More than 105 years ago, Deluxe Corporation began providing payment solutions. Our longevity is a testament to our innovation, and our ability to evolve with our customers. Overcustomers, and the past several years, wetrust they place in us. We have transformed from being primarilyto a check printingmodern payments and data company to providing a diverse selectionthat champions business so communities thrive. We support millions of products and services. Our vision is to be the best at helping small businesses, andthousands of financial institutions grow and we have become a trusted partner to small businesses and an integral parthundreds of the financial services industry.world's largest consumer brands. We provide a selection of customer life cycle management solutions that helpsell our customers acquire and engage their customers across multiple channels. To promote and sell a wide range of products and services primarily in North America, and we use printedoperate 4 business segments that are generally organized by product type. These segments provide the following products and electronic marketing; a direct sales force; referrals from financial institutions, telecommunication clients and other partners; networks of distributors and independent dealers; and an outbound telemarketing group. Overservices:

During the past 24 months, our Small Business Services segment has provided products and services2 years, we made strategic decisions to approximately 4.4 million small business customers and our Direct Checks segment has provided products and services to more than 5.1 million consumers. Through our Financial Services segment, we provide products and services to approximately 4,900 financial institution clients.

Our marketing products include digital printingrealigned reportable segments for the quarter ending March 31, 2024 are as follows:

Our Small Business Services strategies are as follows:

The actions we have acquiredtaken since we began our transformation in 2019 allowed us to pivot from a numberlegacy check printer into a modern payments and data company. We divested non-strategic businesses, and the remainder of businessesour business experienced its third consecutive year of growth in 2023, with profits growing faster than revenue. Our largest cash generator, Checks, is outperforming the market, while holding margins steady in the mid-40% range.

Having laid this groundwork, we have confidence in our ability to deliver greater shareholder return through our focus on growth in payments and data. We recently announced our North Star program, the goal of which is to further drive shareholder value by (1) expanding our earnings before interest, taxes, depreciation and amortization ("EBITDA") growth trajectory, (2) driving increased cash flow, (3) paying down debt, and (4) improving our leverage ratio. North Star is an integrated, multi-year plan that is a mix of cost reduction and growth initiatives, with the mix skewing toward cost reductions. On the cost side, much of the work is an evolution of our organizational design and ongoing infrastructure and operations transformation. We have expandedalready completed our MOS offerings, including technology-based solutionsinitial organizational redesign, combining like-for-like roles, reducing layers and expanding spans of control. As we begin 2024, we are using technology and process automation to digitize and streamline our processes, and we are continuing to drive scale in our operations by consolidating many of our back-office functions, improving our marketing and sales capabilities, and leveraging the global labor market. On the revenue side, we are focused on priorities such as webbuilding our integrated software channel in merchant services, payroll services, web-to-print capabilities, internet marketing servicesexpanding our data business to serve additional industry verticals, and eChecks. Sales of these higher growth products and services are expected to represent an increasing portionevaluating pricing opportunities. All of our revenue. Additional information concerning our acquisitions appears under the caption “Note 5: Acquisitions” of the Notes to

We continue our efforts within Small Business Servicesemploy a multi-channel sales and marketing approach, selling directly to simplify processes, eliminate complexity and lower costs. Small Business Services outsources the production of many of its products, including certain business forms, promotional products and apparel. In conjunction with our cost reduction initiatives, we strive to further enhance our strategic supplier sourcing arrangements. In addition, the expertise we have developed in logistics, productivity and inventory management has allowed us to reduce the number of facilities we operate, while still meeting customer requirements. During 2017, we closed a retail packaging sales location in Dallas, Texas. During 2016, we closed a call center located in Los Angeles, California, a warehouse located in Houston, Texas and a facility housing general office space in Burnsville, Minnesota. During 2015, we closed a facility located in American Fork, Utah that housed a call center and administrative functions, as well as a call center located in Charlotte, North Carolina and a sales facility located in Venice, California. The operations of these facilities were integrated into existing Small Business Services operations.

We provide a full range of payment processing services primarily to small and medium-sized retail and service businesses, including nonprofit organizations. These services include credit card, debit card and electronic benefit transaction processing; check guarantee and conversion; and point-of-sale (“POS”) equipment leasing. The majority of merchant services revenue is generated by services priced as a percentage of transaction value or a specified fee per transaction, depending on the internet channel.payment type or the market. We distribute our services through multiple sales channels, processing approximately $40 billion in annual transaction volume. Payments are processed using a variety of methods, including in-person and online, and via recurring payments.

Going forward, we will continue to explore avenuesinvest in print efficiencies and process improvements to expand sales to existing customers through sales of accessoriesmaintain margins, and other check-relatedwe will prioritize higher margin promotional products and services. One such example is the check protection service we offer in partnership with EZShield, Inc., which provides reimbursement to consumers for losses resulting from forged signatures or endorsements and alteredthat complement checks. As in our other two business segments, Direct Checks continues to simplify processes, eliminate complexity and lower costs. We continue to identify additional opportunities to lower our cost and expense structure in all functional areas, particularly in the areas of marketing and fulfillment.

We continue to focus on improving the customer experience by providing excellent service and quality, while increasing our productivity and reducing costs and increasing productivity.our costs. We accomplishdo this by embedding lean operating principles in allinto our processes, while emphasizing a culture of continuous improvement. Under this approach, employees work together to produce products, rather than working on

One example of continuous improvement.putting these objectives into action is the investment we made in our print infrastructure over the past 2 years. We implemented equipment that enables what the industry refers to as “Print On Demand,” which allows us to continue to reduce costs by utilizing our assetsoffer customers the same choices, with less waste, labor and printing technologies more efficiently and by enabling employees to better leverage their capabilities and talents.

