Western Union 2015 Annual Report Download - page 78

NOTICE OF 2016 ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT
60 | The Western Union Company
EXECUTIVE COMPENSATION
SUPPLEMENTAL INCENTIVE SAVINGS PLAN
We maintain a nonqualified supplemental incentive savings
plan (the “SISP”) for certain of our employees on United States
payroll, including each of our named executive officers other
than Mr. Ersek. Under the SISP, participants may defer up to
80% of their salaries, including commissions and incentive
compensation (other than annual bonuses), and may make a
separate election to defer up to 80% of any annual bonuses
and up to 100% of any performance-based cash awards
they may earn. The SISP also provides participants the
opportunity to receive credits for matching contributions
equal to the difference between the matching contributions
that a participant could receive under the ISP but for the
contribution and compensation limitations imposed by the
Internal Revenue Code, and the matching contributions
allowable to the participant under the ISP. Participants are
generally permitted to choose from among the mutual
funds available for investment under the ISP for purposes
of determining the imputed earnings, gains, and losses
applicable to their SISP accounts. The SISP is unfunded.
Participants may specify the timing of the payment of their
accounts by choosing either a specified payment date or
electing payment upon separation from service (or a date up
to five years following separation from service), and in either
case may elect to receive their accounts in a lump sum or
in annual or quarterly installments over a period of up to ten
years. With respect to each year’s contributions and imputed
earnings, the participant may make a separate distribution
election. Subject to the requirements of Section 409A of the
Internal Revenue Code, applicable Internal Revenue Service
guidance, and the terms of the SISP, participants may receive
an early payment in the event of a severe financial hardship
and may make an election to delay the timing of their
scheduled payment by a minimum of five years.
POTENTIAL PAYMENTS UPON TERMINATION
OR CHANGE-IN-CONTROL
EXECUTIVE SEVERANCE POLICY
We maintain an Executive Severance Policy for the payment
of certain benefits to senior executives, including our named
executive officers, upon termination of employment from
Western Union and upon a change-in-control of Western
Union. Under the Executive Severance Policy, an eligible
executive will become eligible for benefits if (i) prior to a
change-in-control, he or she is involuntarily terminated
by the Company other than on account of death, disability
or for cause, or (ii) after a change-in-control, he or she is
involuntarily terminated by the Company other than on
account of death, disability or for cause or terminates his or
her own employment voluntarily for “good reason” (including
a material reduction in title or position, reduction in base
salary or bonus opportunity or an increase in the executive’s
commute to his or her current principal working location
of more than 50 miles without consent) within 24 months
after the date of the change-in-control. Under the Executive
Severance Policy, a change-in-control is generally defined to
include:
• Acquisition by a person or entity of 35% or more of either
the outstanding shares of the Company or the combined
voting power of such shares, with certain exceptions;
• An unapproved change in a majority of the Board
members within a 24-month period; and 
• Certain corporate restructurings, including certain
mergers, dissolution and liquidation.
The Executive Severance Policy provided for the
following severance and change-in-control benefits as of
December 31, 2015:
• Effective for senior executives hired before February
24, 2011, a severance payment equal to the senior
executive’s base pay plus target bonus for the year in
which the termination occurs (the “base severance
pay”), multiplied by 1.5 (multiplied by two in the case of
the Chief Executive Officer and in the case of all senior
executives who terminate for an eligible reason within
24 months following a change-in-control). Effective
for senior executives hired on and after February 24,
2011, a senior executive employed by the Company for
12 months or less was entitled to receive a severance
payment equal to the base severance pay and, for every
month employed in excess of 12 months, an additional
severance payment equal to a pro rata portion of the
base severance pay, up to a maximum severance
payment equal to the senior executive’s base severance
pay, multiplied by 1.5 (multiplied by two in the case of all
senior executives who terminate for an eligible reason
within 24 months following a change-in-control). 