þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended: December 31, 2013
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¨
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TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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DELAWARE
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20-4531180
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.01 Par Value
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The New York Stock Exchange
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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PAGE
NUMBER
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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•
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deterioration in consumers' and clients' confidence in our business, or in money transfer and payment service providers generally;
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•
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changes in general economic conditions and economic conditions in the regions and industries in which we operate, including global economic and trade downturns, or significantly slower growth or declines in the money transfer, payment service, and other markets in which we operate, including those related to interruptions in migration patterns;
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•
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political conditions and related actions in the United States and abroad which may adversely affect our business and economic conditions as a whole;
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failure to compete effectively in the money transfer and payment service industry with respect to global and niche or corridor money transfer providers, banks and other money transfer and payment service providers, including telecommunications providers, card associations, card-based payment providers, electronic and Internet providers, and digital currencies;
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•
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the pricing of our services and any pricing reductions, and their impact on consumer demand for our services and our financial results;
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our ability to adopt technology in response to changing industry and consumer needs or trends;
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our failure to develop and introduce new services and enhancements, and gain market acceptance of such services;
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changes in, and failure to manage effectively, exposure to foreign exchange rates, including the impact of the regulation of foreign exchange spreads on money transfers and payment transactions;
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our ability to maintain our agent network and business relationships under terms consistent with or more advantageous to us than those currently in place;
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interruptions of United States government relations with countries in which we have or are implementing significant business relationships with agents or clients;
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mergers, acquisitions and integration of acquired businesses and technologies into our Company, including Travelex Global Business Payments, and the failure to realize anticipated financial benefits from these acquisitions, and events requiring us to write down our goodwill;
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any material breach of security, including cybersecurity, or safeguards of or interruptions in any of our systems;
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decisions to change our business mix;
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failure to manage credit and fraud risks presented by our agents, clients and consumers or non-performance by our banks, lenders, other financial services providers or insurers;
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increased costs or loss of business due to difficulty for us, our agents or their subagents in establishing or maintaining relationships with banks needed to conduct our services;
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adverse movements and volatility in capital markets and other events which affect our liquidity, the liquidity of our agents or clients, or the value of, or our ability to recover, our investments or amounts payable to us;
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adverse rating actions by credit rating agencies;
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our ability to realize the anticipated benefits from productivity and cost-savings and other related initiatives, which may include decisions to downsize or to transition operating activities from one location to another, and to minimize any disruptions in our workforce that may result from those initiatives;
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our ability to attract and retain qualified key employees and to manage our workforce successfully;
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our ability to protect our brands and our other intellectual property rights;
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our failure to manage the potential both for patent protection and patent liability in the context of a rapidly developing legal framework for intellectual property protection;
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changes in tax laws and unfavorable resolution of tax contingencies;
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cessation of or defects in various services provided to us by third-party vendors;
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material changes in the market value or liquidity of securities that we hold;
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restrictions imposed by our debt obligations;
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changes in industry standards affecting our business;
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liabilities or loss of business resulting from a failure by us, our agents or their subagents to comply with laws and regulations and regulatory or judicial interpretations thereof, including laws and regulations designed to detect and prevent money laundering, terrorist financing, fraud and other illicit activity, and increased costs or loss of business associated with compliance with those laws and regulations;
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increased costs or loss of business due to regulatory initiatives and changes in laws, regulations and industry practices and standards affecting us, our agents, or their subagents, including related to anti-money laundering regulations, anti-fraud measures, customer due diligence, or agent and subagent due diligence, registration, and monitoring requirements;
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liabilities or loss of business and unanticipated developments resulting from governmental investigations and consent agreements with or enforcement actions by regulators, including those associated with compliance with or failure to comply with the settlement agreement with the State of Arizona, as amended on January 31, 2014;
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the impact on our business from the Dodd-Frank Wall Street Reform and Consumer Protection Act, the rules promulgated there-under, and the actions of the Consumer Financial Protection Bureau, and similar legislation and regulations enacted by other government authorities;
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changes in United States or foreign laws, rules and regulations including the Internal Revenue Code, governmental or judicial interpretations thereof and industry practices and standards, including the impact of the Foreign Account Tax Compliance provisions of the Hiring Incentives to Restore Employment Act;
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liabilities resulting from litigation, including class-action lawsuits and similar matters, including costs, expenses, settlements and judgments;
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failure to comply with regulations regarding consumer privacy and data use and security;
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effects of unclaimed property laws;
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failure to maintain sufficient amounts or types of regulatory capital to meet the changing requirements of our regulators worldwide;
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changes in accounting standards, rules and interpretations;
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adverse tax consequences from our spin-off from First Data Corporation;
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catastrophic events; and
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management's ability to identify and manage these and other risks.
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Year Ended December 31,
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2013
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2012
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2011
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Consumer-to-Consumer
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80
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%
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81
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%
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84
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%
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Consumer-to-Business
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11
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%
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11
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%
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11
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%
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Business Solutions
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7
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%
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6
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%
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3
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%
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Other
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2
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%
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2
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%
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2
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%
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100
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%
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100
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%
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100
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%
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•
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Global money transfer providers
-
Global money transfer providers allow consumers to send money to a wide variety of locations, in both their home countries and abroad.
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•
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Regional money transfer providers
- Regional money transfer providers, or "niche" providers, provide the same services as global money transfer providers, but focus on a smaller group of geographic corridors or services within one region, such as North America to the Caribbean, Central or South America, or Western Europe to North Africa.
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•
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Electronic channels
- Online money transfer service providers, including certain electronic payment providers, allow consumers to send and receive money electronically using the Internet or through mobile devices. Electronic channels also include digital wallets and digital currencies.
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Banks and postbanks
- Banks and postbanks of all sizes compete with us in a number of ways, including bank wire services and card-based services.
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Informal networks
- Informal networks enable people to transfer funds without formal mechanisms and often without compliance with government reporting requirements. We believe that such networks comprise a significant share of the market.
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Alternative channels
- Alternative channels for sending and receiving money include mail and commercial courier services, and card-based options, such as ATM cards and stored-value cards.
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prohibit transactions in, to or from certain countries or with certain governments, individuals and entities;
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impose additional customer identification and customer, agent, and subagent due diligence requirements;
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impose additional reporting or recordkeeping requirements, or require enhanced transaction monitoring;
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limit the types of entities capable of providing money transfer services, impose additional licensing or registration requirements on us, our agents, or their subagents, or impose additional requirements on us with regard to selection or oversight of our agents or their subagents;
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impose minimum capital or other financial requirements on us or our agents and their subagents;
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limit or restrict the revenue which may be generated from money transfers, including transaction fees and revenue derived from foreign exchange;
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require enhanced disclosures to our money transfer customers;
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require the principal amount of money transfers originated in a country to be invested in that country or held in trust until they are paid;
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limit the number or principal amount of money transfers which may be sent to or from the jurisdiction, whether by an individual, through one agent or in aggregate; or
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impose taxes or fees on money transfer transactions.
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Name
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Age
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Position
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Hikmet Ersek
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53
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President, Chief Executive Officer and Director
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Rajesh K. Agrawal
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48
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Executive Vice President, Interim Chief Financial Officer
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Odilon Almeida
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52
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Executive Vice President and President, Americas and European Union
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John R. Dye
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54
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Executive Vice President, General Counsel and Secretary
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Jean Claude Farah
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43
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Executive Vice President and President, Middle East, Africa, APAC, Eastern Europe & CIS
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Diane Scott
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43
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Executive Vice President, Chief Product and Marketing Officer
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J. David Thompson
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47
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Executive Vice President, Global Operations and Chief Information Officer
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Richard L. Williams
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48
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Executive Vice President, Chief Human Resources Officer
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•
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Risks Relating to Our Business and Industry;
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Risks Related to Our Regulatory and Litigation Environment; and
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Risks Related to the Spin-Off.
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•
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changes or proposed changes in laws or regulations or regulator or judicial interpretation thereof that have the effect of making it more difficult or less desirable for consumers to transfer money using consumer money transfer and payment service providers, including additional customer due diligence, identification, reporting, and recordkeeping requirements;
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the quality of our services and our customer experience, and our ability to meet evolving consumer needs and preferences, including customer preferences related to our digital services;
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failure of our agents or their subagents to deliver services in accordance with our requirements;
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reputational concerns resulting from actual or perceived events, including those related to fraud or consumer protection;
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actions by federal, state or foreign regulators that interfere with our ability to transfer consumers' money reliably, for example, attempts to seize money transfer funds, or limit our ability to or prohibit us from transferring money in certain corridors;
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federal, state or foreign legal requirements, including those that require us to provide consumer or transaction data pursuant to our agreement and settlement with the State of Arizona and other requirements or to a greater extent than is currently required;
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any significant interruption in our systems, including by fire, natural disaster, power loss, telecommunications failure, terrorism, vendor failure, unauthorized entry and computer viruses or disruptions in our workforce; and
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•
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any breach of our security policies or legal requirements resulting in a compromise of consumer privacy or data use and security.
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Demand for our services could soften, including due to low consumer confidence, high unemployment, or reduced global trade.
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Our Consumer-to-Consumer money transfer business relies in large part on migration, which brings workers to countries with
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Many of our consumers work in industries that may be impacted by deteriorating economic conditions more quickly or significantly than other industries. Reduced job opportunities, especially in retail, healthcare, hospitality, and construction, or overall weakness in the world’s economies could adversely affect the number of money transfer transactions, the principal amounts transferred and correspondingly our results of operations. If general market softness in the economies of countries important to migrant workers occurs, our results of operations could be adversely impacted. Additionally, if our consumer transactions decline, if the amount of money that consumers send per transaction declines, or if migration patterns shift due to weak or deteriorating economic conditions, our results of operations may be adversely affected.
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Our agents or clients could experience reduced sales or business as a result of a deterioration in economic conditions. As a result, our agents could reduce their numbers of locations or hours of operation, or cease doing business altogether. Businesses using our services may make fewer cross-currency payments or may have fewer customers making payments to them through us, particularly businesses in those industries that may be more affected by an economic downturn.
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•
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Our exposure to receivables from our agents, consumers and businesses could impact us. For more information on this risk, see risk factor,
"
We face credit, liquidity and fraud risks from our agents, consumers and businesses that could adversely affect our business, financial condition and results of operations
."
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•
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The market value of the securities in our investment portfolio may substantially decline. The impact of that decline in value may adversely affect our liquidity, results of operations and financial condition.
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•
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The counterparties to the derivative financial instruments that we use to reduce our exposure to various market risks, including changes in interest rates and foreign exchange rates, may fail to honor their obligations, which could expose us to risks we had sought to mitigate. That failure could have an adverse effect on our financial condition and results of operations.
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•
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We aggregate our foreign exchange exposures in our Business Solutions business, including the exposure generated by the derivative contracts we write to our customers as part of our cross-currency payments business, and typically hedge the net exposure through offsetting contracts with established financial institution counterparties. If our customers fail to honor their obligations or if the counterparties to our offsetting positions fail to honor their obligations, our business, financial condition and results of operations could be adversely affected.
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•
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We may be unable to refinance our existing indebtedness as it becomes due or we may have to refinance on unfavorable terms, which could require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for working capital, capital expenditures, acquisitions, share repurchases, dividends, and other purposes.
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•
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Our revolving credit facility with a consortium of banks is one source for funding liquidity needs and also backs our commercial paper program. If any of the banks participating in our credit facility fails to fulfill its lending commitment to us, our short-term liquidity and ability to support borrowings under our commercial paper program could be adversely affected.
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•
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The third-party service providers on whom we depend may experience difficulties in their businesses, which may impair their ability to provide services to us and have a potential impact on our own business. The impact of a change or temporary stoppage of services may have an adverse effect on our business, results of operations and financial condition.
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•
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Banks upon which we rely to conduct our business could fail or be unable to satisfy their obligations to us. This could lead to our inability to access funds and/or credit losses for us and could adversely impact our ability to conduct our business.
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•
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If market disruption and volatility occurs, we could experience difficulty in accessing capital on favorable terms and our business, financial condition and results of operations could be adversely impacted.
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•
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realizing the anticipated financial benefits from these acquisitions and where necessary, improving internal controls of these acquired businesses;
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•
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managing geographically separated organizations, systems and facilities;
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•
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managing multi-jurisdictional operating, tax and financing structures;
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•
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integrating personnel with diverse business backgrounds and organizational cultures;
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•
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integrating the acquired technologies into our Company;
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•
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complying with regulatory requirements;
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•
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enforcing intellectual property rights in some foreign countries;
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•
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entering new markets with the services of the acquired businesses; and
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•
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general economic and political conditions, including legal and other barriers to cross-border investment in general, or by United States companies in particular.
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•
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limiting our ability to pay dividends to our stockholders or to repurchase stock consistent with our historical practices;
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•
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increasing our vulnerability to changing economic, regulatory and industry conditions;
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•
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limiting our ability to compete and our flexibility in planning for, or reacting to, changes in our business and the industry;
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•
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limiting our ability to borrow additional funds; and
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•
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requiring us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for working capital, capital expenditures, acquisitions and other purposes.
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•
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revisions to agent agreements to increase our ability to oversee the compliance of our agents and their subagents;
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•
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reduced thresholds at which our consumers are required to provide identification for transactions from certain states along the United States southwest border; and
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•
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enhancement of our information systems including migrating customer information for our Orlandi Valuta and Vigo brands onto our Western Union database and migrating to a standard point of sale system.
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ITEM 5.
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MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
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Common Stock
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Dividends
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||||||||
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Market Price
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Declared
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||||||||
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High
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Low
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per Share
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||||||
2013
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||||||
First Quarter
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$
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15.05
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$
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13.23
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$
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0.125
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Second Quarter
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17.23
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14.24
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0.125
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Third Quarter
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19.11
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16.63
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0.125
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Fourth Quarter
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19.50
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15.51
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0.125
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2012
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||||||
First Quarter
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$
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19.82
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$
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16.99
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$
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0.10
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Second Quarter
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18.68
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15.79
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0.10
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Third Quarter
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19.14
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16.32
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0.10
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Fourth Quarter
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18.60
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11.93
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0.125
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Total Number of
Shares Purchased*
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Average Price
Paid per Share
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Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs**
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Remaining Dollar
Value of Shares that
May Yet Be Purchased
Under the Plans or
Programs (In millions)
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||||||
October 1 - 31
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675
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$
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18.78
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—
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$
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59.2
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November 1 - 30
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2,451,107
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|
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16.82
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2,444,035
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$
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18.1
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December 1 - 31
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1,088,613
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16.72
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1,080,422
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$
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—
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Total
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3,540,395
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$
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16.79
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3,524,457
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*
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These amounts represent both shares authorized by the Board of Directors for repurchase under a publicly announced plan, as described below, as well as shares withheld from employees to cover tax withholding obligations on restricted stock units that have vested.
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**
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On February 11, 2014, the Board of Directors authorized $500 million of common stock repurchases through June 30, 2015. Management has historically and may continue to establish prearranged written plans pursuant to Rule 10b5-1. A Rule 10b5-1 plan permits us to repurchase shares at times when we may otherwise be unable to do so, provided the plan is adopted when we are not aware of material non-public information.
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Year Ended December 31,
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||||||||||||||||||
(in millions, except per share data)
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2013
|
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2012
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2011
|
|
2010
|
|
2009
|
||||||||||
Statements of Income Data:
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|
|
|
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|
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|
||||||||||
Revenues (a)
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$
|
5,542.0
|
|
|
$
|
5,664.8
|
|
|
$
|
5,491.4
|
|
|
$
|
5,192.7
|
|
|
$
|
5,083.6
|
|
Operating expenses (b) (c)
|
4,434.6
|
|
|
4,334.8
|
|
|
4,106.4
|
|
|
3,892.6
|
|
|
3,800.9
|
|
|||||
Operating income (a) (b) (c)
|
1,107.4
|
|
|
1,330.0
|
|
|
1,385.0
|
|
|
1,300.1
|
|
|
1,282.7
|
|
|||||
Interest income (d)
|
9.4
|
|
|
5.5
|
|
|
5.2
|
|
|
2.8
|
|
|
9.4
|
|
|||||
Interest expense (e)
|
(195.6
|
)
|
|
(179.6
|
)
|
|
(181.9
|
)
|
|
(169.9
|
)
|
|
(157.9
|
)
|
|||||
Other income/(expense), net, excluding interest income and interest expense (f)
|
5.7
|
|
|
12.9
|
|
|
66.3
|
|
|
12.2
|
|
|
(2.7
|
)
|
|||||
Income before income taxes (a) (b) (c) (d) (e) (f)
|
926.9
|
|
|
1,168.8
|
|
|
1,274.6
|
|
|
1,145.2
|
|
|
1,131.5
|
|
|||||
Net income (a) (b) (c) (d) (e) (f) (g)
|
798.4
|
|
|
1,025.9
|
|
|
1,165.4
|
|
|
909.9
|
|
|
848.8
|
|
|||||
Depreciation and amortization
|
262.8
|
|
|
246.1
|
|
|
192.6
|
|
|
175.9
|
|
|
154.2
|
|
|||||
Cash Flow Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities (h)
|
1,088.6
|
|
|
1,185.3
|
|
|
1,174.9
|
|
|
994.4
|
|
|
1,218.1
|
|
|||||
Capital expenditures (i)
|
(241.3
|
)
|
|
(268.2
|
)
|
|
(162.5
|
)
|
|
(113.7
|
)
|
|
(98.9
|
)
|
|||||
Common stock repurchased (j)
|
(399.7
|
)
|
|
(766.5
|
)
|
|
(803.9
|
)
|
|
(581.4
|
)
|
|
(400.2
|
)
|
|||||
Earnings Per Share Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic (a) (b) (c) (d) (e) (f) (g) (j)
|
$
|
1.43
|
|
|
$
|
1.70
|
|
|
$
|
1.85
|
|
|
$
|
1.37
|
|
|
$
|
1.21
|
|
Diluted (a) (b) (c) (d) (e) (f) (g) (j)
|
$
|
1.43
|
|
|
$
|
1.69
|
|
|
$
|
1.84
|
|
|
$
|
1.36
|
|
|
$
|
1.21
|
|
Cash dividends to stockholders per common share (k)
|
$
|
0.50
|
|
|
$
|
0.425
|
|
|
$
|
0.31
|
|
|
$
|
0.25
|
|
|
$
|
0.06
|
|
Key Indicators (unaudited):
|
|
|
|
|
|
|
|
|
|
||||||||||
Consumer-to-Consumer transactions (l)
|
242.34
|
|
|
230.98
|
|
|
225.79
|
|
|
213.74
|
|
|
196.11
|
|
|
As of December 31,
|
||||||||||||||||||
(in millions)
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Settlement assets
|
$
|
3,270.4
|
|
|
$
|
3,114.6
|
|
|
$
|
3,091.2
|
|
|
$
|
2,635.2
|
|
|
$
|
2,389.1
|
|
Total assets
|
10,121.3
|
|
|
9,465.7
|
|
|
9,069.9
|
|
|
7,929.2
|
|
|
7,353.4
|
|
|||||
Settlement obligations
|
3,270.4
|
|
|
3,114.6
|
|
|
3,091.2
|
|
|
2,635.2
|
|
|
2,389.1
|
|
|||||
Total borrowings
|
4,213.0
|
|
|
4,029.2
|
|
|
3,583.2
|
|
|
3,289.9
|
|
|
3,048.5
|
|
|||||
Total liabilities
|
9,016.6
|
|
|
8,525.1
|
|
|
8,175.1
|
|
|
7,346.5
|
|
|
6,999.9
|
|
|||||
Total stockholders’ equity
|
1,104.7
|
|
|
940.6
|
|
|
894.8
|
|
|
582.7
|
|
|
353.5
|
|
(a)
|
Revenue for the years ended December 31, 2012 and 2011 included $238.5 million and $35.2 million, respectively, of revenue related to Travelex Global Business Payments ("TGBP"), which was acquired in November 2011. Revenue for the years ended December 31, 2010 and 2009 included $111.0 million and $30.8 million, respectively, of revenue related to the Custom House Ltd. ("Custom House") acquisition in September 2009. TGBP and Custom House have subsequently been rebranded to "Western Union Business Solutions."
|
|
|
(b)
|
Operating expenses for the years ended December 31, 2011 and 2010 included $46.8 million and $59.5 million of restructuring and related expenses, respectively, associated with a restructuring plan designed to reduce overall headcount and migrate positions from various facilities, primarily within the United States and Europe, to regional operating centers.
|
|
|
(c)
|
Operating expenses for the year ended December 31, 2009 included an accrual of $71.0 million resulting from an agreement and settlement, which resolved all outstanding legal issues and claims with the State of Arizona and required us to fund a multi-state not-for-profit organization promoting safety and security along the United States and Mexico border, in which California, Texas and New Mexico have participated with Arizona. The settlement agreement was signed on February 11, 2010.
|
|
|
(d)
|
Interest income consists of interest earned on cash balances not required to satisfy settlement obligations and in connection with loans previously made to certain existing agents.
|
|
|
(e)
|
Interest expense primarily relates to our outstanding borrowings.
|
|
|
(f)
|
In 2011, we recognized gains of $20.5 million and $29.4 million, in connection with the remeasurement of our former equity interests in Finint, S.r.l. and Angelo Costa, S.r.l., respectively, to fair value. These equity interests were remeasured in conjunction with our purchases of the remaining interests in these entities that we previously did not hold. Additionally, in 2011, we recognized a $20.8 million net gain on foreign currency forward contracts entered into in order to reduce the economic variability related to the cash amounts used to fund acquisitions of businesses with purchase prices denominated in foreign currencies, primarily for the TGBP acquisition. In 2009, given the increased uncertainty, at that time, surrounding the numerous third-party legal claims associated with our receivable from the Reserve International Liquidity Fund, Ltd., we reserved $12.0 million representing the estimated impact of a pro-rata distribution. In 2010, we recorded a recovery of this reserve of $6.3 million due to the final settlement of this receivable.
|
|
|
(g)
|
In December 2011, we reached an agreement with the United States Internal Revenue Service ("IRS Agreement") resolving substantially all of the issues related to the restructuring of our international operations in 2003. As a result of the IRS Agreement, we recognized a tax benefit of $204.7 million related to the adjustment of reserves associated with this matter.
|
|
|
(h)
|
Net cash provided by operating activities during the year ended December 2012 was impacted by tax payments of $92.4 million made as a result of the IRS Agreement. Net cash provided by operating activities decreased during the year ended December 31, 2010, primarily due to a $250 million tax deposit made relating to United States federal tax liabilities, including those arising from our 2003 international restructuring, which were previously accrued in our consolidated financial statements. Also impacting net cash provided by operating activities during the year ended December 31, 2010 were cash payments of $71.0 million related to the agreement and settlement with the State of Arizona and other states.
|
|
|
(i)
|
Capital expenditures include capitalization of contract costs, capitalization of purchased and developed software and purchases of property and equipment.
|
|
|
(j)
|
On February 11, 2014, the Board of Directors authorized $500 million of common stock repurchases through June 30, 2015. During the years ended December 31, 2013, 2012, 2011, 2010 and 2009, we repurchased 25.7 million, 51.0 million, 40.3 million, 35.6 million and 24.8 million shares, respectively.
|
|
|
(k)
|
During 2013, the Board of Directors declared quarterly cash dividends of $0.125 per common share. During 2012, the Board of Directors declared quarterly cash dividends of $0.125 per common share in the fourth quarter and $0.10 per common share in each of the first three quarters. During 2011, the Board of Directors declared quarterly cash dividends of $0.08 per common share in each of the last three quarters and $0.07 per common share in the first quarter. During 2010, the Board of Directors declared quarterly cash dividends of $0.07 per common share in the fourth quarter and $0.06 per common share in each of the first three quarters. During the fourth quarter of 2009, the Board of Directors declared an annual cash dividend of $0.06 per common share.
|
|
|
(l)
|
Consumer-to-Consumer transactions include Western Union, Vigo and Orlandi Valuta branded Consumer-to-Consumer money transfer services worldwide.
|
ITEM 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
Consumer-to-Consumer
- The Consumer-to-Consumer operating segment facilitates money transfers between two consumers, primarily through a network of third-party agents. Our multi-currency, real-time money transfer service is viewed by us as one interconnected global network where a money transfer can be sent from one location to another, around the world. Our money transfer services are available for international cross-border transfers - that is, the transfer of funds from one country to another - and, in certain countries, intra-country transfers - that is, money transfers from one location to another in the same country. This segment also includes money transfer transactions that can be initiated through websites and account based money transfers.
|
•
|
Consumer-to-Business
- The Consumer-to-Business operating segment facilitates bill payments from consumers to businesses and other organizations, including utilities, auto finance companies, mortgage servicers, financial service providers, government agencies and other businesses. The significant majority of the segment's revenue was generated in the United States during all periods presented, with the remainder primarily generated in Argentina.
|
•
|
Business Solutions
- The Business Solutions operating segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations and individuals. The
majority
of the segment's business relates to exchanges of currency at the spot rate, which enables customers to make cross-currency payments. In addition, in certain countries, we write foreign currency forward and option contracts for customers to facilitate future payments. Travelex Global Business Payments ("TGBP"), which was acquired in November 2011, is included in this segment.
|
•
|
Strengthening consumer money transfer
- We continue to implement key actions in our consumer money transfer business, including: expanding digital money transfer channels; optimizing the performance of the distribution network; strengthening our customer relationships; and enhancing our compliance capabilities. We also plan to continue connecting the cash and digital worlds for our consumers. Digital and electronic account based money transfer channels delivered strong growth in 2013 and generated new customer acquisitions. We plan to accelerate usage in 2014 through added capabilities, enhanced value propositions and expanded reach. Money transfer services through electronic channels, which include online, account based, and mobile money transfer, combined were approximately 5% of consolidated revenue for the year ended
December 31, 2013
.
|
•
|
Driving growth in Western Union Business Solutions
- In Western Union Business Solutions, we are working to drive new customer acquisition and growth opportunities with existing customers through increased sales effectiveness and tailored product solutions for specific market segments. Business Solutions represented 7% of our consolidated revenue for the year ended December 31, 2013.
|
•
|
Generating and deploying cash flow for shareholders
- We currently expect to generate significant cash flow and anticipate continuing to return capital to our shareholders in 2014 through both dividends and share repurchases, subject to U.S. cash availability, targeted investment grade credit ratings, and other factors.
