MoneyGram 2010 Annual Report Download - page 5

Table of Contents
Recent Developments
On March 7, 2011, we entered into a Recapitalization Agreement (the "Recapitalization Agreement") with THL, as the holder of all of the
B Stock, and Goldman Sachs, as the holder of all of the B-1 Stock. Pursuant to the Recapitalization Agreement, (i) THL will convert all
of the shares of B Stock into shares of our common stock in accordance with the Certificate of Designations, Preferences and Rights of
Series B Participating Convertible Preferred Stock of MoneyGram International, Inc., (ii) Goldman Sachs will convert all of the shares of
B-1 Stock into shares of Series D Participating Convertible Preferred Stock of the Company (the "D Stock") in accordance with the
Certificate of Designations, Preferences and Rights of Series B-1 Participating Convertible Preferred Stock of MoneyGram International,
Inc., and (iii) THL will receive approximately 28.2 million additional shares of our common stock and $140.8 million in cash, and
Goldman Sachs will receive approximately 15,504 additional shares of D Stock (equivalent to approximately 15.5 million shares of our
common stock) and $77.5 million in cash (such transactions, collectively, the "2011 Recapitalization").
The 2011 Recapitalization has been approved unanimously by our board of directors following the recommendation of a special
committee of the board of directors comprised of independent and disinterested members of our board of directors, and is subject to
various conditions contained in the Recapitalization Agreement, including the approval of the 2011 Recapitalization or any other matter
that requires approval under the Recapitalization Agreement (collectively the "Stockholder Approval Matters") by the affirmative vote of
a majority of the outstanding shares of our common stock and B Stock (on an as-converted basis), voting as a single class, and the
affirmative vote of a majority of the outstanding shares of our common stock (not including the B Stock or any other stock of the
Company held by any Investor), in each case voting on the Stockholder Approval Matters and the Company's receipt of sufficient
financing to consummate the 2011 Recapitalization.
Concurrently with entering into the Recapitalization Agreement, Worldwide and the Company entered into a consent agreement (the
"Consent Agreement") with certain affiliates of Goldman Sachs (the "GS Note Holders") who are holders of the Notes. Pursuant to the
Consent Agreement, the parties thereto have agreed to enter into a supplemental indenture to the indenture governing the Notes that will,
among other things, amend the indenture in order to permit the 2011 Recapitalization. In addition, the Company is currently working with
certain of its relationship banks to put in place a new senior secured credit facility comprised of a revolver and a term loan, which would
refinance the Company's existing senior secured credit facility and provide the funding for the 2011 Recapitalization.
The foregoing description of the Recapitalization Agreement and the Consent Agreement is not a complete description of all of the
parties' rights and obligations under the Merger Agreement and the Consent Agreement and is qualified in its entirety by reference to the
Recapitalization Agreement and the Consent Agreement, which are filed as Exhibit 2.1 and Exhibit 10.1, respectively, to our Current
Report on Form 8-K as filed with the SEC on March 9, 2011.
Our Business
Our global money transfer and bill payment services are our primary revenue drivers. Money transfers are transfers of funds between
consumers from one location to another. The sender pays a fee based on the transfer amount and the destination location. The designated
recipient may receive the transferred funds at any agent location. In select countries, the designated recipient may also receive the
transferred funds via a deposit to the recipient's bank account, mobile phone account or prepaid card. We typically pay both our "send"
and "receive" agents a commission for the transaction.
We provide money transfer services through our worldwide network of agents and through Company-owned retail locations in the United
States and Western Europe. We also offer our money transfer services on the Internet via our MoneyGram Online service in the United
States and through agent websites in Italy, Saudi Arabia and Japan. In Italy, Abu Dhabi and the Philippines, we also offer our money
transfer services via mobile phone. We also offer our services through kiosks, ATM's, receive cards and direct-to-bank account products
in various markets around the world.
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