Exhibit 10.1

 

   

EFiled: Jul 20 2012 7:56AM EDT

Transaction ID 45451350

Case No. 6387-VCL

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IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

 

     )      

IN RE MONEYGRAM INTERNATIONAL,

     )       C.A. No. 6387-VCL

INC. SHAREHOLDER LITIGATION

     )            )      

STIPULATION AND AGREEMENT OF COMPROMISE AND SETTLEMENT

This Stipulation and Agreement of Compromise and Settlement (“Stipulation”) is
entered into this 19th day of July, 2012, by and between: (i) Plaintiff Willie
R. Pittman and Plaintiffs and Class Representatives Susan Seales and Stephen T.
Selzer on behalf of the Class (hereinafter defined together as the “Plaintiffs”)
and (ii) Defendants MoneyGram International, Inc. (“MoneyGram” or the
“Company”), Thomas H. Lee Partners, L.P. (“THL”), The Goldman Sachs Group, Inc.
(“Goldman”), J. Coley Clark (“Clark”), Victor W. Dahir (“Dahir”), Thomas M.
Hagerty (“Hagerty”), Scott L. Jaeckel (“Jaeckel”), Seth W. Lawry (“Lawry”), Ann
Mather (“Mather”), Pamela Patsley (“Patsley”), Ganesh Rao (“Rao”), and W. Bruce
Turner (“Turner,” together with Clark, Dahir, Hagerty, Jaeckel, Lawry, Mather,
Patsley, and Rao collectively referred to as the “Individual Defendants,” and
MoneyGram, THL, Goldman and the Individual Defendants collectively referred to
as the “Defendants”), in the action captioned In re MoneyGram International,
Inc., Shareholders Litigation, C.A. No. 6387-VCL (the “Action”), pending in the
Court of Chancery of the State of Delaware (the “Court”), by their respective
undersigned counsel.

WHEREAS, in March 2008, certain investment funds affiliated with THL and
co-investors of the investment funds affiliated with THL (“THL Investors”)1 and
Goldman and certain investment funds affiliated with Goldman (the “GS
Investors”2 together with the THL Investors the “Investors”) became preferred
stockholders of MoneyGram in connection with a $1.5 billion recapitalization;

 

1 

The THL Investors are: Thomas H. Lee Equity Fund VI, L.P.; Thomas H. Lee
Parallel Fund VI, L.P.; Thomas H. Lee Parallel (DT) Fund VI, L.P.; THL Equity
Fund VI Investors (MoneyGram), LLC; THL Coinvestment Partners, L.P.; THL
Operating Partners, L,P.; Great-West Investors, L.P.; Putnam Investments
Employees’ Securities Company III LLC; and SPCP Group, LLC.

2 

The GS Investors are; The Goldman Sachs Group, Inc.; GS Capital Partners VI
Fund, L.P.; GS Capital Partners VI Offshore Fund, L.P.; GS Capital Partners VI
GmbH & Co. KG; GS Capital Partners VI Parallel, L.P.; GSMP V Offshore US, Ltd.;
GSMP V Onshore US, Ltd.; and GSMP V Institutional US Ltd.

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WHEREAS, on May 26, 2010, MoneyGram established a Special Committee of its Board
of Directors consisting of Dahir, Mather, Clark and Turner and resolved to
empower the Special Committee to consider a recapitalization and to negotiate
and, if appropriate, recommend a recapitalization to the Board;

WHEREAS, on March 7, 2011, the Special Committee recommended, and the Board
approved, a recapitalization (the “Recapitalization”);

WHEREAS, on March 8, 2011, MoneyGram announced that it had entered into a
recapitalization agreement dated as of March 7, 2011 (the “Recapitalization
Agreement”), and pursuant to the terms of the Recapitalization Agreement:
(1) the THL Investors converted all of their shares of Series B Participating
Convertible Preferred Stock of the Company into 286,438,367 shares in the
aggregate, of common stock of the Company, (2) the GS Investors converted all of
their shares of Series B-1 Participating Convertible Preferred Stock into
157,685.7676 shares of Series D Participating Convertible Preferred Stock of the
Company, and (3) the THL Investors received 28,162,866 additional shares of
common stock and $154,021,019.24 in cash, and the GS Investors received
15,503.8002 additional shares of Series D Preferred Stock and $84,789,348.98 in
cash;

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WHEREAS, on March 9, 2011, MoneyGram filed a copy of the Recapitalization
Agreement with the United States Securities and Exchange Commission (the “SEC”);