We have implemented a stakeholder-focused environmental, social and governance ("ESG") program to meet the payments industry.needs and expectations of regulators, customers, shareholders and employees. We devote significant resources to addressing ESG throughout the company, including responsible process improvement efforts, enhancing our commitments to diversity, equity, inclusion and belonging (“DEIB”) through our DEIB Council and employee resource groups, promoting community awareness, giving back through our volunteer time off program, and continually improving our cybersecurity and privacy processes and controls to keep our data safe. We measure our ESG goals and impacts through yearly strategic assessments that keep us accountable and inform our annual and multi-year ESG strategies.

Protecting the number of financial institutions has been declining for many years. When financial institutions consolidate through mergers and acquisitions, often the newly combined entity seeks to reduce costs by leveraging economies of scale in purchasing, including its check supply contracts. This results in check providers competing intensely on price in order to retain not only their previous business with one of the financial institutions, but also to gain the business of the other financial institution in the merger/acquisition. Financial institution mergers and acquisitions can also impact the duration of our contracts. Normally, the length of our supply contracts with financial institutions ranges from 3 to 6 years. However, contracts may be renegotiated or bought out mid-term due to a consolidation of financial institutions. Banks, especially larger ones, may request prepaid product discounts in the form of cash incentives payable at the beginning of a contract. These contract acquisition payments negatively impact check producers' cash flows at the beginning of these contracts. To the extent financial institution failures and consolidations impact large portions of our customer base, this could have a significant impact on our financial institution check programs.

The principal materials used in producing our main products are paper, plastics, ink, cartonscorrugated packaging and printing plate material, which we purchase from various sources. We also purchase stock business forms and promotional apparel produced by third parties. We believe thatIn addition, we will be able to obtain an adequate supply of materials from current or alternative suppliers.

We believe that in the event one of our vendors fails to perform, we would be able to obtain an alternative source of supply. However, we have taken steps to secure multiple sources of supply for certain of the materials and services we utilize, including those related to certain printed products in our Promotional Solutions segment. We can provide no assurance that we would be able to obtain an alternative source of supply, ifor that such supply could be obtained at current prices, in the event one or more of our service providers failedvendors fails to perform.

We are subject to numerous international, federal, state and local laws and regulations that affect our business activities in several areas, including, but not limited to, labor, advertising, taxation, data privacy and security, digital content, consumer reports, consumer protection, merchant processing, online payment services, real estate, e-commerce, intellectual property, health care, environmental matters, and workplace health and safety. The costcomplexity of complying with theseexisting and new laws and regulations is significant, and regulators may adopt new laws or regulations at any time.

We make available, without charge, through our investor relations website, Deluxe.com/investor,www.investors.deluxe.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports filed or furnished pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after these items are electronically filed with or furnished to the SEC. These reports can also be accessed via the SEC website, sec.gov, or via the SEC's Public Reference Room located at 100 F Street N.E., Washington, D.C. 20549. Information concerning the operation of the SEC's Public Reference Room can be obtained by calling 1-800-SEC-0330.www.sec.gov.

A printed copy of this report may be obtained without charge by calling 651-787-1068, by sending a written request to the attention of Investor Relations, Deluxe Corporation, P.O. Box 64235, St. Paul, Minnesota 55164-0235,818095, Cleveland, Ohio 44181, or by sending an email request to investorrelations@deluxe.com.investor.relations@deluxe.com.

Further information about Deluxe Corporation is also available at Deluxe.com, facebook.com/www.deluxe.com, www.facebook.com/deluxecorp, www.linkedin.com/company/deluxe and twitter.com/deluxecorp.www.twitter.com/deluxe. The content of these websites is not incorporated by reference in this Annual Report on Form 10-K or in any other report or document we file with the SEC.

We have adopted a Code of Business Ethics that applies to all of our employees and our board of directors. The Code of Business Ethics is available on our investor relations website, Deluxe.com/investor,www.investors.deluxe.com, and also can be obtained free of charge upon written request to the attention of Investor Relations, Deluxe Corporation, P.O. Box 64235, St. Paul, Minnesota 55164-0235.818095, Cleveland, Ohio 44181. Any changes or waivers of the Code of Business Ethics will be disclosed on our website. In addition, our Corporate Governance Guidelines and the charters of the Audit and Finance, Compensation and Talent, and Corporate Governance and Finance Committees of our board of directors are available on our website, www.investors.deluxe.com, or upon written request.

Our executive officers are electedappointed by the board of directors each year. The following summarizes our executive officers and their positions.

We routinely encounter and address risks, many of which could cause our future results to the airline industry from July 2016 to March 2017. From June 2009 through July 2016, Mr. Bush served as Senior Vice President, Finance for American Airlines.

If our actual results to differ materially from the statements we make from time to time regarding our expected future results, including, butlong-term growth strategy is not limited to, forecasts regarding revenue, earnings per share, cash provided by operating activities and expected cost savings. Any forecast reflects various assumptions that are subject to significant uncertainties and, as a matter of course, may prove to be incorrect. Further, the achievement of any forecast depends on numerous factors that are beyond our control. Consequently, we caution investors that forward-looking statements are predictions based on our current expectations about future events and are not guarantees of future performance. The variation of actual results or events from such statements may be material and adverse. You are cautioned not to base your entire analysis ofsuccessful, our business and prospects upon isolated statements,financial results would be adversely impacted.

