Western Union 2013 Annual Report Download - page 184

2013 FORM 10-K
74
Commercial Paper Program
Pursuant to our commercial paper program, we may issue unsecured commercial paper notes in an amount not to exceed $1.5
billion outstanding at any time, reduced to the extent of borrowings outstanding on our Revolving Credit Facility in excess of $150
million. Our commercial paper borrowings may have maturities of up to 397 days from date of issuance. Interest rates for borrowings
are based on market rates at the time of issuance. We had no commercial paper borrowings outstanding as of December 31, 2013,
but did have a maximum balance outstanding of $50 million for one day during the year ended December 31, 2013. During the
years ended December 31, 2012 and 2011, the average commercial paper balance outstanding was $161.3 million and $89.7 million,
respectively, and the maximum balance outstanding was $422.8 million and $784.1 million, respectively. Proceeds from our
commercial paper borrowings were used for general corporate purposes.
Revolving Credit Facility
On September 23, 2011, we entered into a credit agreement which expires January 2017 providing for unsecured financing
facilities in an aggregate amount of $1.65 billion, including a $250.0 million letter of credit sub-facility and a $150.0 million swing
line sub-facility.
Interest due under the Revolving Credit Facility is fixed for the term of each borrowing and is payable according to the terms
of that borrowing. Generally, interest is calculated using a selected LIBOR rate plus an interest rate margin of 100 basis points. A
facility fee of 12.5 basis points is also payable quarterly on the total facility, regardless of usage. Both the interest rate margin and
facility fee percentage are based on certain of our credit ratings.
The purpose of our Revolving Credit Facility, which is diversified through a group of 17 participating institutions, is to provide
general liquidity and to support our commercial paper program, which we believe enhances our short-term credit rating. The largest
commitment from any single financial institution within the total committed balance of $1.65 billion is approximately 12%. As
of and during the year ended December 31, 2013, we had no outstanding borrowings under our Revolving Credit Facility. If the
amount available to borrow under the Revolving Credit Facility decreased, or if the Revolving Credit Facility were eliminated,
the cost and availability of borrowing under the commercial paper program may be impacted.
Notes
On November 22, 2013, we issued $250.0 million of aggregate principal amount of unsecured notes due May 22, 2019. Interest
with respect to the 2019 Notes is payable semi-annually in arrears on May 22 and November 22 of each year, beginning on May
22, 2014, based on the fixed per annum rate of 3.350%. The interest rate payable on the 2019 Notes will be increased if the debt
rating assigned to the note is downgraded by an applicable credit rating agency, beginning at a downgrade below investment grade.
However, in no event will the interest rate on the 2019 Notes be increased by more than 2.00% above 3.350% per annum. The
interest rate payable on the 2019 Notes may also be adjusted downward for debt rating upgrades subsequent to any debt rating
downgrades but may not be adjusted below 3.350% per annum. We may redeem the 2019 Notes at any time prior to maturity at
the greater of par or a price based on the applicable treasury rate plus 30 basis points.
On August 22, 2013, we issued $250.0 million of aggregate principal amount of unsecured floating rate notes due August 21,
2015. Interest with respect to the 2015 Floating Rate Notes is payable quarterly in arrears on each February 21, May 21, August
21, and November 21, beginning November 21, 2013, at a per annum rate equal to the three-month LIBOR plus 1.0% (reset
quarterly).