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, 2015
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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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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 downturns or declines related to interruptions in migration patterns, or non-performance by our banks, lenders, insurers, or other financial services providers;
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failure to compete effectively in the money transfer and payment service industry, including among other things, with respect to price, with global and niche or corridor money transfer providers, banks and other money transfer and payment service providers, including electronic, mobile and Internet-based services, card associations, and card-based payment providers, and with digital currencies and related protocols, and other innovations in technology and business models;
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deterioration in customer confidence in our business, or in money transfer and payment service providers generally;
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our ability to adopt new technology and develop and gain market acceptance of new and enhanced services in response to changing industry and consumer needs or trends;
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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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any material breach of security, including cybersecurity, or safeguards of or interruptions in any of our systems or those of our vendors or other third parties;
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cessation of or defects in various services provided to us by third-party vendors;
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mergers, acquisitions and integration of acquired businesses and technologies into our Company, and the failure to realize anticipated financial benefits from these acquisitions, and events requiring us to write down our goodwill;
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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, including interruptions of United States or other government relations with countries in which we have or are implementing significant business relationships with agents or clients;
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failure to manage credit and fraud risks presented by our agents, clients and consumers;
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failure to maintain our agent network and business relationships under terms consistent with or more advantageous to us than those currently in place, including due to increased costs or loss of business as a result of increased compliance requirements or difficulty for us, our agents or their subagents in establishing or maintaining relationships with banks needed to conduct our services;
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decisions to change our business mix;
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changes in tax laws, or their interpretation, and unfavorable resolution of tax contingencies;
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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 protect our brands and our other intellectual property rights and to defend ourselves against potential intellectual property infringement claims;
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our ability to attract and retain qualified key employees and to manage our workforce successfully;
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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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•
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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 protect consumers, or detect and prevent money laundering, terrorist financing, fraud and other illicit activity;
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increased costs or loss of business due to regulatory initiatives and changes in laws, regulations and industry practices and standards, including changes in interpretations in the United States and globally, affecting us, our agents or their subagents, or the banks with which we or our agents maintain bank accounts needed to provide our services, including related to anti-money laundering regulations, anti-fraud measures, customer due diligence, agent and subagent due diligence, registration and monitoring requirements, and consumer protection 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;
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the potential impact on our business from the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), as well as regulations issued pursuant to it and the actions of the Consumer Financial Protection Bureau and similar legislation and regulations enacted by other governmental authorities related to consumer protection;
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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 and evolving industry standards 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 or other restrictions on the use of our working capital to meet the changing requirements of our regulators worldwide;
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changes in accounting standards, rules and interpretations or industry standards affecting our business;
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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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2015
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2014
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2013
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Consumer-to-Consumer
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79
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%
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80
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%
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80
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%
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Consumer-to-Business
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12
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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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7
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%
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7
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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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Walk-in money transfer.
The substantial majority of our remittances constitute walk-in transactions in which payment is collected by one of our agents and is available for pick-up at another agent location, usually within minutes. Additionally, in a few select markets, we offer consumers a lower-priced next day delivery service option for money transfers that do not need to be received within minutes.
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Online money transfer.
In certain countries, consumers can initiate a money transfer from a Western Union branded website, including through their mobile devices. As of
December 31, 2015
, we were providing online money transfer services through Western Union branded websites in 34 countries. Additionally, in certain countries, consumers can initiate a Western Union money transfer through their bank’s online banking services.
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Global money transfer providers
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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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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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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, digital currencies, and social media and other predominantly communication or commerce oriented platforms that offer money transfer services.
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Banks, postbanks, and post offices
- Banks, postbanks, and post offices of all sizes compete with us in a number of ways, including bank wire services, payment instrument issuances, 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;
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impose taxes or fees on money transfer transactions;
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restrict or limit our ability to process transactions using centralized databases, for example, by requiring that transactions be processed using a database maintained in a particular country; and
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prohibit or limit exclusive arrangements with our agents and subagents.
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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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55
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President, Chief Executive Officer and Director
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Rajesh K. Agrawal
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50
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Executive Vice President, Chief Financial Officer
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Odilon Almeida
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54
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Executive Vice President and President, Americas and European Union
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Elizabeth G. Chambers
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53
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Executive Vice President, Chief Strategy and Product Officer
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John R. Dye
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56
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Executive Vice President, General Counsel and Secretary
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Jean Claude Farah
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45
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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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45
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Executive Vice President, Chief Marketing Officer
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J. David Thompson
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49
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Executive Vice President, Global Operations and Chief Information Officer
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Richard L. Williams
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50
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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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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 greater economic opportunities than those available in their native countries. A significant portion of money transfers are sent by international migrants. Migration is affected by (among other factors) overall economic conditions, the availability of job opportunities, changes in immigration laws, and political or other events (such as war, terrorism or health emergencies) that would make it more difficult for workers to migrate or work abroad. Changes to these factors could adversely affect our remittance volume and could have an adverse effect on our business, financial condition, results of operations, cash flows, and our cash management strategies, including the amounts, timing, and manner by which cash is repatriated or otherwise made available from our international subsidiaries ("Cash Management Strategies").
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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 financial condition, results of operations, cash flows, and our Cash Management Strategies 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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Our Business Solutions business is heavily dependent on global trade. A downturn in global trade or the failure of long-term import growth rates to return to historic levels could have an adverse effect on our business, financial condition, results of operations, cash flows, and our Cash Management Strategies. Additionally, as customer hedging activity in our Business Solutions business generally varies with currency volatility, we have experienced and may experience in the future lower foreign exchange revenues in periods of lower currency volatility.
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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, results of operations, and cash flows
."
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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, financial condition, and results of operations.
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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. This includes the exposure generated by the Business Solutions business, where we write derivative contracts to our customers as part of our cross-currency payments business, and we typically hedge the net exposure through offsetting contracts with established financial institution counterparties. That failure could have an adverse effect on our financial condition, results of operations, and cash flows.
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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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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, financial condition, results of operations, and cash flows.
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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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Insurers we utilize to mitigate our exposures to litigation and other risks may be unable to or refuse to satisfy their obligations to us, which could have an adverse effect on our liquidity, financial condition, results of operations, and cash flows.
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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, results of operations, and cash flows could be adversely impacted.
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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 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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•
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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, which include our westernunion.com and mobile money transfer services;
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•
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failure of our agents or their subagents to deliver services in accordance with our requirements;
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•
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reputational concerns resulting from actual or perceived events, including those related to fraud or consumer protection;
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•
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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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•
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federal, state or foreign legal requirements, including those that require us to provide consumer or transaction data pursuant to our settlement agreement with the State of Arizona and other requirements or to a greater extent than is currently required;
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•
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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 computer systems or other data storage facilities resulting in a compromise of personal data.
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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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integrating personnel with diverse business backgrounds and organizational cultures;
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integrating the acquired technologies into our Company;
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•
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complying with regulatory requirements, including those particular to the industry and jurisdiction of the acquired business;
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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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limiting our ability to borrow additional funds; and
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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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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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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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||||||
2015
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||||||
First Quarter
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$
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20.87
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$
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16.73
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$
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0.155
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Second Quarter
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$
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22.84
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$
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20.02
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$
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0.155
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Third Quarter
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$
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20.62
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$
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16.91
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$
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0.155
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Fourth Quarter
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$
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19.90
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$
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17.75
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$
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0.155
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2014
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||||||
First Quarter
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$
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17.83
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$
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15.00
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$
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0.125
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Second Quarter
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$
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17.38
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$
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14.60
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$
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0.125
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Third Quarter
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$
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17.81
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$
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15.97
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$
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0.125
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Fourth Quarter
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$
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18.66
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$
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15.32
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$
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0.125
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Period
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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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908,809
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|
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$
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19.04
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901,200
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$
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763.5
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November 1 - 30
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1,803,029
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$
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19.16
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|
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1,797,473
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$
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729.0
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December 1 - 31
|
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941,685
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|
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$
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18.51
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|
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927,280
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|
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$
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711.9
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Total
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3,653,523
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$
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18.97
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|
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3,625,953
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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 authorization, 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 10, 2015, the Board of Directors authorized $1.2 billion of common stock repurchases through December 31, 2017, of which $711.9 remained available as of December 31, 2015. In certain instances, management has historically and may continue to establish prearranged written plans pursuant to Rule 10b5-1. A Rule 10b5-1 plan permits us to repurchase shares at times when we may otherwise be unable to do so, provided the plan is adopted when we are not aware of material non-public information.
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|
Year Ended December 31,
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||||||||||||||||||
(in millions, except per share data)
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2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Statements of Income Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues (a)
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$
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5,483.7
|
|
|
$
|
5,607.2
|
|
|
$
|
5,542.0
|
|
|
$
|
5,664.8
|
|
|
$
|
5,491.4
|
|
Operating expenses (b) (c)
|
4,374.3
|
|
|
4,466.7
|
|
|
4,434.6
|
|
|
4,334.8
|
|
|
4,106.4
|
|
|||||
Operating income (a) (b) (c)
|
1,109.4
|
|
|
1,140.5
|
|
|
1,107.4
|
|
|
1,330.0
|
|
|
1,385.0
|
|
|||||
Interest income (d)
|
10.9
|
|
|
11.5
|
|
|
9.4
|
|
|
5.5
|
|
|
5.2
|
|
|||||
Interest expense (e)
|
(167.9
|
)
|
|
(176.6
|
)
|
|
(195.6
|
)
|
|
(179.6
|
)
|
|
(181.9
|
)
|
|||||
Other income/(expense), net, excluding interest income and interest expense (f)
|
(10.6
|
)
|
|
(7.2
|
)
|
|
5.7
|
|
|
12.9
|
|
|
66.3
|
|
|||||
Income before income taxes (a) (b) (c) (d) (e) (f)
|
941.8
|
|
|
968.2
|
|
|
926.9
|
|
|
1,168.8
|
|
|
1,274.6
|
|
|||||
Net income (a) (b) (c) (d) (e) (f) (g)
|
837.8
|
|
|
852.4
|
|
|
798.4
|
|
|
1,025.9
|
|
|
1,165.4
|
|
|||||
Depreciation and amortization
|
270.2
|
|
|
271.9
|
|
|
262.8
|
|
|
246.1
|
|
|
192.6
|
|
|||||
Cash Flow Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities (h)
|
$
|
1,071.1
|
|
|
$
|
1,045.9
|
|
|
$
|
1,088.6
|
|
|
$
|
1,185.3
|
|
|
$
|
1,174.9
|
|
Capital expenditures (i)
|
(266.5
|
)
|
|
(179.0
|
)
|
|
(241.3
|
)
|
|
(268.2
|
)
|
|
(162.5
|
)
|
|||||
Common stock repurchased (j)
|
(511.3
|
)
|
|
(495.4
|
)
|
|
(399.7
|
)
|
|
(766.5
|
)
|
|
(803.9
|
)
|
|||||
Earnings Per Share Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic (a) (b) (c) (d) (e) (f) (g) (j)
|
$
|
1.63
|
|
|
$
|
1.60
|
|
|
$
|
1.43
|
|
|
$
|
1.70
|
|
|
$
|
1.85
|
|
Diluted (a) (b) (c) (d) (e) (f) (g) (j)
|
$
|
1.62
|
|
|
$
|
1.59
|
|
|
$
|
1.43
|
|
|
$
|
1.69
|
|
|
$
|
1.84
|
|
Cash dividends declared per common share (k)
|
$
|
0.62
|
|
|
$
|
0.50
|
|
|
$
|
0.50
|
|
|
$
|
0.425
|
|
|
$
|
0.31
|
|
Key Indicators (unaudited):
|
|
|
|
|
|
|
|
|
|
||||||||||
Consumer-to-Consumer transactions
|
261.53
|
|
|
254.93
|
|
|
242.34
|
|
|
230.98
|
|
|
225.79
|
|
|
As of December 31,
|
||||||||||||||||||
(in millions)
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Settlement assets
|
$
|
3,308.7
|
|
|
$
|
3,313.7
|
|
|
$
|
3,270.4
|
|
|
$
|
3,114.6
|
|
|
$
|
3,091.2
|
|
Total assets
|
9,458.9
|
|
|
9,890.4
|
|
|
10,121.3
|
|
|
9,465.7
|
|
|
9,069.9
|
|
|||||
Settlement obligations
|
3,308.7
|
|
|
3,313.7
|
|
|
3,270.4
|
|
|
3,114.6
|
|
|
3,091.2
|
|
|||||
Total borrowings
|
3,225.6
|
|
|
3,720.4
|
|
|
4,213.0
|
|
|
4,029.2
|
|
|
3,583.2
|
|
|||||
Total liabilities
|
8,054.0
|
|
|
8,590.0
|
|
|
9,016.6
|
|
|
8,525.1
|
|
|
8,175.1
|
|
|||||
Total stockholders’ equity
|
1,404.9
|
|
|
1,300.4
|
|
|
1,104.7
|
|
|
940.6
|
|
|
894.8
|
|
(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 and is included in our Business Solutions segment.
|
|
|
(b)
|
Operating expenses for the year ended December 31, 2011 included $46.8 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)
|
During the year ended December 31, 2015, operating expenses included $35.3 million of expenses as a result of a settlement agreement between the Consumer Financial Protection Bureau and one of our subsidiaries, Paymap, Inc., which operates solely in the United States. For further discussion of this matter, see Part II, Item 8,
Financial Statements and Supplementary Data
, Note 5, "Commitments and Contingencies."
|
|
|
(d)
|
Interest income consists of interest earned on cash balances not required to satisfy settlement obligations.
|
|
|
(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.
|
|
|
(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 31, 2012 was impacted by tax payments of $92.4 million made as a result of the IRS Agreement.
|
|
|
(i)
|
Capital expenditures include capitalization of contract costs, capitalization of purchased and developed software and purchases of property and equipment.
|
|
|
(j)
|
On February 10, 2015, the Board of Directors authorized $1.2 billion of common stock repurchases through December 31, 2017, of which $711.9 million remained available as of December 31, 2015. During the years ended December 31, 2015, 2014, 2013, 2012, and 2011, we repurchased 25.1 million, 29.3 million, 25.7 million, 51.0 million, and 40.3 million shares, respectively.
|
|
|
(k)
|
Cash dividends per share declared quarterly by the Company's Board of Directors were as follows:
|
Year
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
||||||||
2015
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
2014
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
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
|
|
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, mobile devices, and account-based services.
|
•
|
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 spot rates, which enable 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.
