MoneyGram 2009 Annual Report Download - page 96

Table of Contents
MONEYGRAM INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
to five years. In addition, the Company 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. The financial impact of the
acquisitions is not material to the Consolidated Balance Sheets or Consolidated Statements of Loss.
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 management industry and offers a complete
solution to the resident payment cycle, including the ability to electronically accept security deposits and rent payments. Residents can
pay rent online, by phone or in person and set up recurring payments. PropertyBridge is a component of the Company's Global Funds
Transfer segment.
In 2007, the Company finalized its purchase price allocation, resulting in goodwill of $24.1 million assigned to the Company's Global
Funds Transfer segment and intangible assets of $6.0 million, consisting primarily of customer lists, developed technology and a non-
compete agreement. The intangible assets are being amortized over useful lives ranging from three to 15 years. The potential earn-out
payment of up to $10.0 million contingent on PropertyBridge's performance during 2008 was not achieved. The purchase price allocation
included $0.2 million of transaction costs. The operating results of PropertyBridge subsequent to October 1, 2007 are included in the
Company's Consolidated Statements of Loss. The financial impact of the acquisition is not material to the Consolidated Balance Sheets or
Consolidated Statements of Loss.
Game Financial Corporation — During 2007, the Company paid $3.3 million in connection with the settlement of a contingency in the
Sales and Purchase Agreement related to the continued operations of Game Financial Corporation, which was sold in 2004, with one
casino. The Company recognized a loss from discontinued operations of $0.3 million in the Consolidated Statements of Loss in 2007,
representing the recognition of a deferred tax asset valuation allowance, partially offset by the reversal of the remaining liability.
Other Disposals — During 2009, the Company decided to sell its corporate airplane. In connection with this decision, the Company
recognized a $7.0 million impairment in the "Transaction and operations support" line in the Consolidated Statements of Loss.
Note 5 — Fair Value Measurement
The Company records certain of its assets and liabilities at fair value. Fair value is defined as the exchange price that would be received
for an asset or paid to transfer a liability, or the exit price, in an orderly transaction between market participants on the measurement date.
A three-level hierarchy is used for fair value measurements based upon the observability of the inputs to the valuation of an asset or
liability as of the measurement date. Under the hierarchy, the highest priority is given to unadjusted quoted prices in active markets for
identical assets or liabilities (Level 1), followed by observable inputs (Level 2) and unobservable inputs (Level 3). A financial
instrument's level within the hierarchy is based on the lowest level of any input that is significant to the fair value measurement.
Following is a description of the Company's valuation methodologies for assets and liabilities measured at fair value:
Investments — For United States government agencies and residential mortgage-backed securities collateralized by United States
government agency securities, fair value measures are generally obtained from independent sources, including a pricing service. As
market quotes are generally not readily available or accessible for these specific securities, the pricing service generally measures fair
value through the use of pricing models and observable inputs for similar assets and market data. Accordingly, these securities are
classified as Level 2 financial instruments. The Company periodically corroborates the valuations provided by the pricing service through
internal valuations utilizing externally developed cash flow models, comparison to actual transaction prices for any sold securities and
any broker quotes received on the same security.
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