WHEREAS, on April 12, 2011, the Company filed its definitive proxy statement
with the SEC in connection with the Recapitalization, setting a special meeting
date of May 18, 2011 for a shareholder vote on the Recapitalization for
stockholders of record as of the close of business on April 11, 2011. The proxy
statement solicited proxies to approve (a) the March 7, 2011 Recapitalization
Agreement; (b) the issuance of additional shares of MoneyGram common stock
issuable directly to the THL Investors and additional shares of Series D
Participating Convertible Preferred Stock issuable directly to the GS Investors
at the closing of the Recapitalization; and (c) a proposal to amend the
Company’s Amended and Restated Certificate of Incorporation to remove the GS
Investors’ right to designate a director to serve on the Company’s board of
directors;

WHEREAS, on April 15, 2011, Plaintiff Willie Pittman filed a Verified Class
Action and Derivative Complaint challenging the proposed Recapitalization and,
on April 29, 2011, a Verified Amended Class Action and Derivative Complaint (the
“Complaint”) was filed in which Susan Seales and Stephen T. Selzer joined the
action as Plaintiffs. In their Amended Complaint, Plaintiffs challenged the
Recapitalizations and alleged claims against the Defendants for breach of
fiduciary duty, breach of certificate of incorporation, disclosure violations,
and aiding and abetting. Plaintiffs sought declaratory, equitable, injunctive,
and monetary relief against all Defendants;

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WHEREAS, on May 6, 2011, the Company filed a supplemental proxy statement with
the SEC;

WHEREAS, following expedited discovery and briefing, the Court heard oral
argument on Plaintiffs’ Motion for a Preliminary Injunction on May 16, 2011. At
the conclusion of oral argument, the Court denied Plaintiffs’ Motion for a
Preliminary Injunction;

WHEREAS, on May 18, 2011, the Company announced that at a special meeting of
stockholders, a majority of the minority of the Company’s existing common
stockholders approved (a) the March 7, 2011 Recapitalization Agreement; (b) the
issuance of additional shares of MoneyGram common stock issuable directly to the
THL Investors and additional shares of Series D Participating Convertible
Preferred Stock issuable directly to the GS Investors at the closing of the
Recapitalization; and (c) the proposal to amend the Company’s Amended and
Restated Certificate of Incorporation to remove the GS Investors’ right to
designate a director to serve on the Company’s board of directors. Thereafter,
the Company refinanced its senior secured credit facility and the Company
completed the Recapitalization and transactions contemplated by the
Recapitalization Agreement;

WHEREAS, on July 5, 2011, the Court entered an order scheduling the Action for a
five-day trial beginning April 23, 2012;

WHEREAS, on November 29, 2011, the Court entered an order: (a) certifying the
Action as a class action on behalf of a non-opt out class defined as: All
holders of common stock of MoneyGram together with their successors and assigns,
during the period commencing March 7, 2011 (the date on which the board of
directors of MoneyGram approved the Recapitalization) and ending at the
effective time of the closing of the Recapitalization, excluding the Defendants
and their associates, affiliates, legal representatives, heirs, successors in
interest, transferees and assignees; (b) certifying Plaintiffs Seales and Selzer
as Class Representatives; and (c) appointing Prickett, Jones & Elliott, PA.
(“Prickett Jones”) and Kessler, Topaz, Meltzer & Check, LLP (“Kessler Topaz”) as
Co-Lead Counsel for the Class;

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WHEREAS, on December 16, 2011, the Court entered an order, rescheduling the
trial for May 21-25, 2012;

WHEREAS, during the course of the litigation, the parties engaged in document
production, written discovery and deposition discovery, including expert
discovery. Twenty-one depositions were conducted during the course of the
litigation. In addition, the parties litigated three motions to compel filed by
Plaintiffs;

WHEREAS, on May 4, 2012, the parties filed their pretrial briefs and supporting
exhibits, and on May 11, 2012, filed a pretrial stipulation and proposed order.
At trial, Plaintiffs intended to try various theories of liability in support of
their claims including that the Recapitalization was not entirely fair to
MoneyGram’s common stockholders, that the stockholder vote taken on May 18, 2011
was uninformed, that the Recapitalization violated MoneyGram’s Certificate of
Incorporation, that the Company issued an improper dividend to the THL Investors
and the Goldman Investors, and that the THL Investors and the Goldman Investors
improperly received certain monies paid to them in connection with the
Recapitalization;

