MONEYGRAM INTERNATIONAL, INC.

SUPPLEMENTAL 401(k) PLAN

As Adopted August 18, 2005

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MONEYGRAM INTERNATIONAL, INC.

SUPPLEMENTAL 401(k) PLAN

As Adopted August 18, 2005

TABLE OF CONTENTS

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MONEYGRAM INTERNATIONAL, INC.

SUPPLEMENTAL 401(k) PLAN

As Adopted August 18, 2005

SECTION 1

INTRODUCTION AND DEFINITIONS

1.1. Statement of Plan .

1.1.1. Establishment . Effective January 1, 2006, MONEYGRAM INTERNATIONAL, INC. (hereinafter sometimes referred to as “MGI”) and certain affiliated corporations (together with MGI hereinafter sometimes collectively referred to as the “Employers” and separately as the “Employer”) hereby establish a nonqualified, unfunded deferred compensation plan known as the “MONEYGRAM INTERNATIONAL, INC. SUPPLEMENTAL 401(k) PLAN” . Elective deferrals and matching credits which relate to services performed on or after January 1, 2006 shall be made subject to the terms of this Plan, the terms of which are intended to comply with the deferred compensation provisions in the American Jobs Creation Act of 2004. Effective in 2005, MGI also established a nonqualified, unfunded deferred compensation plan known as the “MONEYGRAM INTERNATIONAL, INC. SUPPLEMENTAL PROFIT SHARING PLAN” which, effective as of the adoption of this Plan, shall be merged with and continue to be operated under the terms of this Plan.

1.1.2. Purpose . MGI hereby creates a nonqualified, unfunded, deferred compensation plan: (i) for the purpose of allowing a select group of management and highly compensated employees whose elective Pre-Tax Deferrals for a Plan Year under the MoneyGram International, Inc. 401(k) Plan are expected to be limited under section 402(g) of the Code to defer the receipt of compensation which would otherwise be paid to those employees, and (ii) for the benefit of a select group of management and highly compensated employees whose Profit Sharing Contribution for a Plan Year under the MoneyGram International, Inc. 401(k) Plan was reduced by sections 401(a)(17) and 415 of the Code or any other legal limitations.

1.2. Definitions . When the following terms are used herein with initial capital letters, they shall have the following meanings:

1.2.1. Account — the separate bookkeeping account representing the separate unfunded and unsecured general obligation of the Employers established with respect to each person who is a Participant in this Plan in accordance with Section 2 and to which is credited the amounts specified in Section 3 and Section 4, which will vest in accordance with Section 5 and from which are subtracted payments made pursuant to Section 6 and Section 7.

1.2.2. Affiliate — a business entity which is affiliated in ownership with MGI that is recognized as an Affiliate by the Chief Executive Officer for the purposes of this Plan.

1.2.3. Beneficiary — a person designated in accordance with Section 7.3 to receive all or a part of the Participant’s Account in the event of the Participant’s death prior to full distribution thereof. A person so designated shall not be considered a Beneficiary until the death of the Participant.

1.2.4. Chief Executive Officer — the chief executive officer of MGI.

1.2.5. Code — the Internal Revenue Code of 1986, as amended (including, when the context requires, all regulations, interpretations and rulings issued thereunder).

1.2.6. Compensation — Compensation as defined under the MoneyGram International, Inc. 401(k) Plan; provided, however, that Compensation for purposes of this Plan shall be determined without regard to limitations imposed under section 401(a)(17) of the Code. Performance-based pay (as that term is defined under section 409A of the Code and regulations thereunder) shall be excluded from Compensation.

1.2.7. Disability — a medically determinable physical or mental impairment which: (i) renders the individual incapable of performing any substantial gainful employment, (ii) can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, and (iii) is evidenced by a certification to this effect by a doctor of medicine approved by the Chief Executive Officer. In lieu of such a certification, a Participant shall be considered disabled if the Participant is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Participant’s Employer.

1.2.8. Effective Date — January 1, 2006.

1.2.9. Employers — MGI and each business entity affiliated with MGI that employs persons who are designated for participation in this Plan (collectively the “Employers” and separately the “Employer”).

1.2.10. ERISA — the Employee Retirement Income Security Act of 1974, as amended (including, when the context requires, all regulations, interpretations and rulings issued thereunder).

1.2.11. Event of Maturity — any of the occurrences described in Section 6 by reason of which a Participant or Beneficiary may become entitled to a distribution from this Plan.

1.2.12. Human Resources Committee — the Human Resources Committee of the Board of Directors of MGI (or any successor committee).

1.2.13. MGI — MoneyGram International, Inc. and any successor thereto.

1.2.14. Participant — an employee of an Employer who is designated as eligible to participate in this Plan and becomes a Participant in this Plan in accordance with the provisions of Section 2. An employee who has become a Participant shall be considered to continue as a Participant in this Plan until the date of the Participant’s death or, if earlier, the date when the Participant is no longer employed by an Employer or an Affiliate and upon which the Participant no longer has any Account under this Plan (that is, the Participant has received a distribution of all of the Participant’s Account or the Account has been forfeited as hereinafter provided).

1.2.15. Plan — the nonqualified, income deferral program maintained by MGI established for the benefit of Participants eligible to participate therein, as set forth in the Plan Statement. (As used herein, “Plan” does not refer to the documents pursuant to which this Plan is maintained. That document is referred to herein as the “Plan Statement”). The Plan shall be referred to as the “MONEYGRAM INTERNATIONAL, INC. SUPPLEMENTAL 401(k) PLAN.”

1.2.16. Plan Statement — this document entitled “MONEYGRAM INTERNATIONAL, INC. SUPPLEMENTAL 401(k) PLAN ” as adopted by the Board of Directors of MGI (based upon recommendation by the Human Resources Committee), as the same may be amended from time to time thereafter.

1.2.17. Plan Year — the twelve (12) consecutive month period ending on any December 31.

1.2.18. Termination of Employment — a complete severance of an employee’s employment relationship with the Employers and all Affiliates, if any, for any reason. A transfer from employment with an Employer to employment with an Affiliate of an Employer shall not constitute a Termination of Employment. A transfer from full-time employment to employment on a part-time basis) shall not constitute a Termination of Employment. If an Employer who is an Affiliate ceases to be an Affiliate because of a sale of substantially all the stock or assets of that Employer, then Participants who are employed by that Employer shall be deemed to have thereby had a Termination of Employment for the purpose of commencing distributions from this Plan.

1.2.19. Unforeseeable Emergency — a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in section 152(a) of the Internal Revenue Code) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

1.2.20. Valuation Date — the last business day of each calendar quarter of the Plan Year, and such other dates as may be specified by the Chief Executive Officer.

SECTION 2

PARTICIPATION

2.1. Eligibility to Participate . Any employee of the Employer selected for participation in this Plan by the Chief Executive Officer shall become a Participant in this Plan as of any fixed date selected by the Chief Executive Officer. The Chief Executive Officer shall not select any employee for participation unless the Chief Executive Officer determines that: (i) such employee’s Pre-Tax Deferrals for a Plan Year under the MoneyGram International, Inc. 401(k) Plan are expected to be limited by section 402(g) of the Code or (ii) such employee’s Profit Sharing Contribution for a Plan Year under the MoneyGram International, Inc. 401(k) Plan is reduced by sections 401(a)(17) and 415 of the Code or any other legal limitations. In all cases, such employee shall be a member of a select group of management or highly compensated employees (as that expression is used in ERISA). Such employee shall as a condition of participation in this Plan complete such forms as the Chief Executive Officer may require for the effective administration of this Plan.

2.2. Enrollment for Elective Deferrals . In the case of the first Plan Year in which an Eligible Employee first becomes eligible to make elective deferrals in the Plan, no later than thirty (30) days after the employee is notified of eligibility to make a deferral election, such employee shall complete such forms as necessary to defer a portion of the employee’s Compensation for that Plan Year. The agreement to defer a portion of the employee’s Compensation may only be made with respect to Compensation earned for services performed for such Plan Year subsequent to the deferral election. (Alternatively, such election may be made as late as the last day of the Plan Year in which the Eligible Employee first becomes eligible if the agreement to defer Compensation is made solely with respect to Compensation to be earned for services performed in the succeeding Plan Year.) The terms of any such agreement shall provide for that the employee agrees to accept a reduction in Compensation equal to any percentage of Compensation per payroll period, not to exceed fifty percent (50%), or be less than one percent (1%) of such Compensation. In the event an employee elects to defer an amount of his or her Compensation that would not allow for the full payment of all FICA, federal, state and/or local income tax liabilities, the actual amount deferred shall be the maximum amount allowable after all applicable taxes.

2.3. Effect of Deferral Election . A deferral agreement, once accepted by the Employer, shall be irrevocable for the Plan Year with respect to which it is made; provided, however, that if a Disability or Unforeseeable Emergency occurs during such Plan Year, the Participant’s agreement shall be cancelled, and further deferrals shall not be required. Absent a Disability or Unforeseeable Emergency, such agreement shall remain in effect for Compensation earned in subsequent Plan Years unless prior to a subsequent Plan Year, the agreement is changed or terminated by the Participant or the Participant is not selected for active participation for that subsequent Plan Year.

SECTION 3

CREDITS TO ACCOUNTS

3.1. Elective Deferral Credits . Elective deferrals shall be credited to the Participant’s Account throughout the Plan Year as the Participant otherwise would have been paid the deferred portion of the Participant’s Compensation.

3.2. Supplemental Matching Credits . The Chief Executive Officer may make a supplemental matching credit to a Participant’s Account for a Plan Year. The Chief Executive Officer shall have sole discretion to determine the supplemental matching credit which shall be credited to this Plan, if any, and shall not have any obligation for uniformity of treatment among Participants or of any other person; provided, however, that such supplemental matching credit shall not exceed one hundred percent (100%) of the first three percent (3%) of Compensation and fifty percent (50%) of the next two percent (2%) of Compensation deferred by the Participant for the Plan Year and credited under Section 3.1 above. The Chief Executive Officer’s decision to make a supplemental matching credit in any year shall not require approval of similar awards at all to any Participant or other person at any future date.

3.3. Supplemental Profit Sharing Credits . The Chief Executive Officer may make a profit sharing credit to a Participant’s Account for a Plan Year to the extent that it is determined that a Participant’s Profit Sharing Contribution under the MoneyGram International, Inc. 401(k) Plan was reduced by sections 401(a)(17) or 415 of the Code or any other legal limitations. The Chief Executive Officer shall have sole discretion to determine the amount of the reduction which shall be credited to this Plan, if any, and shall not have any obligation for uniformity of treatment among Participants or of any other person. In no event, however, shall the amount credited under this Plan with respect to a Plan Year exceed the amount by which the Participant’s Profit Sharing Contribution under the MoneyGram International, Inc. 401(k) Plan was reduced by sections 401(a)(17) and 415 of the Code or any other legal limitations for such Plan Year. The Chief Executive Officer’s decision to make a supplemental profit sharing credit in any year shall not require approval of similar awards at all to any Participant or other person at any future date.

3.4. Crediting to Accounts . The Chief Executive Officer shall credit to the Account of each Participant the amount, if any, determined for that Participant under Section 3.1, 3.2 or 3.3 above. Such credit shall be recorded in cash. Such amount shall be credited as nearly as practicable as of the time or times when the credits are deferred or awarded.

SECTION 4

ADJUSTMENT OF ACCOUNTS

4.1. Establishment of Accounts . There shall be established for each Participant unfunded, bookkeeping Accounts which shall be adjusted each Valuation Date.

4.2. Adjustments of Accounts . From time to time but not less frequently than each Valuation Date, the Chief Executive Officer shall cause the value of each Account or portion of an Account to be increased (or decreased) from time to time for distributions, credits (including any earnings, gains or losses thereon) and expenses, if any, charged to the Account.

4.3. Investment Adjustments . The Human Resources Committee shall designate from time to time one or more investment options in which Accounts may be deemed invested. Such deemed investment options may include any investment which the Human Resources Committee deems appropriate, including, but not limited to, fixed interest credits, notional mutual fund(s) or an investment index. The Human Resources Committee shall have the sole discretion to determine the number of deemed investment options to be designated hereunder and the nature of the options and may change or eliminate the investment options from time to time. The Human Resources Committee shall adopt rules specifying the deemed investment options, the circumstances under which a particular option may be elected (or shall be automatically utilized), the minimum or maximum percentages which may be allocated to the investment option, the procedures (if any) for Participants’ making or changing elections, the extent (if any) to which beneficiaries of deceased Participants may make investment elections and the effect of a Participant’s or beneficiary’s failure to make an effective investment election with respect to all or any portion of an Account.

SECTION 5

VESTING OF ACCOUNTS

The Account of each Participant shall be fully (100%) vested and nonforfeitable at all times.

SECTION 6

MATURITY

The vested portion of a Participant’s Account shall mature and shall become distributable in accordance with Section 7 upon the earliest occurrence of any of the following events:

(a)

the Participant incurs a Termination of Employment;

(b)

the Participant dies;

(c)

the Participant incurs a Disability;

(d)

termination of this Plan, to the extent permitted under Section 409A of the Code and any regulations thereunder.

SECTION 7

DISTRIBUTIONS

7.1. Time of Payment . Upon the occurrence of an Event of Maturity effective as to a Participant, the Chief Executive Officer shall commence payment of the vested portion of such Participant’s Account (reduced by the amount of any applicable payroll, withholding and other taxes) in a single lump sum or in installments in accordance with Section 7.3. Distribution shall not be made to any Beneficiary until the Chief Executive Officer has determined that the Beneficiary is entitled to payment. Notwithstanding the foregoing, where payment under this Section 7 is made to any “key employee” (as defined under section 409A of the Code) on account of Termination of Employment, such payment shall commence no earlier than six (6) months following a Termination of Employment (or upon the death of the employee, if earlier) if required to comply with section 409A of the Code.

