MoneyGram 2008 Annual Report Download - page 26

Table of Contents
2009. 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. Under the Registration Rights Agreement entered into between the Company and
the Investors at the closing of the Capital Transaction, the Investors and other parties may require us to register for sale publicly (at times
largely of their choosing) all of the Series B Stock that they hold, as well as any common stock or D Stock into which the B-1 Stock may
be converted. Sales of a substantial number of shares of our common stock, or the perception that significant sales could occur
(particularly if sales are concentrated in time or amount), may depress the trading price of our common stock.
An agreement among the Investors and Walmart could prevent an acquisition of the Company.
The Investors and Walmart have entered into an agreement that, among other things, prevents the Investors, without the prior written
consent of Walmart, from voting in favor of, consenting to or selling or transferring their equity securities in a manner that would result
in a change of control of the Company. This provision is effective until March 17, 2010. The Investors collectively have a majority of the
voting stock of the Company and Walmart, whose interests may differ from our stockholders' interests, could prevent the Investors from
agreeing to a sale of the Company under certain circumstances.
Our capital structure, charter documents, and Delaware law could delay or prevent an acquisition of the Company, which could
inhibit your ability to receive a premium on your investment from a possible sale of the Company.
Our current capital structure and certain provisions of our charter documents may discourage third parties from seeking to acquire the
Company. The holders of the B Stock would vote as a class with the common stockholders on any proposed business combination and
would control the outcome. These matters and certain provisions of Delaware law relating to business combinations with interested
stockholders may have the effect of delaying, deterring or preventing a merger or change in control of the Company. Some of these
matters may discourage a future acquisition of the Company even if common stockholders would receive an attractive value for their
shares or if a significant number of our common stockholders believed such a proposed transaction to be in their best interests. As a
result, stockholders who desire to participate in such a transaction may not have the opportunity to do so.
If we cannot meet the New York Stock Exchange ("NYSE") continued listing requirements, the NYSE may delist our common stock.
Our common stock is currently listed on the NYSE. In December 2008, we received notice from the NYSE that we were below listing
requirements because the 30-day average closing price of our common stock had fallen below $1.00. The NYSE provided us until
June 16, 2009 to cure our share price deficiency or be subject to delisting. The NYSE recently suspended its share price listing
requirement on a temporary basis through June 30, 2009. If we do not cure our share price deficiency before June 30, 2009, we will
receive the balance of our initial six-month cure period, or until October 26, 2009 to cure our share price deficiency or our common stock
would be subject to delisting. Our closing stock price on February 23, 2009 was $1.23 and our 30-day average closing price was $1.37.
The NYSE also requires us to maintain average market capitalization and stockholders' equity of at least $75 million. As of February 23,
2009, our market capitalization was approximately $101.1 million. Our stockholders' deficit was $781.7 million at December 31, 2008.
If we are unable to satisfy the NYSE criteria for continued listing, our common stock would be subject to delisting. A delisting of our
common stock could negatively impact us by, among other things, reducing the liquidity and market price of our common stock; reducing
the number of investors willing to hold or acquire our common stock, which could negatively impact our ability to raise equity financing;
decreasing the amount of news and analyst coverage for the Company; and limiting our ability to issue additional securities or obtain
additional financing in the future.
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