WHEREAS, Defendants deny all allegations of wrongdoing or liability and
specifically maintain that they have not committed any violation of law or
breaches of fiduciary duty, or engaged in any wrongdoing whatsoever, deny that
they have aided or abetted any violations of law or breaches of fiduciary duty
including in connection with the Recapitalization, the definitive proxy
statement, the proxy supplement or otherwise and Defendants’ entry into this
Stipulation is not an admission as to any of the claims asserted in the Action;

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WHEREAS, Plaintiffs, through their counsel, based upon their investigation and
the legal proceedings herein, have agreed to settle their individual, class,
direct and derivative claims upon the terms and provisions hereinafter set forth
and have concluded that the Settlement is fair, reasonable and adequate and in
their best interest and the best interest of the Class and the Company;

WHEREAS, representatives of the parties to the Action have held extensive arm’s
length discussions in an effort to resolve all claims asserted, or which could
have been asserted, in the Action and entered into an oral agreement in
principle on May 11, 2012 to settle the Action;

WHEREAS, the parties to the Action wish to settle and resolve all claims
asserted, or which could have been asserted, in the Action; the parties have
reached an agreement set forth in this Stipulation, providing for the settlement
of the Action on the terms and conditions set forth below (the “Settlement”),
subject to the approval of the Court; and Plaintiffs and Co-Lead Counsel for the
Class believe that the Settlement is in the best interests of the Class;

NOW, THEREFORE, IT IS HEREBY AGREED by and among Plaintiffs and Defendants, by
their undersigned attorneys, subject to the approval of the Court, and pursuant
to Court of Chancery Rules 23(a), 23(b)(1) and (b)(2), and 23.1 and the other
conditions set forth herein, for the good and valuable consideration set forth
herein and conferred on Plaintiffs and the Class and the Company, the Action
shall be finally and fully settled, compromised, and dismissed on the merits and
with prejudice, and that the Released Claims (defined below) shall be finally
and fully compromised, settled, released, and dismissed with prejudice as to the
Released Persons in the manner and upon the terms and conditions hereafter set
forth:

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SETTLEMENT CONSIDERATION

1. In consideration for the full settlement, satisfaction, compromise and
release of the Released Claims (as defined below), the Company, in its own right
and acting as a depository, shall, upon the earlier of: (a) ten business days
after the Court’s entry of the Scheduling Order (defined below) or (b) July 20,
2012, pay or cause to be paid $10 million (the “Settlement Fund”) into an
interest-bearing account established by Co-Lead Counsel for the Class (the
“Account”). No Defendant or Released Person shall, except as specifically
provided in this Stipulation, have any obligation to pay or bear any amounts,
expenses, costs, damages, assessments or fees to or for the benefit of
Plaintiffs or any Class Members in connection with this Settlement, including
but not limited to attorneys’ or experts’ fees and expenses for any counsel to
any Class Member, or any costs of notice or settlement administration or
otherwise.

DISTRIBUTION AND ADMINISTRATION OF THE SETTLEMENT FUND

2. MoneyGram shall bear all responsibility for costs and expenses for
distribution and administration of the Settlement Fund to the Class as provided
for herein. Co-Lead Counsel for the Class shall retain at MoneyGram’s expense a
settlement administrator (“Settlement Administrator”), which shall, subject to
the supervision, direction and approval of the Court, oversee administration and
distribution of the Settlement Fund. The Settlement Administrator shall
discharge the duties under the supervision of Co-Lead Counsel for the Class and
subject to the jurisdiction of the Court. The Settlement Administrator will
administer and distribute with the Court’s approval the Settlement Fund, on a
pro rata basis, after deducting and paying any award of attorneys’ fees and
expenses to Co-Lead Counsel for the Class, to all members of the Class who held
MoneyGram common stock at the close of business on April 11, 2011. Within ten
business days of entry of the Scheduling Order, MoneyGram shall provide or cause
to be provided to the Settlement Administrator relevant lists of MoneyGram
stockholders in electronic form suitable to the Settlement Administrator (such
lists to be used solely for the purpose of administering the Settlement Fund).