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2015
|
|
2014
|
||||||||||||
(in millions, except per share amounts)
|
2015
|
|
2014
|
|
2013
|
|
vs. 2014
|
|
vs. 2013
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
3,915.6
|
|
|
$
|
4,083.6
|
|
|
$
|
4,065.8
|
|
|
(4
|
)%
|
|
0
|
%
|
Foreign exchange revenues
|
1,436.2
|
|
|
1,386.3
|
|
|
1,348.0
|
|
|
4
|
%
|
|
3
|
%
|
|||
Other revenues
|
131.9
|
|
|
137.3
|
|
|
128.2
|
|
|
(4
|
)%
|
|
7
|
%
|
|||
Total revenues
|
5,483.7
|
|
|
5,607.2
|
|
|
5,542.0
|
|
|
(2
|
)%
|
|
1
|
%
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of services
|
3,199.4
|
|
|
3,297.4
|
|
|
3,235.0
|
|
|
(3
|
)%
|
|
2
|
%
|
|||
Selling, general and administrative
|
1,174.9
|
|
|
1,169.3
|
|
|
1,199.6
|
|
|
0
|
%
|
|
(3
|
)%
|
|||
Total expenses
|
4,374.3
|
|
|
4,466.7
|
|
|
4,434.6
|
|
|
(2
|
)%
|
|
1
|
%
|
|||
Operating income
|
1,109.4
|
|
|
1,140.5
|
|
|
1,107.4
|
|
|
(3
|
)%
|
|
3
|
%
|
|||
Other income/(expense):
|
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
10.9
|
|
|
11.5
|
|
|
9.4
|
|
|
(5
|
)%
|
|
22
|
%
|
|||
Interest expense
|
(167.9
|
)
|
|
(176.6
|
)
|
|
(195.6
|
)
|
|
(5
|
)%
|
|
(10
|
)%
|
|||
Derivative gains/(losses), net
|
1.2
|
|
|
(2.2
|
)
|
|
(1.3
|
)
|
|
(a)
|
|
|
(a)
|
|
|||
Other income/(expense), net
|
(11.8
|
)
|
|
(5.0
|
)
|
|
7.0
|
|
|
(a)
|
|
|
(a)
|
|
|||
Total other expense, net
|
(167.6
|
)
|
|
(172.3
|
)
|
|
(180.5
|
)
|
|
(3
|
)%
|
|
(5
|
)%
|
|||
Income before income taxes
|
941.8
|
|
|
968.2
|
|
|
926.9
|
|
|
(3
|
)%
|
|
4
|
%
|
|||
Provision for income taxes
|
104.0
|
|
|
115.8
|
|
|
128.5
|
|
|
(10
|
)%
|
|
(10
|
)%
|
|||
Net income
|
$
|
837.8
|
|
|
$
|
852.4
|
|
|
$
|
798.4
|
|
|
(2
|
)%
|
|
7
|
%
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.63
|
|
|
$
|
1.60
|
|
|
$
|
1.43
|
|
|
2
|
%
|
|
12
|
%
|
Diluted
|
$
|
1.62
|
|
|
$
|
1.59
|
|
|
$
|
1.43
|
|
|
2
|
%
|
|
11
|
%
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
512.6
|
|
|
533.4
|
|
|
556.6
|
|
|
|
|
|
|||||
Diluted
|
516.7
|
|
|
536.8
|
|
|
559.7
|
|
|
|
|
|
(a)
|
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."
|
•
|
All items not included in operating income are excluded from the segments.
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Consumer-to-Consumer
|
79
|
%
|
|
80
|
%
|
|
80
|
%
|
Consumer-to-Business
|
12
|
%
|
|
11
|
%
|
|
11
|
%
|
Business Solutions
|
7
|
%
|
|
7
|
%
|
|
7
|
%
|
Other
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2015
|
|
2014
|
||||||||||||
(dollars and transactions in millions)
|
2015
|
|
2014
|
|
2013
|
|
vs. 2014
|
|
vs. 2013
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
3,221.0
|
|
|
$
|
3,421.8
|
|
|
$
|
3,396.1
|
|
|
(6
|
)%
|
|
1
|
%
|
Foreign exchange revenues
|
1,057.1
|
|
|
998.9
|
|
|
981.3
|
|
|
6
|
%
|
|
2
|
%
|
|||
Other revenues
|
65.8
|
|
|
65.1
|
|
|
56.2
|
|
|
1
|
%
|
|
16
|
%
|
|||
Total revenues
|
$
|
4,343.9
|
|
|
$
|
4,485.8
|
|
|
$
|
4,433.6
|
|
|
(3
|
)%
|
|
1
|
%
|
Operating income
|
$
|
1,042.0
|
|
|
$
|
1,050.4
|
|
|
$
|
1,030.4
|
|
|
(1
|
)%
|
|
2
|
%
|
Operating income margin
|
24
|
%
|
|
23
|
%
|
|
23
|
%
|
|
|
|
|
|||||
Key indicator:
|
|
|
|
|
|
|
|
|
|
||||||||
Consumer-to-Consumer transactions
|
261.53
|
|
|
254.93
|
|
|
242.34
|
|
|
3
|
%
|
|
5
|
%
|
|
Year Ended December 31,
|
|||||||||||||
|
As Reported
|
|
Foreign Exchange Translation Impact
|
|
Constant Currency Growth (a)
|
|||||||||
|
2015
|
2014
|
|
2015
|
2014
|
|
2015
|
2014
|
||||||
Consumer-to-Consumer revenue growth/(decline):
|
|
|
|
|
|
|
|
|
||||||
Europe and CIS
|
(9
|
)%
|
0
|
%
|
|
(10
|
)%
|
(1
|
)%
|
|
1
|
%
|
1
|
%
|
North America
|
(1
|
)%
|
1
|
%
|
|
(1
|
)%
|
0
|
%
|
|
0
|
%
|
1
|
%
|
Middle East and Africa
|
(4
|
)%
|
2
|
%
|
|
(5
|
)%
|
(1
|
)%
|
|
1
|
%
|
3
|
%
|
Asia Pacific ("APAC")
|
(6
|
)%
|
0
|
%
|
|
(5
|
)%
|
(2
|
)%
|
|
(1
|
)%
|
2
|
%
|
Latin America and the Caribbean ("LACA") (b)
|
2
|
%
|
(6
|
)%
|
|
(7
|
)%
|
(8
|
)%
|
|
9
|
%
|
2
|
%
|
westernunion.com
|
21
|
%
|
28
|
%
|
|
(5
|
)%
|
(1
|
)%
|
|
26
|
%
|
29
|
%
|
Total Consumer-to-Consumer revenue growth/(decline):
|
(3
|
)%
|
1
|
%
|
|
(6
|
)%
|
(2
|
)%
|
|
3
|
%
|
3
|
%
|
(a)
|
Constant currency revenue growth assumes that revenues denominated in foreign currencies are translated to the U.S. dollar, net of the effect of foreign currency hedges, at rates consistent with those in the prior year.
|
(b)
|
For the years ended December 31, 2015 and 2014 compared to the prior year, the foreign exchange translation impact is primarily the result of fluctuations in the exchange rate between the United States dollar and various South American currencies.
|
|
Year Ended December 31,
|
||||
|
2015
|
|
2014
|
||
Consumer-to-Consumer transaction growth/(decline):
|
|
|
|
||
Europe and CIS
|
1
|
%
|
|
9
|
%
|
North America
|
4
|
%
|
|
3
|
%
|
Middle East and Africa
|
(1
|
)%
|
|
3
|
%
|
APAC
|
(4
|
)%
|
|
1
|
%
|
LACA
|
7
|
%
|
|
3
|
%
|
westernunion.com
|
26
|
%
|
|
39
|
%
|
|
|
|
|
||
Consumer-to-Consumer revenue as a percentage of consolidated revenue:
|
|
|
|
||
Europe and CIS
|
20
|
%
|
|
21
|
%
|
North America
|
19
|
%
|
|
19
|
%
|
Middle East and Africa
|
16
|
%
|
|
16
|
%
|
APAC
|
11
|
%
|
|
12
|
%
|
LACA
|
8
|
%
|
|
8
|
%
|
westernunion.com
|
5
|
%
|
|
4
|
%
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2015
|
|
2014
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
|
vs. 2014
|
|
vs. 2013
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
612.7
|
|
|
$
|
572.7
|
|
|
$
|
579.1
|
|
|
7
|
%
|
|
(1
|
)%
|
Foreign exchange and other revenues
|
25.0
|
|
|
26.1
|
|
|
29.4
|
|
|
(4
|
)%
|
|
(11
|
)%
|
|||
Total revenues
|
$
|
637.7
|
|
|
$
|
598.8
|
|
|
$
|
608.5
|
|
|
6
|
%
|
|
(2
|
)%
|
Operating income
|
$
|
68.6
|
|
|
$
|
98.7
|
|
|
$
|
121.9
|
|
|
(30
|
)%
|
|
(19
|
)%
|
Less: Paymap Settlement Agreement
|
35.3
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|||||
Operating income, excluding Paymap Settlement Agreement
|
$
|
103.9
|
|
|
$
|
98.7
|
|
|
$
|
121.9
|
|
|
|
|
|
||
Operating income margin
|
11
|
%
|
|
16
|
%
|
|
20
|
%
|
|
|
|
|
|||||
Operating income margin, excluding Paymap Settlement Agreement
|
16
|
%
|
|
(a)
|
|
|
(a)
|
|
|
|
|
|
(a)
|
Calculation not meaningful or not applicable
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2015
|
|
2014
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
|
vs. 2014
|
|
vs. 2013
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange revenues
|
$
|
357.2
|
|
|
$
|
363.1
|
|
|
$
|
355.5
|
|
|
(2
|
)%
|
|
2
|
%
|
Transaction fees and other revenues
|
41.5
|
|
|
41.5
|
|
|
37.4
|
|
|
0
|
%
|
|
11
|
%
|
|||
Total revenues
|
$
|
398.7
|
|
|
$
|
404.6
|
|
|
$
|
392.9
|
|
|
(1
|
)%
|
|
3
|
%
|
Operating income/(loss)
|
$
|
2.8
|
|
|
$
|
(12.1
|
)
|
|
$
|
(27.0
|
)
|
|
(a)
|
|
|
(a)
|
|
Operating income/(loss) margin
|
1
|
%
|
|
(3
|
)%
|
|
(7
|
)%
|
|
|
|
|
(a)
|
Calculation not meaningful.
|
|
|
|
|
|
|
|
% Change
|
||||||||||
|
Year Ended December 31,
|
|
2015
|
|
2014
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
|
vs. 2014
|
|
vs. 2013
|
||||||||
Revenues
|
$
|
103.4
|
|
|
$
|
118.0
|
|
|
$
|
107.0
|
|
|
(12
|
)%
|
|
10
|
%
|
Operating income/(loss)
|
$
|
(4.0
|
)
|
|
$
|
3.5
|
|
|
$
|
(17.9
|
)
|
|
(a)
|
|
|
(a)
|
|
(a)
|
Calculation not meaningful.
|
5.930% notes due 2016 (a)
|
$
|
1,000.0
|
|
2.875% notes (effective rate of 2.1%) due 2017
|
500.0
|
|
|
3.650% notes due 2018 (a)
|
400.0
|
|
|
3.350% notes due 2019 (a)
|
250.0
|
|
|
5.253% notes due 2020 (a)
|
324.9
|
|
|
6.200% notes due 2036 (a)
|
500.0
|
|
|
6.200% notes due 2040 (a)
|
250.0
|
|
|
Other borrowings
|
5.5
|
|
|
Total borrowings at par value
|
3,230.4
|
|
|
Fair value hedge accounting adjustments, net (b)
|
7.6
|
|
|
Unamortized discount, net
|
(12.4
|
)
|
|
Total borrowings at carrying value (c)
|
$
|
3,225.6
|
|
(a)
|
The difference between the stated interest rate and the effective interest rate is not significant.
|
(b)
|
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 i
nterest to differ from the notes’ stated rate.
|
(c)
|
As of
December 31, 2015
, our weighted-average effective rate on total borrowings was approximately
4.8%
.
|
|
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)
|
$
|
4,468.2
|
|
|
$
|
1,140.6
|
|
|
$
|
1,090.3
|
|
|
$
|
693.3
|
|
|
$
|
1,544.0
|
|
IRS Agreement and related state tax payments (b)
|
100.0
|
|
|
100.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Estimated pension funding (c)
|
21.6
|
|
|
—
|
|
|
1.9
|
|
|
10.9
|
|
|
8.8
|
|
|||||
Unrecognized tax benefits (d)
|
122.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Foreign currency and interest rate derivative contracts (e)
|
283.7
|
|
|
269.9
|
|
|
13.8
|
|
|
—
|
|
|
—
|
|
|||||
Other (f)
|
13.4
|
|
|
3.3
|
|
|
9.4
|
|
|
0.7
|
|
|
—
|
|
|||||
Other Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Purchase obligations (g)
|
117.9
|
|
|
75.9
|
|
|
34.4
|
|
|
4.5
|
|
|
3.1
|
|
|||||
Operating leases
|
138.5
|
|
|
39.7
|
|
|
57.8
|
|
|
23.9
|
|
|
17.1
|
|
|||||
Total
|
$
|
5,265.9
|
|
|
$
|
1,629.4
|
|
|
$
|
1,207.6
|
|
|
$
|
733.3
|
|
|
$
|
1,573.0
|
|
(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. However, we plan to refinance a portion of our notes maturing in 2016.
|
(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 have made cash payments to the IRS and various state tax authorities of $94.1 million as of December 31, 2015. We have estimated that we will make payments of approximately $100 million in 2016 to cover the remaining portion of the additional tax and interest; however, certain of these payments may be made after 2016.
|
(c)
|
We have estimated our pension plan funding requirements, including interest, using assumptions that are consistent with current pension funding rates. 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, 2015, 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, 2015.