If we are unable to attract and retain customers in a cost-effective manner or effectively develop and operate a multichannel customer experience, our business and results of operations would be adversely affected.

Our success depends on our ability to attract new and returning customers in a cost-effective manner. We use a variety of methods to promote our products and services, including a direct mail advertising,sales force, partner referrals, email marketing, purchased search results from online search engines, direct mail advertising, broadcast media, advertising banners, social media and other

We continually evaluate and modify our marketing and sales efforts and continue to shift a greater portionachieve the most effective mix of our advertising investment to the internet.promotional methods. Competitive pressure may inhibit our ability to reflect increased costs in the prices of our products and services and/or new marketing strategies may not be successful. We can provide no assurance that we will be ableEither of these occurrences would have an adverse impact on our ability to offset a decline in response rates, even with additional marketingcompete and sales efforts.

WeAdditionally, we believe we must maintain a relevant, multichannel experience for ourin order to attract and retain customers. Customers expect to be ablehave the ability to order products and services from us however they please,choose their method of ordering, whether that is via the mail, land-linecomputer, phone computer, tablet or

Competition in the payments industry is intense. We are competing against numerous financial technology ("Fintech") companies, including independent payment processors, credit card processing firms and treasury management service providers, as well as financial institution in-house capabilities. Volume is the key to remaining cost-competitive, and breadth of services is critical to staying relevant to customers. In addition, although we are a leading check printer in the U.S., we face considerable competition in the check printing and related products portion of the payments industry is mature,from another large check printer in our traditional financial institution sales channel, from direct mail and internet-based sellers of personal and business checks, from check printing software vendors, and from certain significant retailers. Pricing continues to be competitive in our financial institution sales channel, as financial institutions seek to maintain their previous levels of profitability, even as check usage declines.

Within our Data Solutions segment, our data-driven marketing services face competition from a wide variety of companies in the data solutions space, including advertising agencies, marketing technology firms, data aggregators and brokers, and source data providers. Adapting to new technology is declining.a key challenge in this business, along with hiring and retaining the right people.

CheckWithin our Promotional Solutions segment, the markets for business forms and promotional products are intensely competitive and highly fragmented. Current and potential competitors include traditional storefront printing companies, office superstores, wholesale printers, online printing companies, small business product resellers, and providers of custom apparel and gifts. The competitive landscape for online suppliers continues to be challenging as new businesses enter the space.

The rate and the extent to which alternative payment methodsdigital payments will achieve acceptance and replace checks, whether as a result of legislative developments, changing payment systems, personal preference or otherwise, cannot be predicted with certainty. A surge in the popularityIncreased use of any of these alternative payment methods, or our inability to successfully offset the secular decline in checks with new check usage withsupply clients or other sources of revenue, would have an adverse effect on our business, cash flows and results of operations.

We face intensehave developed a strong and trusted brand that has contributed significantly to the success of our business. We believe that maintaining and promoting our brand in a cost-effective manner is critical to achieving widespread acceptance of our products and services, expanding our base of customers, and attracting and retaining top talent. We believe that the importance of brand recognition and trust is particularly essential for the success of our various service offerings because of the level of competition for these services. Customer awareness of our brand, as well as the perceived value of our brand, depends largely on the success of our marketing efforts, our ability to continue to provide useful, reliable, secure and innovative products and services, and our ability to maintain trust and be a technology leader. If we fail to successfully promote and maintain our brand or if we incur excessive expenses in all areasthis effort, our business could be materially and adversely affected. There is also the risk that adverse publicity, whether or not justified, could adversely affect our business. If our business partners or key employees are the subject of adverse news reports or negative publicity, our reputation may be tarnished and our results of operations could be adversely affected.

A component of our brand promotion strategy is building on our relationship of trust with our customers, which we believe can be achieved by providing a high-quality customer experience. We have invested, and will continue to invest, in website development, design and technology, and customer service and production operations. Our ability to provide a high-quality customer experience is also dependent on external factors, including the reliability and performance of our suppliers, telecommunications providers and third-party carriers. Our brand value also depends on our ability to protect and use our customers' data in a manner that meets expectations. The failure of our brand promotion activities to meet our expectations or the failure to provide a high-quality customer experience for any reason could adversely affect our ability to attract new customers and maintain customer relationships, which would adversely harm our business and we expect thatresults of operations.

Intense competition and secular declines in the use of checks and business forms compels us to continually improve our operating efficiency in order to maintain or improve profitability. Cost reduction initiatives have required, and will continue to increase.

We may be ableunable to increase pricessuccessfully identify future acquisitions, integrate past and future acquisitions or realize the anticipated benefits of the transactions.

One or more of these factors could impact our ability to successfully operate, integrate or leverage an acquisition and could materially and adversely affect our business and financial results.

We may supplement sales-driven revenue growth with strategically targeted acquisitions over time. The time and expense associated with finding suitable businesses, technologies or services to acquire can be disruptive to our ongoing business and may divert management’s attention. We cannot predict whether suitable acquisition candidates can be identified or acquired on acceptable terms or whether any acquired products, technologies or businesses will contribute to our revenue or earnings to any material extent. We may need to seek additional financing for larger acquisitions, which would increase our debt obligations, and such financing may not be available on terms that are favorable to us. Additionally, acquisitions may result in price reductions, reduced profit margins, lossadditional contingent liabilities, additional amortization expense, and/or future non-cash asset impairment charges related to acquired intangible assets and goodwill, and thus, could adversely affect our business, results of customersoperations and an increase in up-front cash paymentsfinancial condition.

