. and subsidiaries [added: (the Company)] as of December 31, [removed: 2016 and 2015,] [added: 2017] and [added: 2016,] the related consolidated statements of income, comprehensive income, [removed: stockholders’ equity,] [added: stockholders' equity] and cash flows for each of the three years in the period ended December 31, [removed: 2016.][added: 2017, and the related notes (collectively referred to as the “consolidated financial statements”).]

These [added: consolidated] financial statements are the responsibility of the [removed: Company’s] [added: Company's] management.

Our responsibility is to express an opinion on [removed: these] [added: the Company’s] financial statements based on our audits.

We conducted our audits in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material [removed: misstatement.][added: misstatement, whether due to error or fraud.]

[removed: An audit includes] [added: Such procedures included] examining, on a test basis, evidence [removed: supporting] [added: regarding] the amounts and disclosures in the financial statements.

[removed: An audit] [added: Our audits] also [removed: includes assessing] [added: included evaluating] the accounting principles used and significant estimates made by management, as well as evaluating the overall [added: presentation of the] financial [removed: statement presentation.][added: statements.]

In our opinion, the [added: consolidated] financial statements [removed: referred to above] present fairly, in all material respects, the [removed: consolidated] financial position of [removed: FleetCor Technologies, Inc. and subsidiaries] [added: the Company] at December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the [removed: consolidated] results of [removed: their] [added: its] operations and [removed: their] [added: its] cash flows for each of the three years in the period ended December 31, [removed: 2016,] [added: 2017,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States), FleetCor Technologies, Inc. and subsidiaries’] [added: States) (PCAOB), the Company's] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March 1, [removed: 2017] [added: 2018] expressed an unqualified opinion thereon.

[removed: The] [added: To the Shareholders and the] Board of Directors [removed: and Stockholders] of [removed: FleetCor] [added: FLEETCOR] Technologies, Inc. and Subsidiaries

We have audited FleetCor Technologies, Inc. and subsidiaries’ internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission [removed: (2013 framework)] [added: 2013 framework] (the COSO criteria).

[removed: FleetCor Technologies, Inc. and subsidiaries’] [added: The Company’s] management is responsible for maintaining effective internal control over financial [removed: reporting,] [added: reporting] and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying [removed: Management’s] [added: Management] Report on Internal [removed: Control Over] [added: Controls over] Financial Reporting.

We conducted our audit in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

As indicated in the accompanying [removed: Management’s] [added: Management] Report on Internal Control [removed: Over] [added: over] Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of [removed: Serviços e Tecnologia de Pagamentos S.A.] [added: Cambridge Global Payments, Creative Lodging Solutions,] and [removed: TravelCard Nederland B.V.,] [added: a fuel card provider in Russia (the “Acquired Entities”),] which is included in the [removed: 2016] [added: 2017] consolidated financial statements of [removed: FleetCor Technologies, Inc. and subsidiaries] [added: the Company] and constituted [removed: 18%] [added: 11%] of total assets as of December 31, [removed: 2016] [added: 2017] and [removed: 5%] [added: 3%] of revenues for the year then ended.

Our audit of internal control over financial reporting of [removed: FleetCor Technologies, Inc. and subsidiaries] [added: the Company] also did not include an evaluation of the internal control over financial reporting of [removed: Serviços e Tecnologia de Pagamentos S.A. and TravelCard Nederland B.V..][added: the Acquired Entities.]

In our opinion, FleetCor [removed: Technologies, Inc.] and subsidiaries [added: (the Company)] maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States),] [added: States) (PCAOB),] the consolidated balance sheets of [added: the] FleetCor Technologies, Inc. and subsidiaries as of December 31, [removed: 2016 and 2015,] [added: 2017] and [added: 2016,] the related consolidated statements of [removed: income,] comprehensive income, stockholders’ [removed: equity,] [added: equity] and cash flows for each of the three years in the period ended December 31, [removed: 2016 of FleetCor Technologies, Inc.] [added: 2017,] and [removed: subsidiaries] [added: the related notes] and our report dated March 1, [removed: 2017] [added: 2018] expressed an unqualified opinion [removed: thereon.][added: thereon]

| | | [added: 2017 | | | |] 2016 | | | | 2015 | | |

| Cash and cash [removed: equivalents |] [added: equivalents, beginning of year] | [removed: $] | 475,018 | | | [removed: $] | 447,152 | | [added: | | 477,069 | | |]

