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  As Of               Filer                 Filing     As/For/On Docs:Pgs              Issuer               Agent

 6/08/06  Western Union CO                  10-12B                 2:252                                    RR Donnelley/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 10-12B      Registration of Securities (General Form)           HTML     38K 
 2: EX-99.1     Preliminary Information Statement                   HTML  1,619K 

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Exhibit 99.1

Dear First Data Stockholder:

I am pleased to inform you that on [•], 2006, the company’s Board of Directors approved the spin-off of Western Union, a wholly-owned subsidiary that is a leader in the global money transfer business.

The spin-off of Western Union is scheduled to occur on [•], 2006. Holders of record of shares of First Data common stock as of the close of business on [•], 2006, which will be the record date, will receive one share of Western Union common stock for each share of First Data common stock held. No action is required on your part to receive shares of Western Union. You will not be required to pay anything for the new shares or to surrender any First Data shares. You will not receive a stock certificate representing your interest in Western Union unless you request one.

We believe that the separation of Western Union from First Data will provide a better structure for each company to pursue the most appropriate long-term growth opportunities and business strategies by allowing it to focus on its own distinct businesses, opportunities and markets. First Data will continue to provide business customers with leading, innovative electronic commerce and payment solutions, while Western Union will build on its position as the trusted source for consumers around the world to transfer money and pay bills rapidly, reliably and conveniently.

Following the spin-off, First Data’s common stock will continue to trade on the New York Stock Exchange under the symbol “FDC.” Western Union intends to apply to have its common stock authorized for listing on the NYSE under the symbol “WU.”

We intend for the spin-off to be tax-free for all stockholders. To that end, we have requested a favorable ruling from the Internal Revenue Service with respect to the spin-off, and intend to complete the spin-off only if we receive the favorable ruling and a favorable opinion of counsel confirming the spin-off’s tax-free status. The spin-off is also subject to other conditions, including necessary regulatory approvals.

I encourage you to read the enclosed information statement, which is being provided to all First Data stockholders. It describes the spin-off in detail and contains important business and financial information about Western Union.

I look forward to your continued support as a stockholder of First Data. We remain committed to working on your behalf to build long-term stockholder value.

Sincerely,

Ric Duques

Chairman and Chief Executive Officer

First Data

[•], 2006

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Dear Western Union Stockholder:

It is our great pleasure to welcome you as a stockholder of Western Union.

The Western Union Company has roots back to 1851 and first traded on the New York Stock Exchange in 1865. For 150 years, we have been providing innovative services, including sending the first transatlantic telegraph, creating the universal stock ticker and launching the first United States commercial communications satellite service. We introduced our consumer-to-consumer money transfer service in 1871 and today offer these services under the Western Union, Orlandi Valuta and Vigo brands. We began offering consumer-to-business money payment services in 1989 when we introduced Western Union Quick Collect, providing consumers in the United States with convenient walk-in access to our agent network to pay bills in cash.

Since First Data acquired us in 1995, we have become a leader in global money transfer, with a vast, diversified distribution network consisting of over 270,000 agent locations in more than 200 countries and territories. We believe that the size and reach of this network, our brand strength, and the convenience and reliability we bring to our consumers have been the key to the growth of our business as well as our strong financial performance.

We are very excited about our prospects and believe we will be even better positioned to realize the significant growth opportunities for our business as an independent company. Looking forward, we intend to continue to execute our successful strategies of expanding and diversifying our global distribution, building our brand and enhancing our consumers’ experiences, developing consumer convenience and choice, and exploring new service offerings.

We intend to apply to have Western Union common stock authorized for listing on the New York Stock Exchange under the symbol “WU.”

We invite you to learn more about our company by reading the enclosed information statement. We thank you in advance for your support as our business begins a new and exciting chapter in its long and successful history.

Sincerely,

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Preliminary Information Statement

(Subject to Completion, Dated June 7, 2006)

INFORMATION STATEMENT

Common Stock

(Par Value $0.01 Per Share)

First Data Corporation is providing this information statement to you as a stockholder of First Data in connection with the spin-off of The Western Union Company. The spin-off will consist of a series of transactions by which First Data will contribute its money transfer and consumer payments businesses to Western Union, which we refer to as the contribution, and distribute to its stockholders of record all of the outstanding shares of Western Union common stock, which we refer to as the distribution.

First Data expects that the distribution will be made on [·], 2006 on a pro rata basis to the holders of record of First Data common stock on [·], 2006, which we refer to as the record date. If you are a holder of record of First Data common stock at the close of business on the record date, you will receive one share of Western Union common stock for each share of First Data common stock you hold on that date. As discussed under “The Spin-Off—Trading of First Data Common Stock After the Record Date and Prior to the Distribution,” if you sell your shares of First Data common stock in the “regular way” market after the record date and prior to the spin-off, you also will be selling your right to receive shares of Western Union common stock in connection with the spin-off. A book-entry account statement reflecting your ownership of shares of Western Union common stock will be mailed to you, or your brokerage account will be credited for the shares, on or about [·], 2006.

First Data has requested a favorable tax ruling from the United States Internal Revenue Service with respect to the spin-off.

You will not be required to make any payment for the shares of Western Union common stock that you will receive in connection with the spin-off, nor will you be required to surrender or exchange your shares of First Data common stock or take any other action in order to receive shares of Western Union common stock in connection with the spin-off. No approval by First Data stockholders of the spin-off is required or being sought. You are not being asked for a proxy and you are requested not to send a proxy.

There is no current trading market for Western Union common stock. However, we expect that a limited market, commonly known as a “when-issued” trading market, for Western Union common stock will begin on or about [·], 2006, and we expect that “regular way” trading of Western Union common stock will begin the first day of trading following the spin-off. We intend to apply to have Western Union common stock authorized for listing on the New York Stock Exchange under the symbol “WU.”

In reviewing this information statement, you should carefully consider the risks under “ Risk Factors” beginning on page 14 of this information statement.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this information statement is truthful or complete. Any representation to the contrary is a criminal offense.

This information statement is not an offer to sell, or a solicitation of an offer to buy, any securities.

The date of this information statement is [·], 2006.

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In this information statement, unless the context otherwise requires:

We describe in this information statement the businesses to be transferred to us by First Data in connection with the spin-off as though the transferred businesses were our business for all historical periods described. However, The Western Union Company is a newly formed entity that has not conducted any operations prior to the spin-off. References in this information statement to the historical assets, liabilities, products, businesses or activities of our businesses are intended to refer to the historical assets, liabilities, products, businesses or activities of the transferred businesses as those businesses were conducted as part of First Data prior to the spin-off. Following the spin-off, we will be an independent, publicly traded company, and First Data will have no continuing stock ownership in us. Our historical combined financial information as part of First Data contained in this information statement is not necessarily indicative of our future financial position, future results of operations or future cash flows, nor does it reflect what our financial position, results of operations or cash flows would have been had we been operated as a stand-alone company during the periods presented.

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This information statement is being furnished solely to provide information to First Data stockholders who will receive shares of Western Union common stock in connection with the spin-off. It is not provided as an inducement or encouragement to buy or sell any securities. You should not assume that the information contained in this information statement is accurate as of any date other than the date set forth on the cover. Changes to the information contained in this information statement may occur after that date, and we undertake no obligation to update the information.

Trademarks, Service Marks and Trade Names

We own or have rights to use the trademarks, service marks and trade names that we use in conjunction with the operation of our business. Some of the more important trademarks and service marks that we own or have rights to use that appear in this information statement include the WESTERN UNION^®, VIGO^SM, ORLANDI VALUTA^®, WESTERN UNION QUICK COLLECT^®, SPEEDPAY^® and PAYMAP^® marks. The trademarks are registered in the United States and other jurisdictions. Each trademark, trade name or service mark of any other company appearing in this information statement is owned by such company.

Industry Data

This information statement includes industry and trade association data, forecasts and information that we have prepared based, in part, upon data, forecasts and information obtained from independent trade associations, industry publications and surveys and other independent sources available to us. Some data also are based on our good faith estimates, which are derived from management’s knowledge of the industry and from independent sources. The primary sources for third-party industry data and forecasts are Aite Group, LLC, or “Aite,” the International Organization for Migration, the World Bank and other industry reports and articles. These third-party publications and surveys generally state that the information included therein is believed to have been obtained from sources believed to be reliable, but that the publications and surveys can give no assurance as to the accuracy or completeness of such information. We have not independently verified any of the data from third-party sources nor have we ascertained the underlying economic assumptions on which such data are based. Similarly, we believe our internal research is reliable, even though such research has not been verified by any independent sources.

Company Information

The Western Union Company was incorporated in Delaware in February 2006. Our principal executive offices are located at 12500 East Belford Avenue, Englewood, Colorado 80112. Our main telephone number is (303) 967-6756.

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 SUMMARY

The following summary contains certain information from this information statement relating to us and the spin-off. It does not contain all the details concerning us or our spin-off from First Data, including information that may be important to you. To understand our business and financial position and the spin-off, you should carefully review this entire information statement.

Our Company

Western Union, a leader in global money transfer, provides people with fast, reliable and convenient ways to send money around the world, pay bills and purchase money orders. The Western Union brand is globally recognized. Our services are available through a network of over 270,000 agent locations that offer Western Union services in more than 200 countries and territories. Our consumer-to-consumer money transfer service enables people to send money around the world in minutes. Our consumer-to-business service provides consumers with flexible and convenient options for making one-time or recurring payments.

