Western Union 2015 Annual Report Download - page 240

THE WESTERN UNION COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
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On December 10, 2012, the Company issued $250.0 million and $500.0 million of aggregate principal amounts of unsecured
notes due December 10, 2015 ("2015 Fixed Rate Notes") and December 10, 2017 ("2017 Notes"), respectively. The 2015 Fixed
Rate Notes matured and were repaid from the Company's cash balances in December 2015. Interest with respect to the 2017 Notes
is payable semi-annually in arrears on June 10 and December 10 of each year, currently based on the per annum rate of 2.875%.
The interest rate payable on the 2017 Notes will be increased if the debt rating assigned to such notes 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 2017
Notes be increased by more than 2.00% above 2.875% per annum. The interest rate on the 2017 Notes may also be adjusted
downward for debt rating upgrades subsequent to any debt rating downgrades but may not be adjusted below 2.875% per annum.
The 2017 Notes are subject to covenants that, among other things, limit or restrict the ability of the Company to sell or transfer
assets or merge or consolidate with another company, and limit or restrict the Company’s and certain of its subsidiaries’ ability to
incur certain types of security interests, or enter into sale and leaseback transactions. The Company may redeem the 2017 Notes
at any time prior to maturity at the greater of par or a price based on the applicable treasury rate plus 40 basis points.
On August 22, 2011, the Company issued $400.0 million of aggregate principal amount of unsecured notes due August 22,
2018 ("2018 Notes"). Interest with respect to the 2018 Notes is payable semi-annually in arrears on February 22 and August 22
of each year, based on the fixed per annum rate of 3.650%. The 2018 Notes are subject to covenants that, among other things, limit
or restrict the ability of the Company to sell or transfer assets or merge or consolidate with another company, and limit or restrict
the Company’s and certain of its subsidiaries’ ability to incur certain types of security interests, or enter into certain sale and
leaseback transactions. The Company may redeem the 2018 Notes at any time prior to maturity at the greater of par or a price
based on the applicable treasury rate plus 35 basis points.
On June 21, 2010, the Company issued $250.0 million of aggregate principal amount of unsecured notes due June 21, 2040
("2040 Notes"). Interest with respect to the 2040 Notes is payable semi-annually on June 21 and December 21 each year based on
the fixed per annum rate of 6.200%. The 2040 Notes are subject to covenants that, among other things, limit or restrict the Company’s
and certain of its subsidiaries’ ability to grant certain types of security interests or enter into sale and leaseback transactions. The
Company may redeem the 2040 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 March 30, 2010, the Company exchanged $303.7 million of aggregate principal amount of unsecured notes due November
17, 2011 for unsecured notes due April 1, 2020 ("2020 Notes"). Interest with respect to the 2020 Notes is payable semi-annually
on April 1 and October 1 each year based on the fixed per annum rate of 5.253%. In connection with the exchange, note holders
were given a 7% premium ($21.2 million), which approximated market value at the exchange date, as additional principal. As this
transaction was accounted for as a debt modification, this premium was not charged to expense. Rather, the premium, along with
the offsetting hedge accounting adjustments, will be accreted into "Interest expense" over the life of the notes. The 2020 Notes
are subject to covenants that, among other things, limit or restrict the Company’s and certain of its subsidiaries’ ability to grant
certain types of security interests, incur debt (in the case of significant subsidiaries), or enter into sale and leaseback transactions.
The Company may redeem the 2020 Notes at any time prior to maturity at the greater of par or a price based on the applicable
treasury rate plus 15 basis points.
The 2020 Notes were originally issued in reliance on exemptions from the registration requirements of the Securities Act of
1933, as amended (the "Securities Act"). On October 8, 2010, the Company exchanged the 2020 Notes for notes registered under
the Securities Act, pursuant to the terms of a Registration Rights Agreement.
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