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2013
|
|
2012
|
||||||||||||
(in millions, except per share amounts)
|
2013
|
|
2012
|
|
2011
|
|
vs. 2012
|
|
vs. 2011
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
4,065.8
|
|
|
$
|
4,210.0
|
|
|
$
|
4,220.2
|
|
|
(3
|
)%
|
|
0
|
%
|
Foreign exchange revenues
|
1,348.0
|
|
|
1,332.7
|
|
|
1,151.2
|
|
|
1
|
%
|
|
16
|
%
|
|||
Other revenues
|
128.2
|
|
|
122.1
|
|
|
120.0
|
|
|
5
|
%
|
|
2
|
%
|
|||
Total revenues
|
5,542.0
|
|
|
5,664.8
|
|
|
5,491.4
|
|
|
(2
|
)%
|
|
3
|
%
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of services
|
3,235.0
|
|
|
3,194.2
|
|
|
3,102.0
|
|
|
1
|
%
|
|
3
|
%
|
|||
Selling, general and administrative
|
1,199.6
|
|
|
1,140.6
|
|
|
1,004.4
|
|
|
5
|
%
|
|
14
|
%
|
|||
Total expenses
|
4,434.6
|
|
|
4,334.8
|
|
|
4,106.4
|
|
|
2
|
%
|
|
6
|
%
|
|||
Operating income
|
1,107.4
|
|
|
1,330.0
|
|
|
1,385.0
|
|
|
(17
|
)%
|
|
(4
|
)%
|
|||
Other income/(expense):
|
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
9.4
|
|
|
5.5
|
|
|
5.2
|
|
|
71
|
%
|
|
6
|
%
|
|||
Interest expense
|
(195.6
|
)
|
|
(179.6
|
)
|
|
(181.9
|
)
|
|
9
|
%
|
|
(1
|
)%
|
|||
Derivative gains/(losses), net
|
(1.3
|
)
|
|
0.5
|
|
|
14.0
|
|
|
*
|
|
|
(96
|
)%
|
|||
Other income, net
|
7.0
|
|
|
12.4
|
|
|
52.3
|
|
|
(44
|
)%
|
|
(76
|
)%
|
|||
Total other expense, net
|
(180.5
|
)
|
|
(161.2
|
)
|
|
(110.4
|
)
|
|
12
|
%
|
|
46
|
%
|
|||
Income before income taxes
|
926.9
|
|
|
1,168.8
|
|
|
1,274.6
|
|
|
(21
|
)%
|
|
(8
|
)%
|
|||
Provision for income taxes
|
128.5
|
|
|
142.9
|
|
|
109.2
|
|
|
(10
|
)%
|
|
31
|
%
|
|||
Net income
|
$
|
798.4
|
|
|
$
|
1,025.9
|
|
|
$
|
1,165.4
|
|
|
(22
|
)%
|
|
(12
|
)%
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.43
|
|
|
$
|
1.70
|
|
|
$
|
1.85
|
|
|
(16
|
)%
|
|
(8
|
)%
|
Diluted
|
$
|
1.43
|
|
|
$
|
1.69
|
|
|
$
|
1.84
|
|
|
(15
|
)%
|
|
(8
|
)%
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
556.6
|
|
|
604.9
|
|
|
630.6
|
|
|
|
|
|
|||||
Diluted
|
559.7
|
|
|
607.4
|
|
|
634.2
|
|
|
|
|
|
*
|
Calculation not meaningful
|
•
|
The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.
|
•
|
Corporate and other overhead is allocated to the segments primarily based on a percentage of the segments' revenue compared to total revenue.
|
•
|
Costs incurred for the review and closing of acquisitions are included in "Other."
|
•
|
We incurred restructuring and related expenses of $46.8 million during the year ended December 31, 2011 which were not allocated to the segments. While these items were identifiable to our segments, they were not included in the measurement of segment operating profit provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. For additional information on restructuring and related activities, refer to "Operating expenses overview."
|
•
|
All items not included in operating income are excluded from the segments.
|
|
Year Ended December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Consumer-to-Consumer
|
80
|
%
|
|
81
|
%
|
|
84
|
%
|
Consumer-to-Business
|
11
|
%
|
|
11
|
%
|
|
11
|
%
|
Business Solutions
|
7
|
%
|
|
6
|
%
|
|
3
|
%
|
Other
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2013
|
|
2012
|
||||||||||||
(dollars and transactions in millions)
|
2013
|
|
2012
|
|
2011
|
|
vs. 2012
|
|
vs. 2011
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
3,396.1
|
|
|
$
|
3,545.6
|
|
|
$
|
3,580.2
|
|
|
(4
|
)%
|
|
(1
|
)%
|
Foreign exchange revenues
|
981.3
|
|
|
988.5
|
|
|
983.1
|
|
|
(1
|
)%
|
|
1
|
%
|
|||
Other revenues
|
56.2
|
|
|
50.2
|
|
|
45.1
|
|
|
12
|
%
|
|
11
|
%
|
|||
Total revenues
|
$
|
4,433.6
|
|
|
$
|
4,584.3
|
|
|
$
|
4,608.4
|
|
|
(3
|
)%
|
|
(1
|
)%
|
Operating income
|
$
|
1,030.4
|
|
|
$
|
1,266.9
|
|
|
$
|
1,316.0
|
|
|
(19
|
)%
|
|
(4
|
)%
|
Operating income margin
|
23
|
%
|
|
28
|
%
|
|
29
|
%
|
|
|
|
|
|||||
Key indicator:
|
|
|
|
|
|
|
|
|
|
||||||||
Consumer-to-Consumer transactions
|
242.34
|
|
|
230.98
|
|
|
225.79
|
|
|
5
|
%
|
|
2
|
%
|
|
Year Ended December 31,
|
||
|
2013
|
|
2012
|
Consumer-to-Consumer transaction growth/(decline) (a):
|
|
|
|
Europe and CIS
|
4%
|
|
(1)%
|
North America
|
0%
|
|
(1)%
|
Middle East and Africa
|
7%
|
|
7%
|
Asia Pacific ("APAC")
|
6%
|
|
3%
|
Latin America and the Caribbean ("LACA")
|
(1)%
|
|
1%
|
westernunion.com
|
65%
|
|
41%
|
|
|
|
|
Consumer-to-Consumer revenue growth/(decline) (a):
|
|
|
|
Europe and CIS
|
(4)%
|
|
(6)%
|
North America
|
(9)%
|
|
(3)%
|
Middle East and Africa
|
0%
|
|
3%
|
APAC
|
(3)%
|
|
3%
|
LACA
|
(3)%
|
|
3%
|
westernunion.com
|
24%
|
|
24%
|
|
|
|
|
Consumer-to-Consumer revenue as a percentage of consolidated revenue (a):
|
|
|
|
Europe and CIS
|
21%
|
|
22%
|
North America
|
19%
|
|
20%
|
Middle East and Africa
|
16%
|
|
15%
|
APAC
|
12%
|
|
12%
|
LACA
|
9%
|
|
9%
|
westernunion.com
|
3%
|
|
3%
|
(a)
|
Significant allocations are made in determining the transaction and revenue changes under the regional view in the above table. The geographic split for transactions and revenue is determined based upon the region where the money transfer is initiated and the region where the money transfer is paid. For transactions originated and paid in different regions, we split the transaction count and revenue between the two regions, with each region receiving 50%. For money transfers initiated and paid in the same region, 100% of the revenue and transactions are attributed to that region. For money transfers initiated through our websites ("westernunion.com"), 100% of the revenue and transactions are attributed to westernunion.com.
We view our Consumer-to-Consumer money transfer service as one interconnected global network where a money transfer can be sent from one location to another, around the world, including related transactions that can be initiated through websites and account based money transfers. The segment includes five geographic regions whose functions are limited to generating, managing and maintaining agent relationships and localized marketing activities and also includes westernunion.com. By means of common processes and systems, these regions and westernunion.com create an interconnected network for consumer transactions, thereby constituting one global Consumer-to-Consumer money transfer business and one operating segment.
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2013
|
|
2012
|
||||||||||||
(dollars in millions)
|
2013
|
|
2012
|
|
2011
|
|
vs. 2012
|
|
vs. 2011
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
579.1
|
|
|
$
|
573.6
|
|
|
$
|
581.8
|
|
|
1
|
%
|
|
(1
|
)%
|
Foreign exchange and other revenues
|
29.4
|
|
|
30.3
|
|
|
34.1
|
|
|
(3
|
)%
|
|
(11
|
)%
|
|||
Total revenues
|
$
|
608.5
|
|
|
$
|
603.9
|
|
|
$
|
615.9
|
|
|
1
|
%
|
|
(2
|
)%
|
Operating income
|
$
|
121.9
|
|
|
$
|
137.6
|
|
|
$
|
146.9
|
|
|
(11
|
)%
|
|
(6
|
)%
|
Operating income margin
|
20
|
%
|
|
23
|
%
|
|
24
|
%
|
|
|
|
|
|
|
|
|
|
|
|
% Change
|
|||||||||
|
Year Ended December 31,
|
|
2013
|
|
2012
|
|||||||||||
(dollars in millions)
|
2013
|
|
2012
|
|
2011
|
|
vs. 2012
|
|
vs. 2011
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|||||||
Foreign exchange revenues
|
$
|
355.5
|
|
|
$
|
332.0
|
|
|
$
|
154.6
|
|
|
7
|
%
|
|
*
|
Transaction fees and other revenues
|
37.4
|
|
|
35.4
|
|
|
6.5
|
|
|
6
|
%
|
|
*
|
|||
Total revenues
|
$
|
392.9
|
|
|
$
|
367.4
|
|
|
$
|
161.1
|
|
|
7
|
%
|
|
*
|
Operating loss
|
$
|
(27.0
|
)
|
|
$
|
(54.8
|
)
|
|
$
|
(9.6
|
)
|
|
*
|
|
|
*
|
Operating loss margin
|
(7
|
)%
|
|
(15
|
)%
|
|
(6
|
)%
|
|
|
|
|
*
|
Calculation not meaningful.
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2013
|
|
2012
|
||||||||||||
(dollars in millions)
|
2013
|
|
2012
|
|
2011
|
|
vs. 2012
|
|
vs. 2011
|
||||||||
Revenues
|
$
|
107.0
|
|
|
$
|
109.2
|
|
|
$
|
106.0
|
|
|
(2
|
)%
|
|
3
|
%
|
Operating loss
|
$
|
(17.9
|
)
|
|
$
|
(19.7
|
)
|
|
$
|
(21.5
|
)
|
|
*
|
|
|
*
|
|
*
|
Calculation not meaningful.
|
Due in less than one year:
|
|
||
6.500% notes (effective rate of 5.7%) due 2014 (a)
|
$
|
500.0
|
|
Due in greater than one year (a):
|
|
||
Floating rate notes due 2015 (b)
|
250.0
|
|
|
2.375% notes due 2015 (c)
|
250.0
|
|
|
5.930% notes due 2016 (c)
|
1,000.0
|
|
|
2.875% notes (effective rate of 2.0%) due 2017 (a)
|
500.0
|
|
|
3.650% notes due 2018 (c)
|
400.0
|
|
|
3.350% notes (effective rate of 3.4%) due 2019 (d)
|
250.0
|
|
|
5.253% notes due 2020 (c)
|
324.9
|
|
|
6.200% notes due 2036 (c)
|
500.0
|
|
|
6.200% notes due 2040 (c)
|
250.0
|
|
|
Other borrowings
|
5.7
|
|
|
Total borrowings at par value
|
4,230.6
|
|
|
Fair value hedge accounting adjustments, net (a)
|
0.9
|
|
|
Unamortized discount, net
|
(18.5
|
)
|
|
Total borrowings at carrying value (e)
|
$
|
4,213.0
|
|
(a)
|
We utilize interest rate swaps designated as fair value hedges to effectively change the interest rate payments on a portion of our notes from fixed-rate payments to short-term LIBOR-based variable rate payments in order to manage our overall exposure to interest rates. The changes in fair value of these interest rate swaps result in an offsetting hedge accounting adjustment recorded to the carrying value of the related note. These hedge accounting adjustments will be reclassified as reductions to or increases in "Interest expense" in the Consolidated Statements of Income over the life of the related notes, and cause the effective rate of interest to differ from the notes' stated rate.
|
(b)
|
On August 22, 2013, we issued $250.0 million of aggregate principal amount of unsecured floating rate notes due August 21, 2015 ("2015 Floating Rate Notes"). Interest is payable quarterly at a per annum rate equal to three-month LIBOR plus 1.0% (1.2% at December 31, 2013) and is reset quarterly. See below for additional detail relating to the debt issuance.
|
(c)
|
The difference between the stated interest rate and the effective interest rate is not significant.
|
(d)
|
On November 22, 2013, we issued $250.0 million of aggregate principal amount of 3.350% unsecured fixed rate notes due 2019 ("2019 Notes"). The interest rate on the 2019 Notes may be adjusted under certain circumstances as described below.
|
(e)
|
As of December 31, 2013, our weighted-average effective rate on total borrowings was approximately 4.6%.
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
After 5 Years
|
||||||||||
Items related to amounts included on our balance sheet:
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings, including interest (a)
|
$
|
5,824.1
|
|
|
$
|
667.0
|
|
|
$
|
1,815.1
|
|
|
$
|
1,100.2
|
|
|
$
|
2,241.8
|
|
IRS Agreement and related state tax payments (b)
|
100.0
|
|
|
100.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Estimated pension funding (c)
|
35.6
|
|
|
13.3
|
|
|
19.9
|
|
|
2.4
|
|
|
—
|
|
|||||
Unrecognized tax benefits (d)
|
135.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Foreign currency and interest rate derivative contracts (e)
|
223.4
|
|
|
208.9
|
|
|
7.0
|
|
|
7.5
|
|
|
—
|
|
|||||
Other (f)
|
22.9
|
|
|
20.1
|
|
|
1.8
|
|
|
0.4
|
|
|
0.6
|
|
|||||
Other Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Purchase obligations (g)
|
220.8
|
|
|
92.9
|
|
|
89.5
|
|
|
38.4
|
|
|
—
|
|
|||||
Operating leases
|
161.1
|
|
|
44.0
|
|
|
64.6
|
|
|
37.5
|
|
|
15.0
|
|
|||||
|
$
|
6,723.1
|
|
|
$
|
1,146.2
|
|
|
$
|
1,997.9
|
|
|
$
|
1,186.4
|
|
|
$
|
2,257.4
|
|
(a)
|
We have estimated our interest payments based on (i) the assumption that no debt issuances or renewals will occur upon the maturity dates of our notes, and (ii) an estimate of future interest rates on our interest rate swap agreements based on projected LIBOR rates.
|
(b)
|
In December 2011, we reached an agreement with the IRS resolving substantially all of the issues related to the restructuring of our international operations in 2003. As a result of the IRS Agreement, we made cash payments to the IRS and various state tax authorities of $92.4 million during 2012. We have estimated that we will make payments of approximately $100 million in 2014 to cover the remaining portion of the additional tax and interest; however, certain of these payments may be made after 2014.
|
(c)
|
We have estimated our pension plan funding requirements, including interest, using assumptions that are consistent with current pension funding rates. The unfunded pension liability included in "Other liabilities" in our Consolidated Balance Sheets is the present value of the estimated pension plan funding requirements disclosed above. The actual minimum required amounts each year will vary based on the actual discount rate and asset returns when the funding requirement is calculated.
|
(d)
|
Unrecognized tax benefits include associated interest and penalties. The timing of related cash payments for substantially all of these liabilities is inherently uncertain because the ultimate amount and timing of such liabilities is affected by factors which are variable and outside our control.
|
(e)
|
Represents the liability position of our foreign currency and interest rate derivative contracts as of December 31, 2013, which will fluctuate based on market conditions.
|
(f)
|
This line item relates to accrued and unpaid initial payments for new and renewed agent contracts as of December 31, 2013.
|
(g)
|
Many of our contracts contain clauses that allow us to terminate the contract with notice and with a termination penalty. Termination penalties are generally an amount less than the original obligation. Obligations under certain contracts are usage-based and are, therefore, estimated in the above amounts. Historically, we have not had any significant defaults of our contractual obligations or incurred significant penalties for termination of our contractual obligations.
|
•
|
Cash Flow hedges - Cash flow hedges consist of foreign currency hedging of forecasted revenues, as well as hedges of the forecasted issuance of fixed rate debt. Derivative fair value changes that are captured in accumulated other comprehensive loss are reclassified to earnings in the same period or periods the hedged item affects earnings, to the extent the change in the fair value of the instrument is effective in offsetting the change in fair value of the hedged item. The portions of the change in fair value that are either considered ineffective or are excluded from the measure of effectiveness are recognized immediately in "Derivative gains/(losses), net."
|
•
|
Fair Value hedges - Fair value hedges consist of hedges of fixed rate debt, through interest rate swaps. The changes in fair value of these hedges, along with offsetting changes in fair value of the related debt instrument attributable to changes in the benchmark interest rate, are recorded in interest expense.