Security breaches, computer malware or other cyber attackscyberattacks involving the confidential information of our customers, employees or business partners could substantially damage our reputation, subject us to litigation and enforcement actions, and substantially harm our reputationbusiness and business.results of operations.

Information security risks have increased in recent years, in part because of the proliferation of new technologies and increased use of the internet,an increase in remote work arrangements, as well as the increased sophistication and activities of hackers, terrorists and activists, some of which may be linked to hostile nation-state actors.activists. We use internet-based channels that collect customers’ financial account and credit cardpayment information, as well as other sensitive information, including proprietary business information and personally identifiable information of our customers, employees, contractors, suppliers and business partners. WeEach year, we process hundreds of millions of records containing data related to individuals and small businesses. We also provide services that are instrumental in supporting our customers and their businesses, such as merchant services and remittance processing. Cybersecurity is one of the top risks identified by our Enterprise Risk Management Committee, as technology-based organizations such as ours are vulnerable to targeted attacks aimed at exploiting network and system weaknesses.

The secure and uninterrupted operation of our networks and systems, as well as the processing, maintenance and confidentiality of the processing and maintenance of thissensitive information that resides on our systems, is critical to our business operations and strategy. We rely on varioushave a risk-based information/cybersecurity program dedicated to protecting our data and solutions. We employ a defense-in-depth strategy, utilizing the concept of security procedures and systems to ensure the secure storage and transmission of information, including encryption and authentication technology licensed from third parties. Computer networkslayers and the internetCIA (confidential, integrity and availability) triad model. Computer systems and networks are, by nature, vulnerable to unauthorized access. An accidental or willful security breach could result in unauthorized access and/or use of customer information, including consumers' personally identifiable information.information or, in some cases, the protected health information of certain individuals. Our security measures could be breached by third-party action, computer viruses, accidents, employee or contractor error, or malfeasance by rogue employees. Individuals or third parties may be able to circumvent controls and/or exploit vulnerabilities that may exist, resulting in the disclosure or misuse of sensitive business and personal customer or employee information and data.

Because techniques used to obtain unauthorized access, disable or degrade service, or sabotage computer systems change frequently, may be difficult to detect immediately, and generally are not recognized until they are launched against a target, we may be unable to implement adequate preventive measures. Unauthorized parties may also attempt to gain access to our systems or facilities through various means, including hacking into our systems or facilities, fraud, trickery or other means of deceiving employees and contractors. We have experienced distributed denial of service attacks by hackers aimed at disrupting internet traffic and/or attempting to place illegal or abusive content on our or our customers’ websites. Additionally, our customers and employees have been and will continue to be targeted by partiesthreat actors using social engineering techniques to obtain confidential information or using fraudulent "phishing" emails to misappropriate personal information or to introduce viruses or other malware through "trojan horse" programs to our users' computers.into the environment. To-date, these various threats and incidents have not materially impacted our customers, our business or our financial results. However, our technologies, systems and networks are likely to be the target of future attacks due to the increasing threat landscape for all technology businesses, and we can provide no assurance of a similar result in the future.that future incidents will not be material.

Although we invest in a system of information securityDespite our significant cybersecurity systems and controls,processes, a party that is able to circumventcircumvents our security measures could misappropriate our own, our customers' or our customers'partners' personal andor proprietary information, cause interruption in our operations, damage our computers or those of our users, or otherwise damage our reputation, all of which could deter clients and consumers from ordering our products and services and result in the termination of client contracts. Additionally, it is possible that there could be vulnerabilities that could impact large segments of mobile, computer or server architecture. Any of these events would adversely affect our business, financial condition and financial results. results of operations.

In addition, if we were to experience ana material information security breach, we may be required to expend significant amounts of management time and financial resources to remedy, protect against or mitigate the effecteffects of the breach, and we may not be able to remedy the situation in a timely manner, or at all. Furthermore, under payment card association rules and our contracts with debit and credit card processors, if there is a breach of payment card information that we store or that is stored by third parties with which we do business, we could be liable to the payment card issuing banks for their cost of issuing new cards and other related expenses. We could also lose our ability to accept and process credit and debit card payments, which would likely result in the loss of customers and the inability to attract new customers. We could also be exposed to time-consuming and expensive litigation, government inquiries and/or enforcement actions. If we are unsuccessful in defending a lawsuitclaim regarding information security breaches, we may be forced to pay damages, penalties and fines, and our insurance coverage may not be adequate to compensate us fully for any losses that may occur. Contractual provisions with third parties, including cloud service providers, may limit our ability to recover losses resulting from the security breach of which would have an adverse effect on our financial results.a business partner.

