Stock Based Compensation

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

The Company accounts for stock-based compensation pursuant to relevant authoritative guidance, which requires measurement of compensation cost for all stock awards at fair value on the date of grant and recognition of compensation, net of estimated forfeitures, over the requisite service period for awards expected to vest. The Company has Stock Incentive Plans (the Plans) pursuant to which the Company’s board of directors may grant stock options or restricted stock to employees. The Company is authorized to issue grants of restricted stock and stock options to purchase up to 30,463,150 shares for the years ended December 31, 2019 and 2018, respectively, and 26,963,150 shares for the year ended December 31, 2017.

On February 7, 2018, the stockholders of the Company approved the FLEETCOR Technologies, Inc. Amended and Restated 2010 Equity Incentive Plan (the "Amended Plan"). The Amended Plan was authorized and approved by the Company's Board of Directors on December 20, 2017, and Company's stockholders at a special meeting held on February 7, 2018. The Amended Plan amends the Registrant’s existing 2010 Equity Incentive Plan (as amended, the "Prior Plan") to, among other things, increase the number of shares of common stock available for issuance from 13.25 million to 16.75 million and make certain other amendments to the Prior Plan. Giving effect to this increase, there were 3.1 million additional shares remaining available for grant under the Plans at December 31, 2019.

The table below summarizes the expense recognized within general and administrative expenses in the Consolidated Statements of Income related to share-based payments recognized for the years ended December 31 (in thousands):



	2019		2018		2017
Stock options	$	32,736	$	43,443	$	56,400
Restricted stock	28,217		26,496		36,897
Stock-based compensation	$	60,953	$	69,939	$	93,297

The tax benefits recorded on stock based compensation expense and upon the exercises of options were $61.6 million, $37.3 million and $48.6 million for the years ended December 31, 2019, 2018 and 2017, respectively.

The following table summarizes the Company’s total unrecognized compensation cost related to stock-based compensation as of December 31, 2019 (cost in thousands):

Stock Options

The following summarizes the changes in the number of shares of common stock under option for the following periods (shares and aggregate intrinsic value in thousands):



	Shares		Weighted Average Exercise Price		Options Exercisable at End of Year	Weighted Average Exercise Price of Exercisable Options		Weighted Average Fair Value of Options Granted During the Year		Aggregate Intrinsic Value
Outstanding at December 31, 2016	6,146		$	91.20	3,429	$	55.00			$	309,238
Granted	2,885		145.35					$	32.57
Exercised	(633	)	71.43							76,546
Forfeited	(367	)	144.51
Outstanding at December 31, 2017	8,031		109.78		4,029	75.80				663,815
Granted	412		204.59					$	50.07
Exercised	(708	)	73.26							79,588
Forfeited	(119	)	155.41
Outstanding at December 31, 2018	7,616		117.58		5,174	98.39				518,954
Granted	431		244.35					$	57.99
Exercised	(1,482	)	115.53							255,242
Forfeited	(302	)	167.35
Outstanding at December 31, 2019	6,263		$	124.38	5,137	$	109.03			$	1,022,860
Expected to vest at December 31, 2019	1,126		$	194.44

The following table summarizes information about stock options outstanding at December 31, 2019 (shares in thousands):



Exercise Price	Options Outstanding	Weighted Average Remaining Vesting Life in Years	Options Exercisable
$10.00 – $114.90	2,242	0.00	2,242
121.76 – 150.74	2,834	0.21	2,516
151.16 – 165.96	352	0.61	227
172.68 – 199.75	342	1.29	124
202.02 – 209.05	69	2.28	7
216.18 – 231.70	144	2.82	21
252.50 – 288.37	280	2.88	—
	6,263		5,137

The aggregate intrinsic value of stock options exercisable at December 31, 2019 was $917.9 million. The weighted average remaining contractual term of options exercisable at December 31, 2019 was 4.9 years.

The fair value of stock option awards granted was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions for grants or modifications during the years ended December 31 as follows:



	2019		2018		2017
Risk-free interest rate	2.40	%	2.57	%	1.65	%
Dividend yield	—		—		—
Expected volatility	26.40	%	26.92	%	28.00	%
Expected life (in years)	3.7		3.8		3.4

The weighted-average remaining contractual life for options outstanding was 5.4 years at December 31, 2019.

Restricted Stock

The fair value of restricted stock units granted with market based vesting conditions was estimated using the Monte Carlo simulation valuation model with the following assumptions during 2019. There were no restricted stock shares granted with market based vesting conditions in 2018 and 2017.



	2019
Risk-free interest rate	1.48	%
Dividend yield	—
Expected volatility	25.40	%
Expected life (in years)	2.36

The following table summarizes the changes in the number of shares of restricted stock and restricted stock units for the following periods (shares in thousands):



	Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2016	379		$	140.39
Granted	238		141.99
Cancelled	(48	)	152.95
Issued	(204	)	136.85
Outstanding at December 31, 2017	365		155.58
Granted	107		200.71
Cancelled	(47	)	339.34
Issued	(251	)	154.85
Outstanding at December 31, 2018	174		190.73
Granted	232		212.79
Cancelled	(49	)	225.96
Issued	(114	)	206.05
Outstanding at December 31, 2019	243		$	246.34

Unrecognized
Compensation
Cost

Weighted Average
Period of Expense
Recognition
(in Years)

Stock options

Restricted stock