|
(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 instrument is effective in offsetting the change in cash flows attributable to the risk being hedged. 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 19, 2016
|
|
|
/s/ Ernst & Young LLP
|
Denver, Colorado
|
|
February 19, 2016
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Transaction fees
|
$
|
3,915.6
|
|
|
$
|
4,083.6
|
|
|
$
|
4,065.8
|
|
Foreign exchange revenues
|
1,436.2
|
|
|
1,386.3
|
|
|
1,348.0
|
|
|||
Other revenues
|
131.9
|
|
|
137.3
|
|
|
128.2
|
|
|||
Total revenues
|
5,483.7
|
|
|
5,607.2
|
|
|
5,542.0
|
|
|||
Expenses:
|
|
|
|
|
|
||||||
Cost of services
|
3,199.4
|
|
|
3,297.4
|
|
|
3,235.0
|
|
|||
Selling, general and administrative
|
1,174.9
|
|
|
1,169.3
|
|
|
1,199.6
|
|
|||
Total expenses*
|
4,374.3
|
|
|
4,466.7
|
|
|
4,434.6
|
|
|||
Operating income
|
1,109.4
|
|
|
1,140.5
|
|
|
1,107.4
|
|
|||
Other income/(expense):
|
|
|
|
|
|
||||||
Interest income
|
10.9
|
|
|
11.5
|
|
|
9.4
|
|
|||
Interest expense
|
(167.9
|
)
|
|
(176.6
|
)
|
|
(195.6
|
)
|
|||
Derivative gains/(losses), net
|
1.2
|
|
|
(2.2
|
)
|
|
(1.3
|
)
|
|||
Other income/(expense), net
|
(11.8
|
)
|
|
(5.0
|
)
|
|
7.0
|
|
|||
Total other expense, net
|
(167.6
|
)
|
|
(172.3
|
)
|
|
(180.5
|
)
|
|||
Income before income taxes
|
941.8
|
|
|
968.2
|
|
|
926.9
|
|
|||
Provision for income taxes
|
104.0
|
|
|
115.8
|
|
|
128.5
|
|
|||
Net income
|
$
|
837.8
|
|
|
$
|
852.4
|
|
|
$
|
798.4
|
|
Earnings per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
1.63
|
|
|
$
|
1.60
|
|
|
$
|
1.43
|
|
Diluted
|
$
|
1.62
|
|
|
$
|
1.59
|
|
|
$
|
1.43
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
512.6
|
|
|
533.4
|
|
|
556.6
|
|
|||
Diluted
|
516.7
|
|
|
536.8
|
|
|
559.7
|
|
|||
Cash dividends declared per common share
|
$
|
0.62
|
|
|
$
|
0.50
|
|
|
$
|
0.50
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net income
|
$
|
837.8
|
|
|
$
|
852.4
|
|
|
$
|
798.4
|
|
Other comprehensive income/(loss), net of tax (Note 13):
|
|
|
|
|
|
||||||
Unrealized gains/(losses) on investment securities
|
(1.1
|
)
|
|
4.8
|
|
|
(3.6
|
)
|
|||
Unrealized gains/(losses) on hedging activities
|
(7.2
|
)
|
|
81.6
|
|
|
(11.1
|
)
|
|||
Foreign currency translation adjustments
|
(16.8
|
)
|
|
(27.6
|
)
|
|
(13.1
|
)
|
|||
Defined benefit pension plan adjustments
|
0.1
|
|
|
(8.7
|
)
|
|
11.4
|
|
|||
Total other comprehensive income/(loss)
|
(25.0
|
)
|
|
50.1
|
|
|
(16.4
|
)
|
|||
Comprehensive income
|
$
|
812.8
|
|
|
$
|
902.5
|
|
|
$
|
782.0
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,315.9
|
|
|
$
|
1,783.2
|
|
Settlement assets
|
3,308.7
|
|
|
3,313.7
|
|
||
Property and equipment, net of accumulated depreciation of $538.2 and $478.5, respectively
|
231.8
|
|
|
206.4
|
|
||
Goodwill
|
3,163.8
|
|
|
3,169.2
|
|
||
Other intangible assets, net of accumulated amortization of $884.4 and $820.0, respectively
|
705.0
|
|
|
748.1
|
|
||
Other assets
|
733.7
|
|
|
669.8
|
|
||
Total assets
|
$
|
9,458.9
|
|
|
$
|
9,890.4
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
606.6
|
|
|
$
|
600.4
|
|
Settlement obligations
|
3,308.7
|
|
|
3,313.7
|
|
||
Income taxes payable
|
211.5
|
|
|
166.3
|
|
||
Deferred tax liability, net
|
272.6
|
|
|
305.0
|
|
||
Borrowings
|
3,225.6
|
|
|
3,720.4
|
|
||
Other liabilities
|
429.0
|
|
|
484.2
|
|
||
Total liabilities
|
8,054.0
|
|
|
8,590.0
|
|
||
|
|
|
|
||||
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; 502.4 shares and 521.5 shares issued and outstanding as of December 31, 2015 and 2014, respectively
|
5.0
|
|
|
5.2
|
|
||
Capital surplus
|
566.5
|
|
|
445.4
|
|
||
Retained earnings
|
977.3
|
|
|
968.7
|
|
||
Accumulated other comprehensive loss
|
(143.9
|
)
|
|
(118.9
|
)
|
||
Total stockholders' equity
|
1,404.9
|
|
|
1,300.4
|
|
||
Total liabilities and stockholders' equity
|
$
|
9,458.9
|
|
|
$
|
9,890.4
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income
|
$
|
837.8
|
|
|
$
|
852.4
|
|
|
$
|
798.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation
|
67.7
|
|
|
66.6
|
|
|
64.2
|
|
|||
Amortization
|
202.5
|
|
|
205.3
|
|
|
198.6
|
|
|||
Deferred income tax benefit
|
(39.9
|
)
|
|
(26.8
|
)
|
|
(39.3
|
)
|
|||
Other non-cash items, net
|
63.7
|
|
|
49.5
|
|
|
53.3
|
|
|||
Increase/(decrease) in cash, excluding the effects of acquisitions, resulting from changes in:
|
|
|
|
|
|
||||||
Other assets
|
(107.4
|
)
|
|
(31.1
|
)
|
|
(55.4
|
)
|
|||
Accounts payable and accrued liabilities
|
14.2
|
|
|
(29.4
|
)
|
|
81.1
|
|
|||
Income taxes payable
|
47.1
|
|
|
(39.3
|
)
|
|
3.4
|
|
|||
Other liabilities
|
(14.6
|
)
|
|
(1.3
|
)
|
|
(15.7
|
)
|
|||
Net cash provided by operating activities
|
1,071.1
|
|
|
1,045.9
|
|
|
1,088.6
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Capitalization of contract costs
|
(122.8
|
)
|
|
(73.1
|
)
|
|
(119.3
|
)
|
|||
Capitalization of purchased and developed software
|
(49.3
|
)
|
|
(38.1
|
)
|
|
(41.8
|
)
|
|||
Purchases of property and equipment
|
(94.4
|
)
|
|
(67.8
|
)
|
|
(80.2
|
)
|
|||
Purchase of available-for-sale non-settlement related investments
|
—
|
|
|
—
|
|
|
(100.0
|
)
|
|||
Proceeds from sale of available-for-sale non-settlement related investments
|
—
|
|
|
100.2
|
|
|
—
|
|
|||
Purchase of non-settlement related investments and other
|
(110.9
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from maturity of non-settlement related investments
|
100.3
|
|
|
—
|
|
|
—
|
|
|||
Purchases of held-to-maturity non-settlement related investments
|
(9.3
|
)
|
|
—
|
|
|
—
|
|
|||
Acquisition of businesses, net (Note 4)
|
—
|
|
|
(10.6
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
(286.4
|
)
|
|
(89.4
|
)
|
|
(341.3
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Cash dividends paid
|
(316.5
|
)
|
|
(265.2
|
)
|
|
(277.2
|
)
|
|||
Common stock repurchased (Note 13)
|
(511.3
|
)
|
|
(495.4
|
)
|
|
(399.7
|
)
|
|||
Net proceeds from issuance of borrowings
|
—
|
|
|
—
|
|
|
497.3
|
|
|||
Principal payments on borrowings
|
(500.0
|
)
|
|
(500.0
|
)
|
|
(300.0
|
)
|
|||
Proceeds from exercise of options and other
|
75.8
|
|
|
14.2
|
|
|
28.9
|
|
|||
Net cash used in financing activities
|
(1,252.0
|
)
|
|
(1,246.4
|
)
|
|
(450.7
|
)
|
|||
Net change in cash and cash equivalents
|
(467.3
|
)
|
|
(289.9
|
)
|
|
296.6
|
|
|||
Cash and cash equivalents at beginning of year
|
1,783.2
|
|
|
2,073.1
|
|
|
1,776.5
|
|
|||
Cash and cash equivalents at end of year
|
$
|
1,315.9
|
|
|
$
|
1,783.2
|
|
|
$
|
2,073.1
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
161.8
|
|
|
$
|
170.8
|
|
|
$
|
193.7
|
|
Income taxes paid
|
$
|
92.8
|
|
|
$
|
179.4
|
|
|
$
|
158.0
|
|
|
|
|
Capital Surplus
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Total Stockholders' Equity
|
|||||||||||||
|
|
|
|
|
|
|||||||||||||||||
|
Common Stock
|
|
|
|
|
|||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
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 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
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
852.4
|
|
|
—
|
|
|
852.4
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
39.7
|
|
|
—
|
|
|
—
|
|
|
39.7
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(265.2
|
)
|
|
—
|
|
|
(265.2
|
)
|
|||||
Repurchase and retirement of common shares
|
(29.8
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(495.8
|
)
|
|
—
|
|
|
(496.1
|
)
|
|||||
Shares issued under stock-based compensation plans
|
2.5
|
|
|
—
|
|
|
14.8
|
|
|
—
|
|
|
—
|
|
|
14.8
|
|
|||||
Unrealized gains on investment securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.8
|
|
|
4.8
|
|
|||||
Unrealized gains on hedging activities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81.6
|
|
|
81.6
|
|
|||||
Foreign currency translation adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27.6
|
)
|
|
(27.6
|
)
|
|||||
Defined benefit pension plan adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.7
|
)
|
|
(8.7
|
)
|
|||||
Balance, December 31, 2014
|
521.5
|
|
|
5.2
|
|
|
445.4
|
|
|
968.7
|
|
|
(118.9
|
)
|
|
1,300.4
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
837.8
|
|
|
—
|
|
|
837.8
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
42.2
|
|
|
—
|
|
|
—
|
|
|
42.2
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(316.5
|
)
|
|
—
|
|
|
(316.5
|
)
|
|||||
Repurchase and retirement of common shares
|
(25.7
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(512.7
|
)
|
|
—
|
|
|
(513.0
|
)
|
|||||
Shares issued under stock-based compensation plans
|
6.6
|
|
|
0.1
|
|
|
78.9
|
|
|
—
|
|
|
—
|
|
|
79.0
|
|
|||||
Unrealized losses on investment securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.1
|
)
|
|
(1.1
|
)
|
|||||
Unrealized losses on hedging activities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7.2
|
)
|
|
(7.2
|
)
|
|||||
Foreign currency translation adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16.8
|
)
|
|
(16.8
|
)
|
|||||
Defined benefit pension plan adjustment, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|||||
Balance, December 31, 2015
|
502.4
|
|
|
$
|
5.0
|
|
|
$
|
566.5
|
|
|
$
|
977.3
|
|
|
$
|
(143.9
|
)
|
|
$
|
1,404.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
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, mobile devices 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 spot rates, which enable 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.
|
|
For the Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Basic weighted-average shares outstanding
|
512.6
|
|
|
533.4
|
|
|
556.6
|
|
Common stock equivalents
|
4.1
|
|
|
3.4
|
|
|
3.1
|
|
Diluted weighted-average shares outstanding
|
516.7
|
|
|
536.8
|
|
|
559.7
|
|
•
|
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. The individual redemption restrictions of Trust investments measured at net asset value are also considered when determining whether Level 2 classification is appropriate.
|
•
|
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,
|
||||||
|
2015
|
|
2014
|
||||
Settlement assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,075.7
|
|
|
$
|
834.3
|
|
Receivables from selling agents and Business Solutions customers
|
1,070.4
|
|
|
1,006.9
|
|
||
Investment securities
|
1,162.6
|
|
|
1,472.5
|
|
||
|
$
|
3,308.7
|
|
|
$
|
3,313.7
|
|
Settlement obligations:
|
|
|
|
||||
Money transfer, money order and payment service payables
|
$
|
2,428.5
|
|
|
$
|
2,356.7
|
|
Payables to agents
|
880.2
|
|
|
957.0
|
|
||
|
$
|
3,308.7
|
|
|
$
|
3,313.7
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Equipment
|
$
|
529.8
|
|
|
$
|
464.6
|
|
Buildings
|
87.3
|
|
|
87.8
|
|
||
Leasehold improvements
|
83.3
|
|
|
81.1
|
|
||
Furniture and fixtures
|
39.6
|
|
|
32.2
|
|
||
Land and improvements
|
17.0
|
|
|
17.0
|
|
||
Projects in process
|
13.0
|
|
|
2.2
|
|
||
Total property and equipment, gross
|
770.0
|
|
|
684.9
|
|
||
Less accumulated depreciation
|
(538.2
|
)
|
|
(478.5
|
)
|
||
Property and equipment, net
|
$
|
231.8
|
|
|
$
|
206.4
|
|
|
|
December 31, 2015
|
|
December 31, 2014
|
|||||||||||||||
|
|
Weighted-
Average
Amortization
Period
(in years)
|
|
Initial Cost
|
|
Net of
Accumulated
Amortization
|
|
Initial Cost
|
|
Net of
Accumulated
Amortization
|
|||||||||
Acquired contracts
|
|
11.3
|
|
$
|
624.4
|
|
|
$
|
316.6
|
|
|
$
|
630.8
|
|
|
$
|
374.9
|
|
|
Capitalized contract costs
|
|
5.9
|
|
541.2
|
|
|
290.4
|
|
|
559.6
|
|
|
276.6
|
|
|||||
Internal use software
|
|
3.2
|
|
338.1
|
|
|
53.8
|
|
|
301.6
|
|
|
60.1
|
|
|||||
Acquired trademarks
|
|
24.5
|
|
34.7
|
|
|
20.2
|
|
|
36.4
|
|
|
22.7
|
|
|||||
Projects in process
|
|
3.0
|
|
23.5
|
|
|
23.5
|
|
|
12.2
|
|
|
12.2
|
|
|||||
Other intangibles
|
|
4.1
|
|
27.5
|
|
|
0.5
|
|
|
27.5
|
|
|
1.6
|
|
|||||
Total other intangible assets
|
|
7.8
|
|
$
|
1,589.4
|
|
|
$
|
705.0
|
|
|
$
|
1,568.1
|
|
|
$
|
748.1
|
|
•
|
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 instrument is effective in offsetting the change in cash flows attributable to the risk being hedged. 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 and liability 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." 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."
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Cost of services
|
$
|
1.0
|
|
|
$
|
11.6
|
|
|
$
|
24.3
|
|
Selling, general and administrative
|
10.1
|
|
|
18.7
|
|
|
32.6
|
|
|||
Total expenses, pre-tax
|
$
|
11.1
|
|
|
$
|
30.3
|
|
|
$
|
56.9
|
|
Total expenses, net of tax
|
$
|
7.2
|
|
|
$
|
20.2
|
|
|
$
|
40.2
|
|
|
|
Consumer-to-Consumer
|
|
Consumer-to-Business
|
|
Business Solutions
|
|
Other
|
|
Total
|
||||||||||
2013 expenses
|
|
$
|
43.8
|
|
|
$
|
5.4
|
|
|
$
|
3.6
|
|
|
$
|
4.1
|
|
|
$
|
56.9
|
|
2014 expenses
|
|
15.7
|
|
|
6.7
|
|
|
7.3
|
|
|
0.6
|
|
|
30.3
|
|
|||||
2015 expenses
|
|
7.6
|
|
|
1.5
|
|
|
1.8
|
|
|
0.2
|
|
|
11.1
|
|
|
Consumer-to-Consumer
|
|
Consumer-to-Business
|
|
Business Solutions
|
|
Other
|
|
Total
|
||||||||||
January 1, 2014 balance
|
$
|
1,947.7
|
|
|
$
|
214.7
|
|
|
$
|
996.0
|
|
|
$
|
13.6
|
|
|
$
|
3,172.0
|
|
Acquisitions
|
2.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.4
|
|
|||||
Currency translation
|
—
|
|
|
(5.0
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
(5.2
|
)
|
|||||
December 31, 2014 balance
|
$
|
1,950.1
|
|
|
$
|
209.7
|
|
|
$
|
996.0
|
|
|
$
|
13.4
|
|
|
$
|
3,169.2
|
|
Currency translation
|
—
|
|
|
(5.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
(5.4
|
)
|
|||||
December 31, 2015 balance
|
$
|
1,950.1
|
|
|
$
|
204.5
|
|
|
$
|
996.0
|
|
|
$
|
13.2
|
|
|
$
|
3,163.8
|
|
December 31, 2015
|
Amortized
Cost
|
|
Fair
Value
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Net
Unrealized
Gains/ (Losses)
|
||||||||||
Settlement assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal debt securities (a)
|
$
|
1,040.3
|
|
|
$
|
1,052.5
|
|
|
$
|
14.2
|
|
|
$
|
(2.0
|
)
|
|
$
|
12.2
|
|
State and municipal variable rate demand notes
|
42.9
|
|
|
42.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate and other debt securities
|
67.3
|
|
|
67.2
|
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||||
|
1,150.5
|
|
|
1,162.6
|
|
|
14.2
|
|
|
(2.1
|
)
|
|
12.1
|
|
|||||
Other assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Held-to-maturity securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign corporate debt securities
|
9.3
|
|
|
9.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
|
$
|
1,159.8
|
|
|
$
|
1,171.9
|
|
|
$
|
14.2
|
|
|
$
|
(2.1
|
)
|
|
$
|
12.1
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2014
|
Amortized
Cost
|
|
Fair
Value
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Net
Unrealized
Gains/ (Losses)
|
||||||||||
Settlement assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
State and municipal debt securities (a)
|
$
|
1,024.2
|
|
|
$
|
1,038.1
|
|
|
$
|
15.1
|
|
|
$
|
(1.2
|
)
|
|
$
|
13.9
|
|
State and municipal variable rate demand notes
|
316.8
|
|
|
316.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate and other debt securities
|
70.5
|
|
|
70.5
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
|
|||||
Short-term state and municipal bond mutual fund
|
47.1
|
|
|
47.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
|
$
|
1,458.6
|
|
|
$
|
1,472.5
|
|
|
$
|
15.2
|
|
|
$
|
(1.3
|
)
|
|
$
|
13.9
|
|
(a)
|
The majority of these securities are fixed rate instruments.