There are international, federal and state laws and international lawsregulations requiring companies to notify individuals of information security breaches involving their personal data, the cost of which couldwould negatively affect our financial results. These mandatory disclosures regarding an information security breach often lead to widespread negative publicity. If we were required to make

The satisfactory performance, reliability and availability of our information technology systems, and those of our third-party service providers, is critical to our reputation and our ability to attract and retain customers. We could experience temporary interruptions in our websites, transaction and payment processing systems, network infrastructure, service technologies, printing production facilities or customer service operations for a variety of reasons, including, among others:others, human error, software errors or design faults, security breaches, power loss, telecommunications failures, equipment failures, electrical disruptions, labor issues, vandalism, fire, flood, extreme weather, terrorism and other events beyond our control. Furthermore, asIn addition, certain of the services we focusdeliver to the payments technology market are designed to process complex transactions and deliver reports and other information on those transactions, all at very high volumes and processing speeds. Any failure to deliver an effective and secure product or any performance issue that arises with a new product or service could result in significant processing or reporting errors or other losses.

We have invested, and will continue to invest, significant resources onto build out, maintain and improve our growth strategies, we have reduced our investmenttechnology platforms. Any disruptions, delays or deficiencies in the developmentdesign, implementation or operation of our legacy systems, particularly any disruptions, delays or deficiencies that supportimpact our checksoperations, could adversely affect our ability to effectively run and forms businesses, with a focus on sustainingmanage our business. Frequent or persistent interruptions in our operations could cause customers to believe that our products and maintaining such systems. These legacy systems operate with minimalservices are unreliable, leading them to switch to our competitors or no vendor support, contain hardwareto avoid our products and software that we are not able to update and are difficult to maintain, yet any interruption caused by a failure or breach of these systems could create disruption in the core businesses that generate a declining portion of our revenue. In addition, our technology, infrastructure and processes may contain undetected errors or design faults that may cause our websites or operating systems to fail. Over the past two years, we shifted aservices.

A substantial portion of our applications toreside in a private cloud-based environment. While we maintain redundant systems and backup databases and applications software designed to ensureprovide continuous access to cloud services, it is possible that access to our software capabilities could be interrupted and our disaster recovery planning may not account for all eventualities. The failure of our systems could interfere with the delivery of products and services to our customers, impede our customers' ability to do business and result in the loss or corruption of critical data. In addition to the potential loss of customers, we may be required to incur additional development costs and divert technical and other resources, and we may be the subject of negative publicity and/or liability claims, allclaims.

If any of which would adversely affect our reputation and operating results.

We expect to continue to invest in acquisitions. The time and expense associated with finding suitable businesses, technologies or services to acquire can be disruptive to our ongoing business and may divert management’s attention. We

We have entered into agreements with third-party providers for information technology services, including telecommunications, network server, cloud computing and transaction processing services. In addition, we have agreements with companies to provide services such asrelated to our online payment solutions.solutions, including financial institutions that provide clearing services in connection with our merchant services settlement activities, and we have outsourced certain activities, including portions of our finance and procurement functions. A service provider's ability to provide services could be disrupted for a variety of reasons, including, unauthorized access, computer viruses, accidentalamong others, human error, software errors or intentional actions,design faults, security breaches, power loss, telecommunications failures, equipment failures, electrical disruptions, orlabor issues, vandalism, fire, flood, extreme weather, terrorism and other conditions.events beyond their control. In the event that one or more of our service providers is unable to provide adequate or timely information technology services, our ability to deliver products and services to our customers could be adversely affected. Although we believe we have taken reasonable steps to protect our business through contractual arrangements with our service providers, we cannot completely eliminate the risk of disruption in service. Any significant disruption could harm our business, including damage to our brand and loss of customers. Additionally, although we believe that information technologymost of these services are available from numerous sources, a failure to perform by one or more of our service providers could cause a material disruption in our business while we obtain an alternative source of supply.service provider. The use of substitute third-party providers could also result in increased expense. Additionally, while we have policies and procedures for managing these relationships, they inherently involve a lesser degree of control over business operations, governance and compliance, thereby potentially increasing our financial, legal, reputational and operational risk.

Competition for employees is intense. We have implemented various human capital initiatives, including employee wellness initiatives, employee resource groups and a revised performance management process, to make Deluxe an attractive place to work. As remote working arrangements have become more widely accepted, it is more challenging for us to interest rate riskmaintain and enhance our credit facility matures in February 2019.

Paper costs represent a significant portion of our materials expense. Paper is a commodity and its price has been subject to volatility due to supply and demand in the marketplace, as favorablewell as volatility in the raw material and other costs incurred by paper suppliers. There are also relatively few paper suppliers and these suppliers are under financial pressure as paper use declines. As such, when our suppliers increase paper prices, we may not be able to obtain better pricing from alternative suppliers.

In order to provide our Visa and Mastercard transaction processing services, we must be either a direct member or be registered as a merchant processor or service provider of Visa and Mastercard. Registration as a merchant processor or service provider is dependent upon our being sponsored by members of each organization in certain jurisdictions. If our sponsor financial institution in any market should stop providing sponsorship for us, we would need to find another financial institution to provide those under our current credit facility,services or we would need to attain direct membership with the card networks, either of which could prove to be difficult and expensive. If we are unable to find a replacement financial institution to provide sponsorship or attain direct membership, we may no longer be able to provide processing services to affected customers, which would negatively affect our business and results of operationsoperations. In addition, some agreements with our financial institution sponsors give them substantial discretion in approving certain aspects of our business practices, including our solicitation, application and cash flow.qualification procedures for merchants and the terms of our agreements with merchants. Our sponsors' discretionary actions under these agreements could have a material adverse effect on our business and results of operations.

Governmental regulation is continuously evolving and could limit or harm our business.