In 2005, we generated $4.0 billion in total combined revenues and $898.2 million in combined net income. Demand for our services has steadily increased over the past several years. Our consumer-to-consumer transactions grew at a compound annual growth rate of 21% from 2001 to 2005. We handled 119 million consumer-to-consumer money transfers in 2005, an increase of 23% over 2004. Our 215 million consumer-to-business transactions in 2005 represented a 12% increase over 2004.

We believe that brand strength, the size and reach of our global network, convenience and reliability for our consumers have been key to the growth of our business. As we continue to meet the needs of our consumers for fast, reliable and convenient money transfer services, we are also working to enhance our existing services and provide our consumers with broad access to an expanding portfolio of payment and other financial services.

The Western Union Business

The Western Union business model is straight-forward. Our revenue is principally generated by money transfer and payment transactions. We derive our revenue primarily from two sources. Most of our revenue comes from fees that consumers pay when they send money. In certain consumer money transfer transactions involving different send and receive currencies, we generate revenue based on the difference between the exchange rate set by us to the consumer and the rate at which we are able to acquire currency.

We operate primarily in two business segments.

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Our Strengths

We believe our strengths position us to continue as the provider of choice for millions of consumers when they send money. Our strengths include our:

Strong relationships with high quality agents and businesses. We interact with millions of consumers around the world primarily through our global agent network. Our agents facilitate the global distribution and convenience that help define our Western Union brand, which in turn helps create demand for our services and helps us to recruit and retain agents. Our agents tend to be established organizations that provide an array of other consumer products and services, including postal services, groceries, banking, check cashing, travel and other daily necessities. Many are open during nontraditional banking hours, such as nights and weekends, making it easier for consumers to use our services. Although our agent contracts are generally for 5 year terms, our top 40 agents globally have been with us an average of more than 12 years; in 2005, these agents generated approximately 50% of our consumer-to-consumer combined revenues.

We have strong relationships with a number of businesses and other organizations that receive consumer payments, including utilities, auto finance companies, mortgage servicers, financial service providers and government agencies (all sometimes referred to as “billers”). These relationships are a core component of our consumer-to-business payment services. On average, we have provided bill payment services for our top 20 billers for more than 10 years.

Global distribution network. The Western Union^®, Orlandi Valuta^® and Vigo^SM agent networks are the foundation of our international presence. Our agent locations include 5,000 offering Orlandi Valuta^® branded service and nearly 19,000 offering Vigo^SM branded service, with the remainder offering Western Union branded service. A small number offer service under two or three brands. Our global footprint is based on more than a decade of building relationships with agents worldwide.

Success in the consumer-to-consumer money transfer business depends in large part on providing quality service at convenient send and receive locations. Our global network, extending to over 200 countries and territories, provides that convenience. We have emphasized the development of our receive network around the world over the last five years to align the supply of agent locations in the markets that primarily send transactions with those that pay them. Today, we believe we are well-positioned in key receive markets, such as China and India, to meet consumer demand as it evolves with shifts in migration patterns.

To complement the convenience offered by our network’s global physical locations, in certain countries we have made our services available through other channels, such as our Internet service, westernunion.com, which allows consumers to send funds through our website, our telephone money transfer service and our direct-to-bank money transfer service, which allows consumers to send money directly to a bank account.

Established brands. Our Western Union^® brand is built on a foundation of more than a century of history and consumer-focused service. Our consumers have told us that they believe the Western Union brand represents speed, reliability, trust, value and convenience. In the United States, where the brand has existed the longest, there is a very high level of brand awareness among money transfer users. The international expansion of our agent network over the past decade has made the Western Union brand visible today virtually everywhere consumers send and receive money. We are building the level of awareness in Europe and Asia. As people move and travel around the world, they are able to find a well recognized service to send funds to others.

We also offer money transfer services under the Orlandi Valuta^® and Vigo^SM brands. Over the past three years, Western Union branded transactions have grown the fastest of the three brands. Through our Western Union Quick Collect brand, as well as our Speedpay brand, we offer cash-based and electronic consumer-to-business payment services.

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Our operating results over the past several years have allowed us to invest significantly each year to support our brands. In 2005, we invested more than $270 million to market, advertise and promote our services and our agents made significant additional investments.

Consumer relationships. One of our strengths has been our focus on our consumers and offering them fast, reliable money transfer services. Our global loyalty card program, offered for both consumer-to-consumer and consumer-to-business services, is available in a growing number of countries. We launched our Gold Card, the principal feature of the program, in the United States in 2002. As of March 31, 2006, the loyalty program was available in 58 countries and had 5.8 million active cards, primarily in the United States. The Gold Card offers consumers faster service at the point-of-sale, rewards such as free telephone time and service enhancements including, on a pilot basis in select markets, remittance protection insurance. On average, a Gold Card consumer initiates more transactions and has a higher rate of retention than a non-carded consumer. In the United States more than 30% of consumer-to-consumer transactions are completed using a Gold Card. We are also seeing increases in usage in Europe and Asia where we began offering the Gold Card in 2004.

Operational excellence. An important part of operational excellence is steadfastly reliable technology. Our systems enable us to provide worldwide, multi-currency and real-time money transfer processing with a high degree of reliability. We provide dynamic computer host-to-host interfaces to our agents and billers that enable them to offer money transfer and payment services within their own computer environment. We also provide settlement and reconciliation software to our agents and billers with reporting and analysis tools to help them monitor many aspects of their money transfer business, including transactions, profitability and cash flow. Behind the scenes, our settlement systems facilitate the periodic settlement of accounts between our company and our agents and billers. Our systems and processes enable our agents to pay money transfers in over 120 currencies.

Flexibility is another important component of operational excellence. We continue to work to implement consumer focused enhancements to our services. These efforts have resulted in offerings like telephone and Internet services, and money transfers paid directly to a bank account or to a stored-value card.

Attractive financial profile. While we expect to incur significant amounts of debt in connection with the spin-off, our significant revenue and net cash flow will provide us with opportunities to invest in our core business growth, in new services and in new markets. In 2005, we generated $4.0 billion in combined revenues and over $1.0 billion in combined net cash provided by operating activities. Our combined revenues have grown at a compound annual growth rate of 15% since 2001.

Experienced management team. Our management team is substantially the same team that managed the Western Union business for First Data before the spin-off. Business leaders at the senior management level and below were involved in Western Union’s global expansion and creating and implementing our long-term strategy. Collectively, members of our executive team have an average of 8 years with us or First Data.

Our Strategy

We believe that our strengths position us well to continue to pursue global markets and remain focused on our consumers and their needs. To do so, we developed a number of strategies, including:

Expand and diversify global distribution. We intend to continue to identify and create opportunities to generate new revenue from our existing distribution channels, including through acquisitions and by equity investments in our agents. We are focused on selectively expanding our agent network and relationships with billers.

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Our strategy is to align the number of send and receive agent locations in our markets to correspond to the send and receive demands of our consumers in each market. We have focused on building receive networks in countries with large inbound remittance markets, particularly in Latin America, Africa and eastern Europe, as well as key countries like China, India and elsewhere in Asia. This increased presence in receive markets provides emigrants from these countries confidence that money they send home will be delivered to a convenient location they know. In the United States, western Europe and other predominantly send markets, we add agent locations in locales that tend to attract immigrants. While we continue to develop our global network, we expect the majority of our growth in the future to come from existing locations.

Today, we offer cash-based bill payment services primarily in the United States, and we offer consumer-to-business payment services to and from other countries served by our agent network. We intend to pursue continued global expansion of cash and electronic consumer-to-business payments services through our existing agent network and other channels.

Build our brands and enhance our consumers’ experience. We remain focused on our brands and make sizable investments to build our brands and enhance our consumers’ experience. In each of the last three years, we have spent approximately 7% of our combined revenues on marketing, including advertising, events, loyalty programs and employees dedicated to marketing activities. In addition, in each of the last three years we invested in consumer-to-consumer pricing adjustments. Building our brands and enhancing the consumer experience are strategies that are grounded in our global consumer relationship management, or “CRM,” programs, which emphasize building a lifetime relationship with our consumers and their families. The Western Union Gold Card is a key part of this strategy.

Develop consumer convenience and choice. We focus our product development strategy on providing money transfer services that meet consumers’ needs for convenience, choice and control. Our Internet service (westernunion.com), Telephone Money Transfer (a service that allows consumers to speak with Western Union operators in a number of languages by phone to send funds), Money Transfer by Phone (a service that allows consumers to speak with Western Union operators in a number of languages by phone from agent locations to send funds), Direct to Bank (a service that allows consumers to send funds directly to a bank account), Account to Cash (a service that allows consumers to debit their bank accounts and send the money through Western Union for payment at any agent location), Home Delivery of remittances (a service that allows funds to be delivered to the recipient rather than picked up at an agent location) and Western Union@ATM (a service that allows consumers to transfer funds to or from an ATM) are all examples of service enhancements that address our consumers’ needs. We intend to continue to develop these types of enhancements, building on insights from our agents and the knowledge we gain from CRM activities.

In the United States, we offer consumers the ability to send payments to billers through a variety of channels, including walk-in locations, telephone service, interactive voice response units, or “IVR,” and Internet-based service. In order to pay their bills through these channels, consumers can use various means of payments—checks, credit cards, debit cards or cash. We intend to increase our consumer payments business in the United States by pursuing existing and emerging electronic payments services and technologies. Equally as important, we plan to expand this business outside the United States in ways that will vary from market to market.