7.2. Hardship Withdrawals . A Participant who has not incurred an Event of Maturity but who has incurred an Unforeseeable Emergency may request a withdrawal from such Participant’s Account. In the event that the Chief Executive Officer, upon written petition of the Participant, determines in his or her sole discretion that the Participant has suffered an Unforeseeable Emergency, the Employer shall distribute to the Participant as soon as reasonably practicable following such determination, an amount, not in excess of the value of the Participant’s Account, necessary to satisfy the emergency. Immediately upon the distribution, such Participant’s deferral agreement shall be cancelled in accordance with Section 2.3.

7.3. Form of Payment . If a Participant becomes entitled to a distribution by reason of one of the Events of Maturity listed in Section 6, such distribution shall be made in a single lump sum; provided, however, that if the Event of Maturity is the Participant’s Termination of Employment, distribution shall be made: (i) in a single lump sum, or (ii) in annual installments over a period not to exceed five (5) years, in accordance with such Participant’s election at the time of initial enrollment in the Plan (on forms furnished and filed with MGI). In the event no election is made by the Participant, payment shall be made in a single lump sum. For purposes of this Section 7.3, the following rules shall apply:

(a)

Lump sum distributions shall be valued as soon as administratively practicable following the Valuation Date coincident with or next following the Participant’s Event of Maturity (or in the case of a key employee whose Event of Maturity is a Termination of Employment, the date which is six (6) months following such Event of Maturity). Actual distribution shall be made as soon as administratively practicable after such determination.

(b)

The amount of each annual installment shall be determined as of the Valuation Date coincident with or next following each December 31, by dividing the amount of the Account as of such Valuation Date by the number of remaining installment payments to be made. Such installments shall be paid as soon as administratively practicable after such determination. In the case of a key employee, installments shall be determined as of the Valuation Date coincident with or next following the December 31 which is at least six (6) months following such Participant’s Termination of Employment.

(c)

If the Participant dies following a Termination of Employment but before installments are completed, all remaining installments shall be made to the beneficiary or beneficiaries designated under Section 7.4 in a single lump sum.

7.4. Designation of Beneficiaries . A deceased Participant’s vested Account shall be payable to the beneficiary or beneficiaries designated in the Participant’s designation for the MoneyGram International, Inc. 401(k) Plan. If such designation fails, such benefit shall be payable in accordance with the rules for automatic beneficiaries under the MoneyGram International, Inc. 401(k) Plan.

7.5. No Spousal Rights . No spouse or surviving spouse of a Participant and no person designated to be a Beneficiary shall have any rights or interest in the benefits credited under this Plan including, but not limited to, the right to be the sole Beneficiary or to consent to the designation of Beneficiaries (or the changing of designated Beneficiaries) by the Participant.

7.6. Death Prior to Full Distribution . If, at the death of the Participant, any payment to the Participant was due or otherwise pending but not actually paid, the amount of such payment shall be included in the Account which are payable to the Beneficiary (and shall not be paid to the Participant’s estate).

7.7. Distributions in Cash . Distributions from this Plan shall be made in cash.

SECTION 8

FUNDING OF PLAN

8.1. Unfunded Obligation . The obligation of the Employers to make payments under this Plan constitutes only the unsecured (but legally enforceable) promise of the Employers to make such payments. No Participant shall have any lien, prior claim or other security interest in any property of the Employers. The Employers shall have no obligation to establish or maintain any fund, trust or account (other than a bookkeeping account or reserve) for the purpose of funding or paying the benefits promised under this Plan. If such a fund, trust or account is established, the property therein shall remain the sole and exclusive property of the Employer that established it. The Employers shall be obligated to pay the benefits of this Plan out of their general assets.

8.2. Corporate Obligation . Neither MGI, the Board of Directors of MGI, the Chief Executive Officer, the Human Resources Committee, the Employers nor any of their directors, officers, agents or employees in any way secure or guarantee the payment of any benefit or amount which may become due and payable hereunder to or with respect to any Participant. Each person entitled or claiming to be entitled at any time to any benefit hereunder shall look solely to the assets of the Employers for such payments as unsecured general creditors. If, or to the extent that, Accounts have been paid to or with respect to a present or former Participant and that payment purports to be the payment of a benefit hereunder, such former Participant or other person or persons, as the case may be, shall have no further right or interest in the other assets of the Employers in connection with this Plan. No person shall be under any liability or responsibility for failure to effect any of the objectives or purposes of this Plan by reason of the insolvency of the Employers.

SECTION 9

AMENDMENT AND TERMINATION

9.1. Amendment and Termination . The Board of Directors of MGI (based upon recommendation by the Human Resources Committee) may unilaterally amend the Plan Statement prospectively, retroactively or both, at any time and for any reason deemed sufficient by it without notice to any person affected by this Plan and may likewise terminate this Plan both with regard to persons expecting to receive benefits in the future; provided, however, that the Participant’s vested accrued benefit as of the date of such amendment or termination, if any, shall not be, without the written consent of the Participant, diminished or delayed by such amendment or termination.

9.2. No Oral Amendments . No modification of the terms of the Plan Statement or termination of this Plan shall be effective unless it is in writing and approved by the Board of Directors of MGI by a person authorized to execute such writing. No oral representation concerning the interpretation or effect of the Plan Statement shall be effective to amend the Plan Statement.

9.3. Plan Binding on Successors . MGI will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of MGI), by agreement, to expressly assume and agree to perform this Plan in the same manner and to the same extent that MGI would be required to perform it if no such succession had taken place.

SECTION 10

DETERMINATIONS — RULES AND REGULATIONS

10.1. Determinations . The Chief Executive Officer shall make such determinations as may be required from time to time in the administration of this Plan. The Chief Executive Officer shall have the discretionary authority and responsibility to interpret and construe the Plan Statement and to determine all factual and legal questions under this Plan, including but not limited to the entitlement of Participants and Beneficiaries, and the amounts of their respective interests. Each interested party may act and rely upon all information reported to them hereunder and need not inquire into the accuracy thereof, nor be charged with any notice to the contrary.

10.2. Method of Executing Instruments . Information to be supplied or written notices to be made or consents to be given by MGI, the Chief Executive Officer or any other person pursuant to any provision of the Plan Statement may be signed in the name of MGI, the Chief Executive Officer or any other person by any officer or other person who has been authorized to make such certification or to give such notices or consents.

10.3. Claims Procedure . Until modified by the Chief Executive Officer, the claim and review procedures set forth in this Section shall be the mandatory claim and review procedures for the resolution of disputes and disposition of claims filed under the Plan. An application for a distribution shall be considered as a claim for the purposes of this Section.

10.3.1. Initial Claim . An individual may, subject to any applicable deadline, file with the Chief Executive Officer a written claim for benefits under the Plan in a form and manner prescribed by the Chief Executive Officer.

(a)

If the claim is denied in whole or in part, the Chief Executive Officer shall notify the claimant of the adverse benefit determination within ninety (90) days after receipt of the claim.

(b)

The ninety (90) day period for making the claim determination may be extended for ninety (90) days if the Chief Executive Officer determines that special circumstances require an extension of time for determination of the claim, provided that the Chief Executive Officer notifies the claimant, prior to the expiration of the initial ninety (90) day period, of the special circumstances requiring an extension and the date by which a claim determination is expected to be made.

10.3.2. Notice of Initial Adverse Determination . A notice of an adverse determination shall set forth in a manner calculated to be understood by the claimant:

(a)

the specific reasons for the adverse determination;

(b)

references to the specific provisions of the Plan Statement (or other applicable Plan document) on which the adverse determination is based;

(c)

a description of any additional material or information necessary to perfect the claim and an explanation of why such material or information is necessary; and

(d)

a description of the claim and review procedures, including the time limits applicable to such procedure, and a statement of the claimant’s right to bring a civil action under ERISA section 502(a) following an adverse determination on review.

10.3.3. Request for Review . Within sixty (60) days after receipt of an initial adverse benefit determination notice, the claimant may file with the Chief Executive Officer a written request for a review of the adverse determination and may, in connection therewith submit written comments, documents, records and other information relating to the claim benefits. Any request for review of the initial adverse determination not filed within sixty (60) days after receipt of the initial adverse determination notice shall be untimely.

10.3.4. Claim on Review . If the claim, upon review, is denied in whole or in part, the Chief Executive Officer shall notify the claimant of the adverse benefit determination within sixty (60) days after receipt of such a request for review.

(a)

The sixty (60) day period for deciding the claim on review may be extended for sixty (60) days if the Chief Executive Officer determines that special circumstances require an extension of time for determination of the claim, provided that the Chief Executive Officer notifies the claimant, prior to the expiration of the initial sixty (60) day period, of the special circumstances requiring an extension and the date by which a claim determination is expected to be made.

(b)

In the event that the time period is extended due to a claimant’s failure to submit information necessary to decide a claim on review, the claimant shall have sixty (60) days within which to provide the necessary information and the period for making the claim determination on review shall be tolled from the date on which the notification of the extension is sent to the claimant until the date on which the claimant responds to the request for additional information or, if earlier, the expiration of sixty (60) days.

(c)

The Chief Executive Officer’s review of a denied claim shall take into account all comments, documents, records, and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

10.3.5. Notice of Adverse Determination for Claim on Review . A notice of an adverse determination for a claim on review shall set forth in a manner calculated to be understood by the claimant:

(a)

the specific reasons for the denial;

(b)

references to the specific provisions of the Plan Statement (or other applicable Plan document) on which the adverse determination is based;

(c)

a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits;

(d)

a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain information about such procedures; and

(e)

a statement of the claimant’s right to bring an action under ERISA section 502(a).

10.4. Rules and Regulations .

10.4.1. Adoption of Rules . Any rule not in conflict or at variance with the provisions hereof may be adopted by the Chief Executive Officer.

10.4.2. Specific Rules .

(a)

No inquiry or question shall be deemed to be a claim or a request for a review of a denied claim unless made in accordance with the established claim procedures. The Chief Executive Officer may require that any claim for benefits and any request for a review of a denied claim be filed on forms to be furnished by the Chief Executive Officer upon request.

(b)

All decisions on claims and on requests for a review of denied claims shall be made by the Chief Executive Officer unless delegated as provided for in the Plan, in which case references in this Section 10 to the Chief Executive Officer shall be treated as references to the Chief Executive Officer’s delegate.

(c)

Claimants may be represented by a lawyer or other representative at their own expense, but the Chief Executive Officer reserves the right to require the claimant to furnish written authorization and establish reasonable procedures for determining whether an individual has been authorized to act on behalf of a claimant. A claimant’s representative shall be entitled to copies of all notices given to the claimant.

(d)

The decision of the Chief Executive Officer on a claim and on a request for a review of a denied claim may be provided to the claimant in electronic form instead of in writing at the discretion of the Chief Executive Officer.

(e)

In connection with the review of a denied claim, the claimant or the claimant’s representative shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits.

(f)

The time period within which a benefit determination will be made shall begin to run at the time a claim or request for review is filed in accordance with the claims procedures, without regard to whether all the information necessary to make a benefit determination accompanies the filing.

(g)

The claims and review procedures shall be administered with appropriate safeguards so that benefit claim determinations are made in accordance with governing plan documents and, where appropriate, the plan provisions have been applied consistently with respect to similarly situated claimants.

(h)

For the purpose of this Section, a document, record, or other information shall be considered “relevant” if such document, record, or other information: (i) was relied upon in making the benefit determination; (ii) was submitted, considered, or generated in the course of making the benefit determination, without regard to whether such document, record, or other information was relied upon in making the benefit determination; (iii) demonstrates compliance with the administration processes and safeguards designed to ensure that the benefit claim determination was made in accordance with governing plan documents and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants; and (iv) constitutes a statement of policy or guidance with respect to the Plan concerning the denied treatment option or benefit for the claimant’s diagnosis, without regard to whether such advice or statement was relied upon in making the benefit determination.

(i)

The Chief Executive Officer may, in its discretion, rely on any applicable statute of limitation or deadline as a basis for denial of any claim.

10.4.3. Limitations and Exhaustion .

(a)

No claim shall be considered under these administrative procedures unless it is filed with the Chief Executive Officer within two (2) years after the Participant knew (or reasonably should have known) of the general nature of the dispute giving rise to the claim. Every untimely claim shall be denied by the Chief Executive Officer without regard to the merits of the claim. No suit may be brought by or on behalf of any Participant or Beneficiary on any matter pertaining to this Plan unless the action is commenced in the proper forum before the earlier of:

(i)

three (3) years after the Participant knew (or reasonably should have known) of the general nature of the dispute giving rise to the action, or

(ii)

sixty (60) days after the Participant has exhausted these administrative procedures.

(b)

These administrative procedures are the exclusive means for resolving any dispute arising under this Plan:

(i)

no Participant or Beneficiary shall be permitted to litigate any such matter unless a timely claim has been filed under these administrative procedures and these administrative procedures have been exhausted; and

(ii)

determinations by the Chief Executive Officer (including determinations as to whether the claim was timely filed) shall be afforded the maximum deference permitted by law.

(c)

For the purpose of applying the deadlines to file a claim or a legal action, knowledge of all facts that a Participant knew or reasonably should have known shall be imputed to every claimant who is or claims to be a Beneficiary of the Participant or otherwise claims to derive an entitlement by reference to the Participant for the purpose of applying the previously specified periods.

SECTION 11

PLAN ADMINISTRATION

11.1. Authority .

11.1.1. Officers . Administrative functions not assigned to the Chief Executive Officer (or generally assigned to MGI) shall be discharged by its officers or delegated and allocated as provided herein.

11.1.2. Chief Executive Officer . Except as hereinafter provided, the Chief Executive Officer of MGI may delegate or redelegate and allocate and reallocate to one or more persons or to a committee of persons jointly or severally, and whether or not such persons are directors, officers or employees, such functions assigned to the Chief Executive Officer or to MGI generally hereunder, as the Chief Executive Officer may from time to time deem advisable.

11.1.3. Board of Directors . Notwithstanding the foregoing, the Board of Directors of MGI shall have the exclusive authority (which may not be delegated except to a committee of the Board) to amend the Plan Statement and to terminate this Plan, based upon recommendation by the Human Resources Committee.