|
|
Amortized
Cost
|
|
Fair
Value
|
||||
Due within 1 year
|
$
|
195.5
|
|
|
$
|
196.0
|
|
Due after 1 year through 5 years
|
499.9
|
|
|
500.9
|
|
||
Due after 5 years through 10 years
|
394.9
|
|
|
405.5
|
|
||
Due after 10 years
|
60.2
|
|
|
60.2
|
|
||
|
$
|
1,150.5
|
|
|
$
|
1,162.6
|
|
|
Fair Value Measurement Using
|
|
Assets/
Liabilities at
Fair
Value
|
||||||||||||
December 31, 2015
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Settlement assets:
|
|
|
|
|
|
|
|
||||||||
State and municipal debt securities
|
$
|
—
|
|
|
$
|
1,052.5
|
|
|
$
|
—
|
|
|
$
|
1,052.5
|
|
State and municipal variable rate demand notes
|
—
|
|
|
42.9
|
|
|
—
|
|
|
42.9
|
|
||||
Corporate and other debt securities
|
—
|
|
|
67.2
|
|
|
—
|
|
|
67.2
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
—
|
|
|
396.3
|
|
|
—
|
|
|
396.3
|
|
||||
Foreign corporate debt securities
|
—
|
|
|
9.3
|
|
|
—
|
|
|
9.3
|
|
||||
Total assets
|
$
|
—
|
|
|
$
|
1,568.2
|
|
|
$
|
—
|
|
|
$
|
1,568.2
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
$
|
—
|
|
|
$
|
283.7
|
|
|
$
|
—
|
|
|
$
|
283.7
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
283.7
|
|
|
$
|
—
|
|
|
$
|
283.7
|
|
|
|
|
|
|
|
|
|
||||||||
|
Fair Value Measurement Using
|
|
Assets/
Liabilities at
Fair
Value
|
||||||||||||
December 31, 2014
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Settlement assets:
|
|
|
|
|
|
|
|
||||||||
State and municipal debt securities
|
$
|
—
|
|
|
$
|
1,038.1
|
|
|
$
|
—
|
|
|
$
|
1,038.1
|
|
State and municipal variable rate demand notes
|
—
|
|
|
316.8
|
|
|
—
|
|
|
316.8
|
|
||||
Corporate and other debt securities
|
—
|
|
|
70.5
|
|
|
—
|
|
|
70.5
|
|
||||
Short-term state and municipal bond mutual fund
|
47.1
|
|
|
—
|
|
|
—
|
|
|
47.1
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
—
|
|
|
423.0
|
|
|
—
|
|
|
423.0
|
|
||||
Total assets
|
$
|
47.1
|
|
|
$
|
1,848.4
|
|
|
$
|
—
|
|
|
$
|
1,895.5
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
$
|
—
|
|
|
$
|
317.1
|
|
|
$
|
—
|
|
|
$
|
317.1
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
317.1
|
|
|
$
|
—
|
|
|
$
|
317.1
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Other assets:
|
|
|
|
||||
Derivatives
|
$
|
396.3
|
|
|
$
|
423.0
|
|
Prepaid expenses
|
83.4
|
|
|
63.0
|
|
||
Amounts advanced to agents, net of discounts
|
57.1
|
|
|
45.2
|
|
||
Equity method investments
|
43.3
|
|
|
41.6
|
|
||
Other
|
153.6
|
|
|
97.0
|
|
||
Total other assets
|
$
|
733.7
|
|
|
$
|
669.8
|
|
Other liabilities:
|
|
|
|
||||
Derivatives
|
$
|
283.7
|
|
|
$
|
317.1
|
|
Pension obligations
|
69.3
|
|
|
74.9
|
|
||
Other
|
76.0
|
|
|
92.2
|
|
||
Total other liabilities
|
$
|
429.0
|
|
|
$
|
484.2
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Domestic
|
$
|
(27.0
|
)
|
|
$
|
34.7
|
|
|
$
|
(28.4
|
)
|
Foreign
|
968.8
|
|
|
933.5
|
|
|
955.3
|
|
|||
|
$
|
941.8
|
|
|
$
|
968.2
|
|
|
$
|
926.9
|
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of federal income tax benefits
|
0.4
|
%
|
|
0.6
|
%
|
|
0.7
|
%
|
Foreign rate differential, net of U.S. tax paid on foreign earnings (3.4%, 4.3% and 9.2%, respectively)
|
(24.6
|
)%
|
|
(24.0
|
)%
|
|
(22.9
|
)%
|
Other
|
0.2
|
%
|
|
0.4
|
%
|
|
1.1
|
%
|
Effective tax rate
|
11.0
|
%
|
|
12.0
|
%
|
|
13.9
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
59.6
|
|
|
$
|
76.1
|
|
|
$
|
86.1
|
|
State and local
|
5.4
|
|
|
4.7
|
|
|
8.1
|
|
|||
Foreign
|
78.9
|
|
|
61.8
|
|
|
73.6
|
|
|||
Total current taxes
|
143.9
|
|
|
142.6
|
|
|
167.8
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(26.4
|
)
|
|
(19.1
|
)
|
|
2.2
|
|
|||
State and local
|
(6.4
|
)
|
|
0.2
|
|
|
(11.8
|
)
|
|||
Foreign
|
(7.1
|
)
|
|
(7.9
|
)
|
|
(29.7
|
)
|
|||
Total deferred taxes
|
(39.9
|
)
|
|
(26.8
|
)
|
|
(39.3
|
)
|
|||
|
$
|
104.0
|
|
|
$
|
115.8
|
|
|
$
|
128.5
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Deferred tax assets related to:
|
|
|
|
||||
Reserves, accrued expenses and employee-related items
|
$
|
87.1
|
|
|
$
|
81.8
|
|
Tax attribute carryovers
|
60.2
|
|
|
41.0
|
|
||
Pension obligations
|
26.5
|
|
|
26.7
|
|
||
Intangibles, property and equipment
|
7.9
|
|
|
12.1
|
|
||
Other
|
10.2
|
|
|
13.6
|
|
||
Valuation allowance
|
(33.2
|
)
|
|
(46.6
|
)
|
||
Total deferred tax assets
|
158.7
|
|
|
128.6
|
|
||
Deferred tax liabilities related to:
|
|
|
|
||||
Intangibles, property and equipment
|
410.9
|
|
|
428.1
|
|
||
Other
|
12.5
|
|
|
5.5
|
|
||
Total deferred tax liabilities
|
423.4
|
|
|
433.6
|
|
||
Net deferred tax liability (a)
|
$
|
264.7
|
|
|
$
|
305.0
|
|
(a)
|
As of
December 31, 2015
, deferred tax assets that cannot be fully offset by deferred tax liabilities in the respective tax jurisdictions are reflected in "Other assets" in the Consolidated Balance Sheets.
|
|
2015
|
|
2014
|
||||
Balance as of January 1,
|
$
|
93.4
|
|
|
$
|
117.5
|
|
Increases - positions taken in current period (a)
|
17.1
|
|
|
12.2
|
|
||
Increases - positions taken in prior periods (b)
|
7.7
|
|
|
5.7
|
|
||
Decreases - positions taken in prior periods (b)
|
(5.4
|
)
|
|
(23.9
|
)
|
||
Decreases - settlements with taxing authorities
|
—
|
|
|
(8.1
|
)
|
||
Decreases - lapse of applicable statute of limitations
|
(5.6
|
)
|
|
(7.2
|
)
|
||
Decreases - effects of foreign currency exchange rates
|
(1.6
|
)
|
|
(2.8
|
)
|
||
Balance as of December 31,
|
$
|
105.6
|
|
|
$
|
93.4
|
|
(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.
|
Year Ending December 31,
|
|
||
2016
|
$
|
39.7
|
|
2017
|
33.0
|
|
|
2018
|
24.8
|
|
|
2019
|
14.7
|
|
|
2020
|
9.2
|
|
|
Thereafter
|
17.1
|
|
|
Total future minimum lease payments
|
$
|
138.5
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Unrealized gains on investment securities, beginning of period
|
$
|
8.9
|
|
|
$
|
4.1
|
|
|
$
|
7.7
|
|
Unrealized gains/(losses)
|
0.4
|
|
|
15.5
|
|
|
(0.1
|
)
|
|||
Tax (expense)/benefit
|
(0.1
|
)
|
|
(5.7
|
)
|
|
0.1
|
|
|||
Reclassification of gains into "Other revenues"
|
(2.2
|
)
|
|
(7.8
|
)
|
|
(5.8
|
)
|
|||
Reclassification of gains into "Interest income"
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|||
Tax expense related to reclassifications
|
0.8
|
|
|
3.0
|
|
|
2.2
|
|
|||
Net unrealized gains/(losses) on investment securities
|
(1.1
|
)
|
|
4.8
|
|
|
(3.6
|
)
|
|||
Unrealized gains on investment securities, end of period
|
$
|
7.8
|
|
|
$
|
8.9
|
|
|
$
|
4.1
|
|
|
|
|
|
|
|
|
|
||||
Unrealized gains/(losses) on hedging activities, beginning of period
|
$
|
48.6
|
|
|
$
|
(33.0
|
)
|
|
$
|
(21.9
|
)
|
Unrealized gains/(losses)
|
70.8
|
|
|
84.0
|
|
|
(3.1
|
)
|
|||
Tax expense
|
(7.0
|
)
|
|
(3.7
|
)
|
|
(1.7
|
)
|
|||
Reclassification of gains into "Transaction fees"
|
(55.3
|
)
|
|
(1.2
|
)
|
|
(7.6
|
)
|
|||
Reclassification of gains into "Foreign exchange revenues"
|
(22.5
|
)
|
|
(0.4
|
)
|
|
(2.8
|
)
|
|||
Reclassification of losses into "Interest expense"
|
3.6
|
|
|
3.6
|
|
|
3.6
|
|
|||
Tax expense/(benefit) related to reclassifications
|
3.2
|
|
|
(0.7
|
)
|
|
0.5
|
|
|||
Net unrealized gains/(losses) on hedging activities
|
(7.2
|
)
|
|
81.6
|
|
|
(11.1
|
)
|
|||
Unrealized gains/(losses) on hedging activities, end of period
|
$
|
41.4
|
|
|
$
|
48.6
|
|
|
$
|
(33.0
|
)
|
|
|
|
|
|
|
|
|
||||
Foreign currency translation adjustments, beginning of period
|
$
|
(49.2
|
)
|
|
$
|
(21.6
|
)
|
|
$
|
(8.5
|
)
|
Foreign currency translation adjustments
|
(20.3
|
)
|
|
(14.8
|
)
|
|
(17.7
|
)
|
|||
Tax (expense)/benefit
|
3.5
|
|
|
(12.8
|
)
|
|
4.6
|
|
|||
Net foreign currency translation adjustments
|
(16.8
|
)
|
|
(27.6
|
)
|
|
(13.1
|
)
|
|||
Foreign currency translation adjustments, end of period
|
$
|
(66.0
|
)
|
|
$
|
(49.2
|
)
|
|
$
|
(21.6
|
)
|
|
|
|
|
|
|
|
|
||||
Defined benefit pension plan adjustments, beginning of period
|
$
|
(127.2
|
)
|
|
$
|
(118.5
|
)
|
|
$
|
(129.9
|
)
|
Unrealized gains/(losses)
|
(9.7
|
)
|
|
(24.3
|
)
|
|
7.4
|
|
|||
Tax (expense)/benefit
|
2.5
|
|
|
9.0
|
|
|
(3.9
|
)
|
|||
Reclassification of losses into "Cost of services"
|
11.4
|
|
|
10.4
|
|
|
12.4
|
|
|||
Tax benefit related to reclassifications and other
|
(4.1
|
)
|
|
(3.8
|
)
|
|
(4.5
|
)
|
|||
Net defined benefit pension plan adjustments
|
0.1
|
|
|
(8.7
|
)
|
|
11.4
|
|
|||
Defined benefit pension plan adjustments, end of period
|
$
|
(127.1
|
)
|
|
$
|
(127.2
|
)
|
|
$
|
(118.5
|
)
|
Accumulated other comprehensive loss, end of period
|
$
|
(143.9
|
)
|
|
$
|
(118.9
|
)
|
|
$
|
(169.0
|
)
|
Year
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
||||||||
2015
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
|
$
|
0.155
|
|
2014
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
2013
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
Contracts designated as hedges:
|
|
||
Euro
|
$
|
357.5
|
|
Canadian dollar
|
105.8
|
|
|
British pound
|
92.5
|
|
|
Australian dollar
|
46.6
|
|
|
Swiss franc
|
41.9
|
|
|
Other
|
84.1
|
|
|
Contracts not designated as hedges:
|
|
||
Euro
|
$
|
284.6
|
|
British pound
|
149.3
|
|
|
Canadian dollar
|
113.7
|
|
|
Australian dollar
|
49.5
|
|
|
Indian rupee
|
30.2
|
|
|
Swiss franc
|
27.3
|
|
|
Other (a)
|
162.2
|
|
(a)
|
Comprised of exposures to
20
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,
2015 |
|
December 31,
2014 |
|
Balance Sheet
Location
|
|
December 31,
2015 |
|
December 31,
2014 |
||||||||
Derivatives — hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate fair value hedges — Corporate
|
Other assets
|
|
$
|
7.6
|
|
|
$
|
3.5
|
|
|
Other liabilities
|
|
$
|
—
|
|
|
$
|
1.9
|
|
Foreign currency cash flow hedges — Consumer-to-Consumer
|
Other assets
|
|
59.7
|
|
|
66.1
|
|
|
Other liabilities
|
|
2.4
|
|
|
3.5
|
|
||||
Total
|
|
|
$
|
67.3
|
|
|
$
|
69.6
|
|
|
|
|
$
|
2.4
|
|
|
$
|
5.4
|
|
Derivatives — undesignated:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency — Business Solutions (a)
|
Other assets
|
|
$
|
326.1
|
|
|
$
|
349.4
|
|
|
Other liabilities
|
|
$
|
277.1
|
|
|
$
|
310.2
|
|
Foreign currency — Consumer-to-Consumer
|
Other assets
|
|
2.9
|
|
|
4.0
|
|
|
Other liabilities
|
|
4.2
|
|
|
1.5
|
|
||||
Total
|
|
|
$
|
329.0
|
|
|
$
|
353.4
|
|
|
|
|
$
|
281.3
|
|
|
$
|
311.7
|
|
Total derivatives
|
|
|
$
|
396.3
|
|
|
$
|
423.0
|
|
|
|
|
$
|
283.7
|
|
|
$
|
317.1
|
|
(a)
|
In many circumstances, the Company allows its Business Solutions customers to settle part or all of their derivative contracts prior to maturity. However, the offsetting positions originally entered into with financial institution counterparties do not allow for similar settlement. To mitigate this, additional foreign currency contracts are entered into with financial institution counterparties to offset the original economic hedge contracts. This frequently results in increases in our derivative assets and liabilities that may exceed the growth in the underlying derivatives business.