Explore new service offerings. Western Union is exploring new ways to bring additional services to our consumers around the world. For example, Western Union International Bank, based in Vienna, Austria, has the ability to establish branches and offer money transfer and other financial services directly to consumers in each of the 25 member states of the European Union. We continue to investigate new services—either offered by our company directly or through third parties—that are meaningful to our large consumer base.

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Reasons for the Spin-Off

First Data and we believe that the spin-off of our business from First Data will provide several opportunities and benefits that are expected to enhance stockholder value, including the following:

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Questions and Answers About the Spin-Off

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Summary Historical Data and Unaudited Pro Forma Combined Financial Data

The following tables set forth our summary historical data and unaudited pro forma financial data prepared on a combined basis. The historical data present our business as it has historically been operated by First Data. You should read the information set forth below in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Unaudited Pro Forma Combined Financial Statements” and our historical combined financial statements and the notes to those statements included elsewhere in this information statement. The statements of income and cash flow data for the years ended December 31, 2005, 2004 and 2003 and the balance sheet data as of December 31, 2005 and 2004 set forth below are derived from our audited combined financial statements included elsewhere in this information statement. The statements of income and cash flow data for the years ended December 31, 2002 and 2001 and the balance sheet data as of December 31, 2003, 2002 and 2001 set forth below are derived from our unaudited combined financial statements not included in this information statement. The statements of income and cash flow data for the three-month periods ended March 31, 2006 and 2005 and the balance sheet data as of March 31, 2006 set forth below are derived from our unaudited combined financial statements included elsewhere in this information statement. The balance sheet data as of March 31, 2005 set forth below are derived from our unaudited combined financial statements not included in this information statement. The unaudited interim combined financial statements are not necessarily indicative of the results to be expected for any other interim period or for the year ending December 31, 2006. However, in the opinion of management, the unaudited interim combined financial statements include all adjustments (consisting of normal recurring accruals) that are necessary for the fair presentation of the results for the interim periods. See “Index to Combined Financial Statements and Schedule.”

Our historical financial, pro forma and other data included in this information statement are not necessarily indicative of our future financial position, future results of operations or future cash flows, nor do they reflect what our financial position, results of operations or cash flows would have been as a stand-alone company during the periods presented.

The unaudited pro forma combined financial data are derived from our unaudited pro forma combined financial statements. Our unaudited pro forma combined financial statements are derived from our historical combined financial statements and adjusted to give effect to the following transactions:

The share numbers and dollar and settlement amounts are based on First Data share numbers and balances as of March 31, 2006.

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The pro forma adjustments are based upon available information and assumptions that management believes are reasonable; however, such adjustments are subject to change based on the finalization of the terms of the spin-off and the transaction agreements. See “Our Relationship with First Data After the Spin-off—Separation and Distribution Agreement.” In addition, such adjustments are estimates and may not prove to be accurate.

The pro forma combined statements of income data do not include adjustments for certain initial separation costs, nor do they give effect to additional costs associated with operating as a stand-alone company, which we preliminarily estimate to be $65.0 million to $75.0 million annually.

The unaudited pro forma combined statements of income data for the three months ended March 31, 2006 and the year ended December 31, 2005 have been prepared as though the spin-off had occurred as of January 1, 2005. The unaudited pro forma combined balance sheet data as of March 31, 2006 have been prepared as though the spin-off had occurred on March 31, 2006.

Historical Data

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Unaudited Pro Forma Combined Financial Data

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 RISK FACTORS

You should carefully consider each of the following risks and all of the other information contained in this information statement. Some of these risks relate principally to our business and the industry in which we operate, while others relate principally to our spin-off from First Data, and other risks relate to the securities markets generally and ownership of our common stock.

Our business, financial position, results of operations or liquidity could be adversely affected by any of these risks, and, as a result, the trading price of our common stock could decline. The risks described below are not the only ones we face. Additional risks not presently known to us or that we currently deem immaterial also may materially impair our business, financial position, results of operations and liquidity.

Risks Relating to the Spin-Off

We may not realize the potential benefits from the spin-off.

We may not realize the potential benefits that we expect from our spin-off from First Data. We have described those anticipated benefits elsewhere in this information statement. See “The Spin-Off—Background and Reasons for the Spin-Off.” In addition, we will incur significant costs, including those described below, which may exceed our estimates, and we will incur some negative effects from our separation from First Data, including loss of access to the financial, managerial and professional resources from which we have benefited in the past.

Our historical combined and pro forma financial information are not necessarily indicative of our future financial position, future results of operations or future cash flows nor do they reflect what our financial position, results of operations or cash flows would have been as a stand-alone company during the periods presented.

Our historical combined financial information included in this information statement does not reflect what our financial position, results of operations or cash flows would have been as a stand-alone company during the periods presented and is not necessarily indicative of our future financial position, future results of operations or future cash flows. This is primarily a result of the following factors:

The pro forma adjustments are based upon available information and assumptions that we believe are reasonable; however, our assumptions may not prove to be accurate. In addition, our unaudited pro forma combined financial statements do not give effect to on-going additional costs that we expect to incur in connection with being a stand-alone company. Nor do the unaudited pro forma combined statements of income give effect to certain initial separation costs. Accordingly, our unaudited pro forma combined financial statements do not reflect what our financial position or results of operations would have been as a stand-alone company and are not necessarily indicative of our future financial position or future results of operations. Please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Unaudited Pro Forma Combined Financial Statements” and our historical combined financial statements and the notes to those statements included elsewhere in this information statement.

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We will incur significant expenses to create the infrastructure necessary to operate as a stand-alone company, and we will experience increased on-going costs in connection with being a stand-alone company.

We have historically used First Data’s infrastructure to support our business functions, including the telecommunications system supporting our operations and the systems that provide for accounting and financial reporting, accounts payable and receivable processing, procurement and human resource management. The expenses related to establishing and maintaining this infrastructure were spread among all of the First Data businesses. Following the spin-off, we will no longer have access to First Data’s infrastructure, and we will need to establish our own. We expect to incur costs in 2006 to establish the necessary infrastructure.

First Data also performs many important corporate functions for us, including treasury, tax administration, accounting, financial reporting, human resources, employee benefits and incentives, legal, procurement and other services. We currently pay First Data for these services on a cost-allocation basis. Following the spin-off, First Data will continue to provide some of these services to us on a transitional basis for a period of up to one year, pursuant to a transition services agreement we will enter into with First Data. For more information regarding the transition services agreement, see “Our Relationship with First Data After the Spin-Off—Transition Services Agreement.” At the end of this transition period, we will need to perform these functions ourselves or hire third parties to perform these functions on our behalf. The costs associated with performing or outsourcing these functions may exceed those charged by First Data when we were part of First Data or during the transition period. A significant increase in the costs of performing or outsourcing these functions could adversely affect our business, financial position and results of operations.

Prior to the spin-off, our business benefited from First Data’s purchasing power when procuring goods and services, including telecommunications service, computer hardware and software licenses, office supplies and equipment and travel services. As a stand-alone company, we may be unable to obtain goods and services at comparable prices or on terms as favorable as those obtained prior to the spin-off, which could decrease our overall profitability.

If the spin-off does not qualify as a tax-free transaction, you and First Data could be subject to material amounts of taxes and, in certain circumstances, our company could be required to indemnify First Data for material taxes pursuant to indemnification obligations under the tax allocation agreement.

The spin-off is conditioned upon First Data’s receipt of a private letter ruling from the Internal Revenue Service, in form and substance satisfactory to First Data, to the effect that, among other things, the spin-off (including certain related transactions) will qualify as tax-free to First Data, us and First Data stockholders for United States federal income tax purposes under sections 355, 368 and related provisions of the Internal Revenue Code. Although a private letter ruling from the Internal Revenue Service generally is binding on the Internal Revenue Service, if the factual assumptions or representations made in the private letter ruling request are untrue or incomplete in any material respect, then First Data will not be able to rely on the ruling. Furthermore, the Internal Revenue Service will not rule on whether a distribution satisfies certain requirements necessary to obtain tax-free treatment under section 355 of the Internal Revenue Code. Rather, the private letter ruling will be based upon representations by First Data that those requirements have been satisfied, and any inaccuracy in such representations could invalidate the ruling.

The spin-off is also conditioned upon First Data’s receipt of an opinion of Sidley Austin LLP, counsel to First Data (or other nationally recognized tax counsel), in form and substance satisfactory to First Data, to the effect that the spin-off (including certain related transactions) will be tax-free to First Data, us and First Data stockholders for United States federal income tax purposes under sections 355, 368 and related provisions of the Internal Revenue Code. The opinion will rely on the Internal Revenue Service private letter ruling as to matters covered by the ruling. The opinion will be based on, among other things, certain assumptions and representations as to factual matters made by First Data and us which, if untrue or incomplete in any material respect, would jeopardize the conclusions reached by counsel in its opinion. The opinion will not be binding on the Internal Revenue Service or the courts, and the Internal Revenue Service or the courts may not agree with the opinion.

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Neither First Data nor Western Union is aware of any facts or circumstances that would cause the assumptions or representations to be relied upon in the private letter ruling or opinion of counsel to be untrue or incomplete in any material respect. If, notwithstanding receipt of the private letter ruling and opinion of counsel, the spin-off were determined to be a taxable transaction, each holder of First Data common stock who receives shares of our common stock in connection with the spin-off would generally be treated as receiving a taxable distribution in an amount equal to the fair market value of our common stock received. First Data would recognize taxable gain equal to the excess of the fair market value of the consideration received by First Data in the contribution over First Data’s tax basis in the assets contributed to us in the contribution. See “The Spin-Off—Important Federal Income Tax Consequences” beginning on page [•].