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a. The Settlement Fund, including all interest accruing thereon, shall be deemed
to be in the custody of the Court and will remain subject to the jurisdiction of
the Court until such time as it is distributed as provided for in this
Stipulation or by Order of the Court. Any funds in the Account shall be invested
in United States Treasury Bills (or a mutual fund invested solely in such
instruments) and shall collect and reinvest all interest accrued thereon, except
that any residual cash balances of less than $250,000 may be invested in an
account that is fully insured by the United States Government or any agency
thereof, including the FDIC. In the event that the yield on United States
Treasury Bills is negative, in lieu of purchasing such Treasury Bills, all or
any portion of the funds held in the Account may be deposited in a non-interest
bearing account that is fully insured by the United States Government or any
agency thereof, including the FDIC.

b. The Settlement Fund is intended to be a “qualified settlement fund” within
the meaning of Treasury Regulation § 1.468B-1, and the Parties shall so treat
it, and Co-Lead Counsel for the Class, as administrator of the Account within
the meaning of Treasury Regulation § 1.468B-2(k)(3), shall be responsible for
filing tax returns for the Account and paying from the Account any taxes,
including any interest or penalties thereon (the “Taxes”), owed with respect to
the Account. In addition, the Parties, as required, shall do all things that are
necessary or advisable to carry out the provisions of this Paragraph.

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c. All Taxes arising with respect to the income earned by the Settlement Fund,
including any Taxes or tax treatments that may be imposed with respect to any
income earned by the Settlement Fund for any period during which the Settlement
Fund does not qualify as a qualified settlement fund for federal or state income
tax purposes and any expenses and costs incurred in connection with the payment
of taxes pursuant to this Paragraph (including, without limitation, expenses of
tax attorneys and/or accountants and mailing, administration and distribution
costs and expenses relating to the filing of all necessary or advisable tax
returns (the “Tax Expenses”)), shall be paid out of the Settlement Fund. None of
the Defendants or the Released Persons shall have any responsibility for the
payment of Taxes or the Tax Expenses. Co-Lead Counsel for the Class or their
agents shall timely and properly file all informational and other tax returns
necessary or advisable with respect to the Settlement Fund and the distributions
and payments therefrom, including, without limitation, the tax returns described
in Treas. Reg. § 1.468B-2(k), and to the extent applicable, Treas. Reg. §
1.468B-2(l). All tax returns shall be consistent with the terms herein and in
all events shall reflect that all taxes on the income earned by the Settlement
Fund shall be paid out of the Settlement Fund. Co-Lead Counsel for the Class or
their agents shall also timely pay Taxes and Tax Expenses out of the Settlement
Fund, and are authorized to withdraw from the Account, without prior consent of
Defendants or order of the Court, amounts necessary to pay Taxes and Tax
Expenses. Defendants agree to timely provide Co-Lead Counsel for the Class the
statement described in Treas. Reg. § 1.468B-3(e). The Parties agree to cooperate
with Co-Lead Counsel for the Class, their agents, each other, and their tax
advisors to the extent reasonably necessary to carry out the provisions of this
Stipulation.

d. After reasonable and diligent efforts have been made to distribute the
Settlement Fund to eligible Class members, any balance remaining in the
Settlement Fund, including accrued interest, six (6) months after the
distribution shall, if economically feasible, be reallocated to eligible Class
members who have deposited or cashed their distribution check. Thereafter, any
balance remaining in the Settlement Fund shall be paid to the Delaware Combined
Campaign for Justice.

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RELEASES

3. In exchange for payment of the Settlement Fund, and other good and valuable
consideration, the receipt of which is hereby acknowledged, any and all claims,
demands, losses, rights, actions, causes of action, liabilities, obligations,
duties, judgments, suits, costs, expenses, matters and issues known or unknown,
contingent or absolute, suspected or unsuspected, disclosed or undisclosed,
liquidated or unliquidated, matured or unmatured, accrued or unaccrued, apparent
or unapparent, of any kind or nature whatsoever including, but not limited to,
any claims arising under federal, state or foreign law, common law, the Delaware
General Corporation Law or any other statute, rule, or regulation, for damages,
declaratory relief, injunctive relief, equitable relief, or any other remedies,
that have been asserted, could have been asserted, or in the future could or
might be asserted by any of the Plaintiffs, any Class Member, or the Company, in
the Action or in any court, tribunal, forum or proceeding, whether individual,
class, direct, derivative, representative, legal, equitable or any other type or
in any other capacity, by or on behalf of Plaintiffs or any member of the Class,
whether individual, direct, class, derivative, representative, legal, equitable
or any other type or in any other capacity (collectively, the “Releasing
Persons”) against Defendants, the THL Investors, the GS Investors and all of
their respective families, parent entities, controlling persons, associates,
affiliates, successors or subsidiaries and each and all of their respective
present or past heirs, executors, estates, administrators, predecessors,
successors, stockholders, assigns, parents, subsidiaries, associates,
affiliates, employers, employees, agents, consultants, insurers, directors,
managing directors, officers, partners, partnerships, principals,