|
|
Total
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
||||||||||||||
Foreign currency cash flow hedges — Consumer-to-Consumer
|
$
|
57.3
|
|
|
$
|
50.3
|
|
|
$
|
7.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency undesignated hedges — Consumer-to-Consumer
|
(1.3
|
)
|
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency undesignated hedges — Business Solutions
|
49.0
|
|
|
46.6
|
|
|
2.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Interest rate fair value hedges — Corporate
|
7.6
|
|
|
—
|
|
|
1.2
|
|
|
1.6
|
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|||||||
Total
|
$
|
112.6
|
|
|
$
|
95.6
|
|
|
$
|
10.6
|
|
|
$
|
1.6
|
|
|
$
|
—
|
|
|
$
|
4.8
|
|
|
$
|
—
|
|
December 31, 2015
|
|
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
|
|
$
|
224.3
|
|
|
$
|
—
|
|
|
$
|
224.3
|
|
|
$
|
(119.2
|
)
|
|
$
|
105.1
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
172.0
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
396.3
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
255.1
|
|
|
$
|
—
|
|
|
$
|
255.1
|
|
|
$
|
(134.8
|
)
|
|
$
|
120.3
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
167.9
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
423.0
|
|
|
|
|
|
|
|
|
|
December 31, 2015
|
|
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
|
|
$
|
169.6
|
|
|
$
|
—
|
|
|
$
|
169.6
|
|
|
$
|
(119.2
|
)
|
|
$
|
50.4
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
114.1
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
283.7
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to a master netting arrangement or similar agreement
|
|
$
|
169.3
|
|
|
$
|
—
|
|
|
$
|
169.3
|
|
|
$
|
(134.8
|
)
|
|
$
|
34.5
|
|
Derivatives that are not or may not be subject to master netting arrangement or similar agreement
|
|
147.8
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
|
$
|
317.1
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
|
2015
|
|
2014
|
|
2013
|
|
Hedged
Item
|
|
|
2015
|
|
2014
|
|
2013
|
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||
Interest rate contracts
|
|
Interest expense
|
|
$
|
15.2
|
|
|
$
|
17.5
|
|
|
$
|
(8.5
|
)
|
|
Fixed-rate debt
|
|
Interest expense
|
|
$
|
(2.3
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
19.3
|
|
|
Interest expense
|
|
$
|
0.8
|
|
|
$
|
(0.7
|
)
|
|
$
|
—
|
|
Total gain/(loss)
|
|
|
|
$
|
15.2
|
|
|
$
|
17.5
|
|
|
$
|
(8.5
|
)
|
|
|
|
|
|
$
|
(2.3
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
19.3
|
|
|
|
|
$
|
0.8
|
|
|
$
|
(0.7
|
)
|
|
$
|
—
|
|
|
|
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
|
|
2015
|
|
2014
|
|
2013
|
|
|
2015
|
|
2014
|
|
2013
|
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||||||||||
Foreign currency contracts
|
|
$
|
70.8
|
|
|
$
|
84.0
|
|
|
$
|
(3.1
|
)
|
|
Revenue
|
|
$
|
77.8
|
|
|
$
|
1.6
|
|
|
$
|
10.4
|
|
|
Derivative
gains/(losses), net |
|
$
|
(0.1
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
(0.4
|
)
|
Interest rate contracts (c)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Interest expense
|
|
(3.6
|
)
|
|
(3.6
|
)
|
|
(3.6
|
)
|
|
Interest expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total gain/(loss)
|
|
$
|
70.8
|
|
|
$
|
84.0
|
|
|
$
|
(3.1
|
)
|
|
|
|
$
|
74.2
|
|
|
$
|
(2.0
|
)
|
|
$
|
6.8
|
|
|
|
|
$
|
(0.1
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
(0.4
|
)
|
|
|
Gain/(Loss) Recognized in Income on Derivatives (d)
|
||||||||||||
|
|
Income Statement Location
|
|
Amount
|
||||||||||
Derivatives
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Foreign currency contracts (e)
|
Selling, general and administrative
|
|
$
|
35.9
|
|
|
$
|
46.5
|
|
|
$
|
(3.7
|
)
|
|
Foreign currency contracts (f)
|
Derivative gains/(losses), net
|
|
1.3
|
|
|
2.2
|
|
|
(0.9
|
)
|
||||
Total gain/(loss)
|
|
|
$
|
37.2
|
|
|
$
|
48.7
|
|
|
$
|
(4.6
|
)
|
(a)
|
The 2015 loss of
$2.3 million
was comprised of a loss in value on the debt of
$16.0 million
and amortization of hedge accounting adjustments of
$13.7 million
. The 2014 loss of
$4.4 million
was comprised of a loss in value on the debt of
$16.8 million
and amortization of hedge accounting adjustments of
$12.4 million
. 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
.
|
(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 losses on settlement assets and obligations, cash balances, and other assets and liabilities, not including amounts related to derivatives activity as displayed above and included in "Selling, general, and administrative" in the Consolidated Statements of Income were
$36.1 million
,
$51.8 million
and
$5.4 million
for the years ended
2015
,
2014
and
2013
, 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.
|
|
December 31, 2015
|
|
December 31, 2014
|
||||
Notes:
|
|
|
|
||||
Floating rate notes due 2015
|
$
|
—
|
|
|
$
|
250.0
|
|
2.375% notes due 2015 (a)
|
—
|
|
|
250.0
|
|
||
5.930% notes due 2016 (a)
|
1,000.0
|
|
|
1,000.0
|
|
||
2.875% notes (effective rate of 2.1%) due 2017
|
500.0
|
|
|
500.0
|
|
||
3.650% notes due 2018 (a)
|
400.0
|
|
|
400.0
|
|
||
3.350% notes due 2019 (a)
|
250.0
|
|
|
250.0
|
|
||
5.253% notes due 2020 (a)
|
324.9
|
|
|
324.9
|
|
||
6.200% notes due 2036 (a)
|
500.0
|
|
|
500.0
|
|
||
6.200% notes due 2040 (a)
|
250.0
|
|
|
250.0
|
|
||
Other borrowings
|
5.5
|
|
|
5.6
|
|
||
Total borrowings at par value
|
3,230.4
|
|
|
3,730.5
|
|
||
Fair value hedge accounting adjustments, net (b)
|
7.6
|
|
|
5.3
|
|
||
Unamortized discount, net
|
(12.4
|
)
|
|
(15.4
|
)
|
||
Total borrowings at carrying value (c)
|
$
|
3,225.6
|
|
|
$
|
3,720.4
|
|
(a)
|
The difference between the stated interest rate and the effective interest rate is not significant.
|
(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)
|
As of
December 31, 2015
, the Company’s weighted-average effective rate on total borrowings was approximately
4.8%
.
|
Due within 1 year
|
$
|
1,000.0
|
|
Due after 1 year through 2 years
|
505.5
|
|
|
Due after 2 years through 3 years
|
400.0
|
|
|
Due after 3 years through 4 years
|
250.0
|
|
|
Due after 4 years through 5 years
|
324.9
|
|
|
Due after 5 years
|
750.0
|
|
|
Year Ended December 31, 2015
|
|||||||||||
|
Options
|
|
Weighted-Average
Exercise Price
|
|
Weighted-Average Remaining
Contractual Term
(Years)
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding as of January 1
|
16.4
|
|
|
$
|
17.80
|
|
|
|
|
|
||
Granted
|
1.0
|
|
|
$
|
19.32
|
|
|
|
|
|
||
Exercised
|
(4.6
|
)
|
|
$
|
17.25
|
|
|
|
|
|
||
Cancelled/forfeited
|
(1.0
|
)
|
|
$
|
19.20
|
|
|
|
|
|
||
Outstanding as of December 31
|
11.8
|
|
|
$
|
18.01
|
|
|
4.4
|
|
$
|
13.3
|
|
Options exercisable as of December 31
|
8.8
|
|
|
$
|
18.62
|
|
|
3.3
|
|
$
|
7.2
|
|
|
Year Ended December 31, 2015
|
||||
|
Number
Outstanding
|
|
Weighted-Average
Grant-Date Fair Value
|
||
Non-vested as of January 1
|
7.6
|
|
$
|
14.68
|
|
Granted
|
2.9
|
|
$
|
17.85
|
|
Vested
|
(2.0)
|
|
$
|
15.86
|
|
Forfeited
|
(0.9)
|
|
$
|
15.64
|
|
Non-vested as of December 31
|
7.6
|
|
$
|
15.47
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Stock-based compensation expense
|
$
|
(42.2
|
)
|
|
$
|
(39.7
|
)
|
|
$
|
(34.5
|
)
|
Income tax benefit from stock-based compensation expense
|
12.3
|
|
|
11.5
|
|
|
10.0
|
|
|||
Net income impact
|
$
|
(29.9
|
)
|
|
$
|
(28.2
|
)
|
|
$
|
(24.5
|
)
|
Earnings per share:
|
|
|
|
|
|
||||||
Basic and Diluted
|
$
|
(0.06
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.04
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Stock options granted:
|
|
|
|
|
|
||||||
Weighted-average risk-free interest rate
|
1.7
|
%
|
|
1.9
|
%
|
|
1.2
|
%
|
|||
Weighted-average dividend yield
|
3.6
|
%
|
|
3.1
|
%
|
|
3.7
|
%
|
|||
Volatility
|
28.2
|
%
|
|
33.8
|
%
|
|
35.3
|
%
|
|||
Expected term (in years)
|
6.00
|
|
|
6.09
|
|
|
6.09
|
|
|||
Weighted-average grant date fair value
|
$
|
3.58
|
|
|
$
|
3.95
|
|
|
$
|
3.20
|
|
•
|
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."
|
•
|
All items not included in operating income are excluded from the segments.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Consumer-to-Consumer:
|
|
|
|
|
|
||||||
Transaction fees
|
$
|
3,221.0
|
|
|
$
|
3,421.8
|
|
|
$
|
3,396.1
|
|
Foreign exchange revenues
|
1,057.1
|
|
|
998.9
|
|
|
981.3
|
|
|||
Other revenues
|
65.8
|
|
|
65.1
|
|
|
56.2
|
|
|||
|
4,343.9
|
|
|
4,485.8
|
|
|
4,433.6
|
|
|||
Consumer-to-Business:
|
|
|
|
|
|
||||||
Transaction fees
|
612.7
|
|
|
572.7
|
|
|
579.1
|
|
|||
Foreign exchange and other revenues
|
25.0
|
|
|
26.1
|
|
|
29.4
|
|
|||
|
637.7
|
|
|
598.8
|
|
|
608.5
|
|
|||
Business Solutions:
|
|
|
|
|
|
||||||
Foreign exchange revenues
|
357.2
|
|
|
363.1
|
|
|
355.5
|
|
|||
Transaction fees and other revenues
|
41.5
|
|
|
41.5
|
|
|
37.4
|
|
|||
|
398.7
|
|
|
404.6
|
|
|
392.9
|
|
|||
Other:
|
|
|
|
|
|
||||||
Total revenues
|
103.4
|
|
|
118.0
|
|
|
107.0
|
|
|||
Total consolidated revenues
|
$
|
5,483.7
|
|
|
$
|
5,607.2
|
|
|
$
|
5,542.0
|
|
Operating income/(loss):
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
1,042.0
|
|
|
$
|
1,050.4
|
|
|
$
|
1,030.4
|
|
Consumer-to-Business (a)
|
68.6
|
|
|
98.7
|
|
|
121.9
|
|
|||
Business Solutions (b)
|
2.8
|
|
|
(12.1
|
)
|
|
(27.0
|
)
|
|||
Other
|
(4.0
|
)
|
|
3.5
|
|
|
(17.9
|
)
|
|||
Total consolidated operating income
|
$
|
1,109.4
|
|
|
$
|
1,140.5
|
|
|
$
|
1,107.4
|
|
|
|
|
|
|
|
(a)
|
During the year ended
December 31, 2015
, Consumer-to-Business operating income included
$35.3 million
of expenses related to the Paymap Settlement Agreement. For additional information on the Paymap Settlement Agreement, refer to Note 5.