With respect to taxes and other liabilities that could be imposed in connection with the spin-off (and certain related transactions), under the terms of the tax allocation agreement we will enter into with First Data prior to the spin-off, we will be liable to First Data for any such taxes or liabilities resulting from actions taken by or with respect to us, one of our affiliates, or any person that, after the spin-off, is an affiliate thereof. See “Our Relationship with First Data After the Spin-Off—Tax Allocation Agreement” beginning on page [•]. If we are required to indemnify First Data for taxes incurred as a result of the spin-off being taxable to First Data, it would have a material adverse effect on our business, financial position and results of operations.

Our separation from First Data could have negative consequences on our effective tax rate.

Following the spin-off, we will not be able to file a consolidated United States federal income tax return with First Data. As a consequence, following the spin-off, net operating and capital losses, credits and other tax attributes generated by the First Data group will not be available to offset income earned or taxes owed by our consolidated group for United States federal income tax purposes. Any benefits relating to taxes arising from being part of the larger First Data group also may not be available. As a result of these and other inefficiencies, the aggregate amount of United States federal income tax that we pay may increase after the spin-off, and, in addition, we may not be able to realize fully certain of our deferred tax assets.

We have accumulated approximately $547.3 million of foreign earnings at December 31, 2005, which were reinvested indefinitely outside the United States primarily through certain First Data international acquisitions. As a result, no provision has been made for United States federal income taxes on those foreign earnings. As a result of the spin-off, the opportunity to use those foreign earnings to fund First Data international acquisitions will no longer exist. In addition, it is likely that First Data will repay those foreign earnings to us for reinvestment in our foreign businesses. At this time, we intend to reinvest those funds in foreign business as investment needs and opportunities arise. If such foreign investment needs and opportunities are not sufficient at some point in the future, we could be required to report incremental United States federal income tax on the excess foreign earnings whether or not actually repatriated. Under such circumstances, our effective tax rate would increase.

Under some circumstances, we could be prevented from engaging in strategic or capital raising transactions, and we could be liable to First Data for any resulting adverse tax consequences.

Even if the spin-off otherwise qualifies as a tax-free distribution under section 355 of the Internal Revenue Code, the spin-off may result in significant United States federal income tax liabilities to First Data if 50% or more of First Data’s stock or our stock (in each case, by vote or value) is treated as having been acquired, directly or indirectly, by one or more persons as part of a plan (or series of related transactions) that includes the spin-off. For purposes of this test, any acquisitions of First Data stock or our stock, or any understanding, arrangement or substantial negotiations regarding an acquisition of First Data stock or our stock, within two years before or after the spin-off are subject to special scrutiny.

The process for determining whether a change in control prohibited under the foregoing rules has occurred is complex, inherently factual and subject to interpretation of the facts and circumstances of a particular case. If a

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direct or indirect acquisition of First Data stock or our stock resulted in a change in control prohibited under those rules, First Data (but not its stockholders) would recognize taxable gain. Under the tax allocation agreement, each party will be required to indemnify the other against any such tax liabilities solely resulting from actions taken by or in respect of the indemnifying party (including certain of its affiliates). See “Our Relationship with First Data After the Spin-Off—Tax Allocation Agreement” beginning on page [•]. As a result, we may be unable to engage in strategic or capital raising transactions that our stockholders might consider favorable, or to structure potential transactions in the manner most favorable to us.

Our accounting and other management systems and resources may not be adequately prepared to meet the financial reporting and other requirements to which we will be subject following the spin-off. If we are unable to achieve and maintain effective internal controls, our business, financial position and results of operations could be adversely affected.

Our financial results previously were included within the consolidated results of First Data, and our reporting and control systems were appropriate for those of subsidiaries of a public company. However, we were not directly subject to reporting and other requirements of the Securities Exchange Act of 1934, as amended, which we refer to as the Exchange Act. As a result of the spin-off, we will be directly subject to reporting and other obligations under the Exchange Act, including the requirements of Section 404 of the Sarbanes-Oxley Act of 2002, which will require annual management assessments of the effectiveness of our internal controls over financial reporting and a report by our independent registered public accounting firm addressing these assessments. Furthermore, we will need to compile and submit data for financial service regulators (such as various state banking regulators and European central banks). These reporting and other obligations will place significant demands on our management and administrative and operational resources, including accounting resources. To comply with these requirements, we anticipate that we will need to upgrade our systems, including information technology, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff. If we are unable to upgrade our financial and management controls, reporting systems, information technology and procedures in a timely and effective fashion, our ability to comply with our financial reporting requirements and other rules that apply to reporting companies could be impaired. Any failure to achieve and maintain effective internal controls could have an adverse effect on our business, financial position and results of operations.

Following the spin-off, we will have substantial debt obligations that could restrict our operations. In addition, our business, financial position and results of operations could be harmed by adverse rating actions by credit rating agencies.

Historically, Western Union has relied on First Data for its capital needs. Following the spin-off, we will have direct access to the capital markets and will need to finance our company’s capital needs. In connection with the spin-off we will incur substantial indebtedness. Giving effect to the debt we will incur in connection with the spin-off, we expect that our total indebtedness for borrowed money could be as high as approximately $3.6 billion. We may also incur additional substantial indebtedness in the future.

Our indebtedness could have adverse consequences, including:

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There would be adverse tax consequences associated with using earnings generated outside the United States to pay the interest and principal on our indebtedness. Accordingly, this portion of our cash flow will be unavailable under normal circumstances to service our debt obligations.

It is important to our business to receive and maintain an investment grade long-term credit rating. We have had conversations with each of the major credit ratings agencies about our credit profile. At this time we are targeting to have, following the spin-off, long-term debt with an investment grade rating. If our long-term debt does not receive this rating, if our initial rating is downgraded, or if ratings agencies indicate that a downgrade may occur, our business, financial position and results of operations could be adversely affected and perceptions of our financial strength could be damaged. This could adversely affect our relationships with our agents, particularly those agents that are financial institutions or post offices. In addition, a downgrade or an indication that a downgrade may occur also could result in regulators imposing additional capital and other requirements on us, including imposing restrictions on the ability of our regulated subsidiaries to pay dividends. Also, a downgrade could increase our costs of borrowing money, adversely affecting our business, financial position and results of operations.

After the spin-off, our balance sheet as a stand-alone company may not contain sufficient amounts or types of regulatory capital to meet the changing requirements of our various regulators worldwide, which could adversely affect our business, financial position and results of operations.

In connection with the spin-off we will incur substantial indebtedness. As a result, our pro forma stockholders’ deficiency as of March 31, 2006 was $766.3 million. Our regulators likely will expect us, as a stand-alone company, to possess sufficient financial soundness and strength to adequately support our regulated subsidiaries. In addition, although we will not be a bank holding company for purposes of United States law or the law of any other jurisdiction, as a global provider of payments services and in light of the changing regulatory environment in various jurisdictions, we could be subject to new capital requirements introduced or imposed by our regulators that could require us to issue securities that would qualify as Tier 1 regulatory capital under the Basel Committee accords or retain earnings over a period of time. Any of these requirements could adversely affect our business, financial position and results of operations.

Regulators may impose conditions in connection with approving the spin-off which may have an adverse effect on our business, financial position and results of operations.

The transfer of some of the money transfer and consumer payment businesses to us will require filings to be made with some regulators in and outside of the United States. In some jurisdictions, the regulators will need to approve aspects of the transfer that occur within, or otherwise affect, their jurisdictions before the transfers or spin-off can take place. In other jurisdictions, regulators will need to be notified after the spin-off. It is possible that one or more approvals may not be given, or may be delayed, or a jurisdiction notified after the fact could raise objections or concerns which could affect our ability to operate in the affected jurisdiction. Regulatory conditions placed on the transfers or the spin-off may have an adverse effect on our business, financial position and results of operations.

Risks Relating to Our Business and Industry

If we are unable to maintain our agent network, our business, financial position and results of operations would be adversely affected.

Most of our revenue is derived through our agent network. Transaction volumes at existing agent locations often increase over time and new agents provide us with additional revenue. If agents decide to leave our network, or if we are unable to sign new agents, our revenue and profit growth rates may be adversely affected. Agent attrition might occur for a number of reasons, including a competitor engaging an agent or an agent’s dissatisfaction with its relationship with us or the revenue derived from that relationship. In addition, agents may generate fewer transactions or less revenue for various reasons, including the appearance of competitors close to

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our agent locations or increased competition. Because an agent is a third party that engages in a variety of activities in addition to providing our services, it may encounter business difficulties unrelated to its provision of our services, which could cause the agent to reduce its number of locations, hours of operation, or cease doing business altogether.

Our business is subject to a wide range of laws and regulations. Failure by us or our agents to comply with those laws and regulations, or any material change to them or their interpretation, could have an adverse effect on our business, financial position and results of operations.

As described under “Our Business—Regulation,” our business is subject to a wide range of laws and regulations. These include financial services regulations, consumer disclosure and consumer protection laws, currency control regulations, money transfer and payment instrument licensing regulations, escheat laws and laws covering consumer privacy, data protection and information security. Our services also are subject to an increasingly strict set of legal and regulatory requirements intended to help detect and prevent money laundering, terrorist financing and other illicit activity. As legislative and regulatory scrutiny and action in this area increases, we expect that our costs of complying with these requirements will increase, perhaps substantially. Failure to comply with any of these requirements—by either us or our agents (which are third parties, over which we have limited legal and practical control)—could result in the suspension or revocation of a license or registration required to provide money transfer services, the limitation, suspension or termination of services and/or the imposition of civil and criminal penalties, including fines. In addition to those direct costs, a failure by us or our agents to comply with applicable laws and regulations also could seriously damage our reputation and brands, and result in diminished revenue and profit and increased operating costs.