We are subject to numerous international, federal, state and local laws and regulations that affect our business activities in several areas, including, but not limited to, labor, advertising, taxation, data privacy and security, digital content, consumer reports, consumer protection, merchant processing, online payment services, real estate, e-commerce, intellectual property, health care, environmental matters, and workplace health and safety. In addition, legal or regulatory measures to address climate change may impact us in the near future. The costcomplexity of complying with theseexisting and new laws and regulations is significant. In addition,significant, and regulators may adopt new laws or regulations at any time, including triggering enforcement actions, or their interpretation of existing laws may change and/or differ from ours. Thesetime.

The various regulatory requirements to which we are subject could impose significant limitations on our business activities, require changes to our business, restrict our use or storage of personal information, or cause changes in our customers' purchasing behavior, which may make our business more costly and/or less efficient and may require us to modify our current or future products, services, systems or processes. We cannot quantify or predict with any certainty the likely impact of such changes on our business, prospects, financial condition or results of operations.

Portions of our business operate within highly regulated industries and our business results could be significantly affected by the laws and regulations to which we are subject. For example, international, federal state and internationalstate laws and regulations regarding the protection of certain consumer information require us to develop, implement and maintain policies and procedures to protect the security and confidentiality of consumers' nonpublic personal information. Portions of our business are subject to regulations affecting payment processing, including merchant processing, ACH, remote deposit capture and lockbox services. These laws and regulations require us to develop, implement and maintain certain policies and procedures related to payment processing.payments. We are also subject to additional requirements in certain of our contracts with financial institution clients and communications service providers, whichthat are often more restrictive than the regulations, as well as confidentiality clauses in certain of our contracts related to small businesses’ customer information. These regulations and agreements typically limit our ability to use or disclose nonpublic personal information for other than the purposes

Due to our increasingincreased use of the internet for sales and marketing, laws specifically governing digital commerce, the internet, mobile applications, search engine optimization, behavioral advertising, privacy and email marketing may have an impact on our business. Existing and future laws governing issues such as net neutrality, digital and social marketing, privacy, consumer protection or commercial email may limit our ability to market and provide our products and services. Changing data protection regulations may increase the cost of compliance in servicing domestic and international markets for our wholesale and retail business services channels. More restrictive legislation,rules, such as new privacy laws, consumer protection “dark patterns” restrictions, search engine marketing restrictions, “anti-spam” regulations or email privacy rules, could decrease marketing opportunities, decrease traffic to our websites and/or increase the cost of obtaining new customers.

Because of additional regulatory costs, financial institutions may continue to put significant pricing pressure on their suppliers, including their check and service providers. The increase in cost and profit pressure may also lead to further consolidation of financial institutions. Additionally, some financial institutions are warydo not permit offers of offering add-on services, such as bundled products, fraud/identity protection or expedited check delivery, or rewards programs, to their customers. It would have an adverse impact on our results of operations if we were unable to market such services to consumers or small businesses through the majority of our financial institution clients. Additionally, as our product and service offerings become more technologically focused, and with expanded regulatory expectations for supervision of third-party service providers, additional portions of our business could become subject to direct federal regulation and/or examination. This would increase our cost of doing business and could slow our ability to introduce new products and services and otherwise adapt to a rapidly changing business environment.

Third-party claims could result in costly and distracting litigation and, in the event of an unfavorable outcome, could have an adverse effect on our business, financial condition and results of operations.

From time to time, we are involved in claims, litigation and other proceedings relatingrelated to the conduct of our business, including purported class action litigation. Such legal proceedings may include claims related to our employment practices; claims alleging breach of contractual obligations; claims asserting deceptive, unfair or illegal business practices; or claims alleging violations of consumer protection-oriented laws.laws; claims related to legacy distributor account protection rights; or claims related to environmental matters. In addition, third parties may assert patent and other intellectual property infringement claims against us and/or our clients, which could include aggressive and opportunistic enforcement of patents by non-practicing entities. Any such claims could result in litigation against us and could also result in proceedings being brought against us by various federal and state agencies that regulate our business.businesses. The number and significance of these claims and proceedings has increased as our businesses have evolved and expanded in scope. These claims, whether successful or not, could divert management's attention, result in costly and time-consuming litigation, or both. Accruals for identified claims or lawsuits are established based on our best estimatesestimate of ourthe probable liability. However, we cannot accurately predict the ultimate outcome of any such proceedings due to the inherent uncertainties of litigation and other dispute resolution mechanisms. Any unfavorable outcome of a material claim or material litigation could require the payment of monetary damages or fines, attorneys' fees or costly and undesirable changes to our products, features or business practices, which would result in a material adverse effect on our business, financial condition and results of operations.

We may be unable to protect our rights in intellectual property, which could harm our business and ability to compete.

We rely on a combination of trademark and copyright laws, trade secret and patent protection, and confidentiality and license agreements to protect our trademarks, software and other intellectual property. These protective measures afford only limited protection. Despite our efforts to protect our intellectual property, third parties may infringe or misappropriate our intellectual property or otherwise independently develop substantially equivalent products or services that do not infringe on our intellectual property rights. Policing unauthorized use of our intellectual property is difficult. We may be required to spend significant resources to protect our trade secrets and to monitor and police our intellectual property rights. The loss of intellectual property protection or the inability to secure or enforce intellectual property protection could harm our business and ability to compete.