11.2. Conflict of Interest . If any individual to whom authority has been delegated or redelegated hereunder shall also be a Participant in this Plan, such Participant shall have no authority with respect to any matter specially affecting such Participant’s individual interest hereunder or the interest of a person superior to him or her in the organization (as distinguished from the interests of all Participants and Beneficiaries or a broad class of Participants and Beneficiaries), all such authority being reserved exclusively to other individuals as the case may be, to the exclusion of such Participant, and such Participant shall act only in such Participant’s individual capacity in connection with any such matter.

11.3. Service of Process . In the absence of any designation to the contrary by the Chief Executive Officer, the Secretary of MGI is designated as the appropriate and exclusive agent for the receipt of service of process directed to this Plan in any legal proceeding, including arbitration, involving this Plan.

SECTION 12

CONSTRUCTION

12.1. ERISA Status . This Plan is adopted with the understanding that it is an unfunded plan maintained primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees as provided in section 201(2), section 301(3) and section 401(a)(1) of ERISA. Each provision shall be interpreted and administered accordingly.

12.2. IRC Status . This Plan is intended to be a nonqualified deferred compensation arrangement. The rules of section 401(a) et. seq. of the Code shall not apply to this Plan. The rules of section 3121(v) and section 3306(r)(2) of the Code shall apply to this Plan.

12.3. Effect on Other Plans . This Plan shall not alter, enlarge or diminish any person’s employment rights or obligations or rights or obligations under any other qualified or nonqualified plan. It is specifically contemplated that this Plan will, from time to time, be amended and possibly terminated.

12.4. Disqualification . Notwithstanding any other provision of the Plan Statement or any election or designation made under this Plan, any individual who feloniously and intentionally kills a Participant shall be deemed for all purposes of this Plan and all elections and designations made under this Plan to have died before such Participant. A final judgment of conviction of felonious and intentional killing is conclusive for this purpose. In the absence of a conviction of felonious and intentional killing, the Chief Executive Officer shall determine whether the killing was felonious and intentional for this purpose.

12.5. Rules of Document Construction .

(a)

An individual shall be considered to have attained a given age on such individual’s birthday for that age (and not on the day before). Individuals born on February 29 in a leap year shall be considered to have their birthdays on February 28 in each year that is not a leap year.

(b)

Whenever appropriate, words used herein in the singular may be read in the plural, or words used herein in the plural may be read in the singular; the masculine may include the feminine; and the words “hereof,” “herein” or “hereunder” or other similar compounds of the word “here” shall mean and refer to the entire Plan Statement and not to any particular paragraph or Section of the Plan Statement unless the context clearly indicates to the contrary.

(c)

The titles given to the various Sections of the Plan Statement are inserted for convenience of reference only and are not part of the Plan Statement, and they shall not be considered in determining the purpose, meaning or intent of any provision hereof.

(d)

Notwithstanding any thing apparently to the contrary contained in the Plan Statement, the Plan Statement shall be construed and administered to prevent the duplication of benefits provided under this Plan and any other qualified or nonqualified plan maintained in whole or in part by the Employers.

12.6. References to Laws . Any reference in the Plan Statement to a statute or regulation shall be considered also to mean and refer to any subsequent amendment or replacement of that statute or regulation unless, under the circumstances, it would be inappropriate to do so. The terms “spouse,” “nonspouse,” “married,” “surviving spouse,” and other similar terms shall be construed, interpreted and applied on a basis consistent with the federal statute known as the Defense of Marriage Act.

12.7. Choice of Law . Except to the extent that federal law is controlling, this Plan Statement be construed and enforced in accordance with the laws of the State of Minnesota.

12.8. ERISA Administrator . MGI shall be the plan administrator of this Plan.

12.9. Delegation . No person shall be liable for an act or omission of another person with regard to a responsibility that has been allocated to or delegated to such other person pursuant to the terms of the Plan Statement or pursuant to procedures set forth in the Plan Statement.

12.10. Not an Employment Contract . This Plan is not and shall not be deemed to constitute a contract of employment between any Employer and any employee or other person, nor shall anything herein contained be deemed to give any employee or other person any right to be retained in any Employer’s employ or in any way limit or restrict any Employer’s right or power to discharge any employee or other person at any time and to treat him without regard to the effect which such treatment might have upon him as a Participant in this Plan. Neither the terms of the Plan Statement nor the benefits under this Plan nor the continuance thereof shall be a term of the employment of any employee. The Employers shall not be obliged to continue this Plan.

12.11. Tax Withholding . The Employers (or any other person legally obligated to do so) shall withhold the amount of any federal, state or local income tax, payroll tax or other tax required to be withheld under applicable law with respect to any amount payable under this Plan. All benefits otherwise due hereunder shall be reduced by the amount to be withheld.

12.12. Expenses . All expenses of administering the benefits due under this Plan shall be borne by the Employers.

12.13. Spendthrift Provision . No Participant or Beneficiary shall have any interest in any Account which can be transferred nor shall any Participant or Beneficiary have any power to anticipate, alienate, dispose of, pledge or encumber the same while in the possession or control of the Employers. The Chief Executive Officer shall not recognize any such effort to convey any interest under this Plan. No benefit payable under this Plan shall be subject to attachment, garnishment, execution following judgment or other legal process before actual payment to such person.

The power to designate Beneficiaries to receive the Account of a Participant in the event of such Participant’s death shall not permit or be construed to permit such power or right to be exercised by the Participant so as thereby to anticipate, pledge, mortgage or encumber such Participant’s Account or any part thereof, and any attempt of a Participant so to exercise said power in violation of this provision shall be of no force and effect and shall be disregarded by the Employers.

This section shall not prevent the Chief Executive Officer from exercising, in its discretion, any of the applicable powers and options granted to it upon the occurrence of an Event of Maturity, as such powers may be conferred upon it by any applicable provision hereof.

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EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made the 19 ^th day of August, 2005, but shall be effective as of July 1, 2005 (the “Effective Date”) by and between Philip W. Milne (“Milne”) and MoneyGram International, Inc., a Delaware corporation (“MoneyGram”).

1.

Employment

MoneyGram hereby agrees to and does hereby employ Milne as President and Chief Executive Officer, and Milne hereby agrees to accept employment with MoneyGram as President and Chief Executive Officer, for the Employment Period set forth in Paragraph 2 below upon the other terms and conditions set forth in this Agreement. Milne agrees to serve as a member of MoneyGram’s Board of Directors during the Employment Period set forth in Paragraph 2, and agrees to resign from MoneyGram’s Board of Directors upon the termination of his employment hereunder.

2.

Employment Period

The “Employment Period” shall commence on the Effective Date of this Agreement and subject to the provisions of Paragraphs 5 and 6 below, shall continue for period of three (3) years. The “Employment Period” shall thereafter be extended, subject to the provisions of Paragraphs 5 and 6 below, for an additional period of one (1) year commencing on the third anniversary of the Effective Date and on each succeeding anniversary of the Effective Date thereafter, unless the Human Resources Committee of MoneyGram’s Board of Directors provides written notice at least six (6) months prior to any such anniversary date of its intent not to extend the Employment Period. Any such notice of an intent not to extend the Employment Period shall constitute a termination by MoneyGram Not for Cause under Paragraph 5(a), below. It is understood that Milne’s employment may be earlier terminated by either party subject to the rights and obligations of the parties as set forth herein.

3.

Performance

Throughout the Employment Period, and excluding any periods of vacation and sick leave to which Milne is entitled, Milne shall devote such attention and time as is necessary and appropriate to fulfill his duties as Chief Executive Officer and, to the extent necessary to discharge the responsibilities assigned to Milne under this Agreement, use his reasonable best efforts to carry out such responsibilities faithfully and efficiently. It shall not be considered a violation of the foregoing for Milne to (A) serve on corporate, civic or charitable boards or committees, provided that he provides advance notice of his intention to do so to the Corporate Governance and Nominating Committee of MoneyGram’s Board of Directors and that Committee has no objection, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of Milne’s responsibilities as an employee of MoneyGram in accordance with this Agreement.

4.

Compensation and Benefits

(a)

For all services to be rendered by Milne in any capacity during the Employment Period, Milne shall be paid as annual compensation an initial base salary of $600,000.00. Milne’s base salary shall be reviewed at least annually by the Human Resource Committee of MoneyGram’s Board of Directors, which may in its sole discretion recommend an increase to the base salary, subject to approval by MoneyGram’s Board of Directors.

(b)

In addition to his base salary, Milne shall also be eligible during the Employment Period to participate in the MoneyGram International, Inc. Management and Line of Business Incentive Plan, as amended from time to time (or any successor plan) (“MIP”). The Annual MIP bonus targets shall be established by the Board of Directors for each calendar year during the term of this Agreement. Milne’s annual bonus target for 2005 shall be 90% of his base salary. Any bonus payments shall be paid in accordance with the terms of the MIP.

(c)

During the Employment Period, Milne shall be eligible to participate in all long-term incentive programs covered under the MoneyGram International, Inc. 2005 Omnibus Incentive Plan, as amended from time to time (or any successor plan), including stock options, restricted stock, and the MoneyGram International, Inc. Performance Unit Incentive Plan, as amended from time to time (or any successor plan) (“PUP”).

(d)

Milne shall be eligible to participate in all applicable employee welfare benefit plans, on such terms and conditions as may be in effect and/or amended from time to time. In addition, Milne shall be eligible to participate in the Executive Medical Plan, including post-retirement family medical coverage, as described in Exhibit A to this Agreement.

(e)

Milne shall be eligible for such retirement benefits as are described in “Schedule A” of the Travelers Express Company, Inc. Supplemental Pension Plan, as may be in effect and/or amended from time to time.

(f)

During the Employment Period, Milne shall be entitled to company-paid tax and financial planning services, payment of health club, luncheon club, and country club dues, the use of an automobile and reserved parking, a home security system and an annual physical examination, all in accordance with the terms and conditions of applicable MoneyGram policies as may be in effect and/or amended from time to time. For safety and security purposes, MoneyGram’s Board of Directors has directed that whenever possible, Milne shall use the corporate aircraft for all business-related travel. Whenever the corporate aircraft is not

1

available for such travel, Milne shall be entitled to travel first class on commercial airlines. Milne shall be entitled to use the corporate aircraft for personal travel in accordance with the terms and conditions of applicable MoneyGram policies as may be in effect and/or amended from time to time.

(g)

During the Employment Period, Milne shall be entitled to receive prompt reimbursement for all reasonable expenses incurred in carrying out his duties under this Agreement, provided that he complies with MoneyGram’s policies, practices and procedures for submission of expense reports, receipts, or similar documentation of such expenses.

(h)

During the Employment Period, Milne shall be entitled to paid vacation of five (5) weeks per year.

5.

Termination with Severance Allowance

(a) Termination by MoneyGram Not for Cause . In the event of the termination of Milne’s employment by MoneyGram during the Employment Period for any reason other than for Cause (as defined in paragraph 6(a)), or for Milne’s death, disability, or retirement, MoneyGram shall:

(i) pay Milne a severance allowance in an amount equal to the sum of (x) 2.99 times his then-current base salary, plus (y) a pro rata portion of his then-current target bonus, payable in a lump sum 190 days following the termination of his employment. Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by MoneyGram or otherwise to or for the benefit of Milne (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Paragraph 5) (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code or any interest or penalties are incurred by Milne with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then Milne shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by Milne of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Milne retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payment.

(ii) continue the benefits described in Paragraph 4(d), at the same cost to Milne, for a period of three years. Milne shall in that event not be eligible for the post-retirement medical coverage described in Exhibit A to this Agreement, but shall remain eligible for any applicable post-retirement medical benefits that are made generally available to MoneyGram employees;

(iii) accelerate the vesting of any unvested stock options, restricted stock awards, or other equity incentives other than PUP awards (it being expressly understood that this Paragraph 5 (a)(iii) shall be deemed to amend any contrary provisions of any stock option agreement or restricted stock agreement held by Milne on the Effective Date);

(iv) make a pro-rata payment of any outstanding PUP awards (based on time served), as if each of the defined targets for such awards was achieved at the 100% level; and

(v) reimburse Milne for the cost of outplacement services for a period of two (2) years, up to a maximum reimbursement of $50,000.00.

Subject to Paragraph 5(d), said severance allowance shall be in lieu of any and all other severance that might be payable to Milne under any MoneyGram severance policies. If MoneyGram discovers after the termination of Milne’s employment that there existed grounds to terminate his employment for Cause, then MoneyGram shall be relieved of any obligation to provide any further severance allowance or benefits, and Milne shall be required to return any severance allowance already paid to him.

(b) Termination by Milne for Good Reason . In the event that Milne terminates his employment for “Good Reason” as defined herein, MoneyGram shall provide the same payments and benefits described in Paragraph 5(a), which shall be in lieu of any and all other severance that might be payable to Milne under any MoneyGram severance policies. Milne shall have “Good Reason” to terminate his employment if:

(i) There is a material reduction or change in his authority, duties, or responsibilities;

(ii) There is a reduction in his base salary, unless, pursuant to direction by MoneyGram’s Board of Directors, any such reduction is made in concert with and in an amount not greater than the percentage adjustment mandated as an “across the board” reduction in base salary for all MoneyGram officers;

(iii) There is a material reduction in Milne’s retirement benefits, unless, pursuant to direction by MoneyGram’s Board of Directors, any such reduction is made in concert with and in an amount not greater than the percentage adjustment mandated as an “across the board” reduction for all MoneyGram officers, or if such reduction is required by law;

(iv) Milne is required to relocate to a location that would cause his commute to increase by more than 50 miles;

(v) MoneyGram commits a material breach of this Agreement; or

(vi) A successor to MoneyGram fails to assume MoneyGram’s obligations under this Agreement.

(c) Release . In order to obtain the severance allowance provided for in this Agreement, Milne must execute a complete release of all claims, in a form to be provided by MoneyGram. MoneyGram shall have no obligation to pay any severance allowance unless and until Milne shall have signed such release.