As noted above, most of our revenue is derived through our agent network. The types of enterprises that are legally authorized to act as our agents vary significantly from one country to another. Changes in the laws affecting the kinds of entities that are permitted to act as money transfer agents (such as changes in requirements for capitalization or ownership) could adversely affect our ability to distribute our services and the cost of providing such services, both by us and our agents. For example, a requirement that a money transfer provider be a bank or other highly regulated financial entity could increase significantly the cost of providing our services in many countries where that requirement does not exist today or could prevent us from offering our services in an affected country. Further, any changes in law that would require us to provide directly the money transfer services to consumers as opposed to through an agent network—effectively changing our business model—could significantly adversely impact our ability to provide our services, and/or the cost of our services, in the relevant jurisdiction.

Our fees may be reduced because of regulatory initiatives or proceedings that are either industry wide or specifically targeted at our company. For example, recent initiatives both in the United States and at G-8 summit meetings have focused on lowering international remittance costs. These initiatives may have an adverse impact on our business, financial position and results of operations.

Our agents are subject to a variety of regulatory requirements, which differ from jurisdiction to jurisdiction and are subject to change. A material change in the regulatory requirements necessary to offer money transfer services in a jurisdiction important to our business could mean increased costs and/or operational demands on our agents, which could result in the attrition of agents, a decrease in the number of locations at which money transfer services are offered and other negative consequences. The regulatory status of our agents could affect their ability to offer our services. For example, our agents in the United States are considered Money Service Businesses, or “MSBs,” under the Bank Secrecy Act. An increasing number of financial institutions view MSBs, as a class, as higher risk customers for purposes of their anti-money laundering programs. As a result, several financial institutions have terminated their banking relationships with some of our agents and with us. If a significant number of agents are unable to maintain existing or establish new banking relationships, they may not be able to continue to offer our services.

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Virtually all of the Western Union branded agents offer our services on an exclusive basis—that is, they have agreed by contract not to provide any non-Western Union branded money transfer services. While we believe that these agreements generally are valid and enforceable, changes in laws regulating competition or in the interpretation of those laws could undermine our ability to enforce them in the future. For example, Russia and Ukraine have each enacted laws that effectively prohibit payment service providers, such as money transfer companies, from agreeing to exclusive arrangements with banks in those countries. The inability to enforce our exclusivity rights under our contracts could adversely affect our operations and revenue by, for example, allowing competitors to benefit from the goodwill associated with the Western Union brand at our agent locations.

We face competition from global and niche or corridor money transfer providers, United States and international banks, card associations, card-based payments providers and a number of other types of service providers. Our continued growth depends on our ability to compete effectively in the industry.

Money transfer and consumer payments are highly competitive industries comprised of players from a variety of financial and non-financial business groups. Our competitors include banks, credit unions, automated teller machine or “ATM” providers and operators, card associations, card-based payments providers such as issuers of e-money, travel cards or stored-value cards, informal remittance systems, web-based services, telephone payment systems (including mobile phone networks), postal organizations, retailers, check cashers, mail and courier services, currency exchanges and traditional money transfer companies. These services are differentiated by features and functionalities such as speed, convenience, network size, hours of operations, loyalty programs, reliability and price. Our continued growth depends on our ability to compete effectively in these industries. Failure to compete on service differentiation could significantly affect our future growth potential and related profitability.

Recently, card associations have become more active in promoting stored-value cards and other services that compete with our money transfer and consumer payments businesses. These associations, as well as debit networks, can be effective competitors because of the ubiquity of their brands, their large number of financial institution issuers and their extensive merchant networks. In addition, we offer consumers the option of using credit or debit cards in connection with certain of our services. The card associations and debit networks set the charge, known as an interchange fee, that we as a merchant must pay for accepting their cards. Their association and network rules also categorize transactions or cause us to categorize transactions in a manner that can affect the cost of the transaction to us or the consumer. Changes to interchange fees could increase our costs to accept cards in payment for services, while changes in how our services are categorized could make the use of cards to pay for our services less attractive to the consumer.

Many of our agents outside the United States are national post offices. These entities are usually governmental organizations that may enjoy special privileges or protections that could allow them to simultaneously develop their own money transfer businesses. International postal organizations could agree to establish a money transfer network among themselves. Due to the size of these organizations and the number of locations they have, any such network could represent significant competition to us. Because these entities are governmental organizations, they may be able to—or be required to—offer their money transfer services at, near or below their cost of providing such services.

Risks associated with operations outside the United States could adversely affect our business, financial position and results of operations.

Because an increasing portion of our revenue is generated in currencies other than the United States dollar, we are subject to risks related to changes in currency rates and foreign exchange regulation (such as the ability to repatriate funds to the United States, and the cost of repatriation). We use foreign currency forward contracts that qualify as cash flow hedges to mitigate the cash flow risks associated with foreign currency denominated revenue transactions. However, these derivative contracts do not eliminate all of the risks related to foreign currency translation.

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Money transfers to, from or within or between countries may be limited or prohibited by law. At times in the past, we have been required to cease operations in particular countries due to political uncertainties or government restrictions imposed by foreign governments or the United States. Additionally, economic or political instability or natural disasters may make money transfers to, from or within a particular country difficult, such as when banks are closed, when currency devaluation makes exchange rates difficult to manage or when natural disasters or civil unrest makes access to agent locations unsafe. These risks could negatively impact our ability to make payments to or receive payments from international agents or our ability to recoup funds that have been advanced to international agents and could adversely affect our business, financial position and results of operations. In addition, the general state of telecommunications and infrastructure in some lesser developed countries creates operational risks for us and our agents that generally are not present in our operations in the United States and other more developed countries.

As noted above, many of our agents outside the United States are post offices, which are usually owned and operated by national governments. These governments may decide to change the terms under which they allow post offices to offer remittances and other financial services. For example, governments may decide to separate financial service operations from postal operations, or mandate the creation or privatization of a “post bank.” These changes could have an adverse effect on our ability to distribute and offer our services in countries that are material to our business.

Interruptions in international migration patterns could adversely affect our business, financial position and results of operations.

The money transfer business relies in part on migration patterns, which bring workers into countries with greater economic opportunities than their native countries. A significant portion of money transfers is initiated by immigrants. Changes in immigration laws, such as those currently being considered by the United States Congress, economic development patterns that discourage international migration 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 could adversely affect our remittance volume or growth rate and could each have an adverse effect on our business, financial position and results of operations.

Unfavorable resolution of tax contingencies could adversely affect our tax expense.

All of our operations have been included in the consolidated income tax returns of First Data. Our tax returns and positions are subject to review and audit by federal, state, local and international taxing authorities. An unfavorable outcome to a tax audit could result in higher tax costs, thereby negatively impacting our results of operations. In particular, we currently are in discussions with the Internal Revenue Service pursuant to the Internal Revenue Service’s Advance Pricing Agreement, or “APA,” Program. These discussions relate to certain tax aspects of a 2003 legal restructuring of our international operations. If an APA is negotiated successfully, during its term, generally we will avoid further examination by the Internal Revenue Service of the transfer pricing methods applicable to, and valuations of, the covered transactions. We continue to negotiate with the Internal Revenue Service in the APA process, and while we hope to reach a resolution through the process, there can be no assurances that the APA negotiations will be resolved in a manner acceptable to our company. If not so resolved, the matter would then likely proceed to other forums within the Internal Revenue Service. Any differences from our positions as recorded in our financial statements upon resolution of these issues will be reflected as a part of the income tax expense in the period during which the issues are resolved. Such resolution could also affect our effective tax rate for future periods.

Acquisitions and integrating new businesses create risks and may affect operating results.

We occasionally acquire businesses both inside and outside the United States. The acquisition and integration of businesses involve a number of risks. The core risks involve valuation (negotiating a fair price for the business based on inherently limited due diligence) and integration (managing the complex process of

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integrating the acquired company’s people, products and services, technology and other assets in an effort to realize the projected value of the acquired company and the projected synergies of the acquisition). In addition, international acquisitions often involve additional or increased risks including, for example:

Integrating operations could cause an interruption of, or divert resources from, one or more of our businesses and could result in the loss of key personnel. The diversion of management’s attention and any delays or difficulties encountered in connection with an acquisition and the integration of the acquired company’s operations could have an adverse effect on our business, financial position and results of operations.

Our ability to adopt technology in response to changing industry and consumer needs or trends poses a challenge to our business.

Our ability to compete in the markets we serve may be threatened by change, including changes in technology, changes with respect to consumer needs, competition and industry standards. We actively seek solutions that respond in a timely manner to new technology-based money transfer services such as Internet, land and mobile phone based money transfer services and prepaid, stored-value and other card-based money transfer services. Failure to respond well to these challenges could adversely impact our business, financial position and results of operations.

Western Union has been the subject of class-action litigation, and remains the subject of other litigation as well as consent agreements with or enforcement actions by regulators.

Western Union has been the subject of class-action litigation in the United States, alleging that its foreign exchange rate disclosures failed adequately to inform consumers about the revenue that Western Union and its agents derive from international remittances. These suits all have been settled without an admission of liability, and we have made certain changes in our advertising and consumer forms. It is possible that because of changes in law or future litigation or regulatory action, we could be required to modify our disclosures or our practices further. These modifications could be costly to implement, restrict our ability to advertise or promote our services and/or limit the amount of our foreign exchange income.