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limited liability companies, members, attorneys, bankers, consultants, trustees,
insurers, co-insurers, reinsurers, accountants, financial or other advisors,
investment bankers, underwriters, lenders, auditors, and any other
representatives of any of these persons or entities (the “Released Persons”) (or
any of them) that have arisen, could have arisen, arise now or hereafter arise
from, or relate in any manner to, the allegations, conduct, facts, events,
transactions, acts, occurrences, statements, representations,
misrepresentations, omissions or any other matter, thing or cause whatsoever,
referred to by, set forth in, or arising out of or otherwise related directly or
indirectly to (i) any allegation made in the Action; (ii) any matter regarding
or relating to in any way to the Recapitalization, including without limitation,
any disclosures made in connection with any of the foregoing, except claims to
enforce the Stipulation or the Settlement, and/or (iii) any claim relating to
the improper payment of dividends or violation of MoneyGram’s certificate of
incorporation (collectively, the “Released Claims”), shall be deemed completely,
fully, finally, absolutely and forever discharged, dismissed with prejudice,
settled, enjoined, released, relinquished and compromised, upon occurrence of
all events referenced in Paragraph 10 of this Stipulation.

4. Any and all claims that any of Defendants or the Released Persons may have or
could have asserted against Plaintiffs, their counsel, their advisors and the
Class arising out of the initiation, litigation, and resolution of the Action,
except claims to enforce the Stipulation or the Settlement shall be deemed to be
completely released and enjoined as to Plaintiffs, their counsel, their advisors
and the Class, upon occurrence of all events referenced in Paragraph 10 of this
Stipulation.

5. The Settlement is intended to extinguish all such Released Claims and,
consistent with such intentions, the foregoing Release by the Releasing Persons
shall be deemed to include a waiver of their rights to the extent permitted by
state law, federal law, foreign law, or any principle

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of common law that may have the effect of limiting the releases set forth above.
This shall include a waiver by the Releasing Persons of any rights pursuant to §
1542 of the California Civil Code (or any similar, comparable or equivalent
provision) which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR.

The Releasing Persons acknowledge that they or members of the Class may discover
facts in addition to or different from those that they now know or believe to be
true with respect to the subject matter of this release, but that it is their
intention, as plaintiffs and on behalf of the Class, to fully, finally, and
forever settle and release any and all claims released hereby, whether known or
unknown, suspected or unsuspected, which now exist or heretofore existed or may
hereafter exist, and without regard to the subsequent discovery or existence of
such additional or different facts.

SUBMISSION AND APPLICATION TO THE COURT

6. As soon as practicable after this Stipulation has been executed, Plaintiffs
and Defendants shall jointly apply for a scheduling order substantially in the
form attached hereto as Exhibit A (the “Scheduling Order”) establishing the
procedure for: (i) the provision of notice of the Settlement to the Class (as
defined herein) substantially in the form attached hereto as Exhibit B (the
“Notice”), and (ii) the Court’s consideration of the Settlement, dismissal of
the Action with prejudice, and Plaintiffs’ application for attorneys’ fees and
expenses.

7. The Settlement Administrator at MoneyGram’s expense, shall be responsible for
providing the Notice to the Class, regardless of whether the Settlement obtains
Court approval or any conditions of the Settlement are not satisfied. At least
14 calendar days before the Settlement

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Hearing (as defined below), MoneyGram shall cause to be filed with the Court an
appropriate affidavit or declaration with respect to the preparation and mailing
of the Notice. MoneyGram shall provide relevant stock list information to the
Settlement Administrator promptly after execution of this Stipulation.

8. The parties further agree to use their best efforts to obtain Court approval
of the Settlement and a dismissal with prejudice of the Action.

ORDER AND FINAL JUDGMENT

9. If the Court approves the Settlement (including any modification thereto made
with the consent of the parties as provided for herein) following a hearing (the
“Settlement Hearing”) as fair, reasonable, adequate and in the best interests of
Plaintiffs, the Class, and the Company, Plaintiffs and Defendants shall request
jointly that the Court enter an Order and Final Judgment substantially in the
form attached hereto as Exhibit C, certifying the Class, dismissing the Action
with prejudice, and awarding Plaintiffs any attorneys’ fees and expenses.