|
(b)
|
During the year ended
December 31, 2013
, the Company incurred
$19.3 million
, respectively, of integration expenses related to the acquisition of Travelex Global Business Payments ("TGBP"), which was acquired in November 2011. 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,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Assets:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
4,738.7
|
|
|
$
|
5,049.7
|
|
|
$
|
5,321.9
|
|
Consumer-to-Business
|
1,010.1
|
|
|
1,060.2
|
|
|
1,129.9
|
|
|||
Business Solutions
|
2,384.4
|
|
|
2,430.7
|
|
|
2,256.4
|
|
|||
Other
|
1,325.7
|
|
|
1,349.8
|
|
|
1,413.1
|
|
|||
Total assets
|
$
|
9,458.9
|
|
|
$
|
9,890.4
|
|
|
$
|
10,121.3
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
183.4
|
|
|
$
|
191.5
|
|
|
$
|
179.4
|
|
Consumer-to-Business
|
21.7
|
|
|
17.3
|
|
|
15.8
|
|
|||
Business Solutions
|
57.4
|
|
|
56.1
|
|
|
59.6
|
|
|||
Other
|
7.7
|
|
|
7.0
|
|
|
8.0
|
|
|||
Total consolidated depreciation and amortization
|
$
|
270.2
|
|
|
$
|
271.9
|
|
|
$
|
262.8
|
|
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
|
|
||||||
Consumer-to-Consumer
|
$
|
191.0
|
|
|
$
|
132.1
|
|
|
$
|
174.0
|
|
Consumer-to-Business
|
46.1
|
|
|
27.3
|
|
|
36.9
|
|
|||
Business Solutions
|
19.2
|
|
|
13.0
|
|
|
14.8
|
|
|||
Other
|
10.2
|
|
|
6.6
|
|
|
15.6
|
|
|||
Total capital expenditures
|
$
|
266.5
|
|
|
$
|
179.0
|
|
|
$
|
241.3
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Revenue:
|
|
|
|
|
|
||||||
United States
|
$
|
1,584.7
|
|
|
$
|
1,564.6
|
|
|
$
|
1,523.7
|
|
International
|
3,899.0
|
|
|
4,042.6
|
|
|
4,018.3
|
|
|||
Total
|
$
|
5,483.7
|
|
|
$
|
5,607.2
|
|
|
$
|
5,542.0
|
|
Long-lived assets:
|
|
|
|
|
|
||||||
United States
|
$
|
182.9
|
|
|
$
|
158.1
|
|
|
$
|
156.6
|
|
International
|
48.9
|
|
|
48.3
|
|
|
53.3
|
|
|||
Total
|
$
|
231.8
|
|
|
$
|
206.4
|
|
|
$
|
209.9
|
|
2015 by Quarter:
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Year Ended December 31, 2015
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Revenues
|
$
|
1,320.9
|
|
|
$
|
1,383.6
|
|
|
$
|
1,399.2
|
|
|
$
|
1,380.0
|
|
|
$
|
5,483.7
|
|
|
Expenses (a) (b)
|
1,048.6
|
|
|
1,132.8
|
|
|
1,094.7
|
|
|
1,098.2
|
|
|
4,374.3
|
|
||||||
Operating income
|
272.3
|
|
|
250.8
|
|
|
304.5
|
|
|
281.8
|
|
|
1,109.4
|
|
||||||
Other expense, net
|
39.7
|
|
|
43.9
|
|
|
39.1
|
|
|
44.9
|
|
|
167.6
|
|
||||||
Income before income taxes
|
232.6
|
|
|
206.9
|
|
|
265.4
|
|
|
236.9
|
|
|
941.8
|
|
||||||
Provision for income taxes
|
28.7
|
|
|
17.6
|
|
|
33.1
|
|
|
24.6
|
|
|
104.0
|
|
||||||
Net income
|
$
|
203.9
|
|
|
$
|
189.3
|
|
|
$
|
232.3
|
|
|
$
|
212.3
|
|
|
$
|
837.8
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
$
|
0.39
|
|
|
$
|
0.37
|
|
|
$
|
0.46
|
|
|
$
|
0.42
|
|
|
$
|
1.63
|
|
|
Diluted
|
$
|
0.39
|
|
|
$
|
0.36
|
|
|
$
|
0.45
|
|
|
$
|
0.42
|
|
|
$
|
1.62
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
521.0
|
|
|
515.2
|
|
|
509.6
|
|
|
504.5
|
|
|
512.6
|
|
||||||
Diluted
|
525.2
|
|
|
519.8
|
|
|
513.2
|
|
|
508.6
|
|
|
516.7
|
|
(a)
|
Includes
$35.3 million
in the second quarter of expenses related to the Paymap Settlement Agreement. For more information, see Note 5.
|
(b)
|
Includes
$11.1 million
in the fourth quarter of expenses related to productivity and cost-savings initiatives. For more information, see Note 3.
|
2014 by Quarter:
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
Year Ended December 31, 2014
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Revenues
|
$
|
1,350.8
|
|
|
$
|
1,405.6
|
|
|
$
|
1,440.9
|
|
|
$
|
1,409.9
|
|
|
$
|
5,607.2
|
|
|
Expenses (c)
|
1,078.8
|
|
|
1,127.3
|
|
|
1,126.8
|
|
|
1,133.8
|
|
|
4,466.7
|
|
||||||
Operating income
|
272.0
|
|
|
278.3
|
|
|
314.1
|
|
|
276.1
|
|
|
1,140.5
|
|
||||||
Other expense, net
|
44.6
|
|
|
46.2
|
|
|
41.3
|
|
|
40.2
|
|
|
172.3
|
|
||||||
Income before income taxes
|
227.4
|
|
|
232.1
|
|
|
272.8
|
|
|
235.9
|
|
|
968.2
|
|
||||||
Provision for income taxes
|
24.4
|
|
|
38.3
|
|
|
38.7
|
|
|
14.4
|
|
|
115.8
|
|
||||||
Net income
|
$
|
203.0
|
|
|
$
|
193.8
|
|
|
$
|
234.1
|
|
|
$
|
221.5
|
|
|
$
|
852.4
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
$
|
0.37
|
|
|
$
|
0.36
|
|
|
$
|
0.44
|
|
|
$
|
0.42
|
|
|
$
|
1.60
|
|
|
Diluted
|
$
|
0.37
|
|
|
$
|
0.36
|
|
|
$
|
0.44
|
|
|
$
|
0.42
|
|
|
$
|
1.59
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
545.9
|
|
|
537.1
|
|
|
527.8
|
|
|
522.8
|
|
|
533.4
|
|
||||||
Diluted
|
549.2
|
|
|
539.9
|
|
|
531.2
|
|
|
526.9
|
|
|
536.8
|
|
||||||
____________
|
|
|
|
|
|
|
|
|
|
(c)
|
Includes
$30.3 million
in the fourth quarter of expenses related to productivity and cost-savings initiatives. For more information, see Note 3.
|
|
The Western Union Company (Registrant)
|
|
|
|
|
February 19, 2016
|
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 19, 2016
|
Hikmet Ersek
|
|
|
|
|
|
|
|
|
|
/s/ Rajesh K. Agrawal
|
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
February 19, 2016
|
Rajesh K. Agrawal
|
|
|
|
|
|
|
|
|
|
/s/ Amintore T.X. Schenkel
|
|
Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer)
|
|
February 19, 2016
|
Amintore T.X. Schenkel
|
|
|
|
|
|
|
|
|
|
/s/ Jack M. Greenberg
|
|
Non-Executive Chairman of the Board of Directors
|
|
February 19, 2016
|
Jack M. Greenberg
|
|
|
|
|
|
|
|
|
|
/s/ Martin I. Cole
|
|
Director
|
|
February 19, 2016
|
Martin I. Cole
|
|
|
|
|
|
|
|
|
|
/s/ Richard A. Goodman
|
|
Director
|
|
February 19, 2016
|
Richard A. Goodman
|
|
|
|
|
|
|
|
|
|
/s/ Betsy D. Holden
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|
Director
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|
February 19, 2016
|
Betsy D. Holden
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/s/ Jeffrey A. Joerres
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|
Director
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|
February 19, 2016
|
Jeffrey A. Joerres
|
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/s/ Linda Fayne Levinson
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|
Director
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|
February 19, 2016
|
Linda Fayne Levinson
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/s/ Roberto G. Mendoza
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|
Director
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|
February 19, 2016
|
Roberto G. Mendoza
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/s/ Michael A. Miles, Jr.
|
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Director
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|
February 19, 2016
|
Michael A. Miles, Jr.
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/s/ Robert W. Selander
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|
Director
|
|
February 19, 2016
|
Robert W. Selander
|
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/s/ Frances Fragos Townsend
|
|
Director
|
|
February 19, 2016
|
Frances Fragos Townsend
|
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/s/ Solomon D. Trujillo
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Director
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February 19, 2016
|
Solomon D. Trujillo
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Exhibit
Number
|
|
Description
|
|
|
|
2.1
|
|
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).
|
|
|
|
3.1
|
|
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).
|
|
|
|
3.2
|
|
Amended and Restated By-laws of the Company, as amended as of February 19, 2016.
|
|
|
|
4.1
|
|
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).
|
|
|
|
4.2
|
|
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).
|
|
|
|
4.3
|
|
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).
|
|
|
|
4.4
|
|
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).
|
|
|
|
4.5
|
|
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).
|
|
|
|
4.6
|
|
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).
|
|
|
|
4.7
|
|
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).
|
|
|
|
4.8
|
|
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).
|
|
|
|
4.9
|
|
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).
|
|
|
|
4.10
|
|
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).
|
|
|
|
4.11
|
|
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).
|
|
|
|
4.12
|
|
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).
|
|
|
|
4.13
|
|
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).
|
|
|
|
4.14
|
|
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).
|
|
|
|
10.1
|
|
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).
|
|
|
|
10.2
|
|
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).
|
|
|
|
10.3
|
|
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).
|
|
|
|
10.4
|
|
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).
|
|
|
|
10.5
|
|
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).
|
|
|
|
10.6
|
|
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).
|
|
|
|
10.7
|
|
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).
|
|
|
|
10.8
|
|
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).
|
|
|
|
10.9
|
|
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).
|
|
|
|
10.10
|
|
Order Granting Stipulated Motion to Modify Amendment to Settlement Agreement issued March 14, 2014 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).
|
|
|
|
10.11
|
|
Order Granting Stipulated Motion to Extend Deadline for Separate Agreements issued April 14, 2014 by The Honorable Warren Granville, Maricopa County Superior Court Judge (filed as Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).
|
|
|
|
10.12
|
|
Order Granting Stipulation to Extend Time for Production of Data issued October 17, 2014 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 October 30, 2014 and incorporated herein by reference thereto).
|
|
|
|
10.13
|
|
Order Granting Stipulated Motion to Extend Time for Monitor Evaluation issued January 22, 2016 by The Honorable Warren Granville, Maricopa County Superior Court Judge.
|
|
|
|
10.14
|
|
Credit Agreement, dated as of September 29, 2015, among The Western Union Company, the banks named therein, as lenders, Citibank, N.A. and Bank of America, N.A., in their respective capacities as Issuing Lenders, Bank of America, N.A. and The Bank of New York Mellon, as Syndication Agents, Barclays Bank PLC, U.S. Bank National Association and Wells Fargo Bank, National Association, as Documentation Agents, and Citibank, N.A., as Administrative Agent for the Banks thereunder (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 1, 2015 and incorporated herein by reference thereto).
|
|
|
|
10.15
|
|
Form of Director Indemnification Agreement (filed as Exhibit 10.10 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).*
|
|
|
|
10.16
|
|
The Western Union Company Severance/Change in Control Policy (Executive Committee Level), as Amended and Restated Effective July 28, 2015.*
|
|
|
|
10.17
|
|
The Western Union Company 2006 Long-Term Incentive Plan, as amended and restated on January 31, 2014 (filed as Exhibit 10.11 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.18
|
|
The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, as Amended and Restated Effective January 31, 2014 (filed as Exhibit 10.12 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.19
|
|
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).*
|
|
|
|
10.20
|
|
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).*
|
|
|
|
10.21
|
|
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).*
|
|
|
|
10.22
|
|
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).*
|
|
|
|
10.23
|
|
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).*
|
|
|
|
10.24
|
|
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).*
|
|
|
|
10.25
|
|
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).*
|
|
|
|
10.26
|
|
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).*
|
|
|
|
10.27
|
|
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).*
|
|
|
|
10.28
|
|
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).*
|
|
|
|
10.29
|
|
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).*
|
|
|
|
10.30
|
|
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).*
|
|
|
|
10.31
|
|
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 (filed as Exhibit 10.29 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.32
|
|
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).*
|
|
|
|
10.33
|
|
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).*
|
|
|
|
10.34
|
|
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).*
|
|
|
|
10.35
|
|
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).*
|
|
|
|
10.36
|
|
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).*
|
|
|
|
10.37
|
|
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).*
|
|
|
|
10.38
|
|
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).*
|
|
|
|
10.39
|
|
Form of Award Agreement Under The Western Union Company Senior Executive Annual Incentive Plan for 2013 (filed as Exhibit 10.39 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
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).*
|
|
|
|
10.41
|
|
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).*
|
|
|
|
10.42
|
|
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 (filed as Exhibit 10.45 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.43
|
|
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 (filed as Exhibit 10.46 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.44
|
|
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 (filed as Exhibit 10.47 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.45
|
|
Separation Agreement and Release dated as of January 16, 2014 between Scott T. Scheirman, Western Union, LLC, and The Western Union Company (filed as Exhibit 10.48 to the Company's Annual Report on Form 10-K filed on February 24, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.46
|
|
Form of Award Agreement Under The Western Union Company Senior Executive Annual Incentive Plan for 2014 and Thereafter (filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.47
|
|
Form of Supplemental Restricted Stock Unit Award Agreement for Section 16 Officers (Non - U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.48
|
|
Form of Supplemental Restricted Stock Unit Award Agreement for Section 16 Officers (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.9 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.49
|
|
Form of Nonqualified Stock Option Award Agreement for Section 16 Officers (Non - U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.50
|
|
Form of Nonqualified Stock Option Award Agreement for Section 16 Officers (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.11 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.51
|
|
Form of Performance-Based Restricted Stock Unit Award Agreement for Section 16 Officers (Non - U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.12 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.52
|
|
Form of Performance-Based Restricted Stock Unit Award Agreement for Section 16 Officers (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.13 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.53
|
|
Form of Restricted Stock Unit Award Agreement for Section 16 Officers (Non - U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.14 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.54
|
|
Form of Restricted Stock Unit Award Agreement for Section 16 Officers (U.S.) Under The Western Union Company 2006 Long-Term Incentive Plan For Awards Granted in 2014 and Thereafter (filed as Exhibit 10.15 to the Company's Quarterly Report on Form 10-Q filed on May 1, 2014 and incorporated herein by reference thereto).*
|
|
|
|
10.55
|
|
The Western Union Company 2015 Long-Term Incentive Plan (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 20, 2015 and incorporated herein by reference thereto).*
|
|
|
|
10.56
|
|
Form of Deferred Stock Unit Award Agreement for U.S. Non-Employee Directors Under The Western Union Company 2015 Long-Term Incentive Plan, Effective May 15, 2015 (filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on July 30, 2015 and incorporated herein by reference thereto).*
|
|
|
|
10.57
|
|
Form of Nonqualified Stock Option Grant Agreement for U.S. Non-Employee Directors Under The Western Union Company 2015 Long-Term Incentive Plan, Effective May 15, 2015 (filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed on July 30, 2015 and incorporated herein by reference thereto).*
|
|
|
|
12
|
|
Computation of Ratio of Earnings to Fixed Charges
|
|
|
|
14
|
|
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).
|
|
|
|
21
|
|
Subsidiaries of The Western Union Company
|
|
|
|
23
|
|
Consent of Independent Registered Public Accounting Firm
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer of The Western Union Company Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934
|
|
|
|
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
|
|
|
|
32
|
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
State of Arizona, ex rel.
Attorney General Mark Brnovich,
Plaintiff,
vs.
Western Union Financial Services, Inc.