In addition, as a company that provides global financial services primarily to consumers, we could be subject to future class-action or other litigation alleging violations of consumer protection or other laws. We also are subject to claims asserted by consumers based on individual transactions.

Our consumer payments business is subject to various United States federal, state and local laws and regulations, as well as laws and regulations outside the United States. Our United States business is subject to reporting, recordkeeping and anti-money laundering provisions of the Bank Secrecy Act, as amended by the USA

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PATRIOT Act of 2001, and to regulatory oversight and enforcement by the United States Department of Treasury’s Financial Crimes Enforcement Network, or “FinCEN.” In addition, as a money transmitter, we are subject to licensing, regulation and examination by almost all the states and the District of Columbia.

Over the past several years, we have entered into a number of consent agreements with federal and state authorities, including FinCEN, the New York State Banking Department and the California Department of Financial Institutions, relating to the Bank Secrecy Act and anti-money laundering requirements and related matters. These agreements required us to pay civil penalties and to take certain measures to enhance our compliance with recordkeeping, reporting, training and agent oversight requirements under applicable state and federal law. The financial services industry and businesses like ours continue to be under significant regulatory scrutiny with respect to the Bank Secrecy Act and anti-money laundering compliance matters. It is possible that as a result of periodic examinations or otherwise, we could be subject to deficiency findings, fines, criminal penalties, enforcement actions or similar consent agreements in the future that could adversely affect our business, financial position and results of operations.

Our ability to remain competitive depends in part on our ability to protect our brands and our other intellectual property rights and to defend ourselves against potential patent infringement claims.

The Western Union^® brand, consisting of trademark registrations in various countries, is material to our company. The loss of the Western Union trademark or a diminution in the perceived quality associated with the name would harm our business. Similar to the Western Union trademark, the Vigo^SM service mark and the Orlandi Valuta^®, Speedpay^®, Western Union Quick Collect^® and Paymap^® trademarks are important to our company and a loss of the service mark or trademarks or a diminution in the perceived quality associated with these names could harm our business.

The laws of certain foreign countries in which we do business either do not recognize intellectual property rights or do not protect them to the same extent as do the laws of the United States. Adverse determinations in judicial or administrative proceedings in the United States or in foreign countries could impair our ability to sell our services or license or protect our intellectual property, which could adversely affect our business, financial position and results of operations.

We have been, and in the future may be, subject to claims alleging that our technology or business methods infringe patents owned by others, both in and outside the United States. Unfavorable resolution of these claims could require us to change how we deliver a service, result in significant financial consequences, or both, which could adversely affect our business, financial position and results of operations.

Interruptions in our systems may have a significant effect on our business.

Our ability to provide reliable service largely depends on the efficient and uninterrupted operation of our computer information systems. Any significant interruptions could harm our business and reputation and result in a loss of consumers. Our systems and operations could be exposed to damage or interruption from fire, natural disaster, power loss, telecommunications failure, terrorism, vendor failure, unauthorized entry and computer viruses or other causes, many of which may be beyond our control. Although we have taken steps to prevent a system failure, our measures may not be successful and we may experience problems other than system failures. We also may experience software defects, development delays, installation difficulties and other systems problems, which would harm our business and reputation and expose us to potential liability which may not be fully covered by our business interruption insurance. Our data applications may not be sufficient to address technological advances, changing market conditions or other developments.

Breaches of our information security policies or safeguards could adversely affect our ability to operate and could damage our reputation, business, financial position and results of operations.

We collect, transfer and retain consumer data as part of our business. These activities are subject to laws and regulations in the United States and other jurisdictions in which our services are available. These requirements,

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which often differ materially among the many jurisdictions, are designed to protect the privacy of consumers’ personal information and to prevent that information from being inappropriately disclosed. We have developed and maintain technical and operational safeguards designed to comply with applicable legal requirements. However, despite those safeguards, it is possible that hackers, employees acting contrary to our policies or others could improperly access our systems or improperly obtain or disclose data about our consumers. Any breach of our security policies or applicable legal requirements resulting in a compromise of consumer data could expose us to regulatory enforcement action, limit our ability to provide services, subject us to litigation and/or damage our reputation.

We face credit and fraud risks from our agents and from consumers that could adversely affect our business, financial position and results of operations.

The vast majority of our global funds transfer business is conducted through third-party agents that provide our services to consumers at their retail locations. These agents sell our services, collect funds from consumers and are required to pay the proceeds from these transactions to us. As a result, we have credit exposure to our agents. In some countries, our agent networks are comprised of agents that establish subagent relationships; these agents must collect funds from their subagents in order to pay us. We are not insured against credit losses, except in certain circumstances (generally only limited instances and only in the United States) related to agent theft or fraud. If an agent becomes insolvent, files for bankruptcy, commits fraud or otherwise fails to pay money order or money transfer proceeds to us, we must nonetheless pay the money order or complete the money transfer on behalf of the consumer.

From time to time, we have made, and may in the future make, short term advances and longer term loans to our agents. These advances and loans generally are secured by settlement funds payable by us to these agents. However, the failure of these borrowing agents to repay these advances and loans constitutes a credit risk to us.

We offer consumers the ability to transfer money utilizing their credit or debit card, through various distribution channels such as the Internet or telephone. Because they are not face-to-face transactions, these transactions involve a greater risk of fraud. We apply verification and other tools to help authenticate transactions and protect against fraud. However, these tools may not be successful in protecting us against fraud. As the merchant of these transactions, we are not insured for losses and bear the financial risk of the full amount sent.

Risks Relating to Our Common Stock

There has been no prior market for our common stock, the trading price of our common stock may be volatile and you may not be able to sell your shares at or above the initial market price for our common stock following the spin-off.

There has been no prior trading market for our common stock. On or about the record date, our common stock will begin to trade on a “when-issued” basis. We have not and will not set the initial price of our common stock; that price will instead be established by the public markets.

We cannot predict the price at which our common stock will trade after the spin-off. In fact, the combined trading prices of a share of our common stock and a share of First Data common stock after the spin-off may not equal or exceed the trading price of a share of First Data common stock immediately prior to the spin-off. The price at which our common stock trades likely will fluctuate significantly, particularly until an orderly market develops. Prices for our common stock will be determined in the public markets and may be influenced by many factors, many of which are beyond our control, including:

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For more information, see “The Spin-Off—Market for Our Common Stock; Trading of Our Common Stock Prior to the Spin-Off.”

Substantial sales of our common stock could occur in connection with the spin-off, which could cause our stock price to decline.

Shares of our common stock distributed in connection with the spin-off generally may be sold in the public markets immediately following the spin-off. Some First Data stockholders who receive shares of our common stock in connection with the spin-off may sell our shares shortly after the spin-off for any number of reasons. In particular, index funds tied to the Standard & Poor’s 500 Index and other indices hold shares of First Data common stock. To the extent our common stock is not included in these indices, certain of these index funds likely will be required to sell the shares of our common stock they receive in connection with the spin-off. The sale of significant amounts of our common stock, or the perception in the market that this will occur, may lower the market price of our common stock.

Certain provisions of our certificate of incorporation and by-laws will make it difficult for stockholders to change the composition of our board of directors and may discourage hostile takeover attempts that some of our stockholders may consider to be beneficial.

Certain provisions of our certificate of incorporation and by-laws could have the effect of delaying or preventing changes in control if our board of directors determines that such changes in control are not in the best interests of us and our stockholders. These provisions include, among other things, the following:

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While these provisions have the effect of encouraging persons seeking to acquire control of our company to negotiate with our board of directors, they could enable our board of directors to hinder or frustrate a transaction that some, or a majority, of our stockholders might believe to be in their best interests and, in that case, may prevent or discourage attempts to remove and replace incumbent directors. For more information, see “Description of Our Capital Stock” and “Certain Anti-Takeover Effects of Provisions of Our Certificate of Incorporation and By-Laws.”

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 FORWARD-LOOKING STATEMENTS

This information statement and other materials we have filed or will file with the Securities and Exchange Commission (the “SEC”) (as well as information included in our other written or oral statements) contain, or will contain, disclosures which are “forward-looking statements.” Forward-looking statements include all statements that do not relate solely to historical or current facts, and generally can be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “could,” “would,” “likely,” “intend” or “continue.” These forward-looking statements address, among other things, the anticipated effects of the spin-off. These forward-looking statements are based on the current plans and expectations of our management and are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. These factors include, but are not limited to:

You are cautioned not to rely unduly on such forward-looking statements, which speak only as of the date made, when evaluating the information presented in this information statement or in documents incorporated in this information statement. We assume no obligation to update any forward-looking statements contained in this information statement.

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 THE SPIN-OFF

Background and Reasons for the Spin-Off

The board of directors of First Data regularly reviews the various businesses conducted by First Data to ensure that resources are deployed and activities are pursued in the best interests of its stockholders. On January 26, 2006, First Data announced that its board of directors had authorized in principle the distribution of our common stock to First Data’s stockholders in a tax-free spin-off. This authorization is subject to final approval by the First Data board of directors, which approval is subject to, among other things, receipt of a private letter ruling from the Internal Revenue Service and an opinion of Sidley Austin LLP, counsel to First Data (or other nationally recognized tax counsel), in each case with respect to the tax-free nature of the spin-off. In making the determination to spin off our businesses, the board of directors of First Data acknowledged that the principal focus of First Data is on serving the financial transaction processing and card-issuing needs of merchants and financial institutions, and that our business, serving the money transfer and payment needs of consumers, did not fit within that focus. The board of directors of First Data recognized that the spin-off would permit us to focus our attention and financial resources on our money transfer and consumer payments businesses.