|
|
/s/ Ernst & Young LLP
|
Denver, Colorado
|
|
February 24, 2014
|
|
|
/s/ Ernst & Young LLP
|
Denver, Colorado
|
|
February 24, 2014
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Transaction fees
|
$
|
4,065.8
|
|
|
$
|
4,210.0
|
|
|
$
|
4,220.2
|
|
Foreign exchange revenues
|
1,348.0
|
|
|
1,332.7
|
|
|
1,151.2
|
|
|||
Other revenues
|
128.2
|
|
|
122.1
|
|
|
120.0
|
|
|||
Total revenues
|
5,542.0
|
|
|
5,664.8
|
|
|
5,491.4
|
|
|||
Expenses:
|
|
|
|
|
|
||||||
Cost of services
|
3,235.0
|
|
|
3,194.2
|
|
|
3,102.0
|
|
|||
Selling, general and administrative
|
1,199.6
|
|
|
1,140.6
|
|
|
1,004.4
|
|
|||
Total expenses*
|
4,434.6
|
|
|
4,334.8
|
|
|
4,106.4
|
|
|||
Operating income
|
1,107.4
|
|
|
1,330.0
|
|
|
1,385.0
|
|
|||
Other income/(expense):
|
|
|
|
|
|
||||||
Interest income
|
9.4
|
|
|
5.5
|
|
|
5.2
|
|
|||
Interest expense
|
(195.6
|
)
|
|
(179.6
|
)
|
|
(181.9
|
)
|
|||
Derivative gains/(losses), net
|
(1.3
|
)
|
|
0.5
|
|
|
14.0
|
|
|||
Other income, net
|
7.0
|
|
|
12.4
|
|
|
52.3
|
|
|||
Total other expense, net
|
(180.5
|
)
|
|
(161.2
|
)
|
|
(110.4
|
)
|
|||
Income before income taxes
|
926.9
|
|
|
1,168.8
|
|
|
1,274.6
|
|
|||
Provision for income taxes
|
128.5
|
|
|
142.9
|
|
|
109.2
|
|
|||
Net income
|
$
|
798.4
|
|
|
$
|
1,025.9
|
|
|
$
|
1,165.4
|
|
Earnings per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
1.43
|
|
|
$
|
1.70
|
|
|
$
|
1.85
|
|
Diluted
|
$
|
1.43
|
|
|
$
|
1.69
|
|
|
$
|
1.84
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
556.6
|
|
|
604.9
|
|
|
630.6
|
|
|||
Diluted
|
559.7
|
|
|
607.4
|
|
|
634.2
|
|
|||
Cash dividends declared per common share
|
$
|
0.50
|
|
|
$
|
0.425
|
|
|
$
|
0.31
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Net income
|
$
|
798.4
|
|
|
$
|
1,025.9
|
|
|
$
|
1,165.4
|
|
Other comprehensive income/(loss), net of tax:
|
|
|
|
|
|
||||||
Unrealized gains/(losses) on investment securities
|
(3.6
|
)
|
|
2.8
|
|
|
1.8
|
|
|||
Unrealized gains/(losses) on hedging activities
|
(11.1
|
)
|
|
(27.0
|
)
|
|
27.0
|
|
|||
Foreign currency translation adjustments
|
(13.1
|
)
|
|
(2.2
|
)
|
|
(2.0
|
)
|
|||
Defined benefit pension plan adjustments
|
11.4
|
|
|
(7.7
|
)
|
|
(12.5
|
)
|
|||
Total other comprehensive income/(loss)
|
(16.4
|
)
|
|
(34.1
|
)
|
|
14.3
|
|
|||
Comprehensive income
|
$
|
782.0
|
|
|
$
|
991.8
|
|
|
$
|
1,179.7
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,073.1
|
|
|
$
|
1,776.5
|
|
Settlement assets
|
3,270.4
|
|
|
3,114.6
|
|
||
Property and equipment, net of accumulated depreciation of $428.6 and $384.5, respectively
|
209.9
|
|
|
196.1
|
|
||
Goodwill
|
3,172.0
|
|
|
3,179.7
|
|
||
Other intangible assets, net of accumulated amortization of $672.3 and $519.7, respectively
|
833.8
|
|
|
878.9
|
|
||
Other assets
|
562.1
|
|
|
319.9
|
|
||
Total assets
|
$
|
10,121.3
|
|
|
$
|
9,465.7
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
638.9
|
|
|
$
|
556.2
|
|
Settlement obligations
|
3,270.4
|
|
|
3,114.6
|
|
||
Income taxes payable
|
216.9
|
|
|
218.3
|
|
||
Deferred tax liability, net
|
319.2
|
|
|
352.1
|
|
||
Borrowings
|
4,213.0
|
|
|
4,029.2
|
|
||
Other liabilities
|
358.2
|
|
|
254.7
|
|
||
Total liabilities
|
9,016.6
|
|
|
8,525.1
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 5)
|
|
|
|
||||
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $1.00 par value; 10 shares authorized; no shares issued
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value; 2,000 shares authorized; 548.8 shares and 572.1 shares issued and outstanding as of December 31, 2013 and 2012, respectively
|
5.5
|
|
|
5.7
|
|
||
Capital surplus
|
390.9
|
|
|
332.8
|
|
||
Retained earnings
|
877.3
|
|
|
754.7
|
|
||
Accumulated other comprehensive loss
|
(169.0
|
)
|
|
(152.6
|
)
|
||
Total stockholders' equity
|
1,104.7
|
|
|
940.6
|
|
||
Total liabilities and stockholders' equity
|
$
|
10,121.3
|
|
|
$
|
9,465.7
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income
|
$
|
798.4
|
|
|
$
|
1,025.9
|
|
|
$
|
1,165.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation
|
64.2
|
|
|
61.7
|
|
|
61.0
|
|
|||
Amortization
|
198.6
|
|
|
184.4
|
|
|
131.6
|
|
|||
Deferred income tax (benefit)/provision
|
(39.3
|
)
|
|
(35.2
|
)
|
|
21.2
|
|
|||
Gain on revaluation of equity interests (Note 4)
|
—
|
|
|
—
|
|
|
(49.9
|
)
|
|||
Other non-cash items, net
|
53.3
|
|
|
77.2
|
|
|
29.8
|
|
|||
Increase/(decrease) in cash, excluding the effects of acquisitions, resulting from changes in:
|
|
|
|
|
|
||||||
Other assets
|
(55.4
|
)
|
|
(27.8
|
)
|
|
(27.7
|
)
|
|||
Accounts payable and accrued liabilities
|
81.1
|
|
|
9.3
|
|
|
(43.0
|
)
|
|||
Income taxes payable (Note 10)
|
3.4
|
|
|
(79.9
|
)
|
|
(62.3
|
)
|
|||
Other liabilities
|
(15.7
|
)
|
|
(30.3
|
)
|
|
(51.2
|
)
|
|||
Net cash provided by operating activities
|
1,088.6
|
|
|
1,185.3
|
|
|
1,174.9
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Capitalization of contract costs
|
(119.3
|
)
|
|
(174.9
|
)
|
|
(96.7
|
)
|
|||
Capitalization of purchased and developed software
|
(41.8
|
)
|
|
(32.4
|
)
|
|
(13.0
|
)
|
|||
Purchases of property and equipment
|
(80.2
|
)
|
|
(60.9
|
)
|
|
(52.8
|
)
|
|||
Purchases of non-settlement related investments
|
(100.0
|
)
|
|
—
|
|
|
—
|
|
|||
Acquisition of businesses, net (Note 4)
|
—
|
|
|
10.0
|
|
|
(1,218.6
|
)
|
|||
Net proceeds from settlement of foreign currency forward contracts related to acquisitions
|
—
|
|
|
—
|
|
|
20.8
|
|
|||
Net cash used in investing activities
|
(341.3
|
)
|
|
(258.2
|
)
|
|
(1,360.3
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Proceeds from exercise of options
|
28.9
|
|
|
53.4
|
|
|
100.0
|
|
|||
Cash dividends paid
|
(277.2
|
)
|
|
(254.2
|
)
|
|
(194.2
|
)
|
|||
Common stock repurchased
|
(399.7
|
)
|
|
(766.5
|
)
|
|
(803.9
|
)
|
|||
Net (repayments of)/proceeds from commercial paper
|
—
|
|
|
(297.0
|
)
|
|
297.0
|
|
|||
Net proceeds from issuance of borrowings
|
497.3
|
|
|
742.8
|
|
|
696.3
|
|
|||
Principal payments on borrowings
|
(300.0
|
)
|
|
—
|
|
|
(696.3
|
)
|
|||
Net cash used in financing activities
|
(450.7
|
)
|
|
(521.5
|
)
|
|
(601.1
|
)
|
|||
Net change in cash and cash equivalents
|
296.6
|
|
|
405.6
|
|
|
(786.5
|
)
|
|||
Cash and cash equivalents at beginning of year
|
1,776.5
|
|
|
1,370.9
|
|
|
2,157.4
|
|
|||
Cash and cash equivalents at end of year
|
$
|
2,073.1
|
|
|
$
|
1,776.5
|
|
|
$
|
1,370.9
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
193.7
|
|
|
$
|
181.8
|
|
|
$
|
191.3
|
|
Income taxes paid (Note 10)
|
$
|
158.0
|
|
|
$
|
257.1
|
|
|
$
|
144.9
|
|
|
|
|
Capital Surplus
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Total Stockholders' Equity
|
|||||||||||||
|
|
|
|
|
|
|||||||||||||||||
|
Common Stock
|
|
|
|
|
|||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance, December 31, 2010
|
654.0
|
|
|
$
|
6.5
|
|
|
$
|
117.4
|
|
|
$
|
591.6
|
|
|
$
|
(132.8
|
)
|
|
$
|
582.7
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,165.4
|
|
|
—
|
|
|
1,165.4
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
31.2
|
|
|
—
|
|
|
—
|
|
|
31.2
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(194.2
|
)
|
|
—
|
|
|
(194.2
|
)
|
|||||
Repurchase and retirement of common shares
|
(40.5
|
)
|
|
(0.4
|
)
|
|
—
|
|
|
(802.8
|
)
|
|
—
|
|
|
(803.2
|
)
|
|||||
Shares issued under stock-based compensation plans
|
5.9
|
|
|
0.1
|
|
|
98.7
|
|
|
—
|
|
|
—
|
|
|
98.8
|
|
|||||
Tax adjustments from employee stock option plans
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||||
Unrealized gains on investment securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.8
|
|
|
1.8
|
|
|||||
Unrealized gains on hedging activities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27.0
|
|
|
27.0
|
|
|||||
Foreign currency translation adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.0
|
)
|
|
(2.0
|
)
|
|||||
Defined benefit pension plan liability adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12.5
|
)
|
|
(12.5
|
)
|
|||||
Balance, December 31, 2011
|
619.4
|
|
|
6.2
|
|
|
247.1
|
|
|
760.0
|
|
|
(118.5
|
)
|
|
894.8
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,025.9
|
|
|
—
|
|
|
1,025.9
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
34.0
|
|
|
—
|
|
|
—
|
|
|
34.0
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(254.2
|
)
|
|
—
|
|
|
(254.2
|
)
|
|||||
Repurchase and retirement of common shares
|
(51.3
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
(777.0
|
)
|
|
—
|
|
|
(777.5
|
)
|
|||||
Shares issued under stock-based compensation plans
|
4.0
|
|
|
—
|
|
|
51.9
|
|
|
—
|
|
|
—
|
|
|
51.9
|
|
|||||
Tax adjustments from employee stock option plans
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||||
Unrealized gains on investment securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|
2.8
|
|
|||||
Unrealized losses on hedging activities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27.0
|
)
|
|
(27.0
|
)
|
|||||
Foreign currency translation adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
|
(2.2
|
)
|
|||||
Defined benefit pension plan liability adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7.7
|
)
|
|
(7.7
|
)
|
|||||
Balance, December 31, 2012
|
572.1
|
|
|
5.7
|
|
|
332.8
|
|
|
754.7
|
|
|
(152.6
|
)
|
|
940.6
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
798.4
|
|
|
—
|
|
|
798.4
|
|
|||||
Stock-based compensation and other
|
—
|
|
|
—
|
|
|
34.2
|
|
|
—
|
|
|
—
|
|
|
34.2
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(277.2
|
)
|
|
—
|
|
|
(277.2
|
)
|
|||||
Repurchase and retirement of common shares
|
(26.1
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
(398.6
|
)
|
|
—
|
|
|
(398.8
|
)
|
|||||
Shares issued under stock-based compensation plans
|
2.8
|
|
|
—
|
|
|
28.6
|
|
|
—
|
|
|
—
|
|
|
28.6
|
|
|||||
Tax adjustments from employee stock option plans
|
—
|
|
|
—
|
|
|
(4.7
|
)
|
|
—
|
|
|
—
|
|
|
(4.7
|
)
|
|||||
Unrealized losses on investment securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3.6
|
)
|
|
(3.6
|
)
|
|||||
Unrealized losses on hedging activities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11.1
|
)
|
|
(11.1
|
)
|
|||||
Foreign currency translation adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13.1
|
)
|
|
(13.1
|
)
|
|||||
Defined benefit pension plan liability adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.4
|
|
|
11.4
|
|
|||||
Balance, December 31, 2013
|
548.8
|
|
|
$
|
5.5
|
|
|
$
|
390.9
|
|
|
$
|
877.3
|
|
|
$
|
(169.0
|
)
|
|
$
|
1,104.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
Consumer-to-Consumer - The Consumer-to-Consumer operating segment facilitates money transfers between two consumers, primarily through a network of third-party agents. The Company's multi-currency, real-time money transfer service is viewed by the Company as one interconnected global network where a money transfer can be sent from one location to another, around the world. This service is available for international cross-border transfers - that is, the transfer of funds from one country to another - and, in certain countries, intra-country transfers - that is, money transfers from one location to another in the same country. This segment also includes money transfer transactions that can be initiated through websites and account based money transfers.
|
•
|
Consumer-to-Business - The Consumer-to-Business operating segment facilitates bill payments from consumers to businesses and other organizations, including utilities, auto finance companies, mortgage servicers, financial service providers, government agencies and other businesses. The significant majority of the segment's revenue was generated in the United States during all periods presented, with the remainder primarily generated in Argentina.
|
•
|
Business Solutions - The Business Solutions operating segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations and individuals. The
majority
of the segment's business relates to exchanges of currency at the spot rate which enables customers to make cross-currency payments. In addition, in certain countries, the Company writes foreign currency forward and option contracts for customers to facilitate future payments. Travelex Global Business Payments ("TGBP"), which was acquired in November 2011 (see Note 4), is included in this segment.
|
|
For the Year Ended December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Basic weighted-average shares outstanding
|
556.6
|
|
|
604.9
|
|
|
630.6
|
|
Common stock equivalents
|
3.1
|
|
|
2.5
|
|
|
3.6
|
|
Diluted weighted-average shares outstanding
|
559.7
|
|
|
607.4
|
|
|
634.2
|
|
•
|
Level 1:
Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2:
Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For most of these assets, the Company utilizes pricing services that use multiple prices as inputs to determine daily market values. In addition, the Trust has other investments that fall within Level 2 that are valued at net asset value which is not quoted on an active market; however, the unit price is based on underlying investments which are traded on an active market. Further, these investments have no redemption restrictions, and redemptions can generally be done monthly or quarterly with required notice ranging from three to 60 days.
|
•
|
Level 3:
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include items where the determination of fair value requires significant management judgment or estimation. The Company has Level 3 assets that are recognized and disclosed at fair value on a non-recurring basis related to the Company's business combinations, where the values of the intangible assets and goodwill acquired in a purchase are derived utilizing one of the three recognized approaches: the market approach, the income approach or the cost approach.
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Settlement assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
538.6
|
|
|
$
|
574.5
|
|
Receivables from selling agents and Business Solutions customers
|
981.3
|
|
|
1,025.3
|
|
||
Investment securities
|
1,750.5
|
|
|
1,514.8
|
|
||
|
$
|
3,270.4
|
|
|
$
|
3,114.6
|
|
Settlement obligations:
|
|
|
|
||||
Money transfer, money order and payment service payables
|
$
|
2,376.6
|
|
|
$
|
2,297.1
|
|
Payables to agents
|
893.8
|
|
|
817.5
|
|
||
|
$
|
3,270.4
|
|
|
$
|
3,114.6
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Equipment
|
$
|
416.1
|
|
|
$
|
384.6
|
|
Buildings
|
82.3
|
|
|
80.0
|
|
||
Leasehold improvements
|
80.3
|
|
|
65.6
|
|
||
Furniture and fixtures
|
33.3
|
|
|
33.4
|
|
||
Land and improvements
|
16.9
|
|
|
16.9
|
|
||
Projects in process
|
9.6
|
|
|
0.1
|
|
||
|
638.5
|
|
|
580.6
|
|
||
Less accumulated depreciation
|
(428.6
|
)
|
|
(384.5
|
)
|
||
Property and equipment, net
|
$
|
209.9
|
|
|
$
|
196.1
|
|
|
|
December 31, 2013
|
|
December 31, 2012
|
|||||||||||||||
|
|
Weighted-
Average
Amortization
Period
(in years)
|
|
Initial Cost
|
|
Net of
Accumulated
Amortization
|
|
Initial Cost
|
|
Net of
Accumulated
Amortization
|
|||||||||
Acquired contracts
|
|
11.2
|
|
$
|
632.0
|
|
|
$
|
414.3
|
|
|
$
|
627.2
|
|
|
$
|
466.2
|
|
|
Capitalized contract costs
|
|
5.9
|
|
528.5
|
|
|
315.2
|
|
|
457.2
|
|
|
303.7
|
|
|||||
Internal use software
|
|
3.2
|
|
264.9
|
|
|
65.1
|
|
|
221.0
|
|
|
54.7
|
|
|||||
Acquired trademarks
|
|
22.7
|
|
38.0
|
|
|
25.3
|
|
|
43.4
|
|
|
28.4
|
|
|||||
Projects in process
|
|
3.0
|
|
9.6
|
|
|
9.6
|
|
|
15.4
|
|
|
15.4
|
|
|||||
Other intangibles
|
|
2.6
|
|
33.1
|
|
|
4.3
|
|
|
34.4
|
|
|
10.5
|
|
|||||
Total other intangible assets
|
|
8.0
|
|
$
|
1,506.1
|
|
|
$
|
833.8
|
|
|
$
|
1,398.6
|
|
|
$
|
878.9
|
|
•
|
Cash Flow hedges - Changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recorded in "Accumulated other comprehensive loss." Cash flow hedges consist of foreign currency hedging of forecasted revenues, as well as hedges of the forecasted issuance of fixed rate debt. Derivative fair value changes that are captured in "Accumulated other comprehensive loss" are reclassified to earnings in the same period or periods the hedged item affects earnings, to the extent the change in the fair value of the instrument is effective in offsetting the change in fair value of the hedged item. The portions of the change in fair value that are either considered ineffective or are excluded from the measure of effectiveness are recognized immediately in "Derivative gains/(losses), net."
|
•
|
Fair Value hedges - Changes in the fair value of derivatives that are designated as fair value hedges of fixed rate debt are recorded in "Interest expense." The offsetting change in value of the related debt instrument attributable to changes in the benchmark interest rate is also recorded in "Interest expense."
|
•
|
Undesignated - Derivative contracts entered into to reduce the variability related to (a) money transfer settlement assets and obligations, generally with maturities from a few days up to one month, and (b) certain foreign currency denominated cash and other asset positions, typically with maturities of less than one year at inception, are not designated as hedges for accounting purposes and changes in their fair value are included in "Selling, general and administrative." In addition, changes in fair value of derivative contracts, consisting of forward contracts with maturities of less than one year entered into to reduce the economic variability related to the cash amounts used to fund acquisitions of businesses with purchase prices denominated in foreign currencies, are recorded in "Derivative gains/(losses), net." The Company is also exposed to risk from derivative contracts written to its customers arising from its cross-currency Business Solutions payments operations. The duration of these derivative contracts at inception is generally less than one year. The Company aggregates its Business Solutions payments foreign currency exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties (economic hedge contracts) as part of a broader foreign currency portfolio, including significant spot exchanges of currency in addition to forwards and options. The changes in fair value related to these contracts are recorded in "Foreign exchange revenues."
|
|
Severance,
Outplacement
and Related
Benefits
|
|
Other (b)
|
|
Total
|
||||||
Balance, January 1, 2012
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Expenses (a)
|
28.9
|
|
|
2.0
|
|
|
30.9
|
|
|||
Cash payments
|
(5.2
|
)
|
|
(0.4
|
)
|
|
(5.6
|
)
|
|||
Non-cash benefit (a)
|
2.0
|
|
|
—
|
|
|
2.0
|
|
|||
Balance, December 31, 2012
|
$
|
25.7
|
|
|
$
|
1.6
|
|
|
$
|
27.3
|
|
Expenses (a)
|
40.8
|
|
|
16.1
|
|
|
56.9
|
|
|||
Cash payments
|
(25.3
|
)
|
|
(16.5
|
)
|
|
(41.8
|
)
|
|||
Non-cash benefit/(expense) (a)
|
4.2
|
|
|
(0.2
|
)
|
|
4.0
|
|
|||
Balance, December 31, 2013
|
$
|
45.4
|
|
|
$
|
1.0
|
|
|
$
|
46.4
|
|
Total expenses
|
$
|
69.7
|
|
|
$
|
18.1
|
|
|
$
|
87.8
|
|
____________
|
|
|
|
|
(a)
|
Expenses include a non-cash benefit for adjustments to stock compensation for awards forfeited by employees. Other expenses also include non-cash write-offs and accelerated depreciation of fixed assets and leasehold improvements. These amounts were recognized outside of the accrual.
|
(b)
|
Other expenses primarily related to the relocation of various operations to new and existing Company facilities and third-party providers including expenses for hiring, training, relocation, travel and professional fees. All such expenses were recorded when incurred.
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
Productivity and Cost-Savings Initiatives
|
|
Restructuring and Related Expenses
|
||||||||
Cost of services
|
$
|
24.3
|
|
|
$
|
5.5
|
|
|
$
|
10.6
|
|
Selling, general and administrative
|
32.6
|
|
|
25.4
|
|
|
36.2
|
|
|||
Total expenses, pre-tax
|
$
|
56.9
|
|
|
$
|
30.9
|
|
|
$
|
46.8
|
|
Total expenses, net of tax
|
$
|
40.2
|
|
|
$
|
20.2
|
|
|
$
|
32.0
|
|
|
|
Consumer-to-Consumer
|
|
Consumer-to-Business
|
|
Business Solutions
|
|
Other
|
|
Total
|
||||||||||
2012 expenses
|
|
$
|
20.9
|
|
|
$
|
4.0
|
|
|
$
|
—
|
|
|
$
|
6.0
|
|
|
$
|
30.9
|
|
2013 expenses
|
|
43.8
|
|
|
5.4
|
|
|
3.6
|
|
|
4.1
|
|
|
56.9
|
|
|||||
Total expenses
|
|
$
|
64.7
|
|
|
$
|
9.4
|
|
|
$
|
3.6
|
|
|
$
|
10.1
|
|
|
$
|
87.8
|
|
|
Travelex Global Business
Payments (a)
|
|
Finint S.r.l.
|
|
Angelo Costa
S.r.l.
|
||||||
Customer and other contractual relationships
|
$
|
264.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Network of subagents
|
—
|
|
|
53.9
|
|
|
44.6
|
|
|||
Other
|
49.7
|
|
|
10.9
|
|
|
6.8
|
|
|||
Total identifiable intangible assets
|
$
|
314.2
|
|
|
$
|
64.8
|
|
|
$
|
51.4
|
|
(a)
|
Amounts include the impact of the acquisition of the French assets of TGBP on May 4, 2012.
|
|
Consumer-to-Consumer
|
|
Consumer-to-Business
|
|
Business Solutions
|
|
Other
|
|
Total
|
||||||||||
January 1, 2012 balance
|
$
|
1,945.3
|
|
|
$
|
224.9
|
|
|
$
|
1,013.7
|
|
|
$
|
15.0
|
|
|
$
|
3,198.9
|
|
Purchase price adjustments
|
2.4
|
|
|
—
|
|
|
(24.4
|
)
|
|
—
|
|
|
(22.0
|
)
|
|||||
Currency translation
|
—
|
|
|
(3.8
|
)
|
|
6.7
|
|
(0.1
|
)
|
|
2.8
|
|||||||
December 31, 2012 balance
|
$
|
1,947.7
|
|
|
$
|
221.1
|
|
|
$
|
996.0
|
|
|
$
|
14.9
|
|
|
$
|
3,179.7
|
|
Currency translation
|
—
|
|
|
(6.4
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
(7.7
|
)
|
|||||
December 31, 2013 balance
|
$
|
1,947.7
|
|
|
$
|
214.7
|
|
|
$
|
996.0
|
|
|
$
|
13.6
|
|
|
$
|
3,172.0
|
|
December 31, 2013
|
Amortized
Cost
|
|
Fair
Value
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Net
Unrealized
Gains/ (Losses)
|
||||||||||
Settlement assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal debt securities (a)
|
$
|
868.1
|
|
|
$
|
874.2
|
|
|
$
|
7.8
|
|
|
$
|
(1.7
|
)
|
|
$
|
6.1
|
|
State and municipal variable rate demand notes
|
865.0
|
|
|
865.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other debt securities
|
11.2
|
|
|
11.3
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
|
$
|
1,744.3
|
|
|
$
|
1,750.5
|
|
|
$
|
7.9
|
|
|
$
|
(1.7
|
)
|
|
$
|
6.2
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Short-term bond mutual fund
|
100.0
|
|
|
100.2
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|||||
|
$
|
1,844.3
|
|
|
$
|
1,850.7
|
|
|
$
|
8.1
|
|
|
$
|
(1.7
|
)
|
|
$
|
6.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2012
|
Amortized
Cost
|
|
Fair
Value
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Net
Unrealized
Gains/ (Losses)
|
||||||||||
Settlement assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal debt securities (a)
|
$
|
991.5
|
|
|
$
|
1,003.7
|
|
|
$
|
12.5
|
|
|
$
|
(0.3
|
)
|
|
$
|
12.2
|
|
State and municipal variable rate demand notes
|
463.3
|
|
|
463.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other debt securities
|
47.7
|
|
|
47.8
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||
|
$
|
1,502.5
|
|
|
$
|
1,514.8
|
|
|
$
|
12.6
|
|
|
$
|
(0.3
|
)
|
|
$
|
12.3
|
|
(a)
|
The majority of these securities are fixed rate instruments.
|
|
Amortized
Cost
|
|
Fair
Value
|
||||
Due within 1 year
|
$
|
187.6
|
|
|
$
|
188.4
|
|
Due after 1 year through 5 years
|
425.2
|
|
|
429.1
|
|
||
Due after 5 years through 10 years
|
306.7
|
|
|
308.1
|
|
||
Due after 10 years
|
824.8
|
|
|
824.9
|
|
||
|
$
|
1,744.3
|
|
|
$
|
1,750.5
|
|
|
Fair Value Measurement Using
|
|
Assets/
Liabilities at
Fair
Value
|
||||||||||||
December 31, 2013
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Settlement assets:
|
|
|
|
|
|
|
|
||||||||
State and municipal debt securities
|
$
|
—
|
|
|
$
|
874.2
|
|
|
$
|
—
|
|
|
$
|
874.2
|
|
State and municipal variable rate demand notes
|
—
|
|
|
865.0
|
|
|
—
|
|
|
865.0
|
|
||||
Other debt securities
|
—
|
|
|
11.3
|
|
|
—
|
|
|
11.3
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Short-term bond mutual fund
|
100.2
|
|
|
—
|
|
|
—
|
|
|
100.2
|
|
||||
Derivatives
|
—
|
|
|
224.3
|
|
|
—
|
|
|
224.3
|
|
||||
Total assets
|
$
|
100.2
|
|
|
$
|
1,974.8
|
|
|
$
|
—
|
|
|
$
|
2,075.0
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Notes and other borrowings
|
$
|
—
|
|
|
$
|
4,343.2
|
|
|
$
|
—
|
|
|
$
|
4,343.2
|
|
Derivatives
|
—
|
|
|
223.4
|
|
|
—
|
|
|
223.4
|
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
4,566.6
|
|
|
$
|
—
|
|
|
$
|
4,566.6
|
|
|
|
|
|
|
|
|
|
||||||||
|
Fair Value Measurement Using
|
|
Assets/
Liabilities at
Fair
Value
|
||||||||||||
December 31, 2012
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Settlement assets:
|
|
|
|
|
|
|
|
||||||||
State and municipal debt securities
|
$
|
—
|
|
|
$
|
1,003.7
|
|
|
$
|
—
|
|
|
$
|
1,003.7
|
|
State and municipal variable rate demand notes
|
—
|
|
|
463.3
|
|
|
—
|
|
|
463.3
|
|
||||
Other debt securities
|
—
|
|
|
47.8
|
|
|
—
|
|
|
47.8
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
—
|
|
|
96.8
|
|
|
—
|
|
|
96.8
|
|
||||
Total assets
|
$
|
—
|
|
|
$
|
1,611.6
|
|
|
$
|
—
|
|
|
$
|
1,611.6
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Notes and other borrowings
|
$
|
—
|
|
|
$
|
4,200.8
|
|
|
$
|
—
|
|
|
$
|
4,200.8
|
|
Derivatives
|
—
|
|
|
86.1
|
|
|
—
|
|
|
86.1
|
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
4,286.9
|
|
|
$
|
—
|
|
|
$
|
4,286.9
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Other assets:
|
|
|
|
||||
Derivatives
|
$
|
224.3
|
|
|
$
|
96.8
|
|
Short-term bond mutual fund (Note 7)
|
100.2
|
|
|
—
|
|
||
Prepaid expenses
|
69.0
|
|
|
56.9
|
|
||
Amounts advanced to agents, net of discounts
|
41.8
|
|
|
37.7
|
|
||
Equity method investments
|
41.0
|
|
|
41.0
|
|
||
Other receivables
|
21.1
|
|
|
21.4
|
|
||
Debt issue costs
|
17.3
|
|
|
17.3
|
|
||
Deferred customer set up costs
|
17.1
|
|
|
15.9
|
|
||
Accounts receivable, net
|
14.9
|
|
|
15.6
|
|
||
Other
|
15.4
|
|
|
17.3
|
|
||
Total other assets
|
$
|
562.1
|
|
|
$
|
319.9
|
|
Other liabilities:
|
|
|
|
||||
Derivatives
|
$
|
223.4
|
|
|
$
|
86.1
|
|
Pension obligations
|
70.4
|
|
|
102.1
|
|
||
Deferred revenue
|
25.1
|
|
|
30.5
|
|
||
Other
|
39.3
|
|
|
36.0
|
|
||
Total other liabilities
|
$
|
358.2
|
|
|
$
|
254.7
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Components of pre-tax income:
|
|
|
|
|
|
||||||
Domestic
|
$
|
(28.4
|
)
|
|
$
|
94.8
|
|
|
$
|
423.9
|
|
Foreign
|
955.3
|
|
|
1,074.0
|
|
|
850.7
|
|
|||
|
$
|
926.9
|
|
|
$
|
1,168.8
|
|
|
$
|
1,274.6
|
|
|
Year Ended December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of federal income tax benefits
|
0.7
|
%
|
|
0.6
|
%
|
|
2.0
|
%
|
Foreign rate differential, net of U.S. tax paid on foreign earnings (9.2%, 5.1% and 1.2%, respectively)
|
(22.9
|
)%
|
|
(22.5
|
)%
|
|
(14.0
|
)%
|
IRS Agreement
|
—
|
%
|
|
—
|
%
|
|
(16.1
|
)%
|
Other
|
1.1
|
%
|
|
(0.9
|
)%
|
|
1.7
|
%
|
Effective tax rate
|
13.9
|
%
|
|
12.2
|
%
|
|
8.6
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
86.1
|
|
|
$
|
117.2
|
|
|
$
|
36.2
|
|
State and local
|
8.1
|
|
|
(2.5
|
)
|
|
0.6
|
|
|||
Foreign
|
73.6
|
|
|
63.4
|
|
|
51.2
|
|
|||
Total current taxes
|
167.8
|
|
|
178.1
|
|
|
88.0
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
2.2
|
|
|
(24.7
|
)
|
|
41.9
|
|
|||
State and local
|
(11.8
|
)
|
|
(12.3
|
)
|
|
3.9
|
|
|||
Foreign
|
(29.7
|
)
|
|
1.8
|
|
|
(24.6
|
)
|
|||
Total deferred taxes
|
(39.3
|
)
|
|
(35.2
|
)
|
|
21.2
|
|
|||
|
$
|
128.5
|
|
|
$
|
142.9
|
|
|
$
|
109.2
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Deferred tax assets related to:
|
|
|
|
||||
Reserves, accrued expenses and employee-related items
|
$
|
57.0
|
|
|
$
|
65.7
|
|
Pension obligations
|
25.6
|
|
|
36.7
|
|
||
Tax attribute carryovers
|
22.3
|
|
|
14.7
|
|
||
Other
|
26.6
|
|
|
25.3
|
|
||
Valuation allowance
|
(16.4
|
)
|
|
(13.0
|
)
|
||
Total deferred tax assets
|
115.1
|
|
|
129.4
|
|
||
Deferred tax liabilities related to:
|
|
|
|
||||
Intangibles, property and equipment
|
434.3
|
|
|
481.5
|
|
||
Total deferred tax liabilities
|
434.3
|
|
|
481.5
|
|
||
Net deferred tax liability
|
$
|
319.2
|
|
|
$
|
352.1
|
|
|
2013
|
|
2012
|
||||
Balance as of January 1,
|
$
|
103.2
|
|
|
$
|
123.7
|
|
Increases - positions taken in current period (a)
|
18.5
|
|
|
13.1
|
|
||
Increases - positions taken in prior periods (b)
|
15.6
|
|
|
—
|
|
||
Decreases - positions taken in prior periods
|
(8.7
|
)
|
|
(6.1
|
)
|
||
Decreases - settlements with taxing authorities
|
(4.1
|
)
|
|
(24.1
|
)
|
||
Decreases - lapse of applicable statute of limitations
|
(7.0
|
)
|
|
(3.4
|
)
|
||
Balance as of December 31,
|
$
|
117.5
|
|
|
$
|
103.2
|
|
(a)
|
Includes recurring accruals for issues which initially arose in previous periods.