| Restricted cash | | [removed: 168,752] [added: 217,275] | | | | [removed: 167,492] [added: 168,752] | | |

| Accounts and other receivables (less allowance for doubtful accounts of [removed: $32,506] [added: $46,031] and [removed: $21,903,] [added: $32,506,] respectively) | | [removed: 1,202,009] [added: 1,420,011] | | | | [removed: 638,954] [added: 1,202,009] | | |

| Securitized accounts receivable—restricted for securitization investors | | [removed: 591,000] [added: 811,000] | | | | [removed: 614,000] [added: 591,000] | | |

| Prepaid expenses and other current assets | | [removed: 90,914] [added: 187,820] | | | | [removed: 68,113] [added: 90,914] | | |

| Total current assets | | [removed: 2,527,693] [added: 3,549,701] | | | | [removed: 1,944,624] [added: 2,527,693] | | |

| [removed: Property] [added: Property, plant] and [removed: equipment] [added: equipment, gross] | | [removed: 253,361] | | [added: 310,566] | | [removed: 163,569] | | [added: 253,361] | [added: | |]

| [removed: Less] [added: Less:] accumulated depreciation [removed: and amortization] | | [removed: (110,857] | | [added: (130,509 | |] ) | | [removed: (82,809] [added: (110,857] | | ) |

| [removed: Net property] [added: Property] and [removed: equipment] [added: equipment, net] | | [removed: 142,504] [added: 180,057] | | | | [removed: 80,760] [added: 142,504] | | |

| Goodwill | | [removed: 4,195,150] [added: 4,715,823] | | | | [removed: 3,546,034] [added: 4,195,150] | | |

| Other intangibles, net | | [removed: 2,653,233] [added: 2,724,957] | | | | [removed: 2,183,595] [added: 2,653,233] | | |

| Other assets | | [removed: 71,952] [added: 114,962] | | | | [removed: 58,225] [added: 71,952] | | |

| Total assets | | $ | [removed: 9,626,732] [added: 11,318,359] | | | $ | [removed: 7,889,806] [added: 9,626,732] | |

| Accounts payable | | $ | [removed: 1,151,432] [added: 1,437,314] | | | $ | [removed: 669,528] [added: 1,151,432] | |

Opinion on the Financial Statements

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

We have served as the Company‘s auditor since 2002.

March 1, 2018

Opinion on Internal Control over Financial Reporting

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Definition and Limitations of Internal Control Over Financial Reporting

March 1, 2018

| | | 2017 | | | | 2016 | | |

| Cash and cash equivalents | | $ | 913,595 | | | $ | 475,018 | |

| Investments | | 32,859 | | | | 36,200 | | |

| Reclassification of foreign currency translation loss to investment, net of tax | | 31,381 | | | | — | | | | — | | |

| Net income | | — | | | | — | | | | 740,200 | | | | — | | | | — | | | | 740,200 | | |

| Acquisition of common stock | | — | | | | — | | | | — | | | | — | | | | (402,393 | | ) | | (402,393 | | ) |

| Issuance of common stock | | 1 | | | | 140,130 | | | | — | | | | — | | | | — | | | | 140,131 | | |

| Balance at December 31, 2017 | | $ | 122 | | | $ | 2,214,224 | | | $ | 2,958,921 | | | $ | (551,857 | ) | | $ | (944,888 | ) | | $ | 3,676,522 | |

| Gain on disposition of business | | (174,983 | | ) | | — | | | | — | | |

| Proceeds from disposal of a business | | 316,501 | | | | — | | | | — | | |

| Non cash investing activity, notes assumed in acquisitions | | $ | 29,341 | | | $ | — | | | $ | — | |

| |

| --- |

| |

December 31, 2017

The Company helps businesses of all sizes control, simplify and secure payment of various domestic and cross-border payables using specialized payment products.

The Company serves businesses, merchants and partners in North America, Latin America, Europe, and Australasia.

The Company reports these two segments as they align with its senior executive organizational structure, reflect how the Company organizes and manages its employees around the world, manages operating performance, contemplates the differing regulatory environments in North America versus other geographies, and helps the Company isolate the impact of foreign exchange fluctuations on its financial results.

The Company's payment solutions provide its customers with a payment method designed to be superior and more robust and effective than what they use currently, whether they use a competitor’s product or another alternative method such as cash or check.