(d) Change of Control . In the event that Milne’s employment terminates in connection with a “Change of Control” as defined in the MoneyGram International, Inc. Executive Severance Plan (Tier I), Milne’s rights to severance payments and benefits (if any) shall be exclusively as established in the MoneyGram International, Inc. Executive Severance Plan (Tier I). Those payments and benefits shall be provided in lieu of the payments and benefits set forth in this Paragraph 5.

6.

Termination without Severance Allowance

(a)

Termination by MoneyGram for Cause . MoneyGram may terminate Milne’s employment for Cause at any time without incurring any further obligation of any kind under this Agreement. For the purpose of this Agreement, termination of Milne’s employment shall be for “Cause” only if the termination results from:

(i)

Milne’s material breach of this Agreement;

(ii)

Milne’s willful and continued failure to perform the required duties of his position, if Milne shall have failed to remedy such alleged failure within thirty (30) days after Milne’s receipt of written notice from MoneyGram’s Board of Directors;

(iii)

Milne’s breach of his fiduciary duty to MoneyGram;

(iv)

Milne’s material breach of the MoneyGram International, Inc. Code of Ethics, Always Honest policy, or other code of conduct in effect from time to time, provided that any fraudulent or dishonest act shall be considered material regardless of size;

(v)

Milne’s willful or gross misconduct; or

(vi)

Milne’s conviction or guilty plea to a felony or to a misdemeanor involving an act or acts of fraud, theft or embezzlement.

(b)

Termination by Milne Without Good Reason . Milne shall have the right to terminate his employment in his sole discretion, by providing ninety (90) days notice of his intent to resign. Except as otherwise provided in Paragraph 5(b) above, Milne shall in that event receive no further compensation or severance allowance.

(c)

Death . In the event of Milne’s death during the Employment Period, MoneyGram shall have no obligations under this Agreement to provide any severance allowance, but without prejudice to any benefits, such as life insurance, otherwise due in respect of Milne’s death. In addition, MoneyGram shall continue, on the terms set forth in Exhibit A to this Agreement, medical coverage to Milne’s surviving spouse and minor children, provided that any coverage to his spouse shall become supplemental to Medicare coverage when she becomes eligible for Medicare coverage.

(d)

Retirement . In the event of Milne’s voluntary “normal retirement” or “early retirement” during the Employment Period pursuant to the terms of the MoneyGram Pension Plan, MoneyGram shall have no further obligations under this Agreement, whether to provide severance allowance or otherwise, except as follows:

(i) Milne will then be provided with office space and secretarial support, at MoneyGram’s expense, for a period of five (5) years; and

(ii) Milne shall be eligible for any benefits otherwise due in respect of Milne’s retirement, including, but not limited to, post-retirement family medical coverage on the terms set forth in Exhibit A to this Agreement.

(e)

Disability

(i) In the event of Milne’s disability during the Employment Period, Milne’s employment shall be terminated and MoneyGram shall have no further obligations under this Agreement to provide any severance allowance, except that Milne shall be eligible for any benefits otherwise due in respect of Milne’s disability. In addition, MoneyGram shall continue, on the terms set forth in Exhibit A to this Agreement, medical coverage to Milne’s spouse and minor children, provided that any coverage to his spouse shall become supplemental to Medicare coverage when she becomes eligible for Medicare coverage.

(ii) The term “disability” as used in this Agreement shall mean an illness or impairment occurring during the Employment Period which prevents Milne from performing the essential functions of his job under this Agreement, with reasonable accommodations (as defined by federal and Minnesota disability laws), for a period of six consecutive months. The period of employment shall be deemed to have ended as of the close of business on the last day of such six-month period but without prejudice to any payments due Milne from any disability policy or disability insurance.

7.  Confidentiality and Noncompetition

(a) Milne shall hold in a fiduciary capacity for the benefit of MoneyGram all proprietary or confidential information, knowledge or data relating to MoneyGram or any of its businesses that Milne obtains during his employment that is not public knowledge (other than as a result of his violation of this Paragraph 7(a) (“Confidential Information”). Milne shall not, during his employment or at any time thereafter, communicate, divulge or disseminate any Confidential Information for any reason or purpose whatsoever, nor shall he make any use of such Confidential Information for his own purposes.

(b) During the Noncompetition Period (as defined below), Milne shall not, without the prior written consent of the Board, engage in or become associated with any Competitive Activity (as defined below). For purposes of this Paragraph 7(b):

(i) the “Noncompetition Period” means two (2) years from the effective date that Milne’s employment with MoneyGram terminates.

(ii) a “Competitive Activity” means accepting employment with, consulting for, or otherwise assisting any competitor of MoneyGram, its subsidiaries or affiliates; inducing any employee of MoneyGram, its subsidiaries or affiliates to terminate his or her employment ; or otherwise interfering in a similar manner with the business of MoneyGram, its subsidiaries or affiliates.

(c) In addition, the Employee Trade Secret, Confidential Information and Post-Employment Restriction Agreement between MoneyGram and Milne shall remain in full force and effect according to its terms. The agreements and obligations of Milne pursuant to this Paragraph 7 shall be in addition to and not in substitution for his agreements and obligations pursuant to the Employee Trade Secret, Confidential Information and Post-Employment Restriction Agreement.

8.

Post-Employment Obligations

At all times after the termination of his employment, at the request of MoneyGram:

(a) Milne shall provide reasonable and necessary assistance to assure an orderly transition of duties to his successor, including but not limited to the introduction of his successor to key MoneyGram customer accounts; and

(b) Milne shall cooperate with MoneyGram with respect to any claims or lawsuits by or against MoneyGram as to which Milne has knowledge of the facts involved in such claims or lawsuits. Milne shall make himself available to MoneyGram for this purpose upon reasonable notice but without the need of subpoena, and shall be entitled to reasonable compensation for his time and expenses in rendering such cooperation. Further, Milne shall decline to voluntarily aid, assist or cooperate with any party who has claims or lawsuits against MoneyGram, or with their attorneys or agents. MoneyGram and Milne both acknowledge, however, that nothing in this paragraph shall prevent Milne from honestly testifying at an administrative hearing, arbitration, deposition or in court, in response to a lawful and properly served subpoena in a proceeding involving MoneyGram, and that the intention and expectation of both parties is that Milne would testify honestly in any such proceedings .

9.

Arbitration

The parties agree that they shall submit any dispute regarding the performance or breach of any of the provisions of this Agreement, or any other dispute relating to Milne’s employment with MoneyGram and/or the termination thereof, to binding arbitration under the then-applicable rules of the American Arbitration Association. As the sole exception to the scope of this Paragraph 9, the parties agree that any claims arising from an alleged breach of Paragraph 7 need not be submitted to arbitration, and that instead MoneyGram shall be entitled to seek injunctive and other relief from a Court of competent jurisdiction.

If Milne is required to institute arbitration proceedings because of MoneyGram’s alleged breach of this Agreement and prevails on at least one material issue in dispute, MoneyGram shall pay his reasonable attorneys’ fees and associated costs, up to a maximum of $100,000.

10.

Successor in Interest

This Agreement and the rights and obligations hereunder shall be binding upon and inure to the benefit of the parties hereto and their respective legal representatives, and shall also bind and inure to the benefit of any successor of MoneyGram by merger or consolidation or any purchaser or assignee of all or substantially all of its assets. Except to any such successor, purchaser, or assignee of MoneyGram, neither this Agreement nor any rights or benefits hereunder may be assigned by either party hereto.

11.  Construction

Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. If any provision of this Agreement shall be prohibited by or is found to be invalid under applicable law, then such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. It is the express intent of the parties that in that event, this Agreement shall be revised and enforced to the maximum extent permitted under applicable law.

12.

Governing Laws

This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Minnesota.

2

13.

Notices

Any notice required or permitted to be given under this Agreement shall be sufficient if in writing, sent by Certified Mail, Return Receipt Requested:

with a copy to Milne’s then-current home address, as reflected in MoneyGram’s human resources files.

Attention: Chairman of the Human Resources Committee, with a copy to Vice President and General Counsel

14, Terms of this Agreement Prevail Over Inconsistent Terms of Any Other Agreement or Document; Amendment of Agreement .

It is possible that Milne has during his employment with MoneyGram executed a number of agreements or become a participant in various plans or programs which contain terms inconsistent with the terms of this Agreement, particularly with respect to, but not limited to, the issues of termination of employment, severance benefits, restrictive covenants, employment benefits, and the availability of attorney’s fees in the event of a breach. It is anticipated that Milne will in the future execute agreements or become a participant in various plans or programs which also contain terms inconsistent with this Employment Agreement. Those agreements and documents include, by way of illustration only and not by way of limitation, the following:

• Management and Line of Business Incentive Plan

• Various “long-term incentive programs” covered by the 2005 Omnibus Incentive Plan

• Various plans or agreements providing for stock options, restricted stock, etc.

• Performance Unit Incentive Plan

• Awards, Grants, or Agreements pertaining to Compensation, Stock Incentives, or other aspects of Milne’s compensation or benefits

• Executive Medical Plan

• Supplemental Pension Plan

• Code of Ethics

• Always Honest Policy

• Other Codes of Conduct

It is the intention of the parties that, to the extent the terms of any plan, award, grant, agreement, acknowledgment, policy, or other document executed or acknowledged by Milne, or made available to Milne by MoneyGram, regardless of the date of such execution, acknowledgment, or grant of access, are inconsistent with the terms of this Employment Agreement, the latter shall govern. MoneyGram has an interest in using form documents for its employees pertaining to such matters and maintaining uniformity in their provisions, and the parties agree that, for purposes of convenience only, instead of modifying each document to make it conform to the provisions of this Agreement, this provision shall be sufficient to effect that result. The terms of this Employment Agreement, including this provision, may be modified only by a subsequently-executed Employment Agreement which both (a) explicitly identifies this Agreement and the date of its execution, and (b)(i) identifies the particular provisions being modified or (ii) in the event this Agreement is to be superseded in its entirety, explicitly so provides. This provision does not, however, affect in any way Milne’s rights in the event of a “Change in Control” as defined in the MoneyGram International, Inc. Executive Severance Plan (Tier I).

IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the date set forth above.

s/ Philip W. Milne

Philip W. Milne

MoneyGram International, Inc.

By: /s/ Jess Hay

Its: Chair, Human Resources Committee

3

MoneyGram International, Inc.
Executive Health Plan
Plan Summary

Schedule of Benefits

Eligible Dependents

ü An unmarried child up to age 25 of an eligible Employee, if the child is a registered student in regular full-time attendance at school. The child must be mainly dependent on the Employee for care and support. The child cannot be employed on a regular full-time basis by one or more employers for a total of 30 or more hours per week.

ü A legally adopted child. (A child is considered legally adopted on the earlier of the date of placement or the date the legal adoption proceedings have been started.)

ü Any other child related to an eligible Employee, mainly dependent on the eligible Employee for care and support and residing in the eligible Employee’s home.

ü Dependents must reside in the United States.

Cost of Coverage

ü The coverage under this Plan is non-contributory. This means that the Employer pays for the full cost of the coverage.

4

Retired Employee Coverage

ü Retired Employees and eligible spouses are eligible for the benefits for life. If an Employee dies prior to retiring the eligible spouse will still be eligible for coverage for life.

Executive Medical & Dental Benefits

ü Payment will be made for 100% of the Covered Expenses incurred by a Covered Person while covered under this Plan.

ü Covered Expenses are the actual cost to you for services and supplies given for Medical & Dental Care.

ü “Medical Care” means the diagnosis, care mitigation, treatment or prevention of disease, or treatment affecting any structure or function of the body due to defect, illness or accidental injury or care during and following pregnancy including treatment of any conditions caused by the pregnancy.

ü The Covered Expense must be an allowable tax deductible item as defined under Section 213(d) of the Internal Revenue Code of 1986 and as may be amended from time to time. 1

¹ Minnesota state law requires taxation on the benefit of a self insured plan where the executive plan is a subgroup of the active plan. The tax does not apply to fully insured plans, therefore this plan is insured. BlueCross BlueShield of MN (BCBSMN) falls under Chapter 62C of the Minnesota Statutes and is governed by the Minnesota Department of Commerce (DOC). All fully insured Certificates of Coverage and Group Contracts are reviewed annually by the DOC. BCBSMN is required to receive approval of the DOC prior to issuing Certificates of Coverage to their members. Additionally, Minnesota legislation requires certain plan provisions to be in place in order for their contracts to be approved by the DOC. A provision example is:

62E.06, subdivision (a) Qualified Plan Lifetime Maximum (1976) requires that all qualified plans must provide a lifetime maximum of $1,000,000. However, since this legislation was passed, BCBSM has increased this maximum to $2 million, then to $3 million and effective January 1, 2006, the maximum will be increased to $5 million.

BCBSM’s claims processing system must be able to provide the benefits outlined in their Certificates of Coverage.

5

MONEYGRAM INTERNATIONAL, INC.

2005 OMNIBUS INCENTIVE PLAN

NON-QUALIFIED STOCK OPTION AGREEMENT FOR DIRECTORS

As Adopted August 17, 2005

(NQ — DIR)

This Non-Qualified Stock Option Agreement is between MoneyGram International, Inc., a Delaware corporation (Corporation) and the person (Director or Grantee) named in the accompanying Notice of Stock Option Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

The Corporation desires to provide Director with an opportunity to purchase shares of the Corporation’s Common Stock, par value $0.01 (Common Stock), as provided in this Agreement, in order to carry out the purpose of the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan).

The Corporation hereby grants to Director, effective as of the Grant Date, the right and option (Option) to purchase all or any part of the aggregate number of shares of Common Stock set forth in the Notice, on the terms and conditions contained in this Agreement and in accordance with the terms of the Plan. The Option is not intended to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the Code). The per share purchase price of the shares subject to the Option shall be the purchase price per share set forth in the Notice.