|
(b)
|
Changes to positions taken in prior periods relate to changes in estimates used to calculate prior period unrecognized tax benefits.
|
|
2013
|
|
2012
|
||||
Change in projected benefit obligation:
|
|
|
|
||||
Projected benefit obligation as of January 1,
|
$
|
418.8
|
|
|
$
|
414.4
|
|
Interest cost
|
12.1
|
|
|
14.7
|
|
||
Actuarial (gain)/loss
|
(25.4
|
)
|
|
30.2
|
|
||
Benefits paid
|
(39.3
|
)
|
|
(40.5
|
)
|
||
Projected benefit obligation as of December 31,
|
$
|
366.2
|
|
|
$
|
418.8
|
|
Change in plan assets:
|
|
|
|
|
|||
Fair value of plan assets as of January 1,
|
$
|
316.7
|
|
|
$
|
301.7
|
|
Actual return on plan assets
|
2.7
|
|
|
30.5
|
|
||
Benefits paid
|
(39.3
|
)
|
|
(40.5
|
)
|
||
Company contributions
|
15.7
|
|
|
25.0
|
|
||
Fair value of plan assets as of December 31,
|
295.8
|
|
|
316.7
|
|
||
Funded status of the Plan as of December 31,
|
$
|
(70.4
|
)
|
|
$
|
(102.1
|
)
|
Accumulated benefit obligation as of December 31,
|
$
|
366.2
|
|
|
$
|
418.8
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Accrued benefit liability
|
$
|
(70.4
|
)
|
|
$
|
(102.1
|
)
|
Accumulated other comprehensive loss (pre-tax)
|
187.0
|
|
|
206.8
|
|
||
Net amount recognized
|
$
|
116.6
|
|
|
$
|
104.7
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Interest cost
|
$
|
12.1
|
|
|
$
|
14.7
|
|
|
$
|
17.9
|
|
Expected return on plan assets
|
(20.7
|
)
|
|
(20.8
|
)
|
|
(21.3
|
)
|
|||
Amortization of actuarial loss
|
12.4
|
|
|
10.5
|
|
|
8.1
|
|
|||
Net periodic benefit cost
|
$
|
3.8
|
|
|
$
|
4.4
|
|
|
$
|
4.7
|
|
|
2013
|
|
2012
|
||
Discount rate
|
3.91
|
%
|
|
3.03
|
%
|
|
2013
|
|
2012
|
|
2011
|
|||
Discount rate
|
3.03
|
%
|
|
3.72
|
%
|
|
4.69
|
%
|
Expected long-term return on plan assets
|
7.00
|
%
|
|
7.00
|
%
|
|
7.00
|
%
|
|
Percentage of Plan Assets
as of Measurement Date
|
||||
Asset Class
|
2013
|
|
2012
|
||
Equity investments
|
18
|
%
|
|
16
|
%
|
Debt securities
|
59
|
%
|
|
62
|
%
|
Alternative investments
|
23
|
%
|
|
22
|
%
|
December 31, 2013
|
Fair Value Measurement Using
|
|
Total Assets
|
||||||||||||
Asset Class
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
at Fair Value
|
||||||||
Equity investments:
|
|
|
|
|
|
|
|
||||||||
Domestic
|
$
|
26.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26.2
|
|
International (a)
|
1.5
|
|
|
26.5
|
|
|
—
|
|
|
28.0
|
|
||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|||||
Corporate debt (b)
|
—
|
|
|
127.3
|
|
|
—
|
|
|
127.3
|
|
||||
U.S. treasury bonds
|
36.8
|
|
|
—
|
|
|
—
|
|
|
36.8
|
|
||||
State and municipal debt securities
|
—
|
|
|
3.9
|
|
|
—
|
|
|
3.9
|
|
||||
Other
|
—
|
|
|
4.4
|
|
|
—
|
|
|
4.4
|
|
||||
Alternative investments:
|
|
|
|
|
|
|
|
|
|
|
|||||
Hedge funds (c)
|
—
|
|
|
42.4
|
|
|
—
|
|
|
42.4
|
|
||||
Royalty rights and private equity (d)
|
—
|
|
|
—
|
|
|
25.9
|
|
|
25.9
|
|
||||
Total investments of the Trust at fair value
|
$
|
64.5
|
|
|
$
|
204.5
|
|
|
$
|
25.9
|
|
|
$
|
294.9
|
|
Other assets
|
|
|
|
|
|
|
|
|
|
0.9
|
|
||||
Total investments of the Trust
|
$
|
64.5
|
|
|
$
|
204.5
|
|
|
$
|
25.9
|
|
|
$
|
295.8
|
|
December 31, 2012
|
Fair Value Measurement Using
|
|
Total Assets
|
||||||||||||
Asset Class
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
at Fair Value
|
||||||||
Equity investments:
|
|
|
|
|
|
|
|
||||||||
Domestic
|
$
|
24.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24.2
|
|
International (a)
|
1.4
|
|
|
25.0
|
|
|
—
|
|
|
26.4
|
|
||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
||||||
Corporate debt (b)
|
—
|
|
|
131.4
|
|
|
—
|
|
|
131.4
|
|
||||
U.S. treasury bonds
|
52.3
|
|
|
—
|
|
|
—
|
|
|
52.3
|
|
||||
State and municipal debt securities
|
—
|
|
|
4.4
|
|
|
—
|
|
|
4.4
|
|
||||
Other
|
—
|
|
|
3.1
|
|
|
—
|
|
|
3.1
|
|
||||
Alternative investments:
|
|
|
|
|
|
|
|
|
|
||||||
Hedge funds
|
—
|
|
|
44.7
|
|
|
—
|
|
|
44.7
|
|
||||
Royalty rights and private equity (d)
|
—
|
|
|
—
|
|
|
23.8
|
|
|
23.8
|
|
||||
Total investments of the Trust at fair value
|
$
|
77.9
|
|
|
$
|
208.6
|
|
|
$
|
23.8
|
|
|
$
|
310.3
|
|
Other assets
|
|
|
|
|
|
|
6.4
|
|
|||||||
Total investments of the Trust
|
$
|
77.9
|
|
|
$
|
208.6
|
|
|
$
|
23.8
|
|
|
$
|
316.7
|
|
(a)
|
Funds included herein have redemption frequencies of daily to monthly, with redemption notice periods of one to ten business days.
|
(b)
|
Substantially all corporate debt securities are investment grade securities.
|
(c)
|
Hedge funds generally hold liquid and readily priceable securities, such as public equities, exchange-traded derivatives, and corporate bonds. Hedge funds themselves do not have readily available market quotations, and therefore are valued using the Net Asset Value ("NAV") per share provided by the investment sponsor or third party administrator. Funds investing in diverse hedge fund strategies (primarily commingled funds) had the following composition of underlying hedge fund investments within the pension plan at December 31, 2013: relative value (24%), equity long/short (21%), commodities/currencies (20%), multi-strategy (13%), event driven (12%), and global-macro (10%). As of December 31, 2013, funds included herein had redemption frequencies of monthly to quarterly, with redemption notice periods of three to 60 days.
|
(d)
|
Diversified investments in royalty rights related to the sale of pharmaceutical products by third parties. Also included are private equity funds with a focus on venture capital. These investments are illiquid, with investment distributions expected to be received over the lives of the funds, which are uncertain but based on the voting rights of investors and the maturities of the underlying investments.
|
|
Royalty Rights
|
|
Private Equity
|
|
Total
|
||||||
Balance, January 1, 2012
|
$
|
11.4
|
|
|
$
|
2.2
|
|
|
$
|
13.6
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
|
||||
Relating to assets still held as of the reporting date
|
1.6
|
|
|
0.1
|
|
|
1.7
|
|
|||
Relating to assets sold during the year
|
0.8
|
|
|
(0.1
|
)
|
|
0.7
|
|
|||
Net purchases and sales
|
7.6
|
|
|
0.2
|
|
|
7.8
|
|
|||
Balance, December 31, 2012
|
$
|
21.4
|
|
|
$
|
2.4
|
|
|
$
|
23.8
|
|
Actual return on plan assets:
|
|
|
|
|
|
||||||
Relating to assets still held as of the reporting date
|
2.3
|
|
|
0.3
|
|
|
2.6
|
|
|||
Relating to assets sold during the year
|
1.6
|
|
|
0.1
|
|
|
1.7
|
|
|||
Net purchases and sales
|
(2.0
|
)
|
|
(0.2
|
)
|
|
(2.2
|
)
|
|||
Balance, December 31, 2013
|
$
|
23.3
|
|
|
$
|
2.6
|
|
|
$
|
25.9
|
|
Year Ending December 31,
|
|
||
2014
|
$
|
44.0
|
|
2015
|
36.5
|
|
|
2016
|
28.1
|
|
|
2017
|
21.6
|
|
|
2018
|
15.9
|
|
|
Thereafter
|
15.0
|
|
|
Total future minimum lease payments
|
$
|
161.1
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Unrealized gains on investment securities, beginning of period
|
$
|
7.7
|
|
|
$
|
4.9
|
|
|
$
|
3.1
|
|
Unrealized gains/(losses)
|
(0.1
|
)
|
|
9.9
|
|
|
9.7
|
|
|||
Tax (expense)/benefit
|
0.1
|
|
|
(3.7
|
)
|
|
(3.6
|
)
|
|||
Reclassification of gains into "Other revenues"
|
(5.8
|
)
|
|
(5.5
|
)
|
|
(6.9
|
)
|
|||
Tax expense related to reclassifications
|
2.2
|
|
|
2.1
|
|
|
2.6
|
|
|||
Net unrealized gains/(losses) on investment securities
|
(3.6
|
)
|
|
2.8
|
|
|
1.8
|
|
|||
Unrealized gains on investment securities, end of period
|
$
|
4.1
|
|
|
$
|
7.7
|
|
|
$
|
4.9
|
|
|
|
|
|
|
|
|
|
||||
Unrealized gains/(losses) on hedging activities, beginning of period
|
$
|
(21.9
|
)
|
|
$
|
5.1
|
|
|
$
|
(21.9
|
)
|
Unrealized losses
|
(3.1
|
)
|
|
(20.1
|
)
|
|
(5.2
|
)
|
|||
Tax (expense)/benefit
|
(1.7
|
)
|
|
3.1
|
|
|
5.6
|
|
|||
Reclassification of (gains)/losses into "Transaction fees"
|
(7.6
|
)
|
|
(10.3
|
)
|
|
23.3
|
|
|||
Reclassification of (gains)/losses into "Foreign exchange revenues"
|
(2.8
|
)
|
|
(3.1
|
)
|
|
7.0
|
|
|||
Reclassification of losses into "Interest expense"
|
3.6
|
|
|
3.6
|
|
|
2.7
|
|
|||
Tax expense/(benefit) related to reclassifications
|
0.5
|
|
|
(0.2
|
)
|
|
(6.4
|
)
|
|||
Net unrealized gains/(losses) on hedging activities
|
(11.1
|
)
|
|
(27.0
|
)
|
|
27.0
|
|
|||
Unrealized gains/(losses) on hedging activities, end of period
|
$
|
(33.0
|
)
|
|
$
|
(21.9
|
)
|
|
$
|
5.1
|
|
|
|
|
|
|
|
|
|
||||
Foreign currency translation adjustments, beginning of period
|
$
|
(8.5
|
)
|
|
$
|
(6.3
|
)
|
|
$
|
(4.3
|
)
|
Foreign currency translation adjustments
|
(17.7
|
)
|
|
(4.6
|
)
|
|
(3.7
|
)
|
|||
Tax benefit
|
4.6
|
|
|
2.4
|
|
|
1.7
|
|
|||
Net foreign currency translation adjustments
|
(13.1
|
)
|
|
(2.2
|
)
|
|
(2.0
|
)
|
|||
Foreign currency translation adjustments, end of period
|
$
|
(21.6
|
)
|
|
$
|
(8.5
|
)
|
|
$
|
(6.3
|
)
|
|
|
|
|
|
|
|
|
||||
Defined benefit pension plan adjustments, beginning of period
|
$
|
(129.9
|
)
|
|
$
|
(122.2
|
)
|
|
$
|
(109.7
|
)
|
Unrealized gains/(losses)
|
7.4
|
|
|
(20.5
|
)
|
|
(28.4
|
)
|
|||
Tax (expense)/benefit
|
(3.9
|
)
|
|
6.2
|
|
|
10.9
|
|
|||
Reclassification of losses into "Cost of services"
|
12.4
|
|
|
10.5
|
|
|
8.1
|
|
|||
Tax benefit related to reclassifications and other
|
(4.5
|
)
|
|
(3.9
|
)
|
|
(3.1
|
)
|
|||
Net defined benefit pension plan adjustments
|
11.4
|
|
|
(7.7
|
)
|
|
(12.5
|
)
|
|||
Defined benefit pension plan adjustments, end of period
|
$
|
(118.5
|
)
|
|
$
|
(129.9
|
)
|
|
$
|
(122.2
|
)
|
Accumulated other comprehensive loss, end of period
|
$
|
(169.0
|
)
|
|
$
|
(152.6
|
)
|
|
$
|
(118.5
|
)
|
Year
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
||||||||
2013
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
2012
|
|
$
|
0.10
|
|
|
$
|
0.10
|
|
|
$
|
0.10
|
|
|
$
|
0.125
|
|
2011
|
|
$
|
0.07
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
(a)
|
Comprised of exposures to
15
different currencies. None of these individual currency exposures is greater than
$25 million
.
|
|
Derivative Assets
|
|
Derivative Liabilities
|
||||||||||||||||
|
|
|
Fair Value
|
|
|
|
Fair Value
|
||||||||||||
|
Balance Sheet
Location
|
|
December 31,
2013 |
|
December 31,
2012 |
|
Balance Sheet
Location
|
|
December 31,
2013 |
|
December 31,
2012 |
||||||||
Derivatives — hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate fair value hedges — Corporate
|
Other assets
|
|
$
|
11.4
|
|
|
$
|
13.1
|
|
|
Other liabilities
|
|
$
|
7.8
|
|
|
$
|
—
|
|
Foreign currency cash flow hedges — Consumer-to-Consumer
|
Other assets
|
|
11.1
|
|
|
10.8
|
|
|
Other liabilities
|
|
27.7
|
|
|
17.6
|
|
||||
Total
|
|
|
$
|
22.5
|
|
|
$
|
23.9
|
|
|
|
|
$
|
35.5
|
|
|
$
|
17.6
|
|
Derivatives — undesignated:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency — Business Solutions
|
Other assets
|
|
$
|
201.2
|
|
|
$
|
71.9
|
|
|
Other liabilities
|
|
$
|
186.2
|
|
|
$
|
66.5
|
|
Foreign currency — Consumer-to-Consumer
|
Other assets
|
|
0.6
|
|
|
1.0
|
|
|
Other liabilities
|
|
1.7
|
|
|
2.0
|
|
||||
Total
|
|
|
$
|
201.8
|
|
|
$
|
72.9
|
|
|
|
|
$
|
187.9
|
|
|
$
|
68.5
|
|
Total derivatives
|
|
|
$
|
224.3
|
|
|
$
|
96.8
|
|
|
|
|
$
|
223.4
|
|
|
$
|
86.1
|
|
|
Total
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
||||||||||||||
Foreign currency cash flow hedges — Consumer-to-Consumer
|
$
|
(16.6
|
)
|
|
$
|
(11.5
|
)
|
|
$
|
(5.1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency undesignated hedges — Consumer-to-Consumer
|
(1.1
|
)
|
|
(1.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency undesignated hedges — Business Solutions
|
15.0
|
|
|
15.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Interest rate fair value hedges — Corporate
|
3.6
|
|
|
11.2
|
|
|
—
|
|
|
—
|
|
|
(2.7
|
)
|
|
(4.9
|
)
|
|
—
|
|
|||||||
Total
|
$
|
0.9
|
|
|
$
|
13.6
|
|
|
$
|
(5.1
|
)
|
|
$
|
—
|
|
|
$
|
(2.7
|
)
|
|
$
|
(4.9
|
)
|
|
$
|
—
|
|
December 31, 2013
|
|
Gross Amounts of Recognized Assets
|
|
Gross Amounts Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented
in the Consolidated Balance Sheets
|
|
Derivatives Not Offset
in the Consolidated Balance Sheets
|
|
Net Amounts
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
118.4
|
|
|
$
|
—
|
|
|
$
|
118.4
|
|
|
$
|
(93.3
|
)
|
|
$
|
25.1
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
105.9
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
224.3
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
39.1
|
|
|
$
|
—
|
|
|
$
|
39.1
|
|
|
$
|
(19.6
|
)
|
|
$
|
19.5
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
57.7
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
96.8
|
|
|
|
|
|
|
|
|
|
December 31, 2013
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented
in the Consolidated Balance Sheets
|
|
Derivatives Not Offset
in the Consolidated Balance Sheets
|
|
Net Amounts
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
146.1
|
|
|
$
|
—
|
|
|
$
|
146.1
|
|
|
$
|
(93.3
|
)
|
|
$
|
52.8
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
77.3
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
223.4
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
30.5
|
|
|
$
|
—
|
|
|
$
|
30.5
|
|
|
$
|
(19.6
|
)
|
|
$
|
10.9
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
55.6
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
86.1
|
|
|
|
|
|
|
|
|
|
|
|
Gain/(Loss) Recognized in Income on
Derivatives
|
|
|
|
Gain/(Loss) Recognized in Income on
Related Hedged Item (a)
|
|
Gain/(Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
||||||||||||||||||||||||||||||||||||
|
|
Income
Statement
Location
|
|
Amount
|
|
|
|
Income
Statement
Location
|
|
Amount
|
|
Income
Statement
Location
|
|
Amount
|
||||||||||||||||||||||||||||||
Derivatives
|
|
|
2013
|
|
2012
|
|
2011
|
|
Hedged
Item
|
|
|
2013
|
|
2012
|
|
2011
|
|
|
2013
|
|
2012
|
|
2011
|
|||||||||||||||||||||
Interest rate contracts
|
|
Interest expense
|
|
$
|
(8.5
|
)
|
|
$
|
3.9
|
|
|
$
|
11.8
|
|
|
Fixed-rate debt
|
|
Interest expense
|
|
$
|
19.3
|
|
|
$
|
3.7
|
|
|
$
|
12.6
|
|
|
Interest expense
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total gain/(loss)
|
|
|
|
$
|
(8.5
|
)
|
|
$
|
3.9
|
|
|
$
|
11.8
|
|
|
|
|
|
|
$
|
19.3
|
|
|
$
|
3.7
|
|
|
$
|
12.6
|
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Gain/(Loss) Recognized
|
|
Gain/(Loss) Reclassified
|
|
Gain/(Loss) Recognized in Income on
|
||||||||||||||||||||||||||||||||||
|
|
in OCI on Derivatives
|
|
from Accumulated OCI into Income
|
|
Derivatives (Ineffective Portion and Amount
|
||||||||||||||||||||||||||||||||||
|
|
(Effective Portion)
|
|
(Effective Portion)
|
|
Excluded from Effectiveness Testing) (b)
|
||||||||||||||||||||||||||||||||||
|
|
Amount
|
|
Income
Statement Location
|
|
Amount
|
|
Income
Statement Location
|
|
Amount
|
||||||||||||||||||||||||||||||
Derivatives
|
|
2013
|
|
2012
|
|
2011
|
|
|
2013
|
|
2012
|
|
2011
|
|
|
2013
|
|
2012
|
|
2011
|
||||||||||||||||||||
Foreign currency contracts
|
|
$
|
(3.1
|
)
|
|
$
|
(20.1
|
)
|
|
$
|
16.4
|
|
|
Revenue
|
|
$
|
10.4
|
|
|
$
|
13.4
|
|
|
$
|
(30.3
|
)
|
|
Derivative
gains/(losses), net |
|
$
|
(0.4
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(10.2
|
)
|
Interest rate contracts (c)
|
|
—
|
|
|
—
|
|
|
(21.6
|
)
|
|
Interest expense
|
|
(3.6
|
)
|
|
(3.6
|
)
|
|
(2.7
|
)
|
|
Interest expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total gain/(loss)
|
|
$
|
(3.1
|
)
|
|
$
|
(20.1
|
)
|
|
$
|
(5.2
|
)
|
|
|
|
$
|
6.8
|
|
|
$
|
9.8
|
|
|
$
|
(33.0
|
)
|
|
|
|
$
|
(0.4
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(10.2
|
)
|
|
|
Gain/(Loss) Recognized in Income on Derivatives (d)
|
||||||||||||
|
|
Income Statement Location
|
|
Amount
|
||||||||||
Derivatives
|
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Foreign currency contracts (e)
|
Selling, general and administrative
|
|
$
|
(3.7
|
)
|
|
$
|
(10.6
|
)
|
|
$
|
5.9
|
|
|
Foreign currency contracts (f)
|
Derivative gains/(losses), net
|
|
(0.9
|
)
|
|
0.6
|
|
|
21.9
|
|
||||
Total gain/(loss)
|
|
|
$
|
(4.6
|
)
|
|
$
|
(10.0
|
)
|
|
$
|
27.8
|
|
(a)
|
The 2013 gain of
$19.3 million
was comprised of a gain in value on the debt of
$8.5 million
and amortization of hedge accounting adjustments of
$10.8 million
. The 2012 gain of
$3.7 million
was comprised of a loss in value on the debt of
$(3.9) million
and amortization of hedge accounting adjustments of
$7.6 million
. The 2011 gain of
$12.6 million
was comprised of a loss in value on the debt of
$(11.8) million
and amortization of hedge accounting adjustments of
$24.4 million
.
