MoneyGram 2008 Annual Report Download - page 15

Table of Contents
Available Information
Our principal executive offices are located at 1550 Utica Avenue South, Minneapolis, Minnesota 55416 and our telephone number is
[phone]. Our website address is www.moneygram.com. We make our reports on Forms 10-K, 10-Q and 8-K, Section 16 reports
on Forms 3, 4 and 5, and all amendments to those reports, available electronically free of charge in the Investor Relations section of our
website as soon as reasonably practicable after they are filed with or furnished to the Securities and Exchange Commission (the "SEC").
Item 1A. RISK FACTORS
Various risks and uncertainties could affect our business. Any of the risks described below or elsewhere in this Annual Report on
Form 10-K or our other filings with the SEC could have a material impact on our business, financial condition or results of operations.
RISK FACTORS
Our increased debt service, significant debt covenant requirements, our debt rating and any future cash dividends paid on our
preferred stock could impair our financial condition and adversely affect our ability to operate and grow our business.
As a result of the Capital Transaction, we are highly leveraged and have substantial debt service obligations. Our indebtedness could
adversely affect our ability to operate our business and could have an adverse impact on our stockholders, including:
• our ability to obtain additional financing in the future may be impaired;
• a significant portion of our cash flow from operations must be dedicated to the payment of interest and principal on our debt, which
reduces the funds available to us for our operations, acquisitions, product development or other corporate initiatives;
• our debt agreements contain financial and restrictive covenants which significantly impact our ability to operate our business and
any failure to comply with them may result in an event of default, which could have a material adverse effect on us;
• our level of indebtedness increases our vulnerability to general economic downturns and adverse industry conditions;
• our debt service obligations could limit our flexibility in planning for, or reacting to, changes in our business and the industry;
• our substantial leverage could place us at a competitive disadvantage to our competitors who have less leverage relative to their
overall capital structures;
• our ability to pay cash dividends to the holders of our common stock is significantly restricted, and no such dividends are
contemplated in the foreseeable future; and
• payment of cash dividends to the holders of the preferred stock in the future could reduce the funds available to us for our
operations, acquisitions, product development or other corporate initiatives.
Our senior debt pursuant to our credit facility has been rated non-investment grade. Together with our leverage, this rating adversely
affects our ability to obtain additional financing and increases our cost of borrowing. A non-investment grade rating may also affect our
ability to attract and retain certain customers.
Our recent transaction with the Investors significantly dilutes the interests of the common stockholders and grants other important
rights to the Investors.
The Series B Stock issued to the Investors is convertible into shares of common stock or common equivalent stock at the price of $2.50
per common share (subject to anti-dilution rights), giving the Investors an initial equity interest in
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