10. For purposes of effectuating this Settlement only, the Order and Final
Judgment shall confirm:

a. certification of a non-opt out class pursuant to Court of Chancery Rules
23(a), 23(b)(1) and 23(b)(2), consisting of all holders of common stock of
MoneyGram together with their successors and assigns, during the period
commencing March 7, 2011, and ending May 18, 2011, the effective time of the
closing of the Recapitalization, excluding (i) the Individual Defendants,
MoneyGram, THL and their respective associates, affiliates, legal
representatives, heirs, successors in interest, transferees and assignees,
(ii) Goldman, its majority-owned affiliates, and each of their legal
representatives, heirs, successors in interest, transferees and assignees,
(iii) the THL Investors, and (iv) the GS Investors(the “Class”);

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b. the appointment of Plaintiffs Seales and Selzer as Class Representatives; and

c. the appointment of Prickett, Jones & Elliott, P.A. and Kessler, Topaz,
Meltzer & Check, LLP as Co-Lead Counsel for the Class.

CONDITIONS OF SETTLEMENT

11. This Stipulation shall be null and void and of no force and effect, unless
otherwise agreed to by the parties pursuant to Paragraph 20, if:

a. the Settlement does not receive Court approval for any reason, with Court
approval requiring each of the following:

i the dismissal with prejudice of the Action against all Defendants;

ii the entry of a final judgment in the Action in the form of Exhibit C
approving the Settlement, providing for the dismissal with prejudice of the
Action, approving the grant of a release by the Class to the Released Persons of
the Released Claims, and enjoining all members of the Class or Releasing Persons
from asserting any of the Released Claims;

iii such final judgment and dismissal of the Action being finally affirmed in
whole on appeal or, if no appeal is taken, such final judgment and dismissal not
being subject to appeal (or further appeal) by lapse of time or otherwise;

b. the Action is not dismissed with prejudice against all Defendants, or the
dismissal of the Action does not become final and no longer subject to further
appeal or review by lapse of time or otherwise; or

c. The full Settlement Fund is not deposited timely in the Account. In such
event, this Stipulation shall not be deemed to prejudice in any way the
respective positions of the parties with regard to the Action and all of the
parties to this Stipulation shall be

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deemed to have reverted to their respective litigation status immediately prior
to May 11, 2012, all of the parties shall proceed in all respects as if the
Stipulation had not been executed, and any and all funds paid into the
Settlement Fund shall revert back to the contributor(s) of such funds.

12. All members of the Class shall be and are deemed bound by the judgment in
this Action. The judgment to be entered pursuant to this Stipulation and the
releases contained herein are intended with respect to the Released Claims
(which includes, but is not limited to, all claims and issues that have or could
have been raised) to have all preclusive effect available under law in any
pending and/or future lawsuits, arbitrations or other proceedings maintained by
or on behalf of, any of the Plaintiffs or any other members of the Class, as
well as any and all of their respective successors-in-interest, successors,
predecessors-in-interest, predecessors, representatives, trustees, executors,
administrators, estates, heirs, assigns and transferees, immediate and remote,
and any other person or entity acting for or on behalf of, or claiming under,
any of them, and each of them, together with their predecessors-in-interest,
predecessors, successors-in-interest, successors, and assigns.

13. Whether or not Court approval is obtained, the existence or contents of this
Stipulation, and any negotiations, statements or proceedings in connection
therewith shall not be deemed evidence of a presumption, concession or admission
by any Plaintiff, Defendant, Released Person, or any other person of any fault,
liability or wrongdoing or lack of any fault, liability or wrongdoing as to any
facts or claims alleged or asserted in the Action or in any other action or
proceeding (whether civil, criminal or administrative), or that Plaintiffs or
Co-Lead Counsel for the Class, the Class, or any present or former stockholders
of the Company, or any other person, has suffered any damage attributable in any
manner to any Released Person in connection with such facts and claims. The
existence of this Stipulation, its contents, or any negotiations, statements or

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proceedings in connection therewith, shall not be offered or admitted in
evidence or referred to, interpreted, construed, invoked, or otherwise used by
any person for any purpose in the Action, except as may be necessary to enforce
or obtain Court approval of the Settlement. Notwithstanding the foregoing, any
of the Released Persons may file the Stipulation or any judgment or order of the
Court related hereto, in any action pending or that may be brought against them,
in order to support any and all defenses or counterclaims including, without
limitation, those based on res judicata, collateral estoppel, release,
good-faith settlement, judgment bar or reduction, or any other theory of claim
preclusion or issue preclusion, or similar defense or counterclaim. This
provision shall remain in force in the event the Settlement is terminated.