Defendant.
|
No. CV 2010-005807
[PROPOSED] ORDER GRANTING STIPULATED MOTION TO EXTEND TIME FOR MONITOR EVALUATION
Assigned to the Hon. Warren Granville
|
|
/s/ HON. WARREN GRANVILLE
|
|
THE HONORABLE WARREN GRANVILLE
|
|
MARICOPA COUNTY SUPERIOR COURT JUDGE
|
1.
|
Purpose
|
2.
|
Effective Date
|
3.
|
Definitions
|
(a)
|
the acquisition by any individual, entity or group (a “Person”), including any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act, of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of 35% or more of either (i) the then outstanding shares of common stock of Western Union (the “Outstanding Common Stock”) or (ii) the combined voting power of the then outstanding securities of Western Union entitled to vote generally in the election of directors (the “Outstanding Voting Securities”); excluding, however, the following: (A) any acquisition directly from Western Union (excluding any acquisition resulting from the exercise of an exercise, conversion or exchange privilege unless the security being so exercised, converted or exchanged was acquired directly from Western Union), (B) any acquisition by Western Union, (C) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by Western Union or any corporation controlled by Western Union or (D) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii), and (iii) of subsection (c) of this definition; provided further, that for purposes of clause (B), if any Person (other than Western Union or any employee benefit plan (or related trust) sponsored or maintained by Western Union or any corporation controlled by Western Union) shall become the beneficial owner of 35% or more of the Outstanding Common Stock or 35% or more of the Outstanding Voting Securities by reason of an acquisition by Western Union, and such Person shall, after such acquisition by Western Union, become the beneficial owner of any additional shares of the Outstanding Common Stock or any additional Outstanding Voting Securities and such beneficial ownership is publicly announced, such additional beneficial ownership shall constitute a Change in Control;
|
(b)
|
during any twenty-four (24) month period, the cessation of individuals who constitute the Board as of the date this Policy is adopted by the Committee (the “Incumbent Board”), to constitute at least a majority of such Incumbent Board; provided that any individual who becomes a director of Western Union subsequent to the date this Policy is adopted by the Committee whose election, or nomination for election by Western Union’s stockholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be deemed a member of the Incumbent Board; and provided further, that any individual who was initially elected as a director of Western Union as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors, or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall not be deemed a member of the Incumbent Board;
|
(c)
|
the consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of Western Union (a “Corporate Transaction”); excluding, however, a Corporate Transaction pursuant to which (i) all or substantially all of the individuals or entities who are the beneficial owners, respectively, of the Outstanding Common Stock and the Outstanding Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the outstanding securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which as a result of such transaction owns Western Union or all or substantially all of Western Union’s assets either directly or indirectly) in substantially the same proportions relative to each other as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Common Stock and the Outstanding Voting Securities, as the case may be, (ii) no Person (other than Western Union; any employee benefit plan (or related trust) sponsored or maintained by Western Union or any corporation controlled by Western Union; the corporation resulting from such Corporate Transaction; and any Person which beneficially owned, immediately prior to such Corporate Transaction, directly or indirectly, 35% or more of the Outstanding Common Stock or the Outstanding Voting Securities, as the case may be) will beneficially own, directly or indirectly, 35% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding securities of such corporation entitled to vote generally in the election of directors and (iii) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or
|
(d)
|
the consummation of a plan of complete liquidation or dissolution of Western Union.
|
4.
|
Eligibility
|
5.
|
Eligible Termination Reasons
|
(a)
|
Prior to the occurrence of a Change in Control, action by the Company to involuntarily terminate the employment of an Eligible Executive with the Company, but not including a separation from service on account of death, Disability or for Cause.
|
(b)
|
After the occurrence of a Change in Control, (i) action by the Company to involuntarily terminate the employment of an Eligible Executive with the Company, but not including a separation from service on account of death, Disability or for Cause, or (ii) voluntary separation from service from the Company by an Eligible Executive for Good Reason during the twenty-four (24) month period commencing on the date of the Change in Control.
|
6.
|
Non-Eligible Termination Reasons
|
7.
|
Severance and Change in Control Benefits
. The provisions of this Section 7 are subject, without limitation, to the provisions of Section 9 hereof.
|
(a)
|
Post-Termination Payments
. If an Eligible Executive’s employment with the Company is terminated after the Effective Date for any reason set forth in Section 5, the Company shall pay to the Eligible Executive the following amounts in accordance with Section 10:
|
(i)
|
Severance Pay
. An amount equal to 2 (1.5 in the case of an Eligible Executive (other than Western Union’s Chief Executive Officer) whose separation from service is for an eligible termination reason under Section 5(a)) multiplied by the sum of (1) 100% of the Eligible Executive’s Base Salary and (2) the percentage of the Eligible Executive’s Base Salary established as the target bonus for the Eligible Executive under the Company’s Senior Executive Annual Incentive Plan (or the bonus plan then applicable to the Eligible Executive), for the year in which the Termination Date occurs. If an Eligible Executive’s target bonus for the year in which the Termination Date occurs has not been established at the time an amount is payable under this subsection 7(a)(i), then such amount shall be calculated using the Eligible Executive’s annual target bonus for the immediately preceding year, or, if no such prior year target bonus exists with respect to the Eligible Executive, the prior year target bonus established for a similarly situated Eligible Executive, as determined by the Committee. (The reference to the Eligible Executive’s target bonus for the year in which the Termination Date occurs in this subsection 7(a)(i) is solely for purposes of calculating the Eligible Executive’s severance pay, and shall not give the Executive any right to be paid an amount for the year in which the Termination Date occurs under the Company’s Senior Executive Annual Incentive Plan (or the bonus plan then applicable to the Eligible Executive)).
|
(ii)
|
Bonus for Year of Termination
. Subject to the Committee’s certification that the applicable performance goals for the year in which the Termination Date occurs have been achieved, an amount equal to the lesser of (1) the maximum bonus which could have been paid to the Eligible Executive under the Company’s Senior Executive Annual Incentive Plan (or the bonus plan then applicable to the Eligible Executive) for the year in which the Termination Date occurs based on actual performance for such year and (2) a prorated amount (equal to the product of (A) the Eligible Executive’s target bonus for the year in which the Termination Date occurs and (B) the ratio of the number of days the Eligible Executive was employed by the Company during such year up to and including the Termination Date to 365) of the Eligible Executive’s target bonus under the Company’s Senior Executive Annual Incentive Plan (or the bonus plan then applicable to the Eligible Executive) for the year in which the Termination Date occurs.
|
(b)
|
Continued Benefits Coverage
. If an Eligible Executive’s employment with the Company terminates after the Effective Date for any reason set forth in Section 5, the Eligible Executive and his or her eligible dependents shall be given the opportunity to elect continued group health coverage under the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended (“COBRA”) with respect to all group health plans that are subject to COBRA in which the Eligible Executive and his or her dependents were participating immediately prior to such termination. Provided that the Eligible Executive (and/or his or her dependents) timely elects such coverage, the Company shall pay to the Eligible Executive, as an additional Severance Benefit, a lump sum approximately equal to the difference in cost between COBRA premiums and active employee premiums for 18 months of COBRA coverage as calculated by the Company in its discretion as of the Termination Date, which payment shall constitute taxable income to the Eligible Executive and which shall be paid in a lump sum in accordance with Section 10.
|
(i)
|
Non-Change in Control
.
|
a.
|
Long-Term Incentive Awards Granted On and After February 17, 2009
. Effective for awards granted on and after February 17, 2009 under The Western Union Company 2006 Long-Term Incentive Plan (or a successor plan) (the “LTIP”) to an individual who is an Eligible Executive on the date the award is granted, if the Eligible Executive’s employment with the Company is terminated for an eligible termination reason described in Section 5(a), then the unvested portion of awards held by the Eligible Executive that are eligible to become fully vested and exercisable or payable contingent upon the Eligible Executive’s continued employment and the passage of time (whether or not the Company or the Eligible Executive have attained any specified performance goals) (“Time Vested Awards”), other than awards classified by the Committee at the time of grant as “Career Shares” (if applicable to the Eligible Executive) and awards that provide for a deferral of compensation within the meaning of Code Section 409A, shall vest on a prorated basis effective on the Eligible Executive’s Termination Date. Such prorated vesting shall be calculated on a grant-by-grant basis by multiplying the unvested portion of each such award by a fraction, the numerator of which is the number of days that have elapsed between the grant date and the Eligible Executive’s Termination Date and the denominator of which is the number of days between the grant date and the date the award would have become fully vested had the Eligible Executive not terminated his or her employment. Solely for awards granted prior to February 24, 2011which are subject to a graduated vesting schedule, the foregoing calculation shall be performed as if each vesting tranche of the award was a separate grant. Fractions of a share resulting from the calculations shall be rounded to the nearest whole share. The vested portion of any nonqualified stock option and stock appreciation right awards held by an Eligible Executive on his or her Termination Date (and which were granted while an Eligible Executive), including any portion that had previously become vested and the prorated portion that vests effective on the Eligible Executive’s Termination Date in accordance with this subsection, shall be exercisable until the end of the Eligible Executive’s Severance Period (or, if earlier, the expiration of the original term of the award) but not thereafter. Notwithstanding the foregoing, if, at the time of an Eligible Executive’s termination of employment, the Eligible Executive has satisfied the applicable age or age and service requirement for “Retirement” under the LTIP, the following rules shall apply: (i) all outstanding nonqualified stock options held by the Eligible Executive which were granted prior to February 24, 2011 shall continue to vest in accordance with the terms of the applicable award agreement, and to the extent vested, shall be exercisable in accordance with their terms until the date which is four years after the Eligible Executive’s Termination Date (or, if earlier, the expiration of the original term of the award) but not thereafter, and (ii) all outstanding nonqualified stock options or stock appreciation rights held by the Eligible Executive which were granted on or after February 24, 2011 shall vest, to the extent not already vested, on a prorated basis (calculated in the manner described above in this subsection for awards granted on or after February 24, 2011) effective on the Eligible Executive’s Termination Date, and all such vested nonqualified stock options and stock appreciation rights shall be exercisable in accordance with their terms until the earlier of (A) the date which is two years after the Eligible Executive’s Termination Date or the end of the Eligible Executive’s Severance Period (if the award was granted while an Eligible Executive), whichever is later, or (B) the expiration of the original term of the award.
|
|
If an Eligible Executive’s employment with the Company is terminated during a performance period for an eligible termination reason described in Section 5(a), any cash Performance Grants (as defined in the LTIP) awarded to the Eligible Executive under the LTIP (if applicable) with respect to such performance period shall be payable on a prorated basis based upon actual performance results at the end of the applicable performance period as determined by the Committee in its sole discretion, and shall be paid at the time specified in the applicable award (and if applicable, deferral) agreement. Such prorated payment shall be calculated on a grant-by-grant basis by multiplying the Performance Grant award the Eligible Executive would have received had the Eligible Executive remained employed (based upon actual performance results at the end of the applicable performance period as determined by the Committee) by a fraction, the numerator of which shall equal the number of days such Participant was employed with the Company during the Performance Period and the denominator of which is the number of days in the performance period. All other outstanding awards granted to the Eligible Executive under the LTIP on and after February 17, 2009, and any Time Vested Awards that provide for a deferral of compensation within the meaning of Code Section 409A, shall be payable, if at all, in accordance with the terms of the LTIP and the applicable award (and, if applicable, deferral) agreements.
|
b.
|
Long-Term Incentive Awards Granted Prior to February 17, 2009
. Effective for awards granted prior to February 17, 2009 under the LTIP to an individual who is an Eligible Executive on the date the award is granted, if the Eligible Executive’s employment with the Company is terminated for an eligible termination reason described in Section 5(a), all outstanding nonqualified stock options held by the Eligible Executive shall (1) if, at the time of an Eligible Executive’s termination of employment, the Eligible Executive has satisfied the applicable age or age and service requirement for “Retirement” under the LTIP, continue to vest in accordance with the terms of the applicable award agreement, and to the extent vested, shall be exercisable in accordance with their terms until the date which is four years after the effective date of the Eligible Executive’s termination of employment (or, if earlier, the expiration of the original term of the award) but not thereafter or (2) in all other cases, continue to vest solely on account of the passage of time during the Eligible Executive’s Severance Period and, to the extent vested, shall be exercisable in accordance with their terms until the end of the Eligible Executive’s Severance Period (or, if earlier, the expiration of the original term of the award) but not thereafter. All Stock Awards (as defined in the LTIP) held by an Eligible Executive (and which were granted while an Eligible Executive) whose employment with the Company is terminated for an eligible termination reason described in Section 5(a) shall vest on a prorated basis effective on the Eligible Executive’s Termination Date. Such prorated vesting shall be calculated on a grant-by-grant basis by multiplying the number of unvested shares subject to each Stock Award by a fraction, the numerator of which is the number of days that have elapsed between the grant date and the Eligible Executive’s Termination Date and the denominator of which is the number of days between the grant date and the date the shares would have become fully vested had the Eligible Executive not terminated his or her employment. Fractions of a share resulting from the calculations shall be rounded to the nearest whole share.
|
(ii)
|
Change in Control
.
|
a.
|
Long-Term Incentive Awards Granted On and After February 17, 2009
. Effective for awards granted on and after February 17, 2009 under the LTIP to an individual who is an Eligible Executive on the date the award is granted, if the Eligible Executive’s employment with the Company terminates for an eligible termination reason described in Section 5(b) during the 24-month period commencing on the effective date of a Change in Control, then Time Vested Awards held by the Eligible Executive (including but not limited to grants of nonqualified stock options, stock appreciation rights, restricted stock awards, and restricted stock unit awards), other than awards that provide for a deferral of compensation within the meaning of Code Section 409A, shall become fully vested and exercisable or payable effective on the Eligible Executive’s Termination Date. In the event this subsection applies, nonqualified stock options and stock appreciation rights granted to an Eligible Executive (while an Eligible Executive) shall be exercisable until the later of (1) the date specified in the applicable award agreement or (2) the end of the Eligible Executive’s Severance Period (or, if earlier, the expiration of the original term of the award) but not thereafter. If an Eligible Executive’s employment with the Company terminates for an eligible termination reason described in Section 5(b) after the 24-month period commencing on the effective date of a Change in Control, then the unvested portion of Time Vested Awards held by the Eligible Executive (which were granted while an Eligible Executive), other than awards that provide for a deferral of compensation within the meaning of Code Section 409A, shall vest on a prorated basis effective on the Eligible Executive’s Termination Date, and such prorated vesting shall be calculated in the manner described in Section 7(c)(i)a above. The vested portion of any nonqualified stock option and stock appreciation right awards held by such an Eligible Executive on his or her Termination Date (and which were granted while an Eligible Executive), including any portion that had previously become vested and the prorated portion that vests effective on the Eligible Executive’s Termination Date in accordance with this subsection, shall be exercisable until the later of (1) the date specified in the applicable award agreement or (2) the end of the Eligible Executive’s Severance Period (or, if earlier, the expiration of the original term of the award) but not thereafter.
|
b.
|
Long-Term Incentive Awards Granted Prior to February 17, 2009
. In the event of a Change in Control, all outstanding awards granted prior to February 17, 2009 under the LTIP to an individual who is an Eligible Executive on the date the award is granted shall become fully vested and exercisable or payable as of the effective date of the Change in Control. In the event this subsection applies, if the Eligible Executive’s employment with the Company terminates for an eligible termination reason described in Section 5(b) during the 24-month period beginning on the effective date of the Change in Control, then nonqualified stock options granted to the Eligible Executive (while an Eligible Executive) shall remain exercisable until the later of (1) the date specified in the applicable award agreement or (2) the end of the Eligible Executive’s Severance Period (or, if earlier, the expiration of the original term of the award) but not thereafter.
|
(d)
|
Legal Fees
. Effective for Termination Dates occurring on or after the date of a Change in Control, if after exhausting the administrative remedies provided for in Section 20 herein, an Eligible Executive commences litigation regarding a bona fide claim for damages or other relief arising as a result of a claim for benefits under the Policy, and as a result thereof, whether by judgment or settlement, becomes entitled to receive benefits in an amount greater than prior to such litigation, the Company shall reimburse the reasonable legal fees and related expenses that are incurred by the Eligible Executive in connection with such litigation. Any such reimbursement shall be paid as soon as practicable following the resolution of the litigation, and in no event later than March 15 of the calendar year following the calendar year in which the resolution of such litigation occurs.