The operating and financial characteristics of our businesses are different from those of First Data’s businesses. The services we provide and consumers we serve are different from the services that First Data provides and the customers it serves. We are focused on enhancing our position as a provider of money transfers and consumer payments. First Data, on the other hand, is focused on enhancing its position as a provider of payment processing services to merchants and financial institutions and a provider of card issuing and related services to financial institutions.

In the future, Western Union and First Data expect to face different business challenges. To be successful, we believe we will need to expand and diversify our consumer-to-consumer global distribution network, build our brands, enhance the consumer experience, expand the channels by which consumers can send or receive money and diversify our consumer-to-consumer service offerings, expand into new biller and other business and government relationships and expand the international presence of our consumer-to-business offerings. First Data believes that it will need to acquire new merchant relationships, cross sell products and services into existing relationships and leverage core processing capabilities for future expansion into other markets.

First Data and we believe that the spin-off of our businesses from First Data will provide several opportunities and benefits that are expected to enhance stockholder value, including the following:

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Manner of Effecting the Spin-Off

The general terms and conditions of the spin-off will be set forth in the separation and distribution agreement to be entered into by First Data and us. For a description of the expected terms of that agreement, see “Our Relationship with First Data After the Spin-Off—Separation and Distribution Agreement.”

Overview. The spin-off will be accomplished through a series of transactions, pursuant to the terms and conditions of the separation and distribution agreement, by which First Data will contribute to us the subsidiaries that operate its money transfer and consumer payments businesses, as well as related assets, including intellectual property, real estate and First Data’s interest in one of our agents, and distribute to its stockholders of record all of the outstanding shares of our common stock. As discussed under “—Trading of First Data Common Stock After the Record Date and Prior to the Distribution,” if a holder of record of First Data common stock sells those shares in the “regular way” market after the record date and prior to the spin-off, that stockholder also will be selling the right to receive shares of Western Union common stock in the distribution. The distribution will be made in book-entry form on the basis of one share of Western Union common stock for each share of First Data common stock held on the record date of [•], 2006. First Data will instruct Wells Fargo Bank Minnesota, National Association, as distribution agent, to record the distribution on the distribution date to the holders of First Data common stock at the close of business on the record date (or their designated transferees). Each share of Western Union common stock that is distributed will be validly issued, fully paid and nonassessable and free of preemptive rights.

Book Entry Statements. A book-entry account statement reflecting your ownership of shares of Western Union common stock will be mailed to you, or your brokerage account will be credited for the shares, on or about [•], 2006. If you request a certificate for your shares of Western Union common stock, you will receive a certificate for the number of shares you own.

Results of the Spin-Off

Following the spin-off, Western Union will be an independent, publicly traded company owning and operating what had previously been First Data’s money transfer and consumer payments businesses. We expect to have approximately [•] holders of shares of our common stock and approximately [•] million shares of our common stock issued and outstanding immediately following the spin-off based on the distribution ratio described above and the anticipated number of beneficial stockholders and outstanding First Data shares on [•], 2006, the record date. The actual number of shares to be distributed will be determined based on the number of shares of First Data common stock outstanding on the record date.

You will not be required to make any payment for the shares of Western Union common stock you receive, nor will you be required to surrender or exchange your shares of First Data common stock or take any other action in order to receive Western Union common stock. The spin-off will not affect the number of outstanding First Data shares or any rights of First Data stockholders, although it will affect the market value of the outstanding First Data common stock.

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Important Federal Income Tax Consequences

The following section discusses the material United States federal income tax consequences of the spin-off. This discussion is based on the Internal Revenue Code, Treasury regulations promulgated under the Internal Revenue Code and judicial and administrative interpretations thereof, all as in effect as of the date of this information statement, all of which are subject to change at any time, possibly with retroactive effect. The discussion assumes that the spin-off will be consummated in accordance with the separation and distribution agreement and as further described in this information statement. This is not a complete description of all of the consequences of the spin-off and, in particular, may not address United States federal income tax considerations applicable to holders of First Data common stock subject to special treatment under United States federal income tax law. Holders of First Data common stock subject to special treatment include, for example, financial institutions, dealers in securities, traders in securities who elect to apply a mark-to-market method of accounting, insurance companies, tax-exempt entities, partnerships and other pass-through entities, holders who acquired their shares pursuant to the exercise of an employee stock option or right or otherwise as compensation, and holders who hold First Data common stock as part of a “hedge,” “straddle,” “conversion” or “constructive sale” transaction. In addition, this discussion does not address the United States federal income tax consequences to holders of First Data common stock who are not United States holders or who do not hold First Data common stock as a capital asset. No information is provided in this information statement with respect to the tax consequences of the spin-off under applicable foreign or state or local laws. For purposes of this information statement, a “United States holder” means any beneficial owner of First Data common stock, other than an entity or arrangement treated as a partnership for United States federal income tax purposes, that for United States federal income tax purposes is:

Holders of First Data common stock are urged to consult with their tax advisors regarding the tax consequences of the spin-off to them, as applicable, including the effects of United States federal, state and local tax laws, as well as foreign and other tax laws.

The Spin-Off

The spin-off is conditioned upon First Data’s receipt of a private letter ruling from the Internal Revenue Service, in form and substance satisfactory to First Data, to the effect that, among other things, the spin-off (including certain related transactions) will be tax-free to First Data, us and First Data stockholders for United States federal income tax purposes under sections 355, 368 and related provisions of the Internal Revenue Code. Although a private letter ruling from the Internal Revenue Service generally is binding on the Internal Revenue Service, if the factual assumptions or representations made in the private letter ruling request are untrue or incomplete in any material respect, then First Data will not be able to rely on the ruling. Furthermore, the Internal Revenue Service will not rule on whether a distribution satisfies certain requirements necessary to obtain tax-free treatment under section 355 of the Internal Revenue Code. Rather, the private letter ruling will be based upon representations by First Data that those requirements have been satisfied, and any inaccuracy in such representations could invalidate the private letter ruling.

The spin-off is also conditioned upon the receipt by First Data of an opinion of Sidley Austin LLP, counsel to First Data (or other nationally recognized tax counsel), in form and substance satisfactory to First Data, to the

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effect that the spin-off (including certain related transactions) will be tax-free to First Data, us and First Data stockholders for United States federal income tax purposes under sections 355, 368 and related provisions of the Internal Revenue Code. The opinion will rely on the Internal Revenue Service private letter ruling as to matters covered by the ruling. The opinion will be based on, among other things, certain assumptions and representations as to factual matters made by First Data and us which, if untrue or incomplete in any material respect, would jeopardize the conclusions reached by counsel in its opinion. The opinion will not be binding on the Internal Revenue Service or the courts, and the Internal Revenue Service or the courts may not agree with the opinion.

Assuming (i) the receipt and continued validity of the private letter ruling from the Internal Revenue Service, (ii) the correctness of counsel’s opinion and (iii) that the distribution of our common stock to First Data stockholders in connection with the spin-off is not otherwise disqualified as tax-free, the material United States federal income tax consequences of the spin-off will be as follows:

As described above, the private letter ruling and the opinion will be based, in part, on certain assumptions and representations as to factual matters. If any of those assumptions or representations is untrue or incomplete as of the effective time of the spin-off, the tax consequences of the spin-off could differ materially from those described above. In addition, opinions of counsel neither bind the Internal Revenue Service or any court, nor preclude the Internal Revenue Service from adopting a contrary position.

If the spin-off were not to qualify for tax-free treatment under sections 355, 368 and related provisions of the Internal Revenue Code, First Data would recognize taxable gain equal to the excess of the fair market value of the consideration received by First Data in the contribution over First Data’s tax basis in the assets contributed to us in the contribution and, under certain circumstances, we would be required under the tax allocation agreement to indemnify First Data for all or a portion of that liability. See “Our Relationship with First Data After the Spin-Off—Tax Allocation Agreement.” In addition, each United States holder who receives our common stock in the spin-off would be treated as receiving a taxable distribution in an amount equal to the fair market value of our common stock received.

First Data may incur some tax cost in connection with the spin-off (as a result of certain intragroup asset transfers and certain differences between federal and state tax rules), whether or not the spin-off qualifies for tax-free treatment under sections 355, 368 and related provisions of the Internal Revenue Code.

Effect of Certain Acquisitions of First Data Common Stock or Our Common Stock

Even if the spin-off otherwise qualifies as a tax-free distribution under section 355 of the Internal Revenue Code, the spin-off may result in significant United States federal income tax liabilities to First Data if 50% or more of First Data stock or our stock (in each case by vote or value) is acquired, directly or indirectly, by one or more persons as part of a plan (or series of related transactions) that includes the spin-off. For purposes of this test, any acquisitions of First Data stock or our stock, or any agreement, understanding, arrangement or substantial negotiations regarding an acquisition of First Data stock or our stock, within two years before or after the spin-off are subject to special scrutiny.

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The process for determining whether a change in control prohibited under the foregoing rules has occurred is complex, inherently factual and subject to interpretation of the facts and circumstances of a particular case. If a direct or indirect acquisition of First Data stock or our stock resulted in a change in control prohibited under those rules, First Data (but not its stockholders) would recognize taxable gain as described above. With respect to taxes and other liabilities that could be imposed in connection with the spin-off (and certain related transactions), under the terms of the tax allocation agreement we will be liable to First Data for any such taxes or liabilities resulting from actions taken by or with respect to us, one of our affiliates or any person that, after the spin-off, is an affiliate thereof. See “Our Relationship with First Data After the Spin-Off—Tax Allocation Agreement” beginning on page [•].