ATTORNEYS’ FEES AND EXPENSES

14. Co-Lead Counsel for the Class intend to apply to the Court for an award of
attorneys’ fees of up to $3 million and expenses not to exceed $650,000 (the
“Fee Application”). All fees and expenses that are awarded by the Court (the
“Fee Award”) shall be paid from the Settlement Fund and shall be paid within
five (5) business days of entry of an Order approving such award notwithstanding
the existence of objections thereto, or the potential for appeal therefrom,
provided, however, that in the event that the Fee Award is disapproved, reduced,
reversed or otherwise modified, whether on appeal, further proceedings on
remand, successful collateral attack or otherwise, then Co-Lead Counsel for the
Class shall jointly or severally, within ten (10) business days after Co-Lead
Counsel for the Class receives notice of any such disapproval, reduction,
reversal or other modification, return to the Settlement Fund the difference
between the attorneys’ fees and expenses awarded by the Court in the Fee Award
on the one hand, and any attorneys’ fees and expenses ultimately and finally
awarded on appeal, further proceedings on remand or otherwise on the other hand
plus accrued interest at the same net rate as is earned by

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the Settlement Fund. In the event that the Settlement is disapproved, reversed
or otherwise modified, whether on appeal, further proceedings on remand,
successful collateral attack or otherwise, then Co-Lead Counsel for the Class
shall jointly or severally, within ten (10) business days after Co-Lead Counsel
for the Class receives notice of any such disapproval, reversal or other
modification, return to the Settlement Fund the attorneys’ fees and expenses
awarded by the Court in the Fee Award plus accrued interest at the same net rate
as is earned by the Settlement Fund. No other application for attorneys’ fees
and expenses shall be filed, and Co-Lead Counsel for the Class expressly waive
any right to seek any award of such fees and expenses except as provided in this
paragraph. The parties agree that any approval of an award of attorneys’ fees
and expenses shall not be a condition to final approval of the Settlement, nor
shall the Court’s denial of the Fee Application: (i) delay the enforceability of
this Stipulation; (ii) provide any of the parties with the right to terminate
the Settlement; or (iii) affect or delay the binding effect or finality of the
Judgment and the Release of the Released Claims. Any failure of the Court to
approve the Settlement or the Settlement not becoming final shall not preclude
Co-Lead Counsel for the Class from applying for an award of attorneys’ fees and
expenses on grounds of mootness, and Defendants reserve the right to oppose any
such mootness-fee application.

15. Co-Lead Counsel for the Class warrants that no portion of any such award of
attorneys’ fees or expenses shall be paid to any of the Plaintiffs or any Class
Member, except as may be approved by the Court.

16. Defendants and the Released Persons shall have no responsibility for the
allocation of the Fee Award.

17. Except as specifically provided herein, Defendants shall bear no expenses,
costs, damages, or fees alleged or incurred by Plaintiffs or by any member of
the Class, or by any of their attorneys, experts, advisors, agents, or
representatives. Court approval of the Settlement is not in any way conditioned
on Court approval of the application of Co-Lead Counsel for the Class for fees
and/or expenses.

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NON-ASSIGNMENT OF CLAIMS

18. Plaintiffs and their counsel represent and warrant that none of Plaintiffs’
claims or causes of action referred to in this Stipulation or that could have
been alleged in the Action has been assigned, encumbered or in any manner
transferred in whole or in part.

STAY OF PROCEEDINGS

19. Upon the execution of this Stipulation, the parties agree that, except as
provided herein, the Action will be stayed pending submission of the Settlement
for the Court’s approval. The parties also agree to use their best efforts to
prevent, stay or seek dismissal of or oppose entry of any interim or final
relief in favor of any member of the Class in any other litigation against any
of the parties to this Stipulation which challenges the Settlement, the
Recapitalization, including any transactions contemplated thereby, or otherwise
involves, directly or indirectly, a Released Claim.

ENTIRE AGREEMENT

20. This Stipulation constitutes the entire agreement among the parties with
respect to the subject matter hereof, and may not be amended nor may any of its
provisions be waived except by a writing signed by all of the Parties hereto.

COUNTERPARTS

21. This Stipulation may be executed in counterparts and transmitted by
facsimile, via e-mail as a PDF file, or as an original signature by any of the
signatories hereto, and as so executed shall constitute one agreement.

