Western Union 2011 Annual Report Download - page 125

THE WESTERN UNION COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
any such Spin-off Related Taxes attributable solely to actions taken by or with respect to the Company. In
addition, the Company will also be liable for half of any Spin-off Related Taxes (i) that would not have been
imposed but for the existence of both an action by the Company and an action by First Data or (ii) where the
Company and First Data each take actions that, standing alone, would have resulted in the imposition of such
Spin-off Related Taxes. The Company may be similarly liable if it breaches certain representations or covenants
set forth in the tax allocation agreement. If the Company is required to indemnify First Data for taxes incurred as
a result of the Spin-off being taxable to First Data, it likely would have a material adverse effect on the
Company’s business, financial condition and results of operations. First Data generally will be liable for all
Spin-off Related Taxes, other than those described above.
11. Employee Benefit Plans
Defined Contribution Plans
The Western Union Company Incentive Savings Plan (“401(k)”) covers eligible employees on the United
States payroll of the Company. Employees who make voluntary contributions to this plan receive up to a 4%
Company matching contribution. All matching contributions are immediately vested.
The Company administers more than 25 defined contribution plans in various countries globally on behalf of
approximately 1,300 employee participants as of December 31, 2011. Such plans have vesting and employer
contribution provisions that vary by country.
In addition, the Company sponsors a non-qualified deferred compensation plan for a select group of highly
compensated employees. The plan provides tax-deferred contributions, matching and the restoration of Company
matching contributions otherwise limited under the 401(k).
The aggregate amount charged to expense in connection with all of the above plans was $12.8 million,
$12.0 million and $11.2 million during the years ended December 31, 2011, 2010 and 2009, respectively.
Defined Benefit Plan
On December 31, 2010, the Company merged its two frozen defined benefit pension plans into one plan
(“Plan”). The Plan assets were held in a master trust and were identical in terms of their benefit entitlements and
other provisions (except for participant eligibility requirements) and consequently, the financial effect of the
merger was not significant.
The Plan had recorded unfunded pension obligations of $112.7 million and $112.8 million as of December 31,
2011 and 2010, respectively, included in “Other liabilities” in the Consolidated Balance Sheets. In both the years
ended December 31, 2011 and 2010, the Company made contributions of approximately $25 million to the Plan,
including discretionary contributions of $3 million and $10 million, respectively. Due to the closure of one of its
facilities in Missouri and an agreement with the Pension Benefit Guaranty Corporation, the Company funded
$4.1 million during 2009. The Company will be required to fund approximately $20 million to the Plan in 2012
and may make a discretionary contribution of up to approximately $5 million.
The Company recognizes the funded status of the Plan in its Consolidated Balance Sheets with a
corresponding adjustment to “Accumulated other comprehensive loss,” net of tax.
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