A decline in the valuesignificant portion of our postretirement medical plan assets and/orbusiness relies on small business spending. We believe that small businesses are more likely to be significantly affected by economic conditions than larger, more established companies. During a sluggish economy, it may be more difficult for small businesses to obtain credit and they may choose to spend their limited funds on items other than our products and services. As such, the level of small business confidence, the rate of small business formations and closures, and the availability of credit to small businesses all impact our business.

A significant increaseportion of our business also relies upon the health of the financial services industry. As a result of global economic conditions in thepast years, a number of participantsfinancial institutions sought additional capital, merged with other financial institutions and, in some cases, failed. The failure of one or more of our postretirement medical planlarger financial institution clients, or large portions of our customer base, could adversely affect our operating results. In addition to the possibility of losing a significant client, the inability to recover prepaid product discount payments made to one or more of our larger financial institution clients, or the inability to collect accounts receivable or contractually required contract termination payments, could have a negative impact on our results of operations.

There may also be an increase in financial institution mergers and cash flows.acquisitions during periods of economic uncertainty or as a result of other factors affecting the financial services industry. Such an increase could adversely affect our operating results. Often the newly combined entity seeks to reduce costs by leveraging economies of scale in purchasing, including its check supply and business services contracts. This results in providers competing intensely on price in order to retain not only their previous business with one of the financial institutions, but also to gain the business of the other party in the combined entity. Although we devote considerable effort toward the development of a competitively-priced, high-quality selection of products and services for the financial services industry, there can be no assurance that significant financial institution clients will be retained or that the impact of the loss of a significant client can be offset through the addition of new clients or by expanded sales to our remaining clients.

Goodwill represented 46.4% of our total assets as of December 31, 2023. On at least an annual basis, we assess whether the carrying value of our postretirement medical plan assetsgoodwill is subject to various risks,impaired. This analysis considers several factors, including credit, interesteconomic, market and overall market volatility risk. If the equity markets were to experienceindustry conditions. Circumstances that could indicate a significant decline in value, the fair value of our plan assets would decrease. This would affect the funded status of our plan and result in higher postretirement benefit expense in the future. Although our obligation is limited to funding benefits as they become payable, future declines in the fair value of one or more of our planreporting units include, but are not limited to, the following:

Such situations may require us to record an impairment charge for a portion of goodwill. We are also required to assess the carrying value of other long-lived assets, including intangible assets. Information regarding our 2023 impairment analyses can be found under the caption "Note 8: Fair Value Measurements" in the Notes to Consolidated Financial Statements appearing in Part II, Item 8 of this report. We have, in the past, and may again in the future, be required to write-down the value of some of our assets, and these write-downs have been, and could in the future be, material to our results of operations. If we are required to record additional asset impairment charges for any reason, our consolidated results of operations would be adversely affected.

We are a trusted partner to enterprises of all sizes, and this is a responsibility we take seriously. The secure and uninterrupted operation of our networks and systems, as well as the processing, maintenance and confidentiality of the sensitive information that resides on our systems, is critical to our business operations and strategy. Each year, we process hundreds of millions of records containing data related to individuals and businesses. In addition, certain of our products are hosted solutions, and the amount of data we store for our customers on our servers, including personal, important business and other potentially sensitive information, has been increasing. Technology-based organizations such as ours are vulnerable to targeted attacks aimed at exploiting network and system applications or weaknesses. A successful cyberattack could result in the disclosure or misuse of sensitive business and personal information and data, cause interruptions in our operations, damage our reputation and deter clients and consumers from ordering our products and services. It could also result in litigation, the needtermination of client contracts, government inquiries and/or enforcement actions. Any of these events could have a material adverse effect on our business, prospects, results of operations and/or financial position.

We have implemented a risk-based information/cybersecurity program dedicated to contribute increased amountsprotecting our data and solutions. Our privacy policies, together with associated controls and procedures, provide a comprehensive framework to inform and guide the handling of cashdata. We employ a defense-in-depth strategy, utilizing the concept of security layers and the CIA (confidential, integrity and availability) triad model. Our information security program is led by our Chief Information Security Officer ("CISO") and the Information Security department, which establishes the policies, standards and strategies to fund benefits payable under the plan.

We have an Enterprise Risk Management Committee that is led by our Assurance and Risk Advisory Services group, our Chief Financial Officer and our Chief Administrative Officer, with participation from our executive leadership team and senior-level staff, including our Chief Compliance Officer and the CISO. This committee assesses and monitors our top enterprise risks, including cybersecurity, and provides quarterly updates to the board of directors. Our CISO also provides periodic updates to the finance and audit committee of the board of directors, which would resultis responsible for ensuring that we have implemented appropriate risk reviews and discusses, with management and the board, our financial and enterprise risk assessment and risk management practices and policies, as well as reports to the board any material risks identified in increased expense. Althoughthe course of performing its responsibilities.

In the event a cybersecurity incident is identified, our plan is currently overfunded,Cybersecurity Incident Response team will act in accordance with our incident management plans to communicate to our executive leadership team and to coordinate the response to any incident. Our Chief Executive Officer, Chief Financial Officer, General Counsel, Chief Technology and Digital Officer, CISO and Chief Compliance Officer are responsible for assessing such incidents for materiality, ensuring that any required notification or communication occurs and determining, among other things, whether any prohibition on the trading of our common stock by insiders should be imposed prior to the disclosure of information about a significant increasematerial cybersecurity event. We maintain cybersecurity insurance coverage that insures us for costs resulting from cyberattacks, although this coverage may not reimburse us for all losses.

