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Table of Contents
MONEYGRAM INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
In June 2008, the FASB issued FSP EITF 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are
Participating Securities. FSP EITF 03-6-1 addresses whether instruments granted in share-based payment transactions are participating
securities prior to vesting and, therefore, need to be included in computing earnings per share under the two-class method described in
SFAS No. 128. FSP EITF 03-6-1 requires companies to treat unvested share-based payment awards that have non-forfeitable rights to
dividend or dividend equivalents as a separate class of securities in calculating earnings per share. FSP EITF 03-6-1 will be effective for
the Company's fiscal year beginning January 1, 2009, with early adoption prohibited. The Company is currently evaluating the impact of
FSP EITF 03-6-1 on its Consolidated Financial Statements.
In October 2008, the FASB issued FSP FAS 157-3, Determining the Fair Value of a Financial Asset When the Market for That Asset Is
Not Active. FSP FAS 157-3 clarifies the application of SFAS 157 in a market that is not active and provides an example to illustrate key
considerations in determining the fair value of a financial asset when the market for that financial asset is not active. The Company
determines the fair value of certain of its cash equivalents, trading investments, available-for-sale investments and derivative financial
instruments based on the guidance set forth in SFAS 157 as described in Note 5 — Fair Value Measurement. The Company adopted FSP
SFAS No. 157-3 in October 2008 with no material impact on its Consolidated Financial Statements.
In December 2008, the FASB issued FSP FAS 140-4 and FIN 46(R)-8, Disclosures by Public Entities (Enterprises) about Transfers of
Financial Assets and Interests in Variable Interest Entities. FSP FAS 140-4 and FIN 46(R)-8 increases disclosures for public companies
about securitizations, asset-backed financings and variable interest entities. The Company adopted FSP FAS 140-4 and FIN 46(R)-8 with
no material impact on its Consolidated Financial Statements.
Note 4 — Acquisitions and Discontinued Operations
Raphael's Bank France — On February 2, 2009, MoneyGram acquired the French assets of R. Raphael's & Sons PLC ("Raphael's Bank")
for a purchase price of $3.2 million. The acquisition of Raphael's Bank provides us with five highly productive money transfer stores in
and around Paris, France that will be integrated into our French retail operations. We incurred $0.2 million of transaction costs related to
this acquisition in 2008 which are included in the "Transaction and operations" expense line in the Consolidated Income Statements. The
acquired net assets and operating results of Raphael's Bank are not included in the Company's Consolidated Financial Statements as of
December 31, 2008 as the acquisition occurred subsequent to that date.
MoneyCard World Express, S.A. and Cambios Sol S.A. — On July 10, 2008 and July 31, 2008, MoneyGram acquired MoneyCard World
Express, S.A. ("MoneyCard") and Cambios Sol S.A. ("Cambios Sol"), two of its former super-agents in Spain, for purchase prices of
$3.4 million and $4.5 million, respectively, including cash acquired of $1.4 million and $4.1 million, respectively. The acquisition of
these money transfer entities provide the Company with a money transfer license in Spain, as well as the opportunity for further network
expansion and more control over marketing and promotional activities in the region.
The purchase price allocation as of December 31, 2008 includes $4.3 million of goodwill assigned to the Company's Global Funds
Transfer segment and $1.4 million of intangible assets. The intangible assets consist primarily of agent rights and developed technology
and will be amortized over useful lives ranging from three to five years. In addition, we recognized an indefinite life intangible asset of
$0.6 million relating to the money transfer license. The purchase price allocation includes $0.5 million of transaction costs. The operating
results of MoneyCard and Cambios Sol subsequent to the acquisition dates are included in the Company's Consolidated Statements of
(Loss) Income. The financial impact of the acquisitions is not material to the Consolidated Balance Sheets or Consolidated Statements of
(Loss) Income.
PropertyBridge, Inc. — On October 1, 2007, the Company acquired PropertyBridge, Inc. ("PropertyBridge") for $28.1 million.
PropertyBridge is a provider of electronic payment processing services for the real estate
F-22