1.  Option Period and Termination of Service of Director. The period during which this Option may be exercised (Option Period) is the period beginning on the date hereof and ending ten (10) years from such date, subject to Section 2 below, and during this period this Option may be exercised only by the Director personally and while a director of the Corporation, except that:

(a) If the Director ceases to be a director of the Corporation for any reason, excluding death, disability, or retirement, the option rights hereunder (as they exist on the day the Director ceases to be a director) may be exercised only within a period of three (3) months thereafter, subject to the notice requirements and forfeiture provisions set forth below, or prior to the expiration of the Option Period, whichever shall occur sooner.

(b) If the Director ceases to be a director of the Corporation due to death, or dies within the three month or three year periods referred to in Sections (a) or (c) of this Section 1, the option rights hereunder (as they exist immediately prior to the Director’s death) may be exercised by the Director’s personal representative only during a period of twelve (12) months thereafter in the case of death and only during a period of three (3) years thereafter in the case of disability, provided, if the Director dies within such three-year period, any unexercised option held by the Director will, notwithstanding the expiration of such three-year period, continue to be exercisable to the extent to which it was exercisable at the time of death for a period of twelve (12) months from the date of such death, subject in each case to the notice requirements set forth below, or prior in each case to the expiration of the Option Period, whichever shall occur sooner.

(c) If the Director ceases to be a director of the Corporation by reason of disability, the option rights hereunder (as they exist on the day the Director ceases to be such director) may be exercised only within a period of three (3) years thereafter, subject to Section 2 below including the notice requirements set forth therein, or prior to the expiration of the Option Period, whichever shall occur sooner.

(d) If the Director ceases to be a director of the Corporation at or after the age of 65 years, the Director shall be deemed to have retired for purposes of this Agreement and the option rights hereunder (as they exist on the day the Director ceases to be such director) may be exercised only within a period of five (5) years thereafter, subject to the terms and conditions of this Agreement, including the notice requirements and non-compete provisions set forth below, or prior to the expiration of the Option Period, whichever shall occur sooner.

2.  Method of Exercise of this Option. This Option may be exercised in the manner hereinafter prescribed, in whole or in part, at any time or from time to time, during the Option Period as follows.

(a) One-third of the Shares hereby optioned at any time after one year from the date hereof,

(b)

One-third of the Shares hereby optioned at any time two years from the date hereof, and

(c) the balance of the Shares hereby optioned at any time after three years from the date hereof. This Option shall not be exercisable prior to the expiration of one year from the date of grant, except as otherwise specified in the Plan. All purchases hereunder must be completed within the time periods prescribed herein for the exercise thereof.

(d) Notwithstanding Sections (a), (b) and (c) of this Section 2 if the Director ceases to be a director of the Corporation by reason of death, disability or retirement, this Option (to the extent valid and outstanding as of the date such Director ceases to be a director) if not then exercisable shall become fully exercisable to the full extent of the original grant; provided, however, that if such date on which such Director ceases to be a director or an employee is within six months of the date of grant of a particular Stock Option held by a Director this Option shall not become fully exercisable until six months and one day after such date of grant.

On or before the expiration of the Option Period specified herein, written notice of the exercise of this Option with respect to all or a part of the Common Stock hereby optioned may be mailed or delivered to the Corporation by the Director in such form as the Corporation may require, properly completed and among other things stating the number of Shares of Common Stock with respect to which the Option is being exercised, and specifying the method of payment for such Common Stock. The notice must be mailed or delivered prior to the expiration of this Option.

Before any stock certificates shall be issued or book entry made reflecting the transfer of shares to Grantee, the entire purchase price of the Common Stock purchased shall be paid to the Corporation. Certificates will be issued to the purchaser, or book entry made, as soon as practicable thereafter. Failure to pay the purchase price for any Common Stock within the time specified in said notice shall result in forfeiture of the Grantee’s right to purchase the Common Stock at a later date and the number of shares of Common Stock which may thereafter be purchased hereunder shall be reduced accordingly.

The purchase price may be paid either entirely in cash or in whole or in part with unrestricted Common Stock already owned by the Director. If the Director elects to pay the purchase price entirely in cash, he will be notified of the purchase price by the Corporation. If the Director elects to pay the purchase price either substantially all with Common Stock or partly with Common Stock and the balance in cash, he will be notified by the Corporation of the fair market value of the Common Stock on the exercise date and the amount of Common Stock or cash payable. Within five business days after the exercise date, the Director shall deliver to the Corporation either cash or Common Stock certificates, in negotiable form, at least equal in value to the purchase price, or that portion thereof to be paid for with Common Stock, together with cash sufficient to pay the full purchase price. Only full Shares of Common Stock shall be utilized for payment purposes.

To the extent permissible under applicable tax, securities, and other laws, the Director may satisfy a tax withholding requirement by surrendering Shares, including Shares to which Director is entitled as a result of the exercise of this Option.

3.  Non-Compete. Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(a) In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, the Director, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of the Director’s termination of service with the Corporation or any of its Affiliates, in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Director, as a consequence of the Director’s service on the Board of Directors of the Corporation to be in development).

(b) For purposes of the provisions of Section 3, it shall be conclusively presumed that the Director has knowledge of information he or she was directly exposed to through actual receipt or review of memos or documents containing such information, or through actual attendance at meetings at which such information was discussed or disclosed.

(c) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Director prior to or after termination of service on the Corporation’s Board of Directors if the Director engages in any conduct agreed to be avoided pursuant to the provisions of Section 3 at any time within the two (2) years following the date of the Director’s termination of service.

(d) If, at any time within two (2) years after the date of the Director’s termination of service with the Corporation or any of its Affiliates, Director engages in any conduct agreed to be avoided pursuant to the provisions of this Section 3, then any gain (without regard to tax effects) realized by Director from the exercise of this Option, in whole or in part, shall be paid by Director to the Corporation. Director consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Director to the extent of the amounts Director owes the Corporation hereunder.

4.  Non-Transferability of this Option. This Option may not be assigned, encumbered or transferred, in whole or in part, except by the Director’s will or in accordance with the applicable laws of descent and distribution or as otherwise provided or permitted under the Plan, except that a Director holding a Non-Qualified Stock Option may designate as the transferee of any such Option any member of such Director’s “Immediate Family"(as defined in Rule 16a, as promulgated by the Commission under the Exchange Act) or to a trust whose beneficiaries are members of such Director’s Immediate Family, without payment of consideration, to have the power to exercise such Option, and be subject to all the conditions of such Option prior to such designation, such power to exercise to become effective only in the event that such Director shall die prior to exercising such Option.

5.  Adjustments for Changes in Capitalization of Corporation. The Common Stock covered by this Option is, at the option of the Corporation, either authorized but unissued or reacquired Common Stock. In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, extraordinary distribution with respect to the Common Stock or other change in corporate structure affecting the Common Stock during the Option Period, the number of Shares of Common Stock which may thereafter be purchased pursuant to this Option and the purchase price per share, shall be appropriately adjusted, or other appropriate substitutions shall be made, and the determination of the Board of Directors of the Corporation, or the Human Resources Committee of the Board of Directors, as the case may be, as to any such adjustments shall be final, conclusive and binding upon the Director.

6.  Effect of Change in Control.

(a) For purposes of this Agreement, a Change in Control shall mean any of the following events:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

(b) In the event of a Change in Control, this Option (to the extent outstanding as of the date such Change in Control is determined to have occurred) if not then exercisable and vested shall become fully exercisable and vested to the full extent of the original grant.

(c) For purposes of this Agreement, “Change in Control Price” shall mean the higher of (1) the highest reported sales price, regular way, of a share of Stock in any transaction reported on the New York Stock Exchange Composite Tape or other national exchange on which such shares are listed or on The NASDAQ Stock Market during the 60-day period prior to and including the date of a Change in Control or (2) if the Change in Control is the result of a tender or exchange offer or a Corporate Transaction, the highest price per share of Stock paid in such tender or exchange offer or Corporate Transaction; provided, however, that in the case of Incentive Stock Options and Stock Appreciation Rights relating to Incentive Stock Options, the Change in Control Price will be in all cases the Fair Market Value of the Stock on the date such Incentive Stock Option or Stock Appreciation Right is exercised. To the extent that the consideration paid in any such transaction described above consists all or in part of securities or other non-cash consideration, the value of such securities or other non-cash consideration will be determined in the sole discretion of the Board.

(d) Notwithstanding any other provision of the Plan, during the 60-day period from and after a Change in Control (Exercise Period), the Director shall have the right, whether or not this Option is fully exercisable and in lieu of the payment of the exercise price for the Shares of Common Stock being purchased under the Option and by giving notice to the Corporation, to elect (within the Exercise Period) to surrender all or part of the Option to the Corporation and to receive cash, within 30 days of such notice, in an amount equal to the amount by which the Change in Control Price per share of Common Stock on the date of such election shall exceed the exercise price per share of Common Stock under the Option (the Spread) multiplied by the number of Shares of Common Stock granted under the Option as to which the right granted hereunder shall have been exercised; provided, however, that if the Change in Control is within six months of the date of grant of a particular Option held by a Director no such election shall be made by such Director with respect to such Option prior to six months from the date of grant. Notwithstanding any other provision hereof, if the end of such 60-day period from and after a Change in Control is within six months of the date of grant of an Option held by a Director such Option shall be canceled in exchange for a cash payment to the Director, effected on the day which is six months and one day after the date of grant of such Option, equal to the Spread multiplied by the number of Shares of Common Stock granted under the Option.

7.  Plan and Plan Interpretations as Controlling. This Option and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Board may amend the Plan, and that the Committee shall administer the Plan. The Director, by acceptance of this Option, agrees to be bound by said Plan and such Board and Committee actions.

8.  Termination of the Plan; No Right to Future Grants. By entering into this Non-Qualified Stock Option Agreement, the Director acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of an Option is a one-time benefit which does not create any contractual or other right to receive future grants of Options, or benefits in lieu of Options; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Option shall be granted, the number of Shares subject to each Option, the Option price, and the time or times when each Option shall be exercisable, will be at the sole discretion of the Corporation; (d) that the Director’s participation in the Plan is voluntary; (e) that the right to purchase Common Stock ceases upon termination of service for any reason except as may otherwise be explicitly provided in the Plan or this Agreement; (f) that the future value of the Shares is unknown and cannot be predicted with certainty; (g) that if the underlying Shares do not increase in value, the Option will have no value; and (h) the foregoing terms and conditions apply in full with respect to any prior Option grants to Director.

9.  Governing Law. This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Options to purchase shares of Common Stock of the Corporation may not be exercised whenever such exercise or the issuance of any of the optioned Shares would be contrary to law or the regulations of any governmental authority having jurisdiction.

MONEYGRAM INTERNATIONAL, INC.
2005 OMNIBUS INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT FOR DIRECTORS

As Adopted August 17, 2005

(RS – DIR)

This Restricted Stock Agreement is between MoneyGram International, Inc. (Corporation), a Delaware corporation (Corporation) and the person (Director or Grantee) named in the accompanying Notice of Restricted Stock Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

1.  Share Award. The Corporation hereby awards the Director the shares (Shares) of Common Stock, par value $0.01 per share (Common Stock) of the Corporation specified in the Notice, pursuant to the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan), and upon the terms and conditions, and subject to the restrictions therein and hereinafter set forth.

2.  Restrictions on Transfer and Restriction Period. During the period commencing on the effective date hereof (Commencement Date) and terminating 1 year thereafter (Restriction Period), the Shares may not be sold, assigned, transferred, pledged, or otherwise encumbered by the Director, except as hereinafter provided. The Restriction Period shall lapse and full ownership of Shares will vest at the end of the Restriction Period, subject to forfeiture pursuant to paragraph 3.

The Board of Directors (Board) and the Human Resources Committee of the Board of Directors (Committee) shall have authority as specified by the Plan, including the authority to accelerate the time at which any or all of the restrictions shall lapse with respect to any Shares, prior to the expiration of the Restriction Period with respect thereto, or to remove any or all of such restrictions, whenever the it may determine that such action is appropriate by reason of change in applicable tax or other law, or other change in circumstances.

3.  Forfeiture and Repayment Provisions.

(a)  Termination of Board Service. Except as provided in this paragraph 3 and in paragraph 8 below or as otherwise may be determined by the Board, if the Director ceases to be a director of the Corporation for any reason, all Shares which at the time of such termination are subject to the restrictions imposed by paragraph 2 above shall upon such termination of service be forfeited and returned to the Corporation. Except as otherwise specifically determined by the Corporate Governance and Nominating Committee in its absolute discretion on a case by case basis, if the Director resigns or declines to stand for re-election as a director of the Corporation on or after attaining the age of 65 years or if the Director ceases to be a director of the Corporation or any of its Affiliates by reason of death or total or partial disability, full ownership of a portion of the Shares will occur to the extent not previously earned, upon lapse of the Restriction Period as set forth in paragraph 2 and dividends will be paid through such period, in each case on a pro-rata basis, calculated based on the percentage of time such Director served on the Board of Directors of the Corporation from the Commencement Date through the date the Director ceases to be a director of the Corporation..

(b)  Non-Compete.

In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, Director, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, Director, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of Director’s termination of service on the Board in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Director, as a consequence of Director’s service on the Board, to be in development).

(c) All Shares subject to the restrictions imposed by paragraph 2 above shall be forfeited and returned to the Corporation, if Director engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b) at any time within two (2) years following the date of Director’s termination of service on the Board

(d) If, at any time within two (2) years following the date of Director’s termination of service on the Board Director engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b), then all consideration (without regard to tax effects) received directly or indirectly by Director from the sale or other disposition of all Shares which vest during the two (2) year period prior to Director’s termination of service shall be paid by Director to the Corporation, or such Shares shall be returned to the Corporation. Director consents to the deduction from any amounts the Corporation owes to Director to the extent of the amounts Director owes the Corporation hereunder.