|
(b)
|
The portion of the change in fair value of a derivative excluded from the effectiveness assessment for foreign currency forward contracts designated as cash flow hedges represents the difference between changes in forward rates and spot rates.
|
(c)
|
The Company uses derivatives to hedge the forecasted issuance of fixed-rate debt and records the effective portion of the derivative's fair value in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. These amounts are reclassified to "Interest expense" in the Consolidated Statements of Income over the life of the related notes.
|
(d)
|
The Company uses foreign currency forward and option contracts as part of its Business Solutions payments operations. These derivative contracts are excluded from this table as they are managed as part of a broader currency portfolio that includes non-derivative currency exposures. The gains and losses on these derivatives are included as part of the broader disclosure of portfolio revenue for this business discussed above.
|
(e)
|
The Company uses foreign currency forward contracts to offset foreign exchange rate fluctuations on settlement assets and obligations as well as certain foreign currency denominated positions. Foreign exchange gains/(losses) on settlement assets and obligations and cash balances, not including amounts related to derivatives activity as displayed above, were
$(5.4) million
,
$7.8 million
and
$(20.5) million
for the years ended
2013
,
2012
and
2011
, respectively.
|
(f)
|
The derivative contracts used in the Company's revenue hedging program are not designated as hedges in the final month of the contract. Additionally, in the year ended December 31, 2011, the Company entered into derivative contracts, consisting of foreign currency forward contracts with maturities of less than one year, to reduce the economic variability related to the cash amounts used to fund acquisitions of businesses with purchase prices denominated in foreign currencies, primarily for the TGBP acquisition, and recorded a net gain of
$20.8 million
in "Derivatives gains/(losses), net."
|
|
December 31, 2013
|
|
December 31, 2012
|
||||
Due in less than one year:
|
|
|
|
||||
Floating rate notes (a)
|
$
|
—
|
|
|
$
|
300.0
|
|
6.500% notes (effective rate of 5.7%) due 2014 (b)
|
500.0
|
|
|
500.0
|
|
||
Due in greater than one year (b):
|
|
|
|
||||
Floating rate notes due 2015 (c)
|
250.0
|
|
|
—
|
|
||
2.375% notes due 2015 (d)
|
250.0
|
|
|
250.0
|
|
||
5.930% notes due 2016 (d)
|
1,000.0
|
|
|
1,000.0
|
|
||
2.875% notes (effective rate of 2.0%) due 2017 (b)
|
500.0
|
|
|
500.0
|
|
||
3.650% notes due 2018 (d)
|
400.0
|
|
|
400.0
|
|
||
3.350% notes (effective rate of 3.4%) due 2019 (e)
|
250.0
|
|
|
—
|
|
||
5.253% notes due 2020 (d)
|
324.9
|
|
|
324.9
|
|
||
6.200% notes due 2036 (d)
|
500.0
|
|
|
500.0
|
|
||
6.200% notes due 2040 (d)
|
250.0
|
|
|
250.0
|
|
||
Other borrowings
|
5.7
|
|
|
5.8
|
|
||
Total borrowings at par value
|
4,230.6
|
|
|
4,030.7
|
|
||
Fair value hedge accounting adjustments, net (b)
|
0.9
|
|
|
20.2
|
|
||
Unamortized discount, net
|
(18.5
|
)
|
|
(21.7
|
)
|
||
Total borrowings at carrying value (f)
|
$
|
4,213.0
|
|
|
$
|
4,029.2
|
|
(a)
|
The floating rate notes due in March 2013 were repaid using the Company's cash, including cash generated from operations and proceeds from the Company's issuance of the fixed rate notes due 2015 and 2017.
|
(b)
|
The Company utilizes interest rate swaps designated as fair value hedges to effectively change the interest rate payments on a portion of its notes from fixed-rate payments to short-term LIBOR-based variable rate payments in order to manage its overall exposure to interest rates. The changes in fair value of these interest rate swaps result in an offsetting hedge accounting adjustment recorded to the carrying value of the related note. These hedge accounting adjustments will be reclassified as reductions to or increases in "Interest expense" in the Consolidated Statements of Income over the life of the related notes, and cause the effective rate of i
nterest to differ from the notes’ stated rate.
|
(c)
|
On August 22, 2013, the Company issued
$250.0 million
of aggregate principal amount of unsecured floating rate notes due August 21, 2015 ("2015 Floating Rate Notes"). Interest is payable quarterly at a per annum rate equal to three-month LIBOR plus
1.0%
(
1.2%
at
December 31, 2013
) and is reset quarterly. See below for additional detail relating to the debt issuance.
|
(d)
|
The difference between the stated interest rate and the effective interest rate is not significant.
|
(e)
|
On November 22, 2013, the Company issued
$250.0 million
of aggregate principal amount of
3.350%
unsecured fixed rate notes due 2019 ("2019 Notes"). The interest rate on the 2019 Notes may be adjusted under certain circumstances as described below.
|
(f)
|
As of
December 31, 2013
, the Company’s weighted-average effective rate on total borrowings was approximately
4.6%
.
|
|
Year Ended December 31, 2013
|
||||||||||||
|
Options
|
|
Weighted-Average
Exercise Price
|
|
Weighted-Average Remaining
Contractual Term
(Years)
|
|
Aggregate
Intrinsic
Value
|
||||||
Outstanding as of January 1
|
27.0
|
|
|
$
|
18.46
|
|
|
|
|
|
|||
Granted
|
4.0
|
|
|
14.02
|
|
|
|
|
|
||||
Exercised
|
(1.8
|
)
|
|
15.86
|
|
|
|
|
|
||||
Cancelled/forfeited
|
(5.4
|
)
|
|
17.86
|
|
|
|
|
|
||||
Outstanding as of December 31
|
23.8
|
|
|
$
|
18.05
|
|
|
4.4
|
|
|
$
|
19.7
|
|
Options exercisable as of December 31
|
18.1
|
|
|
$
|
18.77
|
|
|
3.1
|
|
|
$
|
8.4
|
|
|
Year Ended December 31, 2013
|
||||
|
Number
Outstanding
|
|
Weighted-Average
Grant-Date Fair Value
|
||
Non-vested as of January 1
|
4.8
|
|
$
|
17.38
|
|
Granted
|
3.2
|
|
13.10
|
|
|
Vested
|
(1.0)
|
|
15.63
|
|
|
Forfeited
|
(0.7)
|
|
15.42
|
|
|
Non-vested as of December 31
|
6.3
|
|
$
|
15.69
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Stock-based compensation expense
|
$
|
(34.5
|
)
|
|
$
|
(34.0
|
)
|
|
$
|
(31.2
|
)
|
Income tax benefit from stock-based compensation expense
|
10.0
|
|
|
10.0
|
|
|
9.8
|
|
|||
Net income impact
|
$
|
(24.5
|
)
|
|
$
|
(24.0
|
)
|
|
$
|
(21.4
|
)
|
Earnings per share:
|
|
|
|
|
|
||||||
Basic and Diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.03
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Stock options granted:
|
|
|
|
|
|
||||||
Weighted-average risk-free interest rate
|
1.2
|
%
|
|
1.2
|
%
|
|
2.5
|
%
|
|||
Weighted-average dividend yield
|
3.7
|
%
|
|
1.8
|
%
|
|
1.4
|
%
|
|||
Volatility
|
35.3
|
%
|
|
33.2
|
%
|
|
31.0
|
%
|
|||
Expected term (in years)
|
6.09
|
|
|
6.09
|
|
|
5.80
|
|
|||
Weighted-average grant date fair value
|
$
|
3.20
|
|
|
$
|
4.90
|
|
|
$
|
5.99
|
|
•
|
The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.
|
•
|
Corporate and other overhead is allocated to the segments primarily based on a percentage of the segments' revenue compared to total revenue.
|
•
|
Costs incurred for the review and closing of acquisitions are included in "Other."
|
•
|
The Company incurred restructuring and related expenses of
$46.8 million
during the year ended
December 31, 2011
which were not allocated to the Company's segments. While these items were identifiable to the Company's segments, they were not included in the measurement of segment operating profit provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. For additional information on restructuring and related activities, refer to Note 3.
|
•
|
All items not included in operating income are excluded from the segments.
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Consumer-to-Consumer:
|
|
|
|
|
|
||||||
Transaction fees
|
$
|
3,396.1
|
|
|
$
|
3,545.6
|
|
|
$
|
3,580.2
|
|
Foreign exchange revenues
|
981.3
|
|
|
988.5
|
|
|
983.1
|
|
|||
Other revenues
|
56.2
|
|
|
50.2
|
|
|
45.1
|
|
|||
|
4,433.6
|
|
|
4,584.3
|
|
|
4,608.4
|
|
|||
Consumer-to-Business:
|
|
|
|
|
|
||||||
Transaction fees
|
579.1
|
|
|
573.6
|
|
|
581.8
|
|
|||
Foreign exchange and other revenues
|
29.4
|
|
|
30.3
|
|
|
34.1
|
|
|||
|
608.5
|
|
|
603.9
|
|
|
615.9
|
|
|||
Business Solutions:
|
|
|
|
|
|
||||||
Foreign exchange revenues
|
355.5
|
|
|
332.0
|
|
|
154.6
|
|
|||
Transaction fees and other revenues
|
37.4
|
|
|
35.4
|
|
|
6.5
|
|
|||
|
392.9
|
|
|
367.4
|
|
|
161.1
|
|
|||
Other:
|
|
|
|
|
|
||||||
Total revenues
|
107.0
|
|
|
109.2
|
|
|
106.0
|
|
|||
Total consolidated revenues
|
$
|
5,542.0
|
|
|
$
|
5,664.8
|
|
|
$
|
5,491.4
|
|
Operating income/(loss):
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
1,030.4
|
|
|
$
|
1,266.9
|
|
|
$
|
1,316.0
|
|
Consumer-to-Business
|
121.9
|
|
|
137.6
|
|
|
146.9
|
|
|||
Business Solutions (a)
|
(27.0
|
)
|
|
(54.8
|
)
|
|
(9.6
|
)
|
|||
Other
|
(17.9
|
)
|
|
(19.7
|
)
|
|
(21.5
|
)
|
|||
Total segment operating income
|
1,107.4
|
|
|
1,330.0
|
|
|
1,431.8
|
|
|||
Restructuring and related expenses (Note 3)
|
—
|
|
|
—
|
|
|
(46.8
|
)
|
|||
Total consolidated operating income
|
$
|
1,107.4
|
|
|
$
|
1,330.0
|
|
|
$
|
1,385.0
|
|
|
|
|
|
|
|
(a)
|
During the years ended
December 31, 2013
,
2012
and
2011
, the Company incurred
$19.3 million
,
$42.8 million
and
$4.8 million
, respectively, of integration expenses related to the acquisition of TGBP. TGBP integration expense consists primarily of severance and other benefits, retention, direct and incremental expense consisting of facility relocation, consolidation and closures; IT systems integration; amortization of a transitional trademark license; and other expenses such as training, travel and professional fees. Integration expense does not include costs related to the completion of the TGBP acquisition, which are included in Other.
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Assets:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
5,321.9
|
|
|
$
|
4,854.2
|
|
|
$
|
4,644.6
|
|
Consumer-to-Business
|
1,129.9
|
|
|
1,029.6
|
|
|
955.8
|
|
|||
Business Solutions
|
2,256.4
|
|
|
2,012.6
|
|
|
1,906.2
|
|
|||
Other
|
1,413.1
|
|
|
1,569.3
|
|
|
1,563.3
|
|
|||
Total assets
|
$
|
10,121.3
|
|
|
$
|
9,465.7
|
|
|
$
|
9,069.9
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
179.4
|
|
|
$
|
158.2
|
|
|
$
|
141.0
|
|
Consumer-to-Business
|
15.8
|
|
|
14.7
|
|
|
18.8
|
|
|||
Business Solutions
|
59.6
|
|
|
65.7
|
|
|
26.8
|
|
|||
Other
|
8.0
|
|
|
7.5
|
|
|
4.7
|
|
|||
Total segment depreciation and amortization
|
262.8
|
|
|
246.1
|
|
|
191.3
|
|
|||
Restructuring and related expenses (Note 3)
|
—
|
|
|
—
|
|
|
1.3
|
|
|||
Total consolidated depreciation and amortization
|
$
|
262.8
|
|
|
$
|
246.1
|
|
|
$
|
192.6
|
|
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
174.0
|
|
|
$
|
219.1
|
|
|
$
|
138.4
|
|
Consumer-to-Business
|
36.9
|
|
|
21.8
|
|
|
13.4
|
|
|||
Business Solutions
|
14.8
|
|
|
16.1
|
|
|
6.7
|
|
|||
Other
|
15.6
|
|
|
11.2
|
|
|
4.0
|
|
|||
Total capital expenditures
|
$
|
241.3
|
|
|
$
|
268.2
|
|
|
$
|
162.5
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenue:
|
|
|
|
|
|
||||||
United States
|
$
|
1,523.7
|
|
|
$
|
1,593.1
|
|
|
$
|
1,568.6
|
|
International
|
4,018.3
|
|
|
4,071.7
|
|
|
3,922.8
|
|
|||
Total
|
$
|
5,542.0
|
|
|
$
|
5,664.8
|
|
|
$
|
5,491.4
|
|
Long-lived assets:
|
|
|
|
|
|
||||||
United States
|
$
|
156.6
|
|
|
$
|
148.2
|
|
|
$
|
152.1
|
|
International
|
53.3
|
|
|
47.9
|
|
|
46.0
|
|
|||
Total
|
$
|
209.9
|
|
|
$
|
196.1
|
|
|
$
|
198.1
|
|
2013 by Quarter:
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Year Ended December 31, 2013
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Revenues
|
$
|
1,325.4
|
|
|
$
|
1,385.9
|
|
|
$
|
1,408.8
|
|
|
$
|
1,421.9
|
|
|
$
|
5,542.0
|
|
|
Expenses (a) (b)
|
1,028.5
|
|
|
1,109.1
|
|
|
1,113.5
|
|
|
1,183.5
|
|
|
4,434.6
|
|
||||||
Operating income
|
296.9
|
|
|
276.8
|
|
|
295.3
|
|
|
238.4
|
|
|
1,107.4
|
|
||||||
Other expense, net
|
46.7
|
|
|
44.6
|
|
|
43.6
|
|
|
45.6
|
|
|
180.5
|
|
||||||
Income before income taxes
|
250.2
|
|
|
232.2
|
|
|
251.7
|
|
|
192.8
|
|
|
926.9
|
|
||||||
Provision for income taxes
|
38.2
|
|
|
33.6
|
|
|
37.3
|
|
|
19.4
|
|
|
128.5
|
|
||||||
Net income
|
$
|
212.0
|
|
|
$
|
198.6
|
|
|
$
|
214.4
|
|
|
$
|
173.4
|
|
|
$
|
798.4
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
$
|
0.37
|
|
|
$
|
0.36
|
|
|
$
|
0.39
|
|
|
$
|
0.31
|
|
|
$
|
1.43
|
|
|
Diluted
|
$
|
0.37
|
|
|
$
|
0.36
|
|
|
$
|
0.39
|
|
|
$
|
0.31
|
|
|
$
|
1.43
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
567.6
|
|
|
555.7
|
|
|
552.1
|
|
|
551.2
|
|
|
556.6
|
|
||||||
Diluted
|
569.7
|
|
|
558.3
|
|
|
555.8
|
|
|
555.0
|
|
|
559.7
|
|
||||||
____________
|
|
|
|
|
|
|
|
|
|
(a)
|
Includes
$3.9 million
in the first quarter,
$6.2 million
in the second quarter,
$3.8 million
in the third quarter, and
$5.4 million
in the fourth quarter of integration expenses related to the acquisition of TGBP.
|
(b)
|
Includes
$4.2 million
in the first quarter,
$13.5 million
in the second quarter,
$6.2 million
in the third quarter, and
$33.0 million
in the fourth quarter of expenses related to productivity and cost-savings initiatives. For more information, see Note 3.
|
2012 by Quarter:
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Year Ended December 31, 2012
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Revenues
|
$
|
1,393.4
|
|
|
$
|
1,425.1
|
|
|
$
|
1,421.6
|
|
|
$
|
1,424.7
|
|
|
$
|
5,664.8
|
|
|
Expenses (c) (d)
|
1,060.9
|
|
|
1,079.2
|
|
|
1,056.0
|
|
|
1,138.7
|
|
|
4,334.8
|
|
||||||
Operating income
|
332.5
|
|
|
345.9
|
|
|
365.6
|
|
|
286.0
|
|
|
1,330.0
|
|
||||||
Other expense, net
|
42.4
|
|
|
35.8
|
|
|
41.8
|
|
|
41.2
|
|
|
161.2
|
|
||||||
Income before income taxes
|
290.1
|
|
|
310.1
|
|
|
323.8
|
|
|
244.8
|
|
|
1,168.8
|
|
||||||
Provision for income taxes
|
42.8
|
|
|
38.9
|
|
|
54.3
|
|
|
6.9
|
|
|
142.9
|
|
||||||
Net income
|
$
|
247.3
|
|
|
$
|
271.2
|
|
|
$
|
269.5
|
|
|
$
|
237.9
|
|
|
$
|
1,025.9
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
$
|
0.40
|
|
|
$
|
0.44
|
|
|
$
|
0.45
|
|
|
$
|
0.40
|
|
|
$
|
1.70
|
|
|
Diluted
|
$
|
0.40
|
|
|
$
|
0.44
|
|
|
$
|
0.45
|
|
|
$
|
0.40
|
|
|
$
|
1.69
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
619.1
|
|
|
610.9
|
|
|
601.5
|
|
|
588.0
|
|
|
604.9
|
|
||||||
Diluted
|
621.9
|
|
|
613.1
|
|
|
604.2
|
|
|
590.2
|
|
|
607.4
|
|
||||||
____________
|
|
|
|
|
|
|
|
|
|
(c)
|
Includes
$6.4 million
in the first quarter,
$14.5 million
in the second quarter,
$10.3 million
in the third quarter, and
$11.6 million
in the fourth quarter of integration expenses related to the acquisition of TGBP.
|
(d)
|
Includes
$30.9 million
in the fourth quarter of expenses related to productivity and cost-savings initiatives. For more information, see Note 3.
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
151.4
|
|
|
$
|
383.7
|
|
Property and equipment, net of accumulated depreciation of $17.0 and $14.4, respectively
|
41.0
|
|
|
33.6
|
|
||
Other assets
|
160.4
|
|
|
68.4
|
|
||
Investment in subsidiaries
|
5,534.1
|
|
|
5,420.3
|
|
||
Total assets
|
$
|
5,886.9
|
|
|
$
|
5,906.0
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
76.8
|
|
|
$
|
79.3
|
|
Income taxes payable
|
76.3
|
|
|
88.3
|
|
||
Payable to subsidiaries, net
|
413.2
|
|
|
773.5
|
|
||
Borrowings
|
4,207.3
|
|
|
4,023.4
|
|
||
Other liabilities
|
8.6
|
|
|
0.9
|
|
||
Total liabilities
|
4,782.2
|
|
|
4,965.4
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $1.00 par value; 10 shares authorized; no shares issued
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value; 2,000 shares authorized; 548.8 shares and 572.1 shares issued and outstanding as of December 31, 2013 and 2012, respectively
|
5.5
|
|
|
5.7
|
|
||
Capital surplus
|
390.9
|
|
|
332.8
|
|
||
Retained earnings
|
877.3
|
|
|
754.7
|
|
||
Accumulated other comprehensive loss
|
(169.0
|
)
|
|
(152.6
|
)
|
||
Total stockholders’ equity
|
1,104.7
|
|
|
940.6
|
|
||
Total liabilities and stockholders’ equity
|
$
|
5,886.9
|
|
|
$
|
5,906.0
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Expenses
|
—
|
|
|
—
|
|
|
—
|
|
|||
Operating income
|
—
|
|
|
—
|
|
|
—
|
|
|||
Interest income
|
0.4
|
|
|
0.2
|
|
|
0.1
|
|
|||
Interest expense
|
(195.7
|
)
|
|
(178.6
|
)
|
|
(181.0
|
)
|
|||
Other expense
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|||
Loss before equity in earnings of affiliates and income taxes
|
(195.3
|
)
|
|
(178.4
|
)
|
|
(181.0
|
)
|
|||
Equity in earnings of affiliates, net of tax
|
919.0
|
|
|
1,136.1
|
|
|
1,276.7
|
|
|||
Income tax benefit
|
74.7
|
|
|
68.2
|
|
|
69.7
|
|
|||
Net income
|
798.4
|
|
|
1,025.9
|
|
|
1,165.4
|
|
|||
Other comprehensive income/(loss), net of tax
|
2.2
|
|
|
2.0
|
|
|
(11.7
|
)
|
|||
Other comprehensive income/(loss) of affiliates, net of tax
|
(18.6
|
)
|
|
(36.1
|
)
|
|
26.0
|
|
|||
Comprehensive income
|
$
|
782.0
|
|
|
$
|
991.8
|
|
|
$
|
1,179.7
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net cash provided by operating activities
|
$
|
689.1
|
|
|
$
|
228.3
|
|
|
$
|
698.1
|
|
Cash flows from investing activities
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
(8.5
|
)
|
|
(3.3
|
)
|
|
(4.2
|
)
|
|||
Purchases of non-settlement related investments
|
(100.0
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(108.5
|
)
|
|
(3.3
|
)
|
|
(4.2
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Advances from/(to) subsidiaries, net
|
(362.2
|
)
|
|
679.1
|
|
|
(180.9
|
)
|
|||
Net proceeds from issuance of borrowings
|
497.3
|
|
|
742.8
|
|
|
696.3
|
|
|||
Principal payments on borrowings
|
(300.0
|
)
|
|
—
|
|
|
(696.3
|
)
|
|||
Net (repayments of)/proceeds from commercial paper
|
—
|
|
|
(297.0
|
)
|
|
297.0
|
|
|||
Proceeds from exercise of options
|
28.9
|
|
|
53.4
|
|
|
100.0
|
|
|||
Cash dividends paid
|
(277.2
|
)
|
|
(254.2
|
)
|
|
(194.2
|
)
|
|||
Common stock repurchased
|
(399.7
|
)
|
|
(766.5
|
)
|
|
(803.9
|
)
|
|||
Net cash provided by/(used in) financing activities
|
(812.9
|
)
|
|
157.6
|
|
|
(782.0
|
)
|
|||
Net change in cash and cash equivalents
|
(232.3
|
)
|
|
382.6
|
|
|
(88.1
|
)
|
|||
Cash and cash equivalents at beginning of year
|
383.7
|
|
|
1.1
|
|
|
89.2
|
|
|||
Cash and cash equivalents at end of year
|
$
|
151.4
|
|
|
$
|
383.7
|
|
|
$
|
1.1
|
|
|
The Western Union Company (Registrant)
|
|
|
|
|
February 24, 2014
|
By:
|
/
S
/ H
IKMET
E
RSEK
|
|
|
Hikmet Ersek
|
|
|
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Hikmet Ersek
|
|
President, Chief Executive Officer and Director (Principal Executive Officer)
|
|
February 24, 2014
|
Hikmet Ersek
|
|
|
|
|
|
|
|
|
|
/s/ Rajesh K. Agrawal
|
|
Executive Vice President and Interim Chief Financial Officer (Principal Financial Officer)
|
|
February 24, 2014
|
Rajesh K. Agrawal
|
|
|
|
|
|
|
|
|
|
/s/ Amintore T.X. Schenkel
|
|
Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer)
|
|
February 24, 2014
|
Amintore T.X. Schenkel
|
|
|
|
|
|
|
|
|
|
/s/ Jack M. Greenberg
|
|
Non-Executive Chairman of the Board of Directors
|
|
February 24, 2014
|
Jack M. Greenberg
|
|
|
|
|
|
|
|
|
|
/s/ Dinyar S. Devitre
|
|
Director
|
|
February 24, 2014
|
Dinyar S. Devitre
|
|
|
|
|
|
|
|
|
|
/s/ Richard A. Goodman
|
|
Director
|
|
February 24, 2014
|
Richard A. Goodman
|
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/s/ Betsy D. Holden
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Director
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February 24, 2014
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Betsy D. Holden
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/s/ Linda Fayne Levinson
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Director
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February 24, 2014
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Linda Fayne Levinson
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/s/ Roberto G. Mendoza
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Director
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February 24, 2014
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Roberto G. Mendoza
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/s/ Michael A. Miles, Jr.