The Company's solutions are comprised of payment products, networks and associated services.

The Company's payment products function like a charge card or prepaid card and tend to be specialized for specific spend categories, such as fuel or lodging, and/or specific customer groups, such as long haul transportation.

The Company's five primary product lines are Fuel, Lodging, Tolls, Corporate Payments and Gift.

FLEETCOR owns and operates proprietary networks with brands throughout the world, bringing incremental sales and loyalty to affiliated merchants.

Third-party networks are used to broaden payment product acceptance and use.

The Company markets its products directly through multiple sales channels, including field sales, telesales and digital marketing, and indirectly through its partners, which include major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and referral partners.

captured when we have validated that the transaction has no errors and have accepted and posted the data to the Company’s records.

Sales commissions paid to personnel are expensed as incurred.

The Company presents taxes assessed by the government imposed concurrent with a revenue producing transaction between us and our customers (e.g. VAT) on a net basis within revenues, net.

Accounts receivable deemed uncollectible are removed from accounts

March 1, 2017

March 1, 2017

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | |

| Deferred income taxes | | — | | | | 8,913 | | |

| Equity method investment | | 36,200 | | | | 76,568 | | |

| | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance at December 31, 2013 | | $ | 117 | | | $ | 631,667 | | | $ | 1,035,198 | | | $ | (67,817 | ) | | $ | (375,663 | ) | | $ | 1,223,502 | |

| Net income | | — | | | | — | | | | 368,707 | | | | — | | | | — | | | | 368,707 | | |

| Issuance of treasury stock | | — | | | | 1,096,698 | | | | — | | | | — | | | | 29,266 | | | | 1,125,964 | | |

| Issuance of common stock | | 3 | | | | 124,077 | | | | — | | | | — | | | | — | | | | 124,080 | | |

| Payments on foreign revolver —B Facility | | — | | | | — | | | | (7,337 | | ) |

| Cash and cash equivalents, beginning of year | | 447,152 | | | | 477,069 | | | | 338,105 | | |

The Company primarily goes to market with its fuel card payments product solutions, corporate payments products, toll products, lodging cards and gift cards.

The Company's core products are primarily sold to businesses, retailers, major oil companies and marketers and government entities.

The Company’s payment programs enable its customers to better manage and control their commercial payments, card programs, and employee spending and provide card-accepting merchants with a high volume customer base that can increase their sales and customer loyalty.

The Company provides its payment products and services in a variety of combinations to create customized payment solutions for customers and partners.

The Company sells a range of customized fleet and lodging payment programs directly and indirectly to our customers through partners, such as major oil companies, leasing companies and petroleum marketers.

The Company refers to these major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and other referral partners with whom we have strategic relationships as our “partners.” The Company provides customers with various card products that typically function like a charge card to purchase fuel, lodging, food, toll, transportation and related products and services at participating locations.

The Company supports its products with specialized issuing, processing and information services that enables the Company to manage card accounts, facilitate the routing, authorization, clearing and settlement of transactions, and provide value-added functionality and data, including customizable card-level controls and productivity analysis tools.

In order to deliver payment programs and services and process transactions, the Company owns and operates proprietary “closed-loop” networks through which the Company electronically connects to merchants and captures, analyzes and reports customized information in North America and internationally.

To support our payment products, the Company also provides a range of services, such as issuing and processing, as well as specialized information services that provide our customers with value-added functionality and data.

Customers can use this data to track important business productivity metrics, combat fraud and employee misuse, streamline expense administration and lower overall workforce and fleet operating costs.

Depending on customer’s and partner’s needs, the Company provides these services in a variety of outsourced solutions ranging from a comprehensive “end-to-end” solution (encompassing issuing, processing and network services) to limited back office processing services.

In North America, the Company sells a fuel card product, commercial payment and data solutions, lodging and transportation management services, gift card and stored value solutions, as well as a fleet telematics offering.

In its International segment, the Company provides fuel card and related fuel services, work force payments, toll and parking payments products and vehicle maintenance management solutions.

Set forth below is a breakdown of revenue by product for the years ended December 31, 2016 and 2015 (in millions):

| Fuel cards | | $ | 1,124 | | | $ | 1,116 | |

| Gift | | 185 | | | | 170 | | |

| Corporate payments | | 180 | | | | 162 | | |