Information Reporting

Current Treasury regulations require each holder of First Data common stock who receives our common stock in the distribution to attach to his, her or its federal income tax return for the year in which the spin-off occurs a detailed statement setting forth the data that may be appropriate in order to show the applicability of section 355 of the Internal Revenue Code to the spin-off. First Data will provide the appropriate information to each stockholder of record.

The foregoing sets forth the material United States federal income tax consequences of the spin-off under current law. This discussion does not address tax consequences that may vary with, or are contingent on, individual circumstances. Moreover, it does not address any non-income tax or any foreign, state or local tax consequences of the spin-off. Each beneficial owner of First Data common stock is encouraged to consult his, her or its tax advisor as to the particular consequences of the spin-off to the stockholder, including the application of state, local and foreign tax laws, and as to possible prospective or retroactive changes in tax law that might affect the tax consequences described above.

Market for Our Common Stock; Trading of Our Common Stock Prior to the Spin-Off

There is currently no trading market for our common stock. We intend to apply to have our common stock authorized for listing on the New York Stock Exchange under the symbol “WU.” We expect that a limited market, commonly known as a “when-issued” trading market, for our common stock will begin on [•], 2006. The term “when-issued” means that shares can be traded prior to the time shares are available or issued. We expect that on the first trading day following the distribution date, “when-issued” trading in our common stock will end and “regular way” will begin. “Regular way” trading refers to trading after a security has been issued and typically involves a transaction that settles on the third full business day following the date of a trade. We have not and will not set the initial price of our common stock; that price will be established by the public markets.

We cannot predict the price at which our common stock will trade after the spin-off. In fact, the combined trading prices of a share of our common stock and a share of First Data common stock after the spin-off may not equal or exceed the trading price of a share of First Data common stock immediately prior to the spin-off. The price at which our common stock trades is likely to fluctuate significantly, particularly until an orderly public market develops. Prices for our common stock will be determined in the public markets and may be influenced by many factors, many of which are beyond our control, including:

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We have appointed Wells Fargo Bank Minnesota, National Association to serve as transfer agent and registrar for our common stock.

Shares of our common stock distributed to holders of First Data common stock in connection with the spin-off will be transferable under the Securities Act of 1933, as amended, which we refer to as the Securities Act, except for shares received by persons who may be deemed to be our affiliates. Persons who may be deemed to be our affiliates after the spin-off generally include individuals or entities that control, are controlled by or are under common control with us and may include certain of our officers, directors or principal stockholders. After we become a publicly traded company, securities held by our affiliates will be subject to the resale restrictions under the Securities Act. Our affiliates will be permitted to sell shares of our common stock only pursuant to an effective registration statement or an exemption from the registration requirements of the Securities Act, such as the exemption afforded by Rule 144 under the Securities Act.

Trading of First Data Common Stock After the Record Date and Prior to the Distribution

Beginning on or shortly before the record date and until the distribution date, there will be two concurrent markets in which to trade First Data common stock: a “regular way” market and an “ex-distribution” market. Shares of First Data common stock that trade on the regular way market will trade with an entitlement to shares of our common stock distributed in connection with the spin-off. Shares that trade on the ex-distribution market will trade without an entitlement to shares of our common stock distributed in connection with the spin-off. Therefore, if you owned shares of First Data common stock at 5:00 p.m., New York City time, on the record date and sell those shares on the regular way market prior to the distribution, you also will be selling the shares of our common stock that would have been distributed to you in connection with the spin-off. If you sell those shares of First Data common stock on the ex-distribution market prior to the distribution, you will still receive the shares of our common stock that were to be distributed to you pursuant to your ownership of the shares of First Data common stock.

Distribution Conditions and Termination

We expect that the distribution will be effective, and the spin-off complete, on the distribution date, [•], 2006, provided that, among other things:

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The fulfillment of the foregoing conditions will not create any obligation on First Data’s part to effect the distribution, and the board of directors of First Data has reserved the right to amend, modify or abandon the distribution and the related transactions at any time prior to the distribution date. The board of directors of First Data may waive any of these conditions in its sole and absolute discretion.

Reason for Furnishing this Information Statement

This information statement is being furnished solely to provide information to stockholders of First Data who will receive shares of Western Union common stock in connection with our spin-off. It is not provided as an inducement or encouragement to buy or sell any of our securities. You should not assume that the information contained in this information statement is accurate as of any date other than the date set forth on the cover. Changes to the information contained in this information statement may occur after that date, and we undertake no obligation to update the information.

Accounting Treatment

The spin-off will be accounted for by First Data on a historical basis, and no gain or loss will be recorded.

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 DIVIDEND POLICY

It is currently contemplated that following the spin-off, we will pay a cash dividend on our common stock with respect to the first full fiscal quarter following the date the spin-off is completed in an amount to be determined prior to the spin-off. However, the declaration and amount of future dividends will be determined by our board of directors and will depend on our financial condition, earnings, capital requirements, legal requirements, regulatory constraints, industry practice and any other factors that our board of directors believes are relevant. In addition, we will be a holding company with no material assets other than the stock of our subsidiaries. Accordingly, our ability to pay dividends will be dependent on our receiving dividends from our operating subsidiaries. Many of our operating subsidiaries are highly regulated and may be subject to restrictions on their ability to pay dividends to us.

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 FINANCING

We currently expect that in connection with the spin-off, we, one or more of our subsidiaries or a combination of both will transfer to First Data up to approximately $3.6 billion in cash or a combination of cash and our debt securities. We expect to finance the cash portion of the amount to be paid to First Data through borrowings by us and/or one or more of our subsidiaries. The borrowing arrangements may be in the form of credit facilities, publicly or privately issued debt or a combination thereof. The amount to be paid to First Data, the amount and term of the debt we will incur, the type of debt and entity that will incur the debt have not been finally determined, but will be determined prior to the spin-off. A number of factors could affect this final determination, and the amount of debt ultimately incurred could be substantially less than the amount assumed in this information statement.

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 CAPITALIZATION

The following table sets forth our capitalization as of March 31, 2006 on a historical basis and on a pro forma basis to give effect to the pro forma adjustments included in our unaudited pro forma combined financial statements. The pro forma adjustments are based upon available information and assumptions that management believes are reasonable; however, such adjustments are subject to change based on the finalization of the terms of the spin-off and the transaction agreements. In addition, such adjustments are estimates and may not prove to be accurate.

The unaudited pro forma combined statements of income do not include adjustments for certain initial separation costs, nor do they give effect to additional costs associated with operating as a stand-alone company.

You should read this table together with “Selected Historical Combined Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Unaudited Pro Forma Combined Financial Statements” and our historical combined financial statements and the notes to those statements included elsewhere in this information statement.

Our ability to issue additional stock will be constrained because the issuance of additional stock might cause the spin-off to be taxable to First Data if 50% or more of our stock (by vote or value) is treated as having been acquired, directly or indirectly, by one or more persons as part of a plan (or series of related transactions) that includes the spin-off. Under the tax allocation agreement we might be required to indemnify First Data against any such tax imposed on First Data as a result of acquisitions of our stock. See “The Spin-Off—Important Federal Income Tax Consequences—Effect of Certain Acquisitions of First Data Common Stock or Our Common Stock” for a more detailed discussion.

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 UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

The unaudited pro forma combined financial statements of Western Union presented below have been derived from our audited combined financial statements for the year ended December 31, 2005 and from our unaudited combined financial statements for the three months ended March 31, 2006. The pro forma adjustments and notes to the pro forma combined financial statements give effect to the distribution of Western Union common stock by First Data and the other transactions contemplated by the separation and distribution agreement. These unaudited pro forma combined financial statements should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our combined financial statements and the notes to those statements included elsewhere in this information statement.

The unaudited pro forma combined statements of income for the year ended December 31, 2005 and the three months ended March 31, 2006 have been prepared as though the spin-off had occurred as of January 1, 2005. The unaudited pro forma combined balance sheet at March 31, 2006 has been prepared as though the spin-off had occurred on March 31, 2006. The pro forma adjustments are based upon available information and assumptions that management believes are reasonable; however, such adjustments are subject to change based on the finalization of the terms of the spin-off and the transaction agreements. See “Our Relationship with First Data After the Spin-off—Separation and Distribution Agreement.” In addition, such adjustments are estimates and may not prove to be accurate.

The pro forma adjustments include the following items:

The share numbers and dollar and settlement amounts are based on First Data share numbers and balances as of March 31, 2006.

The pro forma combined statements of income do not include adjustments for certain initial separation costs.

In addition, the pro forma adjustments do not include additional costs associated with operating as a stand-alone company which we have preliminarily estimated to be approximately $65.0 million to $75.0 million annually.

The unaudited pro forma combined financial statements are for illustrative purposes only and do not reflect what our financial position and results of operations would have been had the spin-off occurred on the dates indicated and are not necessarily indicative of our future financial position and future results of operations.

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THE WESTERN UNION COMPANY

Unaudited Pro Forma Combined Statements of Income

Year Ended December 31, 2005

See accompanying notes.

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THE WESTERN UNION COMPANY

Unaudited Pro Forma Combined Statements of Income

Three Months Ended March 31, 2006

See accompanying notes.

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