|
8.
|
Certain Additional Payments
|
(a)
|
In the event it is determined that any payments or benefits provided by the Company to or on behalf of an Eligible Executive who first became an Eligible Executive before April 30, 2009 (whether pursuant to the terms of this Policy or otherwise) (any such payments or benefits being referred to in this Section as “Payments”), but determined without taking into account any additional payments required under this Section, would be subject to the excise tax imposed by Code Section 4999, or any interest or penalties are incurred by the Eligible Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, collectively referred to herein as the “Excise Tax”), then the Eligible Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount so that after payment by the Eligible Executive of all federal, state and local taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any federal, state or local income taxes (and any interest and penalties imposed with respect thereto) and the Excise Tax imposed upon the Gross-Up Payment, the Eligible Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing, if it is determined that the Eligible Executive otherwise would be entitled to a Gross-Up Payment, but that the Payments to the Eligible Executive do not exceed 110% of the amount which is one dollar less than the smallest amount that would give rise to any Excise Tax (the “Reduced Amount”), then no Gross-Up Payment shall be made to the Eligible Executive and the Payments shall be reduced to the Reduced Amount. In such event, the reduction will occur in the following order: (i) reduction of cash payments; (ii) cancellation of accelerated vesting of equity awards; and (iii) reduction of other employee benefits. If acceleration of vesting of compensation from an Eligible Executive’s equity awards is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant unless the Eligible Executive elects in writing a different order for cancellation. Any Gross-Up Payment made pursuant to this Section 8(a) shall be made to the Eligible Executive no later than December 31 of the year following the year in which any Excise Tax is remitted to the taxing authority. No Gross-Up Payment shall be made pursuant to this Section 8(a) to any Eligible Executive who first becomes an Eligible Executive on or after April 30, 2009, and, in addition, Payments to such an Eligible Executive shall be reduced to the Reduced Amount (in the order described above), if such reduction would provide the Eligible Executive a greater net after-tax amount (after taking into account federal, state, local and social security taxes).
|
(b)
|
Subject to the provisions of Section 8(c), all determinations required to be made under this Section, including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determination, shall be made by the independent registered public accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the Change in Control (the “Accounting Firm”). In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall appoint another nationally recognized independent registered public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). The Accounting Firm shall provide its calculations, together with detailed supporting documentation, to the Company and the Eligible Executive within fifteen (15) calendar days after the date on which the Eligible Employee’s right to Payment is triggered (if requested at that time by the Company or the Eligible Executive) or such other time as agreed between the Company and the Eligible Executive. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 8, shall be paid by the Company to the Eligible Executive within five business days of the receipt of the Accounting Firm’s determination. If the Accounting Firm determines that no Excise Tax is payable by the Eligible Executive, it shall furnish the Eligible Executive with a written opinion that no Excise Tax will be imposed. Any good faith determination by the Accounting Firm shall be binding upon the Company and the Eligible Executive. As a result of the uncertainty in the application of Code Section 4999 at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 8(c) and the Eligible Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of the Eligible Executive. If the related Excise Taxes have been remitted to the taxing authority by the Eligible Executive, the Company shall reimburse the Eligible Executive for the Underpayment no later than December 31 of the year following the year in which the Excise Taxes were remitted to the taxing authority.
|
(c)
|
The Eligible Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment. Such notification shall be given as soon as practicable, but no later than 10 business days after the Eligible Executive is informed in writing of such claim, and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Eligible Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which the Eligible Executive gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Eligible Executive in writing prior to the expiration of such period that it desires to contest such claim, the Eligible Executive shall:
|
(i)
|
give the Company any information reasonably requested by the Company relating to such claim;
|
(ii)
|
take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;
|
(iii)
|
cooperate with the Company in good faith in order effectively to contest such claim; and
|
(iv)
|
permit the Company to participate in any proceedings relating to such claim;
|
(d)
|
If, after the receipt by the Eligible Executive of an amount advanced by the Company pursuant to Section 8(c), the Eligible Executive becomes entitled to receive, and receives, any refund with respect to such claim, the Eligible Executive shall (subject to the Company’s complying with the requirements of Section 8(c)) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Eligible Executive of an amount advanced by the Company pursuant to Section 8(c), a determination is made that the Eligible Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Eligible Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.
|
9.
|
Requirement of Release and Restrictive Covenant
|
10.
|
Method of Payment of Severance Benefits Under Sections 7(a) and 7(b)
|
(a)
|
Severance Benefits payable hereunder to an Eligible Executive pursuant to Section 7(a)(i) of this Policy on account of a separation from service for an eligible termination reason under Section 5(a) shall be paid in substantially equal installments consistent with the Company’s payroll practice during the Eligible Executive’s Severance Period and shall be paid in full no later than the end of such period. The bonus for the year in which the Termination Date occurs payable hereunder to an Eligible Executive pursuant to Section 7(a)(ii) of this Policy on account of a separation from service for an eligible termination reason under Section 5(a) shall be paid to the Eligible Executive in a lump sum cash payment at the same time as bonus payments for such year are paid to other executives under the Company’s Senior Executive Annual Incentive Plan (or other bonus plan applicable to the Eligible Executive for such year). The cash payment referenced in Section 7(b) of this Policy shall be made in a lump sum on or as soon as practicable after the first date on which the Eligible Executive begins to receive severance payments in accordance with the first sentence of this Section 10(a), and in no event later than March 15 of the calendar year following the calendar year in which the Eligible Executive’s separation from service occurs.
|
(b)
|
Severance Benefits payable hereunder to an Eligible Executive pursuant to Sections 7(a) and 7(b) of this Policy on account of a separation from service for an eligible termination reason under Section 5(b) shall be paid, if the Change in Control which makes Section 5(b) applicable constitutes a “change in control event” under Treasury Regulation §1.409A-3(i)(5
)
, in a lump sum within 30 days following the Eligible Executive’s separation from service, and, if such Change in Control does not constitute a “change in control event” under Treasury Regulation §1.409A-3(i)(5
)
, in the manner set forth in Section 10(a). In determining the amount of the lump sum, Section 7(a)(ii) shall be applied without regard to clause (1) and without regard to the requirement in Section 7(a)(ii) that the Committee certify that the applicable performance goals for the year in which the Termination Date occurs have been achieved.
|
(c)
|
If an Eligible Executive dies after becoming eligible for Severance Benefits and executing an Agreement and Release but before full receipt of Severance Benefits, the remaining Severance Benefits, if any, will be paid to the Eligible Executive's estate in one lump sum upon the Eligible Executive’s death. If an Eligible Executive dies after becoming eligible for Severance Benefits but prior to executing an Agreement and Release, his or her estate or representative may not execute an Agreement and Release and no Severance Benefits will be paid under this Policy.
All payments will be net of amounts withheld with respect to taxes, offsets, or other obligations.
|
11.
|
Offsets
|
(a)
|
Non-duplication of Benefits
.
The Company may, in its discretion and to the extent permitted under applicable law, offset against the Eligible Executive’s Severance Benefits under this Policy any other severance, termination, end of service gratuity, compensation for non-competition commitments (whether paid during the term of employment or post-termination), or similar benefits or amounts payable to the Eligible Executive by the Company, including, but not limited to any amounts paid under any offer letter, employment agreement or other individual contractual arrangement, amounts paid pursuant to federal, state, or local workers’ notification or office closing requirements, or statutory severance benefits or payments made on account of any notice period (including but not limited to payments made in lieu of notice or for periods during which the Eligible Executive is released from further duties) as provided under any offer letter, employment agreement or other individual contractual arrangement or pursuant to the law of any country or political subdivision thereof.
|
(b)
|
Debts and Property
.
The Company also may, in its discretion and to the extent permitted under applicable law, offset against the Eligible Executive's Severance Benefits under this Policy the value of unreturned property and any outstanding loan, debt or other amount the Eligible Executive owes to the Company. The entire amount of any offset taken pursuant to this Section 11(b) shall not exceed $5,000 in any taxable year, and the offset shall be taken at the same time and in the same amount as such amount would have been otherwise due from the Eligible Executive.
|
(c)
|
Overpayment
.
The Company may recover any overpayment of Severance Benefits made to an Eligible Executive or an Eligible Executive's estate under this Policy or, to the extent permitted by applicable law, offset any other overpayment made to the Eligible Executive against any Severance Benefits or other amount the Company owes the Eligible Executive or the Eligible Executive's estate.
|
12.
|
Outplacement
|
13.
|
Re-employment and Other Employment
|
14.
|
Funding
|
15.
|
Administration
|
16.
|
Amendment or Termination of the Policy
|
17.
|
Limitation on Individually Negotiated Severance Arrangements
|
18.
|
Section 409A
|
19.
|
Miscellaneous
|
20.
|
Review Procedure
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
$
|
941.8
|
|
|
$
|
968.2
|
|
|
$
|
926.9
|
|
|
$
|
1,168.8
|
|
|
$
|
1,274.6
|
|
Fixed charges
|
175.6
|
|
|
182.7
|
|
|
198.8
|
|
|
177.8
|
|
|
182.9
|
|
|||||
Other adjustments
|
(6.9
|
)
|
|
(3.2
|
)
|
|
(0.7
|
)
|
|
5.3
|
|
|
2.6
|
|
|||||
Total earnings (a)
|
$
|
1,110.5
|
|
|
$
|
1,147.7
|
|
|
$
|
1,125.0
|
|
|
$
|
1,351.9
|
|
|
$
|
1,460.1
|
|
Fixed charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
$
|
167.9
|
|
|
$
|
176.6
|
|
|
$
|
195.6
|
|
|
$
|
179.6
|
|
|
$
|
181.9
|
|
Other adjustments
|
7.7
|
|
|
6.1
|
|
|
3.2
|
|
|
(1.8
|
)
|
|
1.0
|
|
|||||
Total fixed charges (b)
|
$
|
175.6
|
|
|
$
|
182.7
|
|
|
$
|
198.8
|
|
|
$
|
177.8
|
|
|
$
|
182.9
|
|
Ratio of earnings to fixed charges (a/b)
|
6.3
|
|
|
6.3
|
|
|
5.7
|
|
|
7.6
|
|
|
8.0
|
|
Name of Subsidiary
|
|
Jurisdiction of
Incorporation
|
A. Serviban S.A.
|
|
Peru
|
American Rapid Corporation
|
|
Delaware, USA
|
Banco Western Union do Brasil S.A.
|
|
Brazil
|
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, LLC
|
|
Delaware, USA
|
E Commerce Group Products Inc.
|
|
New York, USA
|
First Financial Management Corporation
|
|
Georgia, USA
|
Global Collection Services, S.A.
|
|
Argentina
|
Global Corporate Real Estate Advisors, LLC
|
|
Colorado, USA
|
Grupo Dinámico Empresarial, S.A. de C.V.
|
|
Mexico
|
Money Transfer Financial Services Limited
|
|
Ireland
|
MSR Marketing Services GmbH
|
|
Austria
|
MT Caribbean Holdings SRL
|
|
Barbados
|
MT Financial Holdings Ltd.
|
|
Bermuda
|
MT Global Holdings Ltd.
|
|
Bermuda
|
MT Group Ltd.
|
|
Bermuda
|
MT Group Investment Holdings Ltd.
|
|
Bermuda
|
MT Holdings (Bermuda) Ltd.
|
|
Bermuda
|
MT Holdings Limited
|
|
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
|
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 S.A.
|
|
Argentina
|
RII Holdings, Inc.
|
|
Delaware, USA
|
Ruesch Holding, LLC
|
|
Delaware, USA
|
Ruesch International (Delaware), LLC
|
|
Delaware, USA
|
Ruesch International L.L.C.
|
|
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 Serviços e Participações 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 (Canada), Inc./Services Financiers Western Union (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 (Hellas) International Holdings S.A.
|
|
Greece
|
Western Union Holdings, Inc.
|
|
Georgia, USA
|
Western Union International Bank GmbH
|
|
Austria
|
Western Union International Limited
|
|
Ireland
|
Western Union Ireland Holdings Limited
|
|
Ireland
|
Western Union Italy Holdings Srl
|
|
Italy
|
Western Union Japan K.K.
|
|
Japan
|
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 Malta Holdings Limited
|
|
Malta
|
Western Union Malta Limited
|
|
Malta
|
Western Union Morocco SARL
|
|
Morocco
|
Western Union MT (Australia) Pty. Ltd.
|
|
Australia
|
Western Union MT East
|
|
Russian Federation
|
Western Union Network Belgium SPRL
|
|
Belgium
|
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 Overseas Limited
|
|
Ireland
|
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 Limited
|
|
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
|
|
United Kingdom
|
Western Union Retail Services Ireland Limited
|
|
Ireland
|
Western Union Retail Services Italy S.r.l.
|
|
Italy
|
Western Union Retail Services Norway AS
|
|
Norway
|
Western Union Retail Services RO SRL
|
|
Romania
|
Western Union Retail Services Spain S.A.
|
|
Spain
|
Western Union Retail Services Sweden AB
|
|
Sweden
|
Western Union Services, Inc.
|
|
Maryland, USA
|
Western Union Services India Private Limited
|
|
India
|
Western Union Services (Philippines) Inc.
|
|
Philippines
|
Western Union Services Singapore Private Limited
|
|
Singapore
|
Western Union Services S.L.
|
|
Spain
|
Western Union Services (Spain) S.L.
|
|
Spain
|
Western Union Singapore Limited
|
|
Bermuda
|
Western Union South Africa (PTY) Limited
|
|
South Africa
|
Western Union Support Services (Nigeria) Limited
|
|
Nigeria
|
Western Union Turkey Odeme Hizmetleri Anonim Sirketi
|
|
Turkey
|
WU BP Peru S.R.L.
|
|
Peru
|
WU Ireland Partnership
|
|
Ireland
|
WUBS Financial Services (Singapore) Pte Limited
|
|
Singapore
|
WUBS Investments Ltd.
|
|
United Kingdom
|
WUBS Payments Ltd.
|
|
United Kingdom
|
WUBS (Prague) s.r.o. v likvidaci
|
|
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 Nos. 333-137665 and 333-204183) pertaining to The Western Union Company 2006 Long-Term Incentive Plan, The Western Union Company 2006 Non-Employee Director Equity Compensation Plan, The Western Union Company Supplemental Incentive Savings Plan, and The Western Union Company 2015 Long-Term Incentive Plan;
|
|
/s/ Ernst & Young LLP
|
Denver, Colorado
|
|
February 19, 2016
|
|
Date:
|
February 19, 2016
|
/
S
/ H
IKMET
E
RSEK
|
|
|
Hikmet Ersek
|
|
|
President and Chief Executive Officer
|
Date:
|
February 19, 2016
|
/
S
/ R
AJESH
K. A
GRAWAL
|
|
|
Rajesh K. Agrawal
|
|
|
Executive Vice President and 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 19, 2016
|
/
S
/ H
IKMET
E
RSEK
|
|
|
Hikmet Ersek
|
|
|
President and Chief Executive Officer
|
Date:
|
February 19, 2016
|
/s/ R
AJESH
K. A
GRAWAL
|
|
|
Rajesh K. Agrawal
|
|
|
Executive Vice President and Chief Financial Officer
|