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Director
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February 24, 2014
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Michael A. Miles, Jr.
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/s/ Wulf von Schimmelmann
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Director
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February 24, 2014
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Wulf von Schimmelmann
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/s/ Frances Fragos Townsend
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Director
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February 24, 2014
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Frances Fragos Townsend
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/s/ Solomon D. Trujillo
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Director
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February 24, 2014
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Solomon D. Trujillo
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Exhibit
Number
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Description
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2.1
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Separation and Distribution Agreement, dated as of September 29, 2006, between First Data Corporation and The Western Union Company (filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed on October 3, 2006 and incorporated herein by reference thereto).
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3.1
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Amended and Restated Certificate of Incorporation of The Western Union Company, as filed with the Secretary of State of the State of Delaware on May 30, 2013 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed on June 3, 2013 and incorporated herein by reference thereto).
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3.2
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Amended and Restated Bylaws of The Western Union Company, as amended as of May 30, 2013 (filed as Exhibit 3.2 to the Company's Current Report on Form 8-K filed on June 3, 2013 and incorporated herein by reference thereto).
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4.1
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Indenture, dated as of September 29, 2006, between The Western Union Company and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on October 2, 2006 and incorporated herein by reference thereto).
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4.2
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Form of 5.930% Note due 2016 (filed as Exhibit 4.2 to the Company's Current Report on Form 8-K filed on October 2, 2006 and incorporated herein by reference thereto).
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4.3
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Form of 5.930% Note due 2016 (filed as Exhibit 4.11 to the Company's Registration Statement on Form S-4 filed on December 22, 2006 and incorporated herein by reference thereto).
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4.4
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Supplemental Indenture, dated as of September 29, 2006, among The Western Union Company, First Financial Management Corporation and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.3 to the Company's Current Report on Form 8-K filed on October 2, 2006 and incorporated herein by reference thereto).
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4.5
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Second Supplemental Indenture, dated as of November 17, 2006, among The Western Union Company, First Financial Management Corporation and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.6 to the Company's Current Report on Form 8-K filed on November 20, 2006 and incorporated herein by reference thereto).
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4.6
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Third Supplemental Indenture, dated as of September 6, 2007, among The Western Union Company and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.6 to the Company's Annual Report on Form 10-K filed on February 26, 2008 and incorporated herein by reference thereto).
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4.7
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Indenture, dated as of November 17, 2006, between The Western Union Company and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on November 20, 2006 and incorporated herein by reference thereto).
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4.8
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Form of 6.200% Note due 2036 (filed as Exhibit 4.14 to the Company's Registration Statement on Form S-4 filed on December 22, 2006 and incorporated herein by reference thereto).
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4.9
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Form of 6.50% Note due 2014 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on February 26, 2009 and incorporated herein by reference thereto).
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4.10
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Form of 6.200% Note due 2040 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on June 21, 2010 and incorporated herein by reference thereto).
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4.11
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|
Form of 5.253% 144A Note due 2020 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on April 2, 2010 and incorporated herein by reference thereto).
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4.12
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Form of 5.253% Note due 2020 (filed as Exhibit 4.3 to the Company's Registration Statement on Form S-4 filed on August 5, 2010 and incorporated herein by reference thereto).
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4.13
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|
Supplemental Indenture, dated as of September 6, 2007, among The Western Union Company and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.13 to the Company's Annual Report on Form 10-K filed on February 26, 2008 and incorporated herein by reference thereto).
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4.14
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Form of 3.650% Note due 2018 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on August 22, 2011 and incorporated herein by reference thereto).
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4.15
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Form of 2.375% Note due 2015 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on December 11, 2012 and incorporated herein by reference thereto).
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4.16
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Form of 2.875% Note due 2017 (filed as Exhibit 4.2 to the Company's Current Report on Form 8-K filed on December 11, 2012 and incorporated herein by reference thereto).
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4.17
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Form of Floating Rate Note due 2015 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on August 22, 2013 and incorporated herein by reference thereto).
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4.18
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Form of 3.350% Note due 2019 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on November 22, 2013 and incorporated herein by reference thereto).
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10.1
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Tax Allocation Agreement, dated as of September 29, 2006, between First Data Corporation and The Western Union Company (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 3, 2006 and incorporated herein by reference thereto).
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10.2
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Employee Matters Agreement, dated as of September 29, 2006, between First Data Corporation and The Western Union Company (filed as Exhibit 10.2 to the Company's Current Report on Form 8-K filed on October 3, 2006 and incorporated herein by reference thereto).
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10.3
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|
Transition Services Agreement, dated as of September 29, 2006, between First Data Corporation and The Western Union Company (filed as Exhibit 10.3 to the Company's Current Report on Form 8-K filed on October 3, 2006 and incorporated herein by reference thereto).
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10.4
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|
Patent Ownership Agreement and Covenant Not to Sue, dated as of September 29, 2006, between First Data Corporation and The Western Union Company (filed as Exhibit 10.4 to the Company's Current Report on Form 8-K filed on October 3, 2006 and incorporated herein by reference thereto).
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10.5
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|
Settlement Agreement, dated as of February 11, 2010, by and between Western Union Financial Services, Inc. and the State of Arizona (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 16, 2010 and incorporated herein by reference thereto).
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10.6
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Order Tolling Time Frames and Extending Benefits and Obligations of Settlement Agreement issued June 14, 2013 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on August 7, 2013 and incorporated herein by reference thereto).
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10.7
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Order Tolling Time Frames and Extending Benefits and Obligations of Settlement Agreement issued October 28, 2013 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 29, 2013 and incorporated herein by reference thereto).
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10.8
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Order Tolling Time Frames and Extending Benefits and Obligations of Settlement Agreement issued December 19, 2013 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on December 19, 2013 and incorporated herein by reference thereto).
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10.9
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Settlement Agreement Amendment issued January 31, 2014 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 3, 2014 and incorporated herein by reference thereto).
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10.10
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|
Form of Director Indemnification Agreement (filed as Exhibit 10.11 to Amendment No. 2 to the Company's Registration Statement on Form 10 (file no. 001-32903) filed on August 28, 2006 and incorporated herein by reference thereto).*
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10.11
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The Western Union Company 2006 Long-Term Incentive Plan, as amended and restated on January 31, 2014.*
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10.12
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The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, as Amended and Restated Effective January 31, 2014.*
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10.13
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|
The Western Union Company Non-Employee Director Deferred Compensation Plan, as Amended and Restated Effective December 31, 2008 (filed as Exhibit 10.12 to the Company's Annual Report on Form 10-K filed on February 19, 2009 and incorporated herein by reference thereto).*
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10.14
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|
The Western Union Company Severance/Change in Control Policy (Executive Committee Level), as Amended and Restated Effective September 15, 2011 (filed as Exhibit 10.10 to the Company's Annual Report on Form 10-K filed on February 24, 2012 and incorporated herein by reference thereto).*
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10.15
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|
The Western Union Company Senior Executive Annual Incentive Plan, as Amended and Restated Effective February 23, 2012 (filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2012 and incorporated herein by reference thereto).*
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10.16
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|
The Western Union Company Supplemental Incentive Savings Plan, as Amended and Restated Effective November 30, 2012 (filed as Exhibit 10.12 to the Company's Annual Report on Form 10-K filed on February 22, 2013 and incorporated herein by reference thereto).*
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10.17
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|
The Western Union Company Grandfathered Supplemental Incentive Savings Plan, as Amended and Restated Effective January 1, 2010 (filed as Exhibit 10.14 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).*
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10.18
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|
Form of Unrestricted Stock Unit Award Agreement Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, as Amended and Restated Effective February 17, 2009 (filed as Exhibit 10.15 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).*
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10.19
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Form of Nonqualified Stock Option Award Agreement Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, as Amended and Restated Effective February 17, 2009 (filed as Exhibit 10.16 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).*
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10.20
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Form of Unrestricted Stock Unit Award Agreement for Non-Employee Directors Residing Outside the United States Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan (filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on May 6, 2010 and incorporated herein by reference thereto).*
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10.21
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Form of Nonqualified Stock Option Award Agreement for Non-Employee Directors Residing Outside the United States Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan (filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed on May 6, 2010 and incorporated herein by reference thereto).*
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10.22
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Form of Unrestricted Stock Unit Award Agreement for Non-Employee Directors Residing in the United States Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan (filed as Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q filed on May 6, 2010 and incorporated herein by reference thereto).*
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10.23
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Form of Nonqualified Stock Option Award Agreement for Non-Employee Directors Residing in the United States Under The Western Union Company 2006 Non-Employee Director Equity Compensation Plan (filed as Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q filed on May 6, 2010 and incorporated herein by reference thereto).*
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10.24
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|
Form of Nonqualified Stock Option Award Agreement for Executive Committee Members Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.22 to the Company's Quarterly Report on Form 10-Q filed on November 8, 2006 and incorporated herein by reference thereto).*
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10.25
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Amendment to Form of Nonqualified Stock Option Award Agreement for Executive Committee Members Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on August 5, 2008 and incorporated herein by reference thereto).*
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10.26
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|
Amendment to Form of Nonqualified Stock Option Award Agreement for Executive Committee Members under the 2002 First Data Corporation Long-Term Incentive Plan (filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on August 5, 2008 and incorporated herein by reference thereto).*
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10.27
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|
Amendment to Form of Nonqualified Stock Option Award Agreement for Executive Committee Members under the First Data Corporation 1992 Long-Term Incentive Plan (filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed on August 5, 2008 and incorporated herein by reference thereto).*
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10.28
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Form of Nonqualified Stock Option Award Agreement for Scott T. Scheirman Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.23 to the Company's Quarterly Report on Form 10-Q filed on November 8, 2006 and incorporated herein by reference thereto).*
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10.29
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|
Form of Restricted Stock Unit Award Agreement for Executive Committee Members Residing in the United States Under The Western Union Company 2006 Long-Term Incentive Plan.*
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10.30
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Form of Nonqualified Stock Option Award Agreement for Section 16 Officers (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.29 to the Company's Annual Report on Form 10-K filed on February 25, 2011 and incorporated herein by reference thereto).*
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10.31
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|
Form of Nonqualified Stock Option Award Agreement for Section 16 Officers (Non - U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.30 to the Company's Annual Report on Form 10-K filed on February 25, 2011 and incorporated herein by reference thereto).*
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10.32
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Form of Performance-Based Restricted Stock Unit Award Notice for Executive Committee Members (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.38 to the Company's Annual Report on Form 10-K filed on February 24, 2012 and incorporated herein by reference thereto).*
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10.33
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|
Employment Contract, dated as of November 9, 2009, between Western Union Financial Services GmbH and Hikmet Ersek (filed as Exhibit 10.35 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).*
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10.34
|
|
Expatriate Letter Agreement, dated as of November 9, 2009, between Western Union Financial Services GmbH, The Western Union Company and Hikmet Ersek (filed as Exhibit 10.36 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).*
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10.35
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First Amendment to Employment Contract and Expatriate Letter Agreement, dated as of October 7, 2010, between Western Union Financial Services GmbH, The Western Union Company and Hikmet Ersek (filed as Exhibit 10 to the Company's Quarterly Report on Form 10-Q filed on November 5, 2010 and incorporated herein by reference thereto).*
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10.36
|
|
Expatriate Letter Agreement, dated as of January 4, 2012, between Western Union, LLC and Rajesh K. Agrawal (filed as Exhibit 10.42 to the Company's Annual Report on Form 10-K filed on February 24, 2012 and incorporated herein by reference thereto).*
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10.37
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|
Expatriate Letter Agreement, dated as of December 12, 2011, between Western Union, LLC and Robin S. Heller (filed as Exhibit 10.43 to the Company's Annual Report on Form 10-K filed on February 24, 2012 and incorporated herein by reference thereto).*
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10.38
|
|
Credit Agreement, dated as of September 23, 2011, among The Western Union Company, the banks named therein, as lenders, Wells Fargo Bank, National Association, in its capacity as the swing line bank, Wells Fargo Bank, National Association, Citibank, N.A. and JPMorgan Chase Bank, N.A., in their respective capacities as issuing lenders, Citibank, N.A. and JPMorgan Chase Bank, N.A., as syndication agents, Bank of America, N.A., Barclays Bank PLC and U.S. Bank National Association, as documentation agents, and Wells Fargo Bank, National Association, as administrative agent (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on September 29, 2011 and incorporated herein by reference thereto).
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10.39
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Form of Award Agreement Under The Western Union Company Senior Executive Annual Incentive Plan for 2013.*
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10.40
|
|
Form of Bonus Stock Unit Award Agreement for Non-Employee Directors Residing in the United States Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2012 and incorporated herein by reference thereto).*
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10.41
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|
Form of Bonus Stock Unit Award Agreement for Non-Employee Directors Residing Outside of the United States Under The Western Union Company 2006 Long-Term Incentive Plan (filed as Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2012 and incorporated herein by reference thereto).*
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|
10.42
|
|
Offer Letter, dated as of October 28, 2011, between Western Union, LLC and John Dye (filed as Exhibit 10.43 to the Company’s Annual Report on Form 10-K filed on February 22, 2013 and incorporated herein by reference thereto).*
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10.43
|
|
First Amendment to Offer Letter, dated as of November 15, 2011, between Western Union, LLC and John Dye (filed as Exhibit 10.44 to the Company’s Annual Report on Form 10-K filed on February 22, 2013 and incorporated herein by reference thereto).*
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10.44
|
|
Offer Letter, dated as of April 12, 2012, between Western Union, LLC and John "David" Thompson (filed as Exhibit 10.45 to the Company’s Annual Report on Form 10-K filed on February 22, 2013 and incorporated herein by reference thereto).*
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|
|
|
10.45
|
|
Form of 2013 Performance-Based Restricted Stock Unit Award Notice for Section 16 Officers (Non-U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan.*
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|
|
|
10.46
|
|
Form of Nonqualified Stock Option Award Agreement for Non-Employee Directors Residing Outside the United States Under The Western Union Company 2006 Long-Term Incentive Plan.*
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|
|
10.47
|
|
Form of Nonqualified Stock Option Award Agreement for Non-Employee Directors Residing in the United States Under The Western Union Company 2006 Long-Term Incentive Plan.*
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10.48
|
|
Separation Agreement dated as of January 16, 2014 and Release between Scott T. Scheirman, Western Union, LLC, and The Western Union Company.*
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12
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Computation of Ratio of Earnings to Fixed Charges
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14
|
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The Western Union Company Code of Ethics for Senior Financial Officers, as Amended and Restated Effective December 9, 2009 (filed as Exhibit 14 to the Company's Annual Report on Form 10-K filed on February 26, 2010 and incorporated herein by reference thereto).
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21
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Subsidiaries of The Western Union Company
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23
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Consent of Independent Registered Public Accounting Firm
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31.1
|
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Certification of Chief Executive Officer of The Western Union Company Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934
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31.2
|
|
Certification of Chief Financial Officer of The Western Union Company Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934
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32
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Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code
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101.INS
|
|
XBRL Instance Document
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101.SCH
|
|
XBRL Taxonomy Extension Schema Document
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1.
|
Pursuant to The Western Union Company 2006 Long-Term Incentive Plan (the “Plan”), The Western Union Company (the “Company”) hereby grants to you (“Executive”) an award of Restricted Stock Units (the “Units”), in the amount specified in Executive’s Award Notice (which forms part of this Agreement) as of the Grant Date specified in Executive’s Award Notice, related to shares of the Company’s common stock (“Shares”), subject to the terms and conditions set forth in this Agreement and the Plan. The terms of the Plan are hereby incorporated in this Agreement by this reference and made a part hereof. Capitalized terms not defined herein shall have the same definitions as set forth in the Plan.
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2.
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Each Unit shall provide for the issuance and transfer to Executive of one Share upon lapse of the restrictions set forth in paragraph 3 below. Upon issuance and transfer of Shares to the Executive following the Restricted Period (as defined herein), Executive shall have all rights incident to ownership of such Shares, including but not limited to voting rights and the right to receive dividends.
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3.
|
Subject to other provisions of this Agreement and the terms of the Plan, on the third anniversary of the Grant Date, all restrictions on the Units shall lapse and the Shares subject to the Units shall be issued and transferred to Executive. Effective on and after such date, subject to applicable laws and Company policies, Executive may hold, assign, pledge, sell, or transfer the Shares in Executive’s discretion. The three year period in which the Units may be forfeited by the Executive is defined as the “Restricted Period.”
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4.
|
Executive may elect to satisfy his or her obligation to advance the amount of any required income or other withholding taxes (the “Required Tax Payments”) incurred in connection with the issuance and transfer of the Shares by any of the following means: (1) a cash payment to the Company, (2) delivery (either actual delivery or by attestation procedures established by the Company) to the Company of Common Stock having an aggregate Fair Market Value, determined as of the Tax Date, equal to the amount necessary to satisfy any such obligation, (3) authorizing the Company to withhold whole shares of Common Stock which would otherwise be delivered to Executive having an aggregate Fair Market Value, determined as of the Tax Date, or withhold an amount of cash which would otherwise be payable to Executive, equal to the amount necessary to satisfy any such obligation, (4) a cash payment to the Company by a broker-dealer acceptable to the Company to whom Executive has submitted an irrevocable notice of sale, or (5) any combination of (1) and (2). Shares of Common Stock to be delivered or withheld may not have an aggregate Fair Market Value in excess of the amount determined by applying the minimum statutory withholding rate.
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5.
|
The Units may not be sold, assigned, transferred, pledged, or otherwise disposed of, except by will or the laws of descent and distribution, while subject to restrictions. If Executive or anyone claiming under or through Executive attempts to make any such sale, transfer, assignment, pledge or other disposition of Units in violation of this paragraph 5, such attempted violation shall be null, void, and without effect.
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6.
|
Executive shall forfeit Executive’s right to any unvested Units if Executive’s continuous employment with the Company or a Subsidiary or Affiliate terminates for any reason during the Restricted Period (except solely by reason of a period of Related Employment or as set forth in paragraphs 7 and 9).
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7.
|
Except to the extent paragraph 9 applies, if Executive’s employment with the Company or a Subsidiary or Affiliate is terminated involuntarily and without Cause and on the date of such termination Executive is an eligible participant in the Severance/Change in Control Policy applicable to members of the Company’s Executive Committee, subject to the terms of such policy, any then-restricted Units shall vest on a prorated basis effective on Executive’s termination date. Such prorated vesting shall be calculated by multiplying the number of Units by a fraction, the numerator of which is the number of days that have elapsed between the Grant Date and Executive’s termination date and the denominator of which is the number of days between the Grant Date and the third anniversary of the Grant Date. If Executive dies or incurs a Disability during a period of continuous employment with the Company or a Subsidiary or Affiliate during the Restricted Period, Executive shall immediately vest, as of the date of such termination of employment, in any then-unvested Units. If Executive’s employment with the Company or a Subsidiary or Affiliate is terminated by reason of Retirement, any then-restricted Units shall vest and be settled on a prorated basis effective on Executive’s termination date. Such prorated vesting shall be calculated by multiplying the number of Units by a fraction, the numerator of which is the number of days that have elapsed between the Grant Date and Executive’s termination date and the denominator of which is the number of days between the Grant Date and the third anniversary of the Grant Date.
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8.
|
During the Restricted Period, Executive (and any person succeeding to Executive’s rights pursuant to the Plan) will have no ownership interest or rights in Shares underlying the Units, including no rights to receive dividends or other distributions made or paid with respect to such Shares or to exercise voting or other shareholder rights with respect to such Shares. Executive shall not be entitled to receive dividend equivalents in connection with this award.
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9.
|
If Executive is eligible to participate in the Severance/Change in Control Policy applicable to members of the Company’s Executive Committee at the time of a Change in Control and Executive’s
|
10.
|
The terms of this Agreement may be amended from time to time by the Committee in its sole discretion in any manner that it deems appropriate; provided, however, that no such amendment shall adversely affect in a material manner any right of Executive under this Agreement without Executive’s written consent.
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11.
|
Any action taken or decision made by the Company, the Board, or the Committee or its delegates arising out of or in connection with the construction, administration, interpretation or effect of the Plan or this Agreement shall lie within its sole and absolute discretion, as the case may be, and shall be final, conclusive and binding on Executive and all persons claiming under or through Executive. By accepting this grant of Units or other benefit under the Plan, Executive and each person claiming under or through Executive shall be conclusively deemed to have indicated acceptance and ratification of, and consent to, any action taken under the Plan by the Company, the Board or the Committee or its delegates.
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12.
|
This grant of Units is discretionary, non-binding for future years and there is no promise or guarantee that such grants will be offered to Executive in future years.
|
13.
|
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding Executive’s participation in the Plan, or Executive’s acquisition or sale of the Shares underlying the Units. Executive is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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14.
|
The validity, construction, interpretation, administration and effect of these Terms and Conditions and the Plan and rights relating to the Plan and to this Agreement, shall be governed by the substantive laws, but not the choice of law rules, of the State of Delaware, as provided in the Plan. For purposes of litigating any dispute that arises directly or indirectly under the grant of the Units or the Agreement (including the Appendix), the parties hereby submit to and consent to the jurisdiction of the State of Colorado, and agree that such litigation shall be conducted in the courts of Arapahoe County, or the federal courts for the United States for the District of Colorado, where this grant is made and/or to be performed.
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15.
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If one or more provisions of this Agreement shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and the invalid, illegal or unenforceable provisions shall be deemed null and void; however, to the extent permissible by law, any provisions which could be deemed null and void shall first be construed, interpreted or revised retroactively to permit this Agreement to be construed as to foster the intent of this Agreement and the Plan.
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16.
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Notwithstanding any other provision of the Plan or this Agreement, except as otherwise provided in the case of Executive’s termination of employment due to death, Disability or for an eligible reason under the Severance/Change in Control Policy applicable to members of the Company’s Executive Committee during the 24-month period commencing on the effective date of a Change in Control, in order for the restrictions on the Units to lapse the Company must achieve as a Performance Measure not less than [____________] of operating income during the fiscal year ending [__________],
as
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17.
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Executive acknowledges that Executive has read the Company’s Clawback Policy. In consideration of the grant of the Units, Executive agrees to abide by the Company’s Clawback Policy and any determinations of the Board pursuant to the Clawback Policy. Without limiting the foregoing, and notwithstanding any provision of this Agreement to the contrary, if the Board determines that any Incentive Compensation (as defined in the Company’s Clawback Policy) received by or paid to Executive resulted from any financial result or performance metric that was impacted by Executive’s misconduct or fraud and that compensation should be recovered from Executive (such amount being recovered, the “Clawbacked Compensation”), then upon such determination, the Board may recover such Clawbacked Compensation by (a) cancelling all or any portion of the unvested Units (the “Clawbacked Portion”) and, in such case, the Clawbacked Portion of the unvested Units shall automatically and without further action of the Company be cancelled, (b) requiring Executive to deliver to the Company shares of Common Stock acquired upon the vesting of the Units (to the extent held by Executive), (c) requiring Executive to repay to the Company any net proceeds resulting from the sale of shares of Common Stock acquired upon the vesting of the Units or (d) any combination of the remedies set forth in clauses (a), (b) or (c). The foregoing remedies are in addition to and separate from any other relief available to the Company due to Executive’s misconduct or fraud. Any determination by the Board with respect to the foregoing shall be final, conclusive and binding upon Executive and all persons claiming through Executive.
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18.
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To the extent any amounts under this Agreement are payable by reference to Executive’s “termination of employment,” such term shall be deemed to refer to Executive’s “separation from service,” within the meaning of Section 409A of the Code. Notwithstanding any other provision in this Agreement, if Executive is a “specified employee,” as defined in Section 409A of the Code, as of the date of Executive’s separation from service, then to the extent any amount payable under this Agreement (i) constitutes the payment of nonqualified deferred compensation, within the meaning of Section 409A of the Code, (ii) is payable upon Executive’s separation from service and (iii) under the terms of this Agreement would be payable prior to the six-month anniversary of Executive’s separation from service, such payment shall be delayed until the earlier to occur of (a) the six-month anniversary of the separation from service or (b) the date of Executive’s death.