4.  Certificates for the Shares. The Corporation shall issue a certificate in respect of the Shares or shall direct the Corporation’s transfer agent to record ownership in respect of the Shares in the Corporation’s stock ledger in the name of the Director, the number of Shares of which shall equal the amount of the award specified herein, and shall prohibit the transfer of such Shares by the Director until the expiration of the restrictions set forth in paragraph 2 above. In the alternative, the Corporation may, at its option, issue the shares in book entry. The certificate or record of ownership or book entry shall bear the following legend:

The transferability of the Shares of stock represented hereby are subject to the terms and conditions (including forfeiture) contained in the MoneyGram International, Inc. 2005 Omnibus Incentive Plan and an Agreement entered into between the registered owner and MoneyGram International, Inc. Copies of such Plan and Agreement are on file with the Vice President-General Counsel of MoneyGram International, Inc., 1550 Utica Avenue South, Minneapolis, MN 55416.

The Director further agrees that simultaneously with his or her acceptance of this Agreement, he or she shall execute a stock power covering such award endorsed in blank and that he or she shall promptly deliver such stock power to the Corporation.

5.  Director’s Rights. Except as otherwise provided herein, the Director, as owner of the Shares, shall have all rights of a shareholder, including, but not limited to, the right to receive all dividends paid on the Shares and the right to vote the Shares.

6.  Expiration of Restriction Period. Upon the lapse or expiration of the Restriction Period with respect to any Shares, the Corporation shall redeliver to the Director the certificate in respect of such Shares (reduced appropriately in number if required by Paragraph 3) and the related stock power held by the Corporation pursuant to paragraph 4 above, or shall, if the Shares are held in book entry form, cause the removal of the restrictive legend associated with the book entry for the Shares. The Shares as to which the Restriction Period shall have lapsed or expired and which are represented by such certificate or book entry shall be free of the restrictions referred to in paragraph 2 above and such certificate or book entry shall not bear thereafter the legend provided for in paragraph 4 above.

To the extent permissible under applicable tax, securities, and other laws, the Director may satisfy a tax withholding requirement by directing the Corporation to apply Shares to which Director is entitled as a result of termination of the Restricted Period with respect to any Shares.

7.  Adjustments for Changes in Capitalization of Corporation. In the event of a change in the Common Stock through stock dividends, stock splits, recapitalization or other changes in the corporate structure of the Corporation during the Restriction Period, the number of Shares subject to restrictions as set forth herein shall be appropriately adjusted and the determination of the Board of Directors of the Corporation as to any such adjustments shall be final, conclusive and binding upon the Director. Any Shares of Common Stock or other securities received, as a result of the foregoing, by the Director with respect to Shares subject to the restrictions contained in paragraph 2 above also shall be subject to such restrictions and the certificate(s), stock ledger, or other instruments representing or evidencing such Shares or securities shall be legended and deposited with the Corporation, along with an executed stock power, in the manner provided in paragraph 4 above.

8.  Effect of Change in Control. In the event of a Change in Control (as defined below), the restrictions applicable to any Shares subject to this Agreement shall lapse, and such Shares shall be free of all restrictions and become fully vested and transferable to the full extent of the original grant.

(a) For purposes of this Agreement, a Change in Control shall mean:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

9.  Plan and Plan Interpretations as Controlling. The Shares hereby awarded and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Board or a Committee thereof may from time to time make changes therein, interpret it and establish regulations for the administration thereof. The Director, by acceptance of this Agreement, agrees to be bound by said Plan and such Board and Committee actions.

10.  Termination of the Plan; No Right to Future Grants. By entering into this Restricted Stock Agreement, the Director acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of Restricted Stock is a one-time benefit which does not create any contractual or other right to receive future grants of Restricted Stock, or benefits in lieu of Restricted Stock; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Restricted Stock shall be granted, the number of Shares, the restriction period, and the time or times when any such grants shall vest, will be at the sole discretion of the Corporation; (d) that the Director’s participation in the Plan is voluntary; (e) that the right to any unvested portion of Restricted Stock ceases upon termination of the Director’s service on the Board for any reason except as may otherwise be explicitly provided in the Plan or this Restricted Stock Agreement; (f) that the future value of the Restricted Stock is unknown and cannot be predicted with certainty; and (g) the foregoing terms and conditions apply in full with respect to any prior grants of Restricted Stock to the Director.

11.  Governing Law. This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Shares may not be issued hereunder, or redelivered, whenever such issuance or redelivery would be contrary to law or the regulations of any governmental authority having jurisdiction.

MONEYGRAM INTERNATIONAL, INC.
2005 OMNIBUS INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT

As Adopted August 17, 2005

(NQSO — US)

This Non-Qualified Stock Option Agreement is between MoneyGram International, Inc., a Delaware corporation (Corporation) and the person (Grantee) named in the accompanying Notice of Stock Option Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

The Corporation desires to provide Grantee with an opportunity to purchase shares of the Corporation’s Common Stock, par value $0.01 (Common Stock), as provided in this Agreement, in order to carry out the purpose of the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan).

The Corporation hereby grants to Grantee, effective as of the Grant Date, the right and option (Option) to purchase all or any part of the aggregate number of shares of Common Stock set forth in the Notice, on the terms and conditions contained in this Agreement and in accordance with the terms of the Plan. The Option is not intended to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the Code). The per share purchase price of the shares subject to the Option shall be the purchase price per share set forth in the Notice.

1.  Option Period and Termination of Employment of Grantee. The period during which this Option may be exercised (Option Period) is the period beginning on the date hereof and ending ten (10-) years from such date, subject to Section 2 below, and during this period this Option may be exercised only by the Grantee personally and while an employee of the Corporation or a subsidiary or division thereof (Affiliate), except that:

(a) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation for any reason, excluding death, disability, retirement and termination of employment for cause, the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of three (3) months thereafter, subject to the notice requirements and forfeiture provisions set forth below, or prior to the expiration of the Option Period, whichever shall occur sooner. If Grantee is an employee and is terminated for cause all option rights subject to this Agreement shall expire immediately upon the giving to such Grantee of notice of such termination.

(b) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation due to death, or dies within the three month or two year periods referred to in Sections (a) or (c) of this Section 1, the option rights hereunder (as they exist immediately prior to the Grantee’s death) may be exercised by the Grantee’s personal representative only during a period of twelve (12) months thereafter in the case of death and only during a period of two (2) years thereafter in the case of disability, provided, if the Grantee dies within such two-year period, any unexercised option held by the Grantee will, notwithstanding the expiration of such two-year period, continue to be exercisable to the extent to which it was exercisable at the time of death for a period of twelve (12) months from the date of such death, subject in each case to the notice requirements set forth below, or prior in each case to the expiration of the Option Period, whichever shall occur sooner.

(c) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation by reason of disability, the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of two (2) years thereafter, subject to Section 2 below including the notice requirements set forth therein, or prior to the expiration of the Option Period, whichever shall occur sooner.

(d) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation by reason of retirement, the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of five (5) years thereafter, subject to the terms and conditions of this Agreement including the notice requirements and non-compete and forfeiture provisions set forth herein, or prior to the expiration of the Option Period, whichever shall occur sooner.

(e) For purposes of this Agreement, termination for cause shall mean a termination which results from:

(i) a willful and continued failure to perform the required duties of the Grantee’s position;

(ii) a breach of Grantee’s fiduciary duty to the Corporation;

(iii)

an act of willful or gross misconduct, whether or not such act is the basis for a determination by Company pursuant to 3(c) or (d) below that Grantee has engaged in misconduct or acts contrary to the Corporation; or

(iv)

a conviction or guilty plea to a felony or to a misdemeanor involving an act or acts of fraud, theft or embezzlement.

The Corporation’s determination of whether a termination was for cause shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

2.  Method of Exercise of this Option. This Option may be exercised in the manner hereinafter prescribed, in whole or in part, at any time or from time to time, during the Option Period as follows.

(a) One third of the Shares hereby optioned at any time after one year from the date hereof,

(b) One third of the Shares hereby optioned at any time two years from the date hereof, and

(c) the balance of the Shares hereby optioned at any time after three years from the date hereof. This Option shall not be exercisable prior to the expiration of one year from the date of grant, except as otherwise specified in the Plan. All purchases hereunder must be completed within the time periods prescribed herein for the exercise thereof.

(d) Notwithstanding Sections (a), (b), and (c) of this Section 2 if the Grantee ceases to be an employee of the Corporation by reason of death, disability or retirement, this Option (to the extent valid and outstanding as of the date such Grantee ceases to be an employee) if not then exercisable shall become fully exercisable to the full extent of the original grant; provided, however, that if such date on which such Grantee ceases to be an employee is within six months of the date of grant of a particular Stock Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b) of the Exchange Act this Option shall not become fully exercisable until six months and one day after such date of grant.

On or before the expiration of the Option Period specified herein, written notice of the exercise of this Option with respect to all or a part of the Common Stock hereby optioned may be mailed or delivered to the Corporation by the Grantee in such form as the Corporation may require, properly completed and among other things stating the number of Shares of Common Stock with respect to which the Option is being exercised, and specifying the method of payment for such Common Stock. The notice must be mailed or delivered prior to the expiration of this Option.

Before any stock certificates shall be issued or book entry made reflecting the transfer of shares to Grantee, the entire purchase price of the Common Stock purchased shall be paid to the Corporation. Certificates will be issued to the purchaser, or book entry made, as soon as practicable thereafter. Failure to pay the purchase price for any Common Stock within the time specified in said notice shall result in forfeiture of the Grantee’s right to purchase the Common Stock at a later date and the number of shares of Common Stock which may thereafter be purchased hereunder shall be reduced accordingly.

The purchase price may be paid either entirely in cash or in whole or in part with unrestricted Common Stock already owned by the Grantee. If the Grantee elects to pay the purchase price entirely in cash, he will be notified of the purchase price by the Corporation. If the Grantee elects to pay the purchase price either substantially all with Common Stock or partly with Common Stock and the balance in cash, he will be notified by the Corporation of the fair market value of the Common Stock on the exercise date and the amount of Common Stock or cash payable. Within five business days after the exercise date, the Grantee shall deliver to the Corporation either cash or Common Stock certificates, in negotiable form, at least equal in value to the purchase price, or that portion thereof to be paid for with Common Stock, together with cash sufficient to pay the full purchase price. Only full Shares of Common Stock shall be utilized for payment purposes.

To the extent permissible under applicable tax, securities, and other laws, the Corporation may, in its sole discretion, permit Grantee to satisfy a tax withholding requirement by surrendering Shares, including Shares to which Grantee is entitled as a result of the exercise of this Option, in such manner as the Corporation shall choose in its discretion, to satisfy such requirement.

3.  Forfeiture and Repayment Provisions. Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(a)  Certification. The right to exercise this Option shall be conditional upon certification by the Grantee at time of exercise that the Grantee has read and understands the forfeiture and repayment provisions set forth in this Section 3, that the Grantee has not engaged in any misconduct or acts contrary to the Corporation as described below, and that Grantee has no intent to leave employment with the Corporation or any of its Affiliates for the purpose of engaging in any activity or providing any services which are contrary to the spirit and intent of Section 3(b).

(b)  Non-Compete. Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(i) In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, the Grantee, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates, in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Grantee, as a consequence of the Grantee’s employment with the Corporation or one of its Affiliates, to be in development):

(1) with respect to which the Grantee’s work has been directly concerned at any time during the two (2) years preceding termination of employment with the Corporation or one of its Affiliates, or

(2) with respect to which during that period of time the Grantee, as a consequence of the Grantee’s job performance and duties, acquired knowledge of trade secrets or other confidential information of the Corporation or its Affiliates.

(ii) For purposes of the provisions of Section 3(b), it shall be conclusively presumed that the Grantee has knowledge of information he or she was directly exposed to through actual receipt or review of memos or documents containing such information, or through actual attendance at meetings at which such information was discussed or disclosed.

(iii) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Grantee engages in any conduct agreed to be avoided pursuant to the provisions of Section 3(b) at any time within the two (2) years following the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates.

(iv) If, at any time within two (2) years after the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates, Grantee engages in any conduct agreed to be avoided pursuant to the provisions of Section 3(b), then any gain (without regard to tax effects) realized by Grantee from the exercise of this Option, in whole or in part, shall be paid by Grantee to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation hereunder.

(c)  Misconduct. Unless a Change in Control shall have occurred after the date hereof:

(i) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Corporation reasonably determines that during the Grantee’s employment with the Corporation or any of its Affiliates:

(1) Grantee knowingly participated in misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material violation of any code of ethics of the Corporation applicable to the Grantee or of the Always Honest compliance program or similar program of the Corporation; or

(2) Grantee was aware of and failed to report, as required by any code of ethics of the Corporation applicable to the Grantee or by the Always Honest compliance program or similar program of the Corporation, misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc.or any of its Affiliates or misconduct which represents a material knowing violation of any code of ethics of the Corporation applicable to the Grantee or of the Always Honest compliance program or similar program of the Corporation.

(ii) If, at any time after the Grantee exercises this Option in whole or in part, the Corporation reasonably determines that the provisions of Section 3(c) applies to the Grantee, then any gain (without regard to tax effects) realized by the Grantee from such exercise shall be paid by Grantee to the Corporation. The Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to the Grantee to the extent of the amounts the Grantee owes the Corporation under this Section 3.

(d) Acts Contrary to Corporation. Unless a Change in Control shall have occurred after the date hereof:

(i) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Corporation reasonably determines that Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation.

(ii) If, at any time within two (2) years after the Grantee exercises this Option in whole or in part, the Corporation reasonably determines that Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation, then any gain (without regard to tax effects) realized by the Grantee from such exercise shall be paid by Grantee to the Corporation. The Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to the Grantee to the extent of the amounts the Grantee owes the Corporation under this Section 3.