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GOVERNING LAW

22. This Stipulation and the Settlement contemplated by it shall be governed by,
and construed in accordance with, the Laws of the State of Delaware, without
regard to conflict of law principles. Any dispute arising out of or relating to
this Stipulation or Settlement shall be filed and litigated exclusively in the
Court, which shall retain jurisdiction over the parties and all such disputes.
The parties expressly waive any right to demand a jury trial, and consent to
service of process upon their attorneys by registered mail, in connection with
any dispute brought in accordance with this paragraph.

EXECUTION AUTHORITY

23. Each of the attorneys executing this Stipulation has been duly empowered and
authorized by his/her respective client(s) to do so.

SUCCESSORS AND ASSIGNS

24. This Stipulation shall be binding upon and shall inure to the benefit of the
parties and their respective agents, successors, executors, heirs and assigns.

[Signature pages to follow]

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OF COUNSEL:

   PRICKETT, JONES & ELLIOTT, P.A.

KESSLER TOPAZ

       /s/ Michael Hanrahan                        

MELTZER & CHECK, LLP

   Michael Hanrahan (#941)

Marc A. Topaz

   Gary F. Traynor (#2131)

Lee D. Rudy

   Paul A. Fioravanti, Jr. (#3808)

Michael C. Wagner

   J. Clayton Athey (#4378)

J. Daniel Albert

   Kevin H. Davenport (#5327)

280 King of Prussia Road

   1310 N. King Street

Radnor, Pennsylvania 19087

   Wilmington, Delaware 19801

(610) 667-7706

   (302) 888-6500

Counsel for Plaintiffs and the Class

   Counsel for Plaintiffs and the Class

OF COUNSEL:

   MORRIS NICHOLS ARSHT & TUNNELL LLP

Thomas R. Jackson

       /s/ William M. Lafferty                    

Joshua S. Roseman

   William M. Lafferty (#2755)

Samantha S. Cox

   John P. DiTomo (#4850)

JONES DAY

   Ryan D. Stottmann (#5237)

2727 North Harwood Street

   1201 N Market Street, 18th Floor

Dallas, Texas 75201-1515

   Wilmington, Delaware 19801

(214) 220-3939

   (302) 658-9200    Attorneys for Defendants J. Coley Clark,    Victor W.
Dahir, Ann Mather and W. Bruce    Turner

OF COUNSEL:

   SEITZ ROSS ARONSTAM & MORITZ LLP

Mark C. Hansen

  

Kevin B. Huff

       /s/ Collins J. Seitz, Jr.                        

KELLOGG HUBER HANSEN TODD

   Collins J. Seitz, Jr. (#2237)

EVANS & FIGEL, PLLC

   Bradley R. Aronstam (#5129)

1615 M Street N.W., Suite 400

   100 S. West Street

Washington, District of Columbia 20036

   Wilmington, Delaware 19801

(202) 326-7900

   (302) 576-1600    Attorneys for Defendants Thomas H. Lee    Partners, LP.,
Thomas M. Hagerty, Scott L.    Jaeckel, Seth W. Lawry and Ganesh Rao

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OF COUNSEL:

   ABRAMS & BAYLISS LLP

William G. McGuinness

  

Stephanie J. Goldstein

       /s/ Kevin G. Abrams                        

FRIED, FRANK, HARRIS,

   Kevin G. Abrams (#2375)

SHRIVER & JACOBSON LLP

   20 Montchanin Road, Suite 200

One New York Plaza

   Wilmington, Delaware 19807

New York, New York 10004

   (302) 778-1000

(212) 859-8000

   Attorneys for The Goldman Sachs Group, Inc.

OF COUNSEL:

   RICHARDS, LAYTON & FINGER, P.A.

John C. Wander

   Daniel J. Kelly   

    /s/ Lisa A. Schmidt                          

Elizabeth C. Brandon

   Lisa A. Schmidt (#3019)

VINSON & ELKINS

   Brock E. Czeschin (#3938)

Trammell Crow Center

   Steven J. Fineman (#4025)

2001 Ross Avenue

   Scott W. Perkins (#5049)

Suite 3700

   One Rodney Square

Dallas, Texas 75201

   920 North King Street

(214) 220-7700

   Wilmington, Delaware 19801    (302) 651-7786    Attorneys for Defendant
MoneyGram    International, Inc. and Pamela H. Patsley