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I hereby confirm that the foregoing and the documents attached hereto are hereby in all respects accepted and agreed to by the undersigned as of the date of this Agreement:
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Signature:_________________________
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Printed Name: ______________________________
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Date:_____________________________
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|
Maximum Award:
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___% of the Incentive Pool
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Target Award:
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[________________]
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Performance Period:
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[________________]
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Incentive Pool:
|
[________________]
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Cash Incentive Award:
|
[________________]
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Supplemental RSU Incentive Award:
|
[________________]
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Cash Incentive Award Vesting Date:
|
[________________]
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|
Supplemental RSU Incentive Award Vesting Dates:
|
[___] Anniversary of Grant Date ([___])
[___] Anniversary of Grant Date ([___])
|
•
|
Except as otherwise provided for in this Agreement and the Plan, the Cash Incentive Award shall be determined based on Corporate Performance Measures and Individual Performance Measures (weighted [___][___] and [___][___], respectively) established by the Committee and set forth in
Exhibit A
;
provided
,
however
, that if the Strategic Performance Measures established by the Committee and set forth in Exhibit B
are not achieved, the Cash Incentive Award determined based on the achievement of the Corporate Performance Measures and Individual Performance Measures shall be reduced by up to [___] of the Target Award.
|
•
|
Except as otherwise provided for in this Agreement and the Plan, the Supplemental RSU Incentive Award shall be determined based on Strategic Performance Measures established by the Committee and set forth in
Exhibit B
;
provided
,
however
, that the vesting of the Supplemental RSU Incentive Award shall be subject to the Company’s achievement of operating income of [_________] for [____].
|
Grant Date:
|
[__________]
|
Target Award:
Maximum Award:
|
___ shares of Common Stock
___ shares of Common Stock
|
Performance Period:
|
[__________]
|
Performance Measure:
|
[__________]
|
Vesting Date:
|
[__________]
|
|
THE WESTERN UNION COMPANY,
|
|
|
a Delaware corporation
|
|
|
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By:
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Name:
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Title:
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1.
|
Pursuant to The Western Union Company 2006 Long-Term Incentive Plan (the “Plan”), The Western Union Company (the “Company”) hereby grants to you (“Executive”) an award of Restricted Stock Units (the “Units”), in the amount specified in your Award Notice
(which forms part of this Agreement) as of the Grant Date specified in your Award Notice, related to shares of the Company’s common stock (“Shares”), subject to the terms and conditions set forth in this Agreement and the Plan. The terms of the Plan are hereby incorporated in this Agreement by this reference and made a part hereof. Capitalized terms not defined herein shall have the same definitions as set forth in the Plan.
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2.
|
Each Unit shall provide for the issuance and transfer to Executive of one Share upon lapse of the restrictions set forth in paragraph 3 below and subject to the satisfaction of the Performance Measure during the Performance Period set forth in the Award Notice and the Committee’s determination of the amount of the Award payable to Executive in accordance with Exhibit A. Upon issuance and transfer of Shares to Executive following the Restricted Period (as defined herein), Executive shall have all rights incident to ownership of such Shares, including but not limited to voting rights and the right to receive dividends.
|
3.
|
Subject to other provisions of this Agreement and the terms of the Plan, on the third anniversary of the Grant Date, subject to the satisfaction of the Performance Measure during the Performance Period set forth in the Award Notice and the Committee’s determination of the amount of the Award payable to Executive in accordance with Exhibit A, all restrictions on the Units shall lapse and the number of Shares subject to the Units determined by the Committee to be transferred to Executive in accordance with Exhibit A shall be issued and transferred to Executive. Effective on and after such date, subject to applicable laws and Company policies, Executive may hold, assign, pledge, sell, or transfer the Shares transferred to Executive in Executive’s discretion. The three year period in which the Units may be forfeited by Executive is defined as the “Restricted Period.”
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4.
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Executive may elect to satisfy Executive’s obligation to advance the amount of any required income tax (including foreign, federal, state and local taxes), social insurance, payroll tax, payment on account or other tax-related items related to Executive’s participation in the Plan and legally applicable to Executive (the “Required Tax Payments”) by any of the following means: (1) a cash payment to the Company, (2) delivery (either actual delivery or by attestation procedures established by the Company) to the Company of Common Stock having an aggregate Fair Market Value, determined as of the Tax Date, equal to the amount necessary to satisfy any such obligation, (3) authorizing the Company to withhold whole shares of Common Stock which would otherwise be delivered to Executive having an aggregate Fair Market Value, determined as of the Tax Date, or withhold an amount of cash which would otherwise be payable to Executive, equal to the amount necessary to satisfy any such obligation, (4) a cash payment to the Company by a broker-dealer acceptable to the Company to whom Executive has submitted an irrevocable notice of sale, or (5) any combination of (1) and (2).
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5.
|
The Units may not be sold, assigned, transferred, pledged, or otherwise disposed of, except by will or the laws of descent and distribution, while subject to restrictions. If Executive or anyone claiming under or through Executive attempts to make any such sale, transfer, assignment, pledge or other disposition of Units in violation of this paragraph 5, such attempted violation shall be null, void, and without effect.
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6.
|
Executive shall forfeit Executive’s right to any unvested Units if Executive’s continuous employment with the Company or a Subsidiary or Affiliate terminates for any reason during the Restricted Period
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7.
|
If Executive’s employment with the Company terminates for any reason on or after the first anniversary of the Grant Date, other than voluntary termination by Executive, death, Disability, Retirement or for Cause, and paragraph 9 does not apply, Executive shall be entitled to a prorated Award. Such prorated Award shall be equal to the amount of the Award which is actually earned, based upon satisfaction of the Performance Measure during the Performance Period (as certified by the Committee in writing) and the Committee’s determination of the amount of the Award payable to Executive in accordance with Exhibit A, multiplied by a fraction, the numerator of which shall equal the number of days Executive was employed with the Company during the Restricted Period and the denominator of which shall equal the number of days in the Restricted Period. Such prorated Award shall be paid at the same time as if Executive had remained employed with the Company through the end of the Restricted Period. If Executive’s employment with the Company terminates before the first anniversary of the Grant Date for any reason other than death, Disability or Retirement, and paragraph 9 does not apply, Executive shall not be entitled to a prorated Award.
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8.
|
During the Restricted Period, Executive (and any person succeeding to Executive’s rights pursuant to the Plan) will have no ownership interest or rights in Shares underlying the Units, including no rights to receive dividends or other distributions made or paid with respect to such Shares or to exercise voting or other shareholder rights with respect to such Shares. Executive shall not be entitled to receive dividend equivalents in connection with this Award.
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9.
|
If Executive is eligible to participate in the Severance/Change in Control Policy applicable to members of the Company’s Executive Committee at the time of a Change in Control and Executive’s employment with the Company, a Subsidiary or an Affiliate terminates for an eligible reason under such policy during the 24-month period commencing on the effective date of the Change in Control,
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10.
|
The terms of this Agreement may be amended from time to time by the Committee in its sole discretion in any manner that it deems appropriate; provided, however, that no such amendment shall adversely affect in a material manner any right of Executive under this Agreement without Executive’s written consent.
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11.
|
Any action taken or decision made by the Company, the Board, or the Committee or its delegates arising out of or in connection with the construction, administration, interpretation or effect of the Plan or this Agreement shall lie within its sole and absolute discretion, as the case may be, and shall be final, conclusive and binding on Executive and all persons claiming under or through Executive. By accepting this grant of Units or other benefit under the Plan, Executive and each person claiming under or through Executive shall be conclusively deemed to have indicated acceptance and ratification of, and consent to, any action taken under the Plan by the Company, the Board or the Committee or its delegates.
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12.
|
In accepting the award of Units, Executive acknowledges that (i) the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, as provided in the Plan; (ii) the award of Units is voluntary and occasional and does not create any contractual or other right to receive future awards of Units, or benefits in lieu of Units even if Units have been awarded repeatedly in the past; (iii) all decisions with respect to future awards, if any, will be at the sole discretion of the Committee; (iv) Executive’s participation in the Plan is voluntary; (v) the award of Units is an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to the Company or to Executive’s employer, and the Units are outside the scope of Executive’s employment contract, if any; (vi) the Units are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculation of any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; (vii) neither the award of the Units nor any provision of this Agreement, the Plan or the policies adopted pursuant to the Plan confer upon Executive any right with respect to employment or continuation of current employment, and in the event that Executive is not an employee of the Company or any Subsidiary or Affiliate, the Units shall not be interpreted to form an employment contract or relationship with the Company or any Subsidiary or Affiliate; (viii) this grant of the Units does not establish or imply an employment relationship between Executive and the Company; (ix) the future value of the underlying Shares is unknown and cannot be predicted with certainty, (x) if Executive receives Shares, the value of such Shares acquired upon vesting of the Units may increase or decrease in value; (xi) no claim or entitlement to compensation or damages arises from termination of the Units, and no claim or entitlement to compensation or damages shall arise from any diminution in value of the Units or Shares received upon the vesting of the Units resulting from termination of the Executive’s employment by the Company or the Executive’s employer (for any reason whatsoever and whether or not in breach of local labor laws) and Executive irrevocably releases the Company and Executive’s employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, Executive shall be deemed irrevocably to have waived his or her entitlement to pursue such claim; and (xii) in the event of involuntary termination of employment (whether or not in breach of local labor laws), Executive’s right to receive Shares pursuant to the Units after termination of employment,
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13.
|
The validity, construction, interpretation, administration and effect of these Terms and Conditions and the Plan and rights relating to the Plan and to this Agreement, shall be governed by the substantive laws, but not the choice of law rules, of the State of Delaware.
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14.
|
Executive hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of Executive’s personal data as described in this Agreement by and among, as applicable, Executive’s employer, the Company and the Company’s Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing Executive’s participation in the Plan.
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15.
|
The Company may, in its sole discretion, decide to deliver any documents related to the Units and to participation in the Plan or related to future Units that may be granted under the Plan by electronic means or to request Executive’s consent to participate in the Plan by electronic means. Executive hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an online or electronic system established and maintained by the Company or a third party designated by the Company.
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16.
|
If one or more provisions of this Agreement shall be held invalid, illegal or unenforceable in any
|
17.
|
Executive should be aware that Executive may be entitled to revoke this Agreement and Executive’s acceptance of the grant of the Units pursuant to the Austrian Consumer Protection Act under the following conditions: (a) if Executive signs this Agreement outside of the business premises of Executive’s employer, Executive may be entitled to revoke the Agreement provided the revocation is made within one week of Executive’s acceptance; or (b) if circumstances relevant to Executive’s decision to enter into the Agreement, as presented by the Company, either do not materialize or materialize to a significantly reduced extent, through no fault of Executive’s, Executive may be entitled to revoke the Agreement. This revocation must be made within one week of the time that it is foreseeable that the circumstances mentioned above do not materialize or materialize at a significantly reduced extent. If Executive revokes under sections (a) or (b) listed above, the revocation must be in written form to be valid. It is sufficient if Executive returns this Agreement to the Company or the Company’s representative with language which can be understood as Executive’s refusal to conclude or honor this Agreement.
|
18.
|
Executive acknowledges that Executive has read the Company’s Clawback Policy. In consideration of the grant of the Units, Executive agrees to abide by the Company’s Clawback Policy and any determinations of the Board pursuant to the Clawback Policy. Without limiting the foregoing, and notwithstanding any provision of this Agreement to the contrary, if the Board determines that any Incentive Compensation (as defined in the Company’s Clawback Policy) received by or paid to Executive resulted from any financial result or performance metric that was impacted by Executive’s misconduct or fraud and that compensation should be recovered from Executive (such amount being recovered, the “Clawbacked Compensation”), then upon such determination, the Board may recover such Clawbacked Compensation by (a) cancelling all or any portion of the unvested Units (the “Clawbacked Portion”) and, in such case, the Clawbacked Portion of the unvested Units shall automatically and without further action of the Company be cancelled, (b) requiring Executive to deliver to the Company shares of Common Stock acquired upon the vesting of the Units (to the extent held by Executive), (c) requiring Executive to repay to the Company any net proceeds resulting from the sale of shares of Common Stock acquired upon the vesting of the Units or (d) any combination of the remedies set forth in clauses (a), (b) or (c). The foregoing remedies are in addition to and separate from any other relief available to the Company due to Executive’s misconduct or fraud. Any determination by the Board with respect to the foregoing shall be final, conclusive and binding upon Executive and all persons claiming through Executive.
|
19.
|
To the extent any amounts under this Agreement are payable by reference to Executive’s “termination of employment,” such term shall be deemed to refer to Executive’s “separation from service,” within the meaning of Section 409A of the Code. Notwithstanding any other provision in this Agreement, if Executive is a “specified employee,” as defined in Section 409A of the Code, as of the date of Executive’s separation from service, then to the extent any amount payable under this Agreement (i) constitutes the payment of nonqualified deferred compensation, within the meaning of Section 409A of the Code, (ii) is payable upon Executive’s separation from service and (iii) under the terms of this Agreement would be payable prior to the six-month anniversary of Executive’s separation from service, such payment shall be delayed until the earlier to occur of (a) the six-month anniversary of the separation from service or (b) the date of Executive’s death.
|
I hereby confirm that the foregoing and the documents attached hereto are hereby in all respects accepted and agreed to by the undersigned as of the date of this Agreement:
|
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|
|
Signature:
|
|
Printed Name:
|
|
Date:
|
|
|
|
1.
|
These Terms and Conditions form part of the Stock Option Agreement (the “Agreement”) pursuant to which you have been granted a Nonqualified Stock Option (“Stock Option”) under The Western Union Company 2006 Long-Term Incentive Plan (the “Plan”). A copy of the Plan is enclosed for your convenience. The terms of the Plan are hereby incorporated in this Agreement by reference and made a part hereof.
Any capitalized terms used in this Agreement that are not defined herein shall have the meaning set forth in the Plan.
|
2.
|
The number of common shares of The Western Union Company (the “Company”) subject to the Stock Option, and the option exercise price, are specified in the attached Award Notice (which forms part of the Agreement).
|
3.
|
Subject to the other provisions of this Agreement and the terms of the Plan, at any time or times on or after the Date of Grant specified in the attached Award Notice, but not later than the tenth anniversary of such Date of Grant, you may exercise this Stock Option as to the number of shares of common stock of the Company (“Common Stock”) which, when added to the number of shares of Common Stock as to which you have theretofore exercised under this Stock Option, if any, will not exceed the total number of shares of Common Stock covered hereby. This Stock Option may not be exercised for a fraction of a share of Common Stock of the Company.
|
4.
|
This Stock Option may not be exercised unless the following conditions are met:
|
(a)
|
Legal counsel for the Company must be satisfied at the time of exercise that the issuance of shares upon exercise will comply with applicable U.S. federal, state, local and foreign laws.
|
(b)
|
You pay the exercise price as follows: (i) by giving notice to the Company or its designee of the number of whole shares of Common Stock to be purchased and by making payment therefor in full (or arranging for such payment to the Company's satisfaction) either (A) in cash in U.S. dollars, (B) by delivery (either actual delivery or by attestation procedures established by the Company) of previously owned whole shares of Common Stock having an aggregate Fair Market Value, determined as of the date of exercise, equal to the aggregate purchase price payable by reason of such exercise, (C) except as may be prohibited by applicable law, in cash by a broker-dealer acceptable to the Company to whom you have submitted an irrevocable notice of exercise (i.e., also known as “cashless exercise”) or (D) by a combination of (A) and (B) and (ii) by executing such documents as the Company may reasonably request.
|
5.
|
In the event that you cease to be a Non-Employee Director for any reason, you will continue to have the right to exercise this Stock Option in accordance with the other provisions of this Agreement and the applicable provisions of the Plan until and including the tenth anniversary of the Date of Grant specified in the attached Award Notice.
|
6.
|
As long as you continue service to the Company, you may transfer Stock Options to a Family Member or Family Entity
without consideration; provided, however, in the case of a transfer of Stock Options
|
7.
|
Regardless of any action the Company takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related items related to your participation in the Plan and legally applicable to you (“Tax-Related Items”), you acknowledge that the ultimate liability for all Tax-Related Items is and remains your responsibility and may exceed the amount actually withheld by the Company. You further acknowledge that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Stock Option, including but not limited to, the grant, vesting, exercise of the Stock Option, the issuance of shares of Common Stock upon exercise, the subsequent sale of shares of Common Stock acquired pursuant to the exercise of the Stock Option and the receipt of any dividends; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the Stock Option to reduce or eliminate your liability for the Tax-Related Items or achieve any particular tax result. Further, if you have become subject to tax in more than one jurisdiction between the Grant Date and the date of any relevant taxable or tax withholding event (“Tax Date”), as applicable, you acknowledge that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
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8.
|
The Board or Committee may amend or terminate the Plan and the Committee may amend (or its delegate may amend) these Terms and Conditions. No amendment may impair your rights as an option holder without your consent. The determination of such impairment shall be made by the Committee in its sole discretion.
|
9.
|
The Committee (or its delegate) administers the Plan and has discretion to interpret the Plan and this Agreement. Any decision or interpretation rendered by the Committee or its delegate shall be final, conclusive and binding on you and all persons claiming under or through you. By accepting this grant or other benefit under the Plan, you and each person claiming under or through you shall be conclusively deemed to have indicated acceptance and ratification of, and consent to, any action taken under the Plan by the Committee or its delegate.
|
10.
|
This Award is discretionary, non-binding for future years and there is no promise or guarantee that such grants will be offered to the Director in future years.
|
11.
|
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the shares of Common Stock acquired pursuant to the exercise of the Stock Option. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.
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12.
|
You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this Agreement and any other grant materials by and among, as applicable, the Company and its Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing your participation in the Plan.
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13.
|
The validity, construction, interpretation, administration and effect of the Plan and this Agreement and rights relating to the Plan and to this Agreement, shall be governed by the substantive laws, but not the choice of law rules, of the State of Delaware in the United States of America, as provided in the Plan. For purposes of litigating any dispute that arises directly or indirectly under the Stock Option or the Agreement, the parties hereby submit to and consent to the jurisdiction of the State of Colorado in the United States of America, and agree that such litigation shall be conducted only in the courts of Arapahoe County in the State of Colorado in the United States of America, or the federal courts for the United States of America for the District of Colorado, and no other courts, where this grant is made and/or to be performed.
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14.
|
If you have received this Agreement or any other document related to the Stock Option and/or the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
|
15.
|
If one or more provisions of this Agreement shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and the invalid, illegal or unenforceable provisions shall be deemed null and void; however, to the extent permissible by law, any provisions which could be deemed null and void shall first be construed, interpreted or revised retroactively to permit this Agreement to be construed as to foster the intent of this Agreement and the Plan.
|
16.
|
The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. Director hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an online or electronic system established and maintained by the Company or a third party designated by the Company.
|
17.
|
The Company reserves the right to impose other requirements on your participation in the Plan, on the Stock Option and on any shares of Common Stock purchased upon exercise of the Stock Option under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
|
1.
|
These Terms and Conditions form part of the Stock Option Agreement (the “Agreement”) pursuant to which you have been granted a Nonqualified Stock Option (“Stock Option”) under The Western Union Company 2006 Long-Term Incentive Plan (the “Plan”). A copy of the Plan is enclosed for your convenience. The terms of the Plan are hereby incorporated in this Agreement by reference and made a part hereof.
Any capitalized terms used in this Agreement that are not defined herein shall have the meaning set forth in the Plan.
|
2.
|
The number of common shares of The Western Union Company (the “Company”) subject to the Stock Option, and the option exercise price, are specified in the attached Award Notice (which forms part of the Agreement).
|
3.
|
Subject to the other provisions of this Agreement and the terms of the Plan, at any time or times on or after the Date of Grant specified in the attached Award Notice, but not later than the tenth anniversary of such Date of Grant, you may exercise this Stock Option as to the number of shares of common stock of the Company (“Common Stock”) which, when added to the number of shares of Common Stock as to which you have theretofore exercised under this Stock Option, if any, will not exceed the total number of shares of Common Stock covered hereby. This Stock Option may not be exercised for a fraction of a share of Common Stock of the Company.
|
4.
|
This Stock Option may not be exercised unless the following conditions are met:
|
(a)
|
Legal counsel for the Company must be satisfied at the time of exercise that the issuance of shares upon exercise will comply with applicable U.S. federal, state, local and foreign laws.
|
(b)
|
You pay the exercise price as follows: (i) by giving notice to the Company or its designee of the number of whole shares of Common Stock to be purchased and by making payment therefor in full (or arranging for such payment to the Company's satisfaction) either (A) in cash, (B) by delivery (either actual delivery or by attestation procedures established by the Company) of previously owned whole shares of Common Stock having an aggregate Fair Market Value, determined as of the date of exercise, equal to the aggregate purchase price payable by reason of such exercise, (C) except as may be prohibited by applicable law, in cash by a broker-dealer acceptable to the Company to whom you have submitted an irrevocable notice of exercise (i.e., also known as “cashless exercise”) or (D) by a combination of (A) and (B) and (ii) by executing such documents as the Company may reasonably request.
|
5.
|
In the event that you cease to be a Non-Employee Director for any reason, you will continue to have the right to exercise this Stock Option in accordance with the other provisions of this Agreement and the applicable provisions of the Plan until and including the tenth anniversary of the Date of Grant specified in the attached Award Notice.
|
6.
|
As long as you continue service to the Company, you may transfer Stock Options to a Family Member or Family Entity
without consideration; provided, however, in the case of a transfer of Stock Options to a limited liability company or a partnership which is a Family Entity, such transfer may be for consideration consisting solely of an entity interest in the limited liability company or partnership to
|
7.
|
Regardless of any action the Company takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related items related to your participation in the Plan and legally applicable to you (“Tax-Related Items”), you acknowledge that the ultimate liability for all Tax-Related Items is and remains your responsibility. You further acknowledge that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Stock Option, including but not limited to, the grant, vesting, exercise of the Stock Option, the issuance of shares of Common Stock upon exercise, the subsequent sale of shares of Common Stock acquired pursuant to the exercise of the Stock Option and the receipt of any dividends; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the Stock Option to reduce or eliminate your liability for the Tax-Related Items or achieve any particular tax result. Further, if you have become subject to tax in more than one jurisdiction between the Grant Date and the date of any relevant taxable event (“Tax Date”), you acknowledge that the Company may be required to account for Tax-Related Items in more than one jurisdiction.
|
8.
|
The Board or Committee may amend or terminate the Plan and the Committee may amend (or its delegate may amend) these Terms and Conditions. No amendment may impair your rights as an option holder without your consent. The determination of such impairment shall be made by the Committee in its sole discretion.
|
9.
|
The Committee (or its delegate) administers the Plan and has discretion to interpret the Plan and this Agreement. Any decision or interpretation rendered by the Committee or its delegate shall be final, conclusive and binding on you and all persons claiming under or through you. By accepting this grant or other benefit under the Plan, you and each person claiming under or through you shall be conclusively deemed to have indicated acceptance and ratification of, and consent to, any action taken under the Plan by the Committee or its delegate.
|
10.
|
This Award is discretionary, non-binding for future years and there is no promise or guarantee that such grants will be offered to the Director in future years.
|
11.
|
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the shares of Common Stock acquired pursuant to the exercise of the Stock Option. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.
|
12.
|
The validity, construction, interpretation, administration and effect of the Plan and this Agreement and rights relating to the Plan and to this Agreement, shall be governed by the substantive laws, but not the choice of law rules, of the State of Delaware in the United States of America, as provided in the Plan. For purposes of litigating any dispute that arises directly or indirectly under the Stock Option or the Agreement, the parties hereby submit to and consent to the jurisdiction of the State of Colorado in the United States of America, and agree that such litigation shall be conducted only in
|
13.
|
If one or more provisions of this Agreement shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and the invalid, illegal or unenforceable provisions shall be deemed null and void; however, to the extent permissible by law, any provisions which could be deemed null and void shall first be construed, interpreted or revised retroactively to permit this Agreement to be construed as to foster the intent of this Agreement and the Plan.
|
14.
|
The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. Director hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an online or electronic system established and maintained by the Company or a third party designated by the Company.
|
15.
|
The Company reserves the right to impose other requirements on your participation in the Plan, on the Stock Option and on any shares of Common Stock purchased upon exercise of the Stock Option under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
|
(a)
|
Continued Employment and Transition Period
. For the period through and including December 31, 2013, Executive shall continue to work full time and be required to perform Executive’s regular job duties as Chief Financial Officer of Western Union. Effective January 1, 2014, Executive shall no longer serve as Western Union’s Chief Financial Officer, but shall continue to be employed by the Company in a senior advisory capacity and shall be available as needed for questions and consultation at the direction of Western Union’s Chief Executive Officer through and including the Termination Date. The period beginning January 1, 2014 through and including the Termination Date is referred to herein as the “Transition Period.”
