MoneyGram 2004 Annual Report Download - page 72

Table of Contents
MONEYGRAM INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 12. Stockholders' Equity
Rights Agreement: In connection with the spin-off, MoneyGram adopted a Rights Agreement ("the Rights Agreement") by and between the Company and
Wells Fargo Bank, N.A., as the Rights Agent. The preferred share purchase rights ("the rights") issuable under the Rights Agreement were attached to the
shares of MoneyGram common stock distributed in the spin-off. In addition, pursuant to the Rights Agreement, one right will be issued with each share of
MoneyGram common stock issued after the spin-off. The rights are inseparable from MoneyGram common stock and will allow its holder to purchase one
one-hundredth of a share of MoneyGram series A junior participating preferred stock for $100.00, once the rights become exercisable. The rights become
exercisable ten days after a person or group acquires, or begins a tender or exchange offer for, 15 percent or more of the Company's outstanding common
stock. In the event a person or group acquires 15 percent or more of the Company's outstanding common stock, and subject to certain conditions and
exceptions more fully described in the Rights Agreement, each right will entitle the holder (other than the person or group acquiring 15 percent or more of the
Company's outstanding common stock) to purchase shares of MoneyGram common stock having a market value equal to $200.00. The rights are redeemable
at the discretion of the Company's Board of Directors for $0.01 per right and will expire, unless earlier redeemed, on June 30, 2014. Each one one-hundredth
of a share of MoneyGram preferred stock, if issued, will not be redeemable, will entitle holders to quarterly dividend payments of the greater of $0.01 per
share or an amount equal to the dividend paid on one share of MoneyGram common stock, will have the same voting power as one share of MoneyGram
common stock and will entitle holders, upon liquidation, to receive the greater of $1.00 per share or the payment made on one share of MoneyGram common
stock.
Preferred Stock: MoneyGram's Certificate of Incorporation provides for the issuance of up to 5,000,000 shares of undesignated preferred stock and up to
2,000,000 shares of series A junior participating preferred stock. Undesignated preferred stock may be issued in one or more series, with each series to have
those rights and preferences, including, without limitation, voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences,
as shall be determined by unlimited discretion of MoneyGram's Board of Directors. Series A junior participating preferred stock has been reserved for
issuance upon exercise of preferred share purchase rights. At December 31, 2004, no preferred stock is issued or outstanding.
Common Stock: MoneyGram's Certificate of Incorporation provides for the issuance of up to 250,000,000 shares of common stock with a par value of $0.01.
On the Distribution Date, MoneyGram was recapitalized such that the 88,556,077 shares of MoneyGram common stock outstanding was equal to the number
of shares of Viad common stock outstanding at the close of business on the record date. Stockholders' equity at December 31, 2003 and 2002 represented
Viad's capital structure consisting of 200,000,000 common shares authorized and 99,739,925 shares issued with a $1.50 par value.
The holders of MoneyGram common stock are entitled to one vote per share on all matters to be voted upon by its stockholders. The holders of common stock
have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to the common stock. The
determination to pay dividends on common stock will be at the discretion of the Board of Directors and will depend on our financial condition, results of
operations, cash requirements, prospects and such other factors as the Board of Directors may deem relevant.
On August 19, 2004, the Board of Directors declared the Company's initial quarterly cash dividend of $0.01 per share. The dividend was paid on October 1,
2004 to stockholders of record at the close of business on September 16, 2004. The total amount of the dividend was $0.9 million. On November 18, 2004, the
Board of Directors declared the Company's second quarterly cash dividend of $0.01 per share. The Company paid $0.9 million to the transfer agent on
December 31, 2004 and the cash dividend was distributed by the transfer agent on January 3, 2005. On February 17,
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