(e) The Corporation’s reasonable determination required under Sections 3(c)(i) and (ii) and 3(d)(i) and (ii) shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

4.  Non-Transferability of this Option. This Option may not be assigned, encumbered or transferred, in whole or in part, except by the Grantee’s will or in accordance with the applicable laws of descent and distribution or as otherwise provided or permitted under the Plan, except that a Grantee holding a Non-Qualified Stock Option may designate as the transferee of any such Option any member of such Grantee’s “Immediate Family"(as defined in Rule 16a, as promulgated by the Commission under the Exchange Act) or to a trust whose beneficiaries are members of such Grantee’s Immediate Family, without payment of consideration, to have the power to exercise such Option, and be subject to all the conditions of such Option prior to such designation, such power to exercise to become effective only in the event that such Grantee shall die prior to exercising such Option.

5.  Adjustments for Changes in Capitalization of Corporation. The Common Stock covered by this Option is, at the option of the Corporation, either authorized but unissued or reacquired Common Stock. In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, extraordinary distribution with respect to the Common Stock or other change in corporate structure affecting the Common Stock during the Option Period, the number of Shares of Common Stock which may thereafter be purchased pursuant to this Option and the purchase price per share, shall be appropriately adjusted, or other appropriate substitutions shall be made, and the determination of the Board of Directors of the Corporation, or the Human Resources Committee of the Board of Directors, as the case may be, as to any such adjustments shall be final, conclusive and binding upon the Grantee.

6.  Effect of Change in Control.

(a) For purposes of this Agreement, a Change in Control shall mean any of the following events:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

(b) In the event of a Change in Control, this Option (to the extent outstanding as of the date such Change in Control is determined to have occurred) if not then exercisable and vested shall become fully exercisable and vested to the full extent of the original grant.

(c) For purposes of this Agreement, “Change in Control Price” shall mean the higher of (1) the highest reported sales price, regular way, of a share of Stock in any transaction reported on the New York Stock Exchange Composite Tape or other national exchange on which such shares are listed or on The NASDAQ Stock Market during the 60-day period prior to and including the date of a Change in Control or (2) if the Change in Control is the result of a tender or exchange offer or a Corporate Transaction, the highest price per share of Stock paid in such tender or exchange offer or Corporate Transaction; provided, however, that in the case of Incentive Stock Options and Stock Appreciation Rights relating to Incentive Stock Options, the Change in Control Price will be in all cases the Fair Market Value of the Stock on the date such Incentive Stock Option or Stock Appreciation Right is exercised. To the extent that the consideration paid in any such transaction described above consists all or in part of securities or other non-cash consideration, the value of such securities or other non-cash consideration will be determined in the sole discretion of the Board.

(d) Notwithstanding any other provision of the Plan, during the 60-day period from and after a Change in Control (Exercise Period), the Grantee shall have the right, whether or not this Option is fully exercisable and in lieu of the payment of the exercise price for the Shares of Common Stock being purchased under the Option and by giving notice to the Corporation, to elect (within the Exercise Period) to surrender all or part of the Option to the Corporation and to receive cash, within 30 days of such notice, in an amount equal to the amount by which the Change in Control Price per share of Common Stock on the date of such election shall exceed the exercise price per share of Common Stock under the Option (the Spread) multiplied by the number of Shares of Common Stock granted under the Option as to which the right granted hereunder shall have been exercised; provided, however, that if the Change in Control is within six months of the date of grant of a particular Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b) of the Securities Exchange Act of 1934 no such election shall be made by such Grantee with respect to such Option prior to six months from the date of grant. Notwithstanding any other provision hereof, if the end of such 60-day period from and after a Change in Control is within six months of the date of grant of an Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b), such Option shall be canceled in exchange for a cash payment to the Grantee, effected on the day which is six months and one day after the date of grant of such Option, equal to the Spread multiplied by the number of Shares of Common Stock granted under the Option.

7.  Plan and Plan Interpretations as Controlling. This Option and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Board may amend the Plan, and that the Committee shall administer the Plan. The Grantee, by acceptance of this Option, agrees to be bound by said Plan and such Board and Committee actions.

8.  Termination of the Plan; No Right to Future Grants. By entering into this Non-Qualified Stock Option Agreement, the Grantee acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of an Option is a one-time benefit which does not create any contractual or other right to receive future grants of Options, or benefits in lieu of Options; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Option shall be granted, the number of Shares subject to each Option, the Option price, and the time or times when each Option shall be exercisable, will be at the sole discretion of the Corporation; (d) that the Grantee’s participation in the Plan shall not create a right to further employment with the Grantee’s employer and shall not interfere with the ability of the Grantee’s employer to terminate the Grantee’s employment relationship at any time with or without cause; (e) that the Grantee’s participation in the Plan is voluntary; (f) that the value of the Options is an extraordinary item of compensation which is outside the scope of the Grantee’s employment contract, if any; (g) that the Option is not part of normal and expected compensation for purposes of calculating any severance, resignation, bonuses, pension or retirement benefits or similar payments; (h) that the right to purchase Common Stock ceases upon termination of employment for any reason except as may otherwise be explicitly provided in the Plan or this Option Agreement; (i) that the future value of the Shares is unknown and cannot be predicted with certainty; (j) that if the underlying Shares do not increase in value, the Option will have no value; and (k) the foregoing terms and conditions apply in full with respect to any prior Option grants to Grantee.

9.  Governing Law. This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Options to purchase shares of Common Stock of the Corporation may not be exercised whenever such exercise or the issuance of any of the optioned Shares would be contrary to law or the regulations of any governmental authority having jurisdiction.

MONEYGRAM INTERNATIONAL, INC.
2005 OMNIBUS INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT

As Adopted August 17, 2005

(RS — US)

This Restricted Stock Agreement is between MoneyGram International, Inc., a Delaware corporation (Corporation) and the person (Grantee) named in the accompanying Notice of Restricted Stock Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

1.  Share Award. The Corporation hereby awards the Grantee the shares (Shares) of Common Stock, par value $0.01 per share (Common Stock) of the Corporation specified in the Notice, pursuant to the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan), and upon the terms and conditions, and subject to the restrictions therein and hereinafter set forth.

2.  Restrictions on Transfer and Restriction Period. During the period commencing on the effective date hereof (Commencement Date) and terminating 3 years thereafter (Restriction Period), the Shares may not be sold, assigned, transferred, pledged, or otherwise encumbered by the Grantee, except as hereinafter provided. The Restriction Period shall lapse and full ownership of Shares will vest at the end of the Restriction Period, subject to forfeiture pursuant to paragraph 3.

The Board of Directors (Board) and the Human Resources Committee of the Board of Directors (Committee) shall have authority, as specified by the Plan, including the authority to accelerate the time at which any or all of the restrictions shall lapse with respect to any Shares, prior to the expiration of the Restriction Period with respect thereto, or to remove any or all of such restrictions, whenever it may determine that such action is appropriate by reason of change in applicable tax or other law, or other change in circumstances.

3.  Forfeiture and Repayment Provisions.

(a)  Termination of Employment. Except as provided in this paragraph 3 and in paragraph 8 below or as otherwise may be determined by the Board, if the Grantee ceases to be an employee of the Corporation or any of its Affiliates for any reason, all Shares which at the time of such termination of employment are subject to the restrictions imposed by paragraph 2 above shall upon such termination of employment be forfeited and returned to the Corporation. Except as otherwise specifically determined by the Human Resources Committee in its absolute discretion on a case by case basis, if the Grantee is terminated by the Corporation or any of its Affiliates for any reason other than for cause, or if the Grantee ceases to be an employee of the Corporation or any of its Affiliates by reason of death or total or partial disability, full ownership of the Shares will occur to the extent not previously earned, upon lapse of the Restriction Period as set forth in paragraph 2. If the Grantee ceases to be an employee of the Corporation or any of its Affiliates by reason of normal or early retirement, full ownership of the Shares will occur upon lapse of the Restriction Period as set forth in paragraph 2 and dividends will be paid through such period, in each case on a pro-rata basis, calculated based on the percentage of time such Grantee was employed by the Corporation or any of its Affiliates from the Commencement Date through the date the Grantee ceases to be an employee of the Corporation or any of its Affiliates.

(b) For purposes of this Agreement, termination for cause shall mean a termination which results from:

(i) a willful and continued failure to perform the required duties of the Grantee’s position;

(ii)

a breach of Grantee’s fiduciary duty to the Corporation;

(iii)

an act of willful or gross misconduct, whether or not such act is the basis for a determination by Company pursuant to 3(d) or (e) below that Grantee has engaged in misconduct or acts contrary to the Corporation; or

(iv)

a conviction or guilty plea to a felony or to a misdemeanor involving an act or acts of fraud, theft or embezzlement.

The Corporation’s determination of whether a termination was for cause shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

(c)  Non-Compete. Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(i) In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, Grantee, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates, in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Grantee, as a consequence of Grantee’s employment with the Corporation or one of its Affiliates, to be in development):

(1) with respect to which Grantee’s work has been directly concerned at any time during the two (2) years preceding termination of employment with the Corporation or one of its Affiliates, or

(2) with respect to which during that period of time Grantee, as a consequence of Grantee’s job performance and duties, acquired knowledge of trade secrets or other confidential information of the Corporation or its Affiliates.

(ii) For purposes of the provisions of paragraph 3(b), it shall be conclusively presumed that Grantee has knowledge of information he or she was directly exposed to through actual receipt or review of memos or documents containing such information, or through actual attendance at meetings at which such information was discussed or disclosed.

(iii) All Shares subject to the restrictions imposed by paragraph 2 above shall be forfeited and returned to the Corporation, if Grantee engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b) at any time within two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates.

(iv) If, at any time within two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates, Grantee engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b), then all consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of all Shares which vest during the two (2) year period prior to Grantee’s termination from employment shall be paid by Grantee to the Corporation, or such Shares shall be returned to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation or its Affiliates hereunder.

(d)  Misconduct. Unless a Change in Control shall have occurred after the date hereof:

(i) All consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of the Shares shall be paid by Grantee to the Corporation or such Shares shall be returned to the Corporation, if the Corporation reasonably determines that during Grantee’s employment with the Corporation or any of its Affiliates:

(1) Grantee knowingly participated in misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material violation of any code of ethics of the Corporation applicable to Grantee or of the Always Honest compliance program or similar program of the Corporation or its Affiliates; or

(2) Grantee was aware of and failed to report, as required by any code of ethics of the Corporation applicable to Grantee or by the Always Honest compliance program or similar program of the Corporation, misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material knowing violation of any code of ethics of the Corporation applicable to Grantee or of the Always Honest compliance program or similar program of the Corporation or its Affiliates.

(ii) Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation under this paragraph 3(c).

(e)  Acts Contrary to Corporation. Unless a Change in Control shall have occurred after the date hereof, if the Corporation reasonably determines that at any time within two (2) years after the lapse of the Restriction Period Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation, then all consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of all Shares which vest during the two (2) year period prior to the Corporation’s determination shall be paid by Grantee to the Corporation, or such Shares shall be returned to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation under this paragraph 3(d).

(f) The Corporation’s reasonable determination required under Sections 3(c)(i) and 3(d) shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

4.  Certificates for the Shares. The Corporation shall issue a certificate in respect of the Shares or shall direct the Corporation’s transfer agent to record ownership in respect of the Shares in the Corporation’s stock ledger in the name of the Grantee, the number of Shares of which shall equal the amount of the award specified herein, and shall prohibit the transfer of such Shares by the Grantee until the expiration of the restrictions set forth in paragraph 2 above. In the alternative, the Corporation may, at its option, issue the shares in book entry. The certificate or record of ownership or book entry shall bear the following legend:

The transferability of the Shares of stock represented hereby are subject to the terms and conditions (including forfeiture) contained in the MoneyGram International, Inc. 2005 Omnibus Incentive Plan and an Agreement entered into between the registered owner and MoneyGram International, Inc. Copies of such Plan and Agreement are on file with the Vice President-General Counsel of MoneyGram International, Inc., 1550 Utica Avenue South, Minneapolis, MN 55416.

The Grantee further agrees that simultaneously with his or her acceptance of this Agreement, he or she shall execute a stock power covering such award endorsed in blank and that he or she shall promptly deliver such stock power to the Corporation.

5.  Grantee’s Rights. Except as otherwise provided herein, the Grantee, as owner of the Shares, shall have all rights of a shareholder, including, but not limited to, the right to receive all dividends paid on the Shares and the right to vote the Shares.

6.  Expiration of Restriction Period. Upon the lapse or expiration of the Restriction Period with respect to any Shares, the Corporation shall redeliver to the Grantee the certificate in respect of such Shares (reduced appropriately in number in the event of early or normal retirement) and the related stock power held by the Corporation pursuant to paragraph 4 above, or shall, if the Shares are held in book entry form, cause the removal of the restrictive legend associated with such Shares. The Shares as to which the Restriction Period shall have lapsed or expired and which are represented by such certificate or held in book entry form shall be free of the restrictions referred to in paragraph 2 above and shall not bear thereafter the legend provided for in paragraph 4 above.

To the extent permissible under applicable tax, securities, and other laws, the Corporation may, in its sole discretion, permit Grantee to satisfy a tax withholding requirement by directing the Corporation to apply Shares to which Grantee is entitled as a result of termination of the Restricted Period with respect to any Shares of Restricted Stock, in such manner as the Corporation shall choose in its discretion to satisfy such requirement.

7.  Adjustments for Changes in Capitalization of Corporation. In the event of a change in the Common Stock through stock dividends, stock splits, recapitalization or other changes in the corporate structure of the Corporation during the Restriction Period, the number of Shares of Common Stock subject to restrictions as set forth herein shall be appropriately adjusted and the determination of the Board of Directors of the Corporation as to any such adjustments shall be final, conclusive and binding upon the Grantee. Any Shares of Common Stock or other securities received, as a result of the foregoing, by the Grantee with respect to Shares subject to the restrictions contained in paragraph 2 above also shall be subject to such restrictions and the certificate(s) or other instruments representing or evidencing such Shares or securities shall be legended and deposited with the Corporation, along with an executed stock power, in the manner provided in paragraph 4 above.

