WEX Inc.WEX
WEX Inc. Commitments Disclosure
| 19. | Commitments and Contingencies | ||||
Litigation and Regulatory Matters
From time to time, the Company is subject to legal proceedings, claims and regulatory matters in the ordinary course of business, including but not limited to: commercial disputes; contract disputes; employment litigation; disputes regarding our intellectual property rights; alleged infringement or misappropriation by us of intellectual property rights of others; and, matters relating to our compliance with applicable laws and regulations. As of the date of this filing, the current estimate of a reasonably possible loss contingency from all legal or regulatory proceedings is not material to the Company’s consolidated financial position, results of operations, cash flows or liquidity.
Extension of Credit to Customers
We have entered into commitments to extend credit in the ordinary course of business. We had approximately $11.3 billion of unused commitments to extend credit at December 31, 2025, as part of established customer agreements. These amounts may increase or decrease during 2026 as we increase or decrease credit to customers, subject to appropriate credit reviews, as part of our lending product agreements. Many of these commitments are not expected to be utilized. We can adjust most of our customers’ credit lines at our discretion at any time. Therefore, we do not believe total unused credit available to customers and customers of strategic relationships represents future cash requirements. Given that the Company can generally adjust its customers’ credit lines at its discretion at any time, the unfunded portion of loan commitments to customers is unconditionally cancellable and thus the Company has not established a liability for expected credit losses on those commitments.
Unfunded Commitments
As a member bank, we have committed to providing a line of credit for the funding of up to a maximum of $25.0 million in loans to a nonprofit, community development financial institution to facilitate their offering of flexible financing for affordable, quality housing to assist Utah’s low and moderate-income residents. As of December 31, 2025, the Company has funded $7.6 million against this line of credit, which has been included on the consolidated balance sheet within accounts receivable. The Company’s remaining unused line of credit commitment as of December 31, 2025 was $17.4 million and extends through August 2026.
The Company has entered into certain subscription and limited partnership agreements for limited partnership investment of up to $10.0 million in certain venture capital funds investing in climate/alternative energy technologies. Payment on such commitments are due, from time to time, upon the request by the partnerships’ general partners up until the tenth anniversary of the respective final closing date for each venture fund, except as otherwise modified in accordance with the terms of the respective limited partnership agreements. As of December 31, 2025, the Company has made payments of $3.6 million against these commitments.
Minimum Volume, Spend and Purchase Commitments
Under contractual arrangements with certain European fuel suppliers, the Company is subject to minimum volume commitments for the purchase of fuel products by its card customers in certain countries and for certain years, as defined within the agreements. Upon failing to meet these minimum volume commitments, the Company is subject to underlift fees. Such underlift fees incurred and paid to the fuel suppliers under the contracts were immaterial for the years ended
December 31, 2025, 2024, and 2023. Beginning with 2026, any underlift fees incurred under the contractual arrangement in effect as of December 31, 2025 are no longer payable to the fuel supplier and instead are required to be reinvested into the program.
The Company has other purchase commitments that include obligations made under noncancellable purchase orders and contractual obligations requiring minimum spend for certain IT and non-IT related services, including cloud-based computing services. Unconditional purchase commitments under significant non-cancelable contracts with remaining terms in excess of one year as of December 31, 2025, excluding obligations recorded on our consolidated balance sheet, totaled approximately $198.3 million, $61.6 million of which we expect to incur during 2026. The remaining $136.7 million of obligations are expected to be incurred ratably through 2030.
Deferred Payments on Acquisitions
On April 1, 2021, WEX Inc. completed the acquisition of certain contractual rights to serve as custodian or sub-custodian to over $3 billion of HSAs from the HealthcareBank division of Bell Bank, a subsidiary of SBI. WEX Inc. paid Bell Bank cash consideration for the acquisition of $200.0 million on the closing of the acquisition, $25.0 million in July 2023 and $12.5 million in January 2024. The purchase agreement included additional consideration payable to Bell Bank annually that is calculated on a quarterly basis and is contingent, and based, upon increases in the Federal Funds rate from the date of acquisition. The contingent payment period extends through the earlier of (i) the year ending December 31, 2030, or (ii) the date when the cumulative amount paid as contingent consideration equals $225.0 million. Through December 31, 2025, $206.4 million of consideration has been incurred, $51.0 million of which is unpaid as of December 31, 2025 and is payable during the first quarter of 2026. The Company expects that it will incur the full $225.0 million in contingent consideration. Payments on contingent consideration are included in net cash provided by operating activities in the consolidated statements of cash flows, specifically within changes in accrued expenses and other current and long-term liabilities, except with respect to the initial fair value of the contingent consideration at acquisition date, which was included within net cash provided by financing activities.
During 2019, the Company acquired Discovery Benefits, an employee benefits administrator, from SBI, who obtained a 4.9 percent equity interest in PO Holding, the then newly formed parent company of WEX Health and Discovery Benefits. During 2021, the Company repurchased a portion of SBI’s non-controlling interest in PO Holding, which reduced SBI’s ownership percentage to 4.53 percent. On March 7, 2022, WEX Inc. purchased SBI’s remaining 4.53 percent interest in PO Holding for a purchase price of $234.0 million plus any interest accruing pursuant to the terms of the Share Purchase Agreement. The purchase price is payable in three installments of $76.7 million, with the first payment made in March of 2024, second payment made in March 2025, and the remaining installment payable in March 2026, with a final payment of $4.0 million also payable in March 2026. During 2025, WEX Inc. paid SBI interest in arrears of $9.7 million on the outstanding purchase price balance from March 2024 to March 2025 at the 12-month SOFR (as determined on March 1, 2024) plus 1.25 percent. WEX Inc. will owe SBI approximately $4.9 million of interest in arrears on the outstanding balance from March 2025 to March 2026 at the 12-month SOFR (as determined on March 3, 2025) plus 2.25 percent. No interest accrues on the $4.0 million payment due in March 2026.Free Sentinel
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Mar 18, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Mar 6, 2017 | |
| 2015 | Feb 26, 2016 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.