We record provisions with respect to identified claims or lawsuits when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Claims and lawsuits are reviewed quarterly and provisions are taken or adjusted to reflect the status of a particular matter. We believe the recorded reserves in our consolidated financial statements are adequate in light of the probable and estimable outcomes. Recorded liabilities were not material to our financial position, results of operations or liquidity, and we do not believe that any of the currently identified claims or litigation will materially affect our financial position, results of operations or liquidity upon resolution. However, litigation is subject to inherent uncertainties, and unfavorable rulings could occur. If an unfavorable ruling were to occur, it may cause a material adverse impact on our financial position, results of operations or liquidity in the period in which the ruling occurs or in future periods.

Not applicable.

Our common stock is traded on the New York Stock Exchange under the symbol DLX. Dividends are declared by our board of directors on a currentquarterly basis, and therefore, are subject to change in the future.change. As of December 31, 2017,2023, the number of shareholders of record was 6,491. The table below shows4,897, excluding shareholders whose shares are held in the per share price rangesname of various dealers, clearing agencies, banks, brokers and other fiduciaries.

In October 2018, our board of directors authorized the repurchase of up to $500.0 million of our common stock for the past two fiscal years as quoted on the New York Stock Exchange, as well as the quarterly dividend amount for each period.

The table below compares the cumulative total shareholder return on our common stock for the last five fiscal years with the cumulative total return of the S&P MidCap 400 Index and the Dow Jones U.S. Support Services (DJUSIS)("DJUSIS") Index.

You shouldPlease note that this MD&A discussion contains forward-looking statements that involve risks and uncertainties. Please seePart I, Item 1A of this report foroutlines known material risks and important information to consider when evaluating our forward-looking

We help businesses deepen customer relationships through trusted, technology-enabled solutions that help our customers acquirebusinesses pay and engage their customers across multiple channels,get paid, accelerate growth and operate more efficiently. Our solutions include merchant services, marketing services and data analytics, treasury management solutions, promotional products, and fraud and security solutions, as well as operate theircustomized checks and business forms. We support millions of small businesses, efficiently and effectively. To promote and sell a wide rangethousands of products and services, we use printed and electronic marketing; a direct sales force; referrals from financial institutions telecommunication clients and other partners; networks of Safeguard^® distributors and independent dealers; and an outbound telemarketing group. Over the past 24 months, our Small Business Services segment has provided products and services to approximately 4.4 million small business customers and our Direct Checks segment has provided products and services to more than 5.1 million consumers. Through our Financial Services segment, we provide products and services to approximately 4,900 financial institution clients. We operate primarily in the United States. Small Business Services also has operations in Canada, Australia and portions of Europe.

During the first quarter of 2024, we realigned our organizational structure to better reflect our portfolio mix and offerings, and we updated our reportable segments to correspond with these changes. We did not operate under the new segment also offers computer forms compatible with accounting software packages commonly used by small businesses. Forms sold bystructure during 2023, and we continued to allocate resources and assess performance based on our Financial Services and Direct Checkscurrent reportable segment structure. Information regarding our realigned reportable segments include deposit tickets and check registers.for the quarter ending March 31, 2024 can be found in Part I, Item 1 of this report.

We believe that extendthese business exits allow us to focus our resources on the rangekey growth areas of productspayments and services we offerdata, while allowing us to optimize our customers, primarily MOS offerings. Information about our acquisitionsoperations. Further information regarding these business exits can be found under the caption "Note 5: Acquisitions" of6: Acquisition and Divestitures" in the Notes to Consolidated Financial Statements appearing in Part II, Item 8 of this report. During 2018, we plan to continue our focus in these areas, with an emphasis on profitable revenue growth

As of December 31, 2023, we held cash and cash equivalents of $72.0 million and $240.5 million was available for borrowing under our revolving credit facility. We expect to maintain a disciplined approach to capital deployment that focuses on our need to continue investing in initiatives to drive revenue growth, including acquisitions. We anticipate that capital expenditures will be approximately $100 million in 2024, as compared to $100.7 million for 2023, as we continue with important innovation investments and building scale across our board of directorsproduct categories. We also expect that we will maintaincontinue to pay our current dividend level.regular quarterly dividend. However, dividends are approved by theour board of directors on a quarterly basis,each quarter and thus, are subject to change. To the extent we generate excessWe anticipate that net cash we plan to opportunistically repurchase common shares and/or reduce the amounts outstanding under our credit facility.

We do not manage our business based on product versus service revenue. Instead, we analyze our products and servicesrevenue based on the following categories:

Cost of revenue consists primarily of raw materials used to manufacture our products, shipping and handling costs, third-party costs for outsourced products and services, payroll and related expenses, information technology costs, depreciation and amortization of assets used in the production process and in support of digital service offerings, and related overhead.

Total cost of revenue as a percentage of total revenue for 2016,2023 increased as compared to 2015, was primarily attributable to2022, as the inflationary impacts, investments in the business and restructuring and integration expense more than offset the benefit of our increase in revenue, including incremental costs of approximately $61.0 million for acquired businesses. In addition, delivery rates and material costs increased in 2016. Partially offsetting these increases in total cost of revenue was the impact of lower order volume for both personal and business checks, as well as forms and accessories sold by Small Business Services. In addition, total cost of revenue decreased approximately $15.0 million during 2016 due to manufacturing efficiencies and other benefits resulting from our continued cost reduction initiatives.pricing actions.