8.  Effect of Change in Control. In the event of a Change in Control (as defined below), the restrictions applicable to any Shares subject to this Agreement shall lapse, and such Shares shall be free of all restrictions and become fully vested and transferable to the full extent of the original grant.

(a) For purposes of this Agreement, a Change in Control shall mean:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

9.  Plan and Plan Interpretations as Controlling. The Shares hereby awarded and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Corporation’s Board of Directors or a Committee thereof may from time to time make changes therein, interpret it and establish regulations for the administration thereof. The Grantee, by acceptance of this Agreement, agrees to be bound by said Plan and such Board and Committee actions.

10.  Termination of the Plan; No Right to Future Grants. By entering into this Restricted Stock Agreement, the Grantee acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of Restricted Stock is a one-time benefit which does not create any contractual or other right to receive future grants of Restricted Stock, or benefits in lieu of Restricted Stock; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Restricted Stock shall be granted, the number of Shares, the restriction period, and the time or times when any such grants shall vest, will be at the sole discretion of the Corporation; (d) that the Grantee’s participation in the Plan shall not create a right to further employment with the Grantee’s employer and shall not interfere with the ability of the Grantee’s employer to terminate the Grantee’s employment relationship at any time with or without cause; (e) that the Grantee’s participation in the Plan is voluntary; (f) that the value of the Restricted Stock is an extraordinary item of compensation which is outside the scope of the Grantee’s employment contract, if any; (g) that the Restricted Stock is not part of normal and expected compensation for purposes of calculating any severance, resignation, bonuses, pension or retirement benefits or similar payments; (h) that the right to any unvested portion of Restricted Stock ceases upon termination of employment for any reason except as may otherwise be explicitly provided in the Plan or this Restricted Stock Agreement; (i) that the future value of the Restricted Stock is unknown and cannot be predicted with certainty; and (j) the foregoing terms and conditions apply in full with respect to any prior grants of Restricted Stock to Grantee.

11.  Governing Law. This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Shares may not be issued hereunder, or redelivered, whenever such issuance or redelivery would be contrary to law or the regulations of any governmental authority having jurisdiction.

MONEYGRAM INTERNATIONAL, INC.
2005 OMNIBUS INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT

As Adopted August 17, 2005

(NQSO — UK)

This Non-Qualified Stock Option Agreement is between MoneyGram International, Inc., a Delaware corporation (Corporation) and the person (Grantee) named in the accompanying Notice of Stock Option Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

The Corporation desires to provide Grantee with an opportunity to purchase shares of the Corporation’s common stock, par value $0.01 (Common Stock), as provided in this Agreement, in order to carry out the purpose of the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan).

The Corporation hereby grants to Grantee, effective as of the Grant Date, the right and option (Option) to purchase all or any part of the aggregate number of shares of Common Stock set forth in the Notice, on the terms and conditions contained in this Agreement and in accordance with the terms of the Plan. The Option is not intended to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the Code). The per share purchase price of the shares subject to the Option shall be the purchase price per share set forth in the Notice.

1.  Option Period and Termination of Employment of Grantee . The period during which this Option may be exercised (Option Period) is the period beginning on the date hereof and ending ten (10) years from such date, subject to Section 2 below, and during this period this Option may be exercised only by the Grantee personally and while an employee of the Corporation or a subsidiary or division thereof (Affiliate), except that:

(a) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation for any reason, excluding death, disability, retirement and termination of employment for Cause (as defined in the Plan), the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of three (3) months thereafter, subject to the notice requirements and forfeiture provisions set forth below, or prior to the expiration of the Option Period, whichever shall occur sooner. If Grantee is an employee and is terminated for cause (as defined below) all the option rights hereunder shall expire immediately upon the giving to such Grantee of notice of such termination.

(b) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation due to death, or dies within the three month or two year periods referred to in Sections (a) or (c) of this Section 1, the option rights hereunder (as they exist immediately prior to the Grantee’s death) may be exercised by the Grantee’s personal representative only during a period of twelve (12) months thereafter in the case of death and only during a period of two (2) years thereafter in the case of disability, provided, if the Grantee dies within such two year period, any unexercised option held by the Grantee will, notwithstanding the expiration of such two year period, continue to be exercisable to the extent to which it was exercisable at the time of death for a period of twelve (12) months from the date of such death, subject in each case to the notice requirements set forth below, or prior in each case to the expiration of the Option Period, whichever shall occur sooner.

(c) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation by reason of disability, the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of two (2) years thereafter, subject to Section 2 below including the notice requirements set forth therein, or prior to the expiration of the Option Period, whichever shall occur sooner.

(d) If the Grantee ceases to be an employee of the Corporation or any Affiliate of the Corporation by reason of retirement, the option rights hereunder (as they exist on the day the Grantee ceases to be an employee) may be exercised only within a period of five (5) years thereafter, subject to the terms and conditions of this Agreement, including the notice requirements and non-compete and forfeiture provisions set forth herein, or prior to the expiration of the Option Period, whichever shall occur sooner.

(e) For purposes of this Agreement, termination for cause shall mean a termination which results from:

(i) a willful and continued failure to perform the required duties of the Grantee’s position;

(ii)

a breach of Grantee’s fiduciary duty to the Corporation;

(iii)

an act of willful or gross misconduct, whether or not such act is the basis for a determination by Company pursuant to 3(c) or (d) below that Grantee has engaged in misconduct or acts contrary to the Corporation; or

(iv)

a conviction or guilty plea to a felony or to a misdemeanor involving an act or acts of fraud, theft or embezzlement.

The Corporation’s determination as to whether a termination was for cause shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

2.  Method of Exercise of this Option . This Option may be exercised in the manner hereinafter prescribed, in whole or in part, at any time or from time to time, during the Option Period as follows.

(a) One third of the Shares hereby optioned at any time after one year from the date hereof,

(b) One third of the Shares hereby optioned at any time two years from the date hereof, and

(c) the balance of the Shares hereby optioned at any time after three years from the date hereof. This Option shall not be exercisable prior to the expiration of one year from the date of grant, except as otherwise specified in the Plan. All purchases hereunder must be completed within the time periods prescribed herein for the exercise thereof.

(d) Notwithstanding Sections (a), (b), and (c) of this Section 2 if the Grantee ceases to be an employee of the Corporation or any Affiliate by reason of death, disability or retirement, this Option (to the extent valid and outstanding as of the date such Grantee ceases to be an employee) if not then exercisable shall become fully exercisable to the full extent of the original grant; provided, however, that if such date on which such Grantee ceases to be an employee is within six months of the date of grant of a particular Stock Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b) of the Exchange Act this Option shall not become fully exercisable until six months and one day after such date of grant.

On or before the expiration of the Option Period specified herein, written notice of the exercise of this Option with respect to all or a part of the Common Stock hereby optioned may be mailed or delivered to the Corporation by the Grantee in such form as the Corporation may require, properly completed and among other things stating the number of Shares of Common Stock with respect to which the Option is being exercised, and specifying the method of payment for such Common Stock. The notice must be mailed or delivered prior to the expiration of this Option .

Before any stock certificates shall be issued or book entry made reflecting the transfer of shares to Grantee, the entire purchase price of the Common Stock purchased shall be paid to the Corporation. Certificates will be issued to the purchaser, or book entry made, as soon as practicable thereafter. Failure to pay the purchase price for any Common Stock within the time specified in said notice shall result in forfeiture of the Grantee’s right to purchase the Common Stock at a later date and the number of shares of Common Stock which may thereafter be purchased hereunder shall be reduced accordingly.

The purchase price may be paid either entirely in cash or in whole or in part with unrestricted Common Stock already owned by the Grantee. If the Grantee elects to pay the purchase price entirely in cash, he will be notified of the purchase price by the Corporation. If the Grantee elects to pay the purchase price either substantially all with Common Stock or partly with Common Stock and the balance in cash, he will be notified by the Corporation of the fair market value of the Common Stock on the exercise date and the amount of Common Stock or cash payable. Within five business days after the exercise date, the Grantee shall deliver to the Corporation either cash or Common Stock certificates, in negotiable form, at least equal in value to the purchase price, or that portion thereof to be paid for with Common Stock, together with cash sufficient to pay the full purchase price. Only full Shares of Common Stock shall be utilized for payment purposes.

To the extent permissible under applicable tax, securities, and other laws, the Corporation may, in its sole discretion, permit Grantee to satisfy a tax withholding requirement by surrendering Shares, including Shares to which Grantee is entitled as a result of the exercise of this Option, in such manner as the Corporation shall choose in its discretion, to satisfy such requirement.

3.  Forfeiture and Repayment Provisions . Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(a)  Certification . The right to exercise this Option shall be conditional upon certification by the Grantee at time of exercise that the Grantee has read and understands the forfeiture and repayment provisions set forth in this Section 3, that the Grantee has not engaged in any misconduct or acts contrary to the Corporation as described below, and that Grantee has no intent to leave employment with the Corporation or any of its Affiliates for the purpose of engaging in any activity or providing any services which are contrary to the spirit and intent of Section 3(b).

(b)  Non-Compete . Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(i) In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, the Grantee, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates, in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Grantee, as a consequence of the Grantee’s employment with the Corporation or one of its Affiliates, to be in development):

(1) with respect to which the Grantee’s work has been directly concerned at any time during the two (2) years preceding termination of employment with the Corporation or one of its Affiliates, or

(2) with respect to which during that period of time the Grantee, as a consequence of the Grantee’s job performance and duties, acquired knowledge of trade secrets or other confidential information of the Corporation or its Affiliates.

(ii) For purposes of the provisions of Section 3(b), it shall be conclusively presumed that the Grantee has knowledge of information he or she was directly exposed to through actual receipt or review of memos or documents containing such information, or through actual attendance at meetings at which such information was discussed or disclosed.

(iii) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Grantee engages in any conduct agreed to be avoided pursuant to the provisions of Section 3(b) at any time within the two (2) years following the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates.

(iv) If, at any time within two (2) years after the date of the Grantee’s termination of employment with the Corporation or any of its Affiliates, Grantee engages in any conduct agreed to be avoided pursuant to the provisions of Section 3(b), then any gain (without regard to tax effects) realized by Grantee from the exercise of this Option, in whole or in part, shall be paid by Grantee to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation hereunder.

(c)  Misconduct . Unless a Change in Control shall have occurred after the date hereof:

(i) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Corporation reasonably determines that during the Grantee’s employment with the Corporation or any of its Affiliates:

(1) Grantee knowingly participated in misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material violation of any code of ethics of the Corporation applicable to the Grantee or of the Always Honest compliance program or similar program of the Corporation; or

(2) Grantee was aware of and failed to report, as required by any code of ethics of the Corporation applicable to the Grantee or by the Always Honest compliance program or similar program of the Corporation, misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material knowing violation of any code of ethics of the Corporation applicable to the Grantee or of the Always Honest compliance program or similar program of the Corporation.

(ii) If, at any time after the Grantee exercises this Option in whole or in part, the Corporation reasonably determines that the provisions of Section 3(c) applies to the Grantee, then any gain (without regard to tax effects) realized by the Grantee from such exercise shall be paid by Grantee to the Corporation. The Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to the Grantee to the extent of the amounts the Grantee owes the Corporation under this Section 3.

(d)  Acts Contrary to Corporation . Unless a Change in Control shall have occurred after the date hereof:

(i) The Corporation is authorized to suspend or terminate this Option and any other outstanding stock option or stock appreciation right held by the Grantee prior to or after termination of employment if the Corporation reasonably determines that Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation.

(ii) If, at any time within two (2) years after the Grantee exercises this Option in whole or in part, the Corporation reasonably determines that Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation, then any gain (without regard to tax effects) realized by the Grantee from such exercise shall be paid by Grantee to the Corporation. The Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to the Grantee to the extent of the amounts the Grantee owes the Corporation under this Section 3.

(e) The Corporation’s reasonable determination required under Sections 3(c)(i) and (ii) and 3(d)(i) and (ii) shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

4.  Non-Transferability of this Option . This Option may not be assigned, encumbered or transferred, in whole or in part, except by the Grantee’s will or in accordance with the applicable laws of descent and distribution or as otherwise provided or permitted under the Plan, except that a Grantee holding a Non-Qualified Stock Option may designate as the transferee of any such Option any member of such Grantee’s “Immediate Family"(as defined in Rule 16a, as promulgated by the Commission under the Exchange Act) or to a trust whose beneficiaries are members of such Grantee’s Immediate Family, without payment of consideration, to have the power to exercise such Option, and be subject to all the conditions of such Option prior to such designation, such power to exercise to become effective only in the event that such Grantee shall die prior to exercising such Option.

5.  Adjustments for Changes in Capitalization of Corporation . The Common Stock covered by this Option is, at the option of the Corporation, either authorized but unissued or reacquired Common Stock. In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, extraordinary distribution with respect to the Common Stock or other change in corporate structure affecting the Common Stock during the Option Period, the number of Shares of Common Stock which may thereafter be purchased pursuant to this Option and the purchase price per share, shall be appropriately adjusted, or other appropriate substitutions shall be made, and the determination of the Board of Directors of the Corporation, or the Human Resources Committee of the Board of Directors, as the case may be, as to any such adjustments shall be final, conclusive and binding upon the Grantee.

6.  Effect of Change in Control.

(a) For purposes of this Agreement, a Change in Control shall mean any of the following events:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

(b) In the event of a Change in Control, this Option (to the extent outstanding as of the date such Change in Control is determined to have occurred) if not then exercisable and vested shall become fully exercisable and vested to the full extent of the original grant.

(c) For purposes of this Agreement, “Change in Control Price” shall mean the higher of (1) the highest reported sales price, regular way, of a share of Stock in any transaction reported on the New York Stock Exchange Composite Tape or other national exchange on which such shares are listed or on The Nasdaq Stock Market during the 60-day period prior to and including the date of a Change in Control or (2) if the Change in Control is the result of a tender or exchange offer or a Corporate Transaction, the highest price per share of Stock paid in such tender or exchange offer or Corporate Transaction; provided, however, that in the case of Incentive Stock