|
(b)
|
Cash Incentive Award for 2013
. Provided that the Compensation and Benefits Committee of Western Union’s Board of Directors (“Compensation Committee”) has certified that the applicable performance goals under the Western Union Senior Executive Annual Incentive Plan (“SEAIP”) have been achieved for 2013, Executive shall be eligible to receive a 2013 Cash Incentive Award under the SEAIP in accordance with the terms of Executive’s 2013 SEAIP Award Agreement. Any Cash Incentive Award payable to Executive under in this subparagraph, less tax withholding and other legally allowed deductions, shall be paid in a lump sum cash payment at the same time that Cash Incentive Award payments for 2013 are paid to actively employed executives under the SEAIP. Subject to the approval of the Compensation Committee and its certification that the applicable performance goals under the SEAIP have been achieved for 2013, in the event of Executive’s death prior to the payout of Executive’s 2013 Cash Incentive Award under the SEAIP, such award shall be paid in a lump sum cash payment to Executive’s estate as soon as administratively practicable after Cash Incentive Award payments for 2013 are paid to actively employed executives under the SEAIP. Pursuant to Section 3 of the 2013 SEAIP Award Agreement, Executive shall not receive the 2013 Supplemental RSU Incentive Award (if any) and Executive acknowledges that Executive has no entitlement to receive a 2013 Supplemental RSU Incentive Award.
|
(c)
|
February 28, 2014 Release
. Provided that Executive executes and returns to the Company on or within three business days following the Termination Date the February 28, 2014 Release in the form attached hereto as Schedule 1, which document is incorporated herein by reference, Executive shall be eligible to receive compensation and benefits in accordance with the terms and conditions of this Separation Agreement and the February 28, 2014 Release, subject to the terms of the Severance Policy. In the event Executive does not sign the February 28, 2014 Release or if Employee revokes the February 28, 2014 Release within seven (7) days of execution of the same, the Company shall have no obligation thereafter to provide to Executive the consideration hereunder and such consideration immediately shall cease (except to the extent that such payments and benefits are required by law), including any payment or benefit Executive could have become eligible for under the February 28, 2014 Release.
|
(d)
|
Outplacement Assistance
. Executive will receive executive outplacement services provided by an outplacement provider to be selected by the Company in its sole discretion for a maximum duration of twelve (12) months from the date of activation, provided that such services are activated no earlier than January 1, 2014 and no later than January 1, 2015. The Company must approve the type and scope of the outplacement services and the Company will pay the outplacement provider directly for
|
(e)
|
Status as Eligible Executive
. Except to the extent paragraph 3 of this Separation Agreement applies, Executive shall be treated for all purposes as an “Eligible Executive” under the Severance Policy as of the Termination Date.
|
(a)
|
In consideration of those payments and benefits listed above which are payable only under this Separation Agreement, Executive agrees to and hereby does knowingly and voluntarily release and discharge the Company, Western Union, their subsidiaries and Affiliates, their agents, executives, directors, officers, employees, and their predecessors and successors, including the subsidiaries, Affiliates, agents, executives, directors, officers and employees of such predecessors and successors, (the “Released Parties”), from any and all claims, causes of action and demands of any kind, whether known or unknown, which Executive has, ever has had, or ever in the future may have and which are based on acts or omissions occurring up to and including the date of this Separation Agreement. Included in the release set forth in the preceding sentence, without limiting its scope, are claims arising under Title VII of the Civil Rights Act of 1964, the Employee Retirement Income Security Act of 1974, and the Age Discrimination in Employment Act of 1967 (“ADEA”), each as amended, as well as any other federal, state or local employment or labor laws, wrongful discharge or employment claims, as well as any claims in contract, tort, or common law, and which are related to Executive’s employment with the Company, Western Union, and/or their subsidiaries and Affiliates or the termination of that employment (the “Claims”). The terms “Claims” is intended to be broad and all-encompassing and is not limited to those claims specifically cited in the foregoing sentence.
|
(b)
|
Executive further agrees that while nothing in this Separation Agreement shall limit Executive’s right to maintain a pending charge of discrimination, or file a future charge of discrimination, with any federal, state or local governmental agency relating to Executive’s employment with the Company and/or participate in any proceeding relating to any action or Executive’s employment, whether brought by an agency or by another on Executive’s behalf, Executive expressly waives by this Separation Agreement the right to recover monetary damages and any other relief personal to Executive if such charge, lawsuit or action is pursued. Notwithstanding this provision, Executive may bring a claim against the Company to enforce this Separation Agreement or to challenge the validity of this Separation Agreement under ADEA.
|
(c)
|
While the Released Parties do not intend to release and discharge any claims or causes of action against Executive under this Separation Agreement, the Released Parties acknowledge that, as of the date of this Separation Agreement, the Released Parties are not aware of any claims or causes of action or demands of any kind which any of the Released Parties could assert against Executive based on Executive’s acts or omissions occurring up to and including the date of this Separation Agreement.
|
(a)
|
Voluntary Termination by Executive.
Prior to the Termination Date, Executive may terminate Executive’s employment, at any time. Unless such termination by Executive is for “Good Reason” following the occurrence of a “Change in Control”, as both terms are defined under the Severance Policy, in the event of such termination, the Company shall have no obligation thereafter to continue to provide to Executive the benefits under the Severance Policy and this Separation Agreement and such consideration immediately shall cease (except to the extent that such benefits are required by law), including any payments and benefits Executive would be eligible for under the February 28, 2014 Release.
|
(b)
|
Termination on Account of Death or Disability.
Subject to and consistent with the terms of the Severance Policy, in the event of Executive’s termination of employment on account of death or “Disability” (as defined under the Severance Policy) prior to the Termination Date, or in the event of Executive’s death prior to having executed the February 28, 2014 Release, Executive (or Executive’s estate, in the event of Executive’s death) shall not be eligible to receive the benefits under the Severance Policy and this Separation Agreement and such consideration immediately shall cease (except to the extent that such benefits are required by law), including any payments and benefits Executive would have been eligible for under the February 28, 2014 Release. Nothing in this Separation Agreement or the February 28, 2014 Release shall constitute a waiver or release of Executive’s right to accelerated vesting of any equity awards upon death or disability to which he would otherwise be entitled pursuant to any agreement, grant, award or plan.
|
(c)
|
Termination for Cause.
Prior to the Termination Date, Executive’s employment may be terminated by the Company for “Cause.” For purposes of this Separation Agreement, Cause shall be determined by Western Union in good faith and, consistent with the terms of the Severance Policy, shall be limited to the following events:
|
•
|
the willful and continued failure by Executive to substantially perform the duties assigned by the Company and agreed to by Executive as set forth in this Separation Agreement (other than a failure resulting from Disability);
|
•
|
the willful
engagement by Executive in conduct which is demonstrably injurious to the Company (monetarily or otherwise);
|
•
|
any act of dishonesty;
|
•
|
the commission of a felony;
|
•
|
the continued failure by Executive to meet performance standards;
|
•
|
excessive absenteeism; or
|
•
|
a significant violation by Executive of any statutory or common law duty of loyalty to the Company.
|
/s/ Scott T. Scheirman
|
Scott T. Scheirman
|
/s/ Darren Dragovich
|
|
|
|
By:
|
Darren Dragovich
|
|
|
Title:
|
Assistant Secretary
|
/s/ James G. Robinson
|
|
|
|
By:
|
James G. Robinson
|
|
|
Title:
|
Assistant Secretary
|
(a)
|
Severance Pay
. Executive will receive severance pay in the total gross amount of $2,265,420.36, less tax withholding and other legally allowed deductions. The period from the Termination Date through February 29, 2016 is the “Severance Period.” Payment of the severance will be as follows:
|
(i)
|
Executive will receive a gross payment of $1,124,061.96 (which represents the present value, based on an interest rate of 1.5%, of the first 50% of the cash severance benefits payable to Executive under the Severance Policy) on or before March 31, 2014; and
|
(ii)
|
a gross payment of $47,556.40 on the 15
th
and last business day of each month for the period commencing on March 1, 2015 and ending on February 29, 2016.
|
(b)
|
Bonus for Year of Termination
. Executive shall not be eligible to participate in Western Union’s Senior Executive Annual Incentive Plan (“SEAIP”) for 2014 and shall instead participate in Western Union’s 2014 Performance Incentive Plan (“Incentive Plan”), subject to the provisions of this subparagraph
, and the Company shall provide to Executive a copy of the necessary award agreement under the Incentive Plan
. Provided that the Compensation and Benefits Committee of Western Union’s Board of Directors (“Compensation Committee”) has certified that the applicable performance goals
|
(c)
|
Payment In Lieu of Continued Benefits Coverage
. Provided Executive (and Executive’s eligible dependents, if applicable) timely elects continued group health coverage under the Consolidated Omnibus Budget Reconciliation Act of 1986 (“COBRA”), Executive will receive a lump sum payment approximately equal to the difference in cost between COBRA premiums and active employee contributions for 18 months of health coverage, as calculated by the Company in its sole discretion. Such lump sum payment, which shall constitute taxable income to Executive, shall be paid on the first pay date following the Company’s verification of Executive’s COBRA election. From and after the beginning of the Severance Period, Executive will not be eligible to continue active participation in any other Western Union benefit plan or program, including but not limited to long-term incentive compensation, nonqualified deferred compensation, 401(k), or any other plan. Details about specific plan coverages, conversion and distribution eligibility will be provided separately. Information on electing COBRA coverage will be provided shortly after Executive’s Termination Date.
|
(d)
|
Long-Term Incentive Awards
. Subject to the terms of the applicable long-term incentive award agreements, Executive’s outstanding long-term incentive awards shall be treated in the manner described in this subparagraph (d).
|
(1)
|
Stock Options.
The 180,798 unexercised stock options granted to Executive on September 29, 2006 under the 2006 LTIP are fully vested and may be exercised by Executive until the end of the Severance Period, but not thereafter.
|
(2)
|
Performance Share Unit Grants
. With respect to the Performance Share Unit Award granted to Executive on February 24, 2011 (the “2011 PSU Award”), subject to the terms of the 2006 LTIP and the 2011 PSU Award agreement, Executive will be entitled to an unreduced award equal to the value of the 2011 PSU Award as determined by the Compensation Committee in accordance with the 2006 LTIP and the 2011 PSU Award agreement based on actual performance results, which shall be payable during the period beginning on January 1, 2014 and ending March 15, 2014.
|
(e)
|
No Waiver of Accrued Benefits
. Nothing in the Separation Agreement or this February 28, 2014 Release shall constitute a waiver or release of Executive’s accrued rights and benefits under the Company’s paid time off policy, incentive compensation, including but not limited to the Incentive Savings Plan, the Supplemental Savings Plan and equity plans, financial security, insurance, health, and welfare benefit programs as a result of his employment with the Company and its Affiliates, subject to the terms and conditions of the foregoing plans and policies.
|
(a)
|
In consideration of those payments and benefits listed above which are payable only under this February 28, 2014 Release, Executive agrees to and hereby does knowingly and voluntarily release and discharge the Company, Western Union, their subsidiaries and Affiliates, their agents, executives, directors, officers, employees, and their predecessors and successors, including the subsidiaries, Affiliates, agents, executives, directors, officers and employees of such predecessors and successors, (the “Released Parties”), from any and all claims, causes of action and demands of any kind, whether known or unknown, which Executive has, ever has had, or ever in the future may have and which are based on acts or omissions occurring up to and including the date of this February 28, 2014 Release. Included in the release set forth in the preceding sentence, without limiting its scope, are claims arising under Title VII of the Civil Rights Act of 1964, the Employee Retirement Income Security Act of 1974, and the Age Discrimination in Employment Act of 1967 (“ADEA”), each as amended, as well
|
(b)
|
Executive further agrees that while nothing in this February 28, 2014 Release shall limit Executive’s right to maintain a pending charge of discrimination, or file a future charge of discrimination, with any federal, state or local governmental agency relating to Executive’s employment with the Company and/or participate in any proceeding relating to any action or Executive’s employment, whether brought by an agency or by another on Executive’s behalf, Executive expressly waives by this February 28, 2014 Release the right to recover monetary damages and any other relief personal to Executive if such charge, lawsuit or action is pursued. Notwithstanding this provision, Executive may bring a claim against the Company to enforce this February 28, 2014 Release or to challenge the validity of this February 28, 2014 Release under ADEA.
|
(c)
|
While the Released Parties do not intend to release and discharge any claims or causes of action against Executive under this February 28, 2014 Release, the Released Parties acknowledge that they were not aware of any claims or causes of action or demands of any kind which any of the Released Parties could assert against Executive based on Executive’s acts or omissions occurring up to and including the date of the Separation Agreement.
|
|
Scott T. Scheirman
|
|
|
|
|
By:
|
|
|
|
Title:
|
|
|
|
|
|
By:
|
|
|
|
Title:
|
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
$
|
926.9
|
|
|
$
|
1,168.8
|
|
|
$
|
1,274.6
|
|
|
$
|
1,145.2
|
|
|
$
|
1,131.5
|
|
Fixed charges
|
198.8
|
|
|
177.8
|
|
|
182.9
|
|
|
178.0
|
|
|
172.8
|
|
|||||
Other adjustments
|
(0.7
|
)
|
|
5.3
|
|
|
2.6
|
|
|
(3.1
|
)
|
|
(0.9
|
)
|
|||||
Total earnings (a)
|
$
|
1,125.0
|
|
|
$
|
1,351.9
|
|
|
$
|
1,460.1
|
|
|
$
|
1,320.1
|
|
|
$
|
1,303.4
|
|
Fixed charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
$
|
195.6
|
|
|
$
|
179.6
|
|
|
$
|
181.9
|
|
|
$
|
169.9
|
|
|
$
|
157.9
|
|
Other adjustments
|
3.2
|
|
|
(1.8
|
)
|
|
1.0
|
|
|
8.1
|
|
|
14.9
|
|
|||||
Total fixed charges (b)
|
$
|
198.8
|
|
|
$
|
177.8
|
|
|
$
|
182.9
|
|
|
$
|
178.0
|
|
|
$
|
172.8
|
|
Ratio of earnings to fixed charges (a/b)
|
5.7
|
|
|
7.6
|
|
|
8.0
|
|
|
7.4
|
|
|
7.5
|
|
Name of Subsidiary
|
|
Jurisdiction of
Incorporation
|
A. Serviban S.A.
|
|
Peru
|
American Rapid Corporation
|
|
Delaware, USA
|
Banco Western Union do Brasil S.A.
|
|
Brazil
|
CHL Management Services Limited Partnership
|
|
British Columbia, Canada
|
Custom House Currency Exchange (Australia) Pty. Limited
|
|
Australia
|
Custom House Currency Exchange (Singapore) Pte. Limited
|
|
Singapore
|
Custom House Financial Ltd.
|
|
Federal, Canada
|
Custom House Financial (UK) Limited
|
|
United Kingdom
|
Custom House Holdings (USA) Ltd.
|
|
Washington, USA
|
Custom House (Online) Ltd.
|
|
Federal, Canada
|
Custom House ULC
|
|
British Columbia, Canada
|
Custom House (USA) Ltd.
|
|
Washington, USA
|
Custom House Ventures ULC
|
|
British Columbia, Canada
|
E Commerce Group Products Inc.
|
|
New York, USA
|
Finint UK Ltd.
|
|
United Kingdom
|
First Financial Management Corporation
|
|
Georgia, USA
|
Global Collection Services, S.A.
|
|
Argentina
|
Grupo Dinámico Empresarial, S.A. de C.V.
|
|
Mexico
|
MSR Marketing Services GmbH
|
|
Austria
|
MT Caribbean Holdings SRL
|
|
Barbados
|
MT Global Holdings Ltd.
|
|
Bermuda
|
MT Group Ltd.
|
|
Bermuda
|
MT Holdings (Bermuda) Ltd.
|
|
Bermuda
|
MT International Holdings, Ltd.
|
|
Bermuda
|
MT International Operations Ltd.
|
|
Bermuda
|
MT International Operations Partnership
|
|
Bermuda
|
MT Network Holdings Ltd.
|
|
Bermuda
|
MT Payment Services Operations EU/EEA Limited
|
|
Ireland
|
MT Processing Holdings Ltd.
|
|
Bermuda
|
MT Retail Services Switzerland AG
|
|
Switzerland
|
MT Worldwide Holdings Ltd.
|
|
Bermuda
|
On Time AG
|
|
Switzerland
|
Operaciones Internationales OV, S. de R.L. de C.V.
|
|
Mexico
|
Orlandi de Mexico S.A. de C.V.
|
|
Mexico
|
Paymap Inc.
|
|
Delaware, USA
|
PT Western Union Indonesia
|
|
Indonesia
|
Red Global SA
|
|
Argentina
|
RII Holdings, Inc.
|
|
Delaware, USA
|
Ruesch Holding, LLC
|
|
Delaware, USA
|
Ruesch International (Delaware), LLC
|
|
Delaware, USA
|
Ruesch International LLC
|
|
Delaware, USA
|
Servicio Electrónico de Pago S.A.
|
|
Argentina
|
Servicio Integral de Envios, S. de R.L. de C.V.
|
|
Mexico
|
Servicios de Apoyo GDE, S.A. de C.V.
|
|
Mexico
|
Societe Financiere de Paiements S.A.S.
|
|
France
|
SpeedPay, Inc.
|
|
New York, USA
|
The Western Union Real Estate Holdings LLC
|
|
Delaware, USA
|
Transfer Express de Panama S.A.
|
|
Panama
|
Union del Oeste de Costa Rica SRL
|
|
Costa Rica
|
Vigo Remittance Canada Company
|
|
Nova Scotia, Canada
|
Vigo Remittance Corp.
|
|
Delaware, USA
|
Western Union Acquisition Partnership
|
|
Australia
|
Western Union Benelux MT Ltd.
|
|
Ireland
|
Western Union (Bermuda) Holding Finance Ltd.
|
|
Bermuda
|
Western Union Business Solutions (Australia) Pty Limited
|
|
Australia
|
Western Union Business Solutions Hong Kong Limited
|
|
Hong Kong
|
Western Union Business Solutions Japan KK
|
|
Japan
|
Western Union Business Solutions Malta Limited
|
|
Malta
|
Western Union Business Solutions (New Zealand)
|
|
New Zealand
|
Western Union Business Solutions (SA) Limited
|
|
United Kingdom
|
Western Union Business Solutions (Singapore) Pte Limited
|
|
Singapore
|
Western Union Business Solutions (UK) Limited
|
|
United Kingdom
|
Western Union Business Solutions (USA), LLC
|
|
Delaware, USA
|
Western Union Chile Limitada
|
|
Chile
|
Western Union Communications, Inc.
|
|
Delaware, USA
|
Western Union Consulting Services (Beijing), Co., Ltd.
|
|
China
|
Western Union Corretora de Cambio S.A.
|
|
Brazil
|
Western Union do Brasil Participacoes Limitada
|
|
Brazil
|
Western Union do Brasil Servicos e Participacoes Ltda.
|
|
Brazil
|
Western Union Financial Holdings L.L.C.
|
|
New York, USA
|
Western Union Financial Services Argentina S.R.L.
|
|
Argentina
|
Western Union Financial Services (Australia) PTY Ltd.
|
|
Australia
|
Western Union Financial Services (Belgium) SPRL
|
|
Belgium
|
Western Union Financial Services (Canada), Inc.
|
|
Ontario, Canada
|
Western Union Financial Services Eastern Europe LLC
|
|
Delaware, USA
|
Western Union Financial Services GmbH
|
|
Austria
|
Western Union Financial Services (Hong Kong) Limited
|
|
Hong Kong
|
Western Union Financial Services International (France) SARL
|
|
France
|
Western Union Financial Services (Korea) Inc.
|
|
Korea
|
Western Union Financial Services (Luxembourg) S.á.r.l.
|
|
Luxembourg
|
Western Union Financial Services, Inc.
|
|
Colorado, USA
|
Western Union GB Limited
|
|
United Kingdom
|
Western Union Global Network Pte. Limited
|
|
Singapore
|
Western Union (Hellas) International Holdings S.A.
|
|
Greece
|
Western Union Holding (Bermuda) Ltd.
|
|
Bermuda
|
Western Union Holdings, Inc.
|
|
Georgia, USA
|
Western Union International Bank GmbH
|
|
Austria
|
Western Union International Ltd.
|
|
Ireland
|
Western Union Ireland Holdings Limited
|
|
Ireland
|
Western Union Italy Holdings Srl
|
|
Italy
|
Western Union, LLC
|
|
Colorado, USA
|
Western Union Luxembourg Holdings 1 S.á.r.l.
|
|
Luxembourg
|
Western Union Luxembourg Holdings 2 S.á.r.l.
|
|
Luxembourg
|
Western Union Luxembourg Holdings 3 S.á.r.l.
|
|
Luxembourg
|
Western Union Luxembourg Holdings 4 S.á.r.l.
|
|
Luxembourg
|
Western Union Malta Holdings Limited
|
|
Malta
|
Western Union Malta Limited
|
|
Malta
|
Western Union Management (Bermuda) Limited
|
|
Bermuda
|
Western Union Morocco SARL
|
|
Morocco
|
Western Union MT East
|
|
Russian Federation
|
Western Union Network (Canada) Company
|
|
Nova Scotia, Canada
|
Western Union Network (France) SAS
|
|
France
|
Western Union Network (Ireland) Limited
|
|
Ireland
|
Western Union Northern Europe GmbH
|
|
Germany
|
Western Union Online Limited
|
|
Ireland
|
Western Union Operations (UK) Ltd.
|
|
United Kingdom
|
Western Union Overseas Limited
|
|
Ireland
|
Western Union Payment Services Bhd Sdn (WUBS)
|
|
Malaysia
|
Western Union Payment Services (India) Private Limited
|
|
India
|
Western Union Payment Services Ireland Limited
|
|
Ireland
|
Western Union Payment Services Network (Canada) ULC
|
|
British Columbia, Canada
|
Western Union Payment Services Network EU/EEA Limited
|
|
Ireland
|
Western Union Payment Services UK Limited
|
|
United Kingdom
|
Western Union Payments (Malaysia) SDN. BHD.
|
|
Malaysia
|
Western Union Peru SAC
|
|
Peru
|
Western Union Processing Lithuania, UAB
|
|
Lithuania
|
Western Union Processing Ltd.
|
|
Ireland
|
Western Union Provision of Marketing & Advertising Services (Hellas) MEPE
|
|
Greece
|
Western Union Regional Panama S.A.
|
|
Panama
|
Western Union Retail Services Belgium
|
|
Belgium
|
Western Union Retail Services GB Limited
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United Kingdom
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Western Union Retail Services Ireland Limited
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|
Ireland
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Western Union Retail Services Italy S.r.l.
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|
Italy
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Western Union Retail Services Norway AS
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|
Norway
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Western Union Retail Services RO SRL
|
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Romania
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Western Union Retail Services Spain S.A.
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Spain
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Western Union Retail Services Sweden AB
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|
Sweden
|
Western Union Services, Inc.
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|
Maryland, USA
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Western Union Services India Private Limited
|
|
India
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Western Union Services (Philippines) Inc.
|
|
Philippines
|
Western Union Services Singapore Private Limited
|
|
Singapore
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Western Union Services S.L.
|
|
Spain
|
Western Union Services (Spain) S.L.
|
|
Spain
|
Western Union Settlement Holdings Limited
|
|
Ireland
|
Western Union Singapore Limited
|
|
Bermuda
|
Western Union South Africa (PTY) Limited
|
|
South Africa
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Western Union Support Services (Nigeria) Limited
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|
Nigeria
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WorldBridge Payment Services SA
|
|
Greece
|
WU BP Peru S.R.L.
|
|
Peru
|
WUBS Financial Services (Singapore) Pte Limited
|
|
Singapore
|
WUBS Investments Ltd.
|
|
United Kingdom
|
WUBS Payments Ltd.
|
|
United Kingdom
|
WUBS (Prague) SRO
|
|
Czech Republic
|
(1)
|
Registration Statements (Form S-3 Nos. 333-191606 and 333-191608) of The Western Union Company, and
|
(2)
|
Registration Statement (Form S-8 No. 333-137665) pertaining to The Western Union Company 2006 Long-Term Incentive Plan, The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, and The Western Union Company Supplemental Incentive Savings Plan;
|
|
/s/ Ernst & Young LLP
|
Denver, Colorado
|
|
February 24, 2014
|
|
Date:
|
February 24, 2014
|
/
S
/ H
IKMET
E
RSEK
|
|
|
Hikmet Ersek
|
|
|
President and Chief Executive Officer
|
Date:
|
February 24, 2014
|
/
S
/ R
AJESH
K. A
GRAWAL
|
|
|
Rajesh K. Agrawal
|
|
|
Executive Vice President and Interim Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of The Western Union Company.
|
Date:
|
February 24, 2014
|
/
S
/ H
IKMET
E
RSEK
|
|
|
Hikmet Ersek
|
|
|
President and Chief Executive Officer
|
Date:
|
February 24, 2014
|
/s/ R
AJESH
K. A
GRAWAL
|
|
|
Rajesh K. Agrawal
|
|
|
Executive Vice President and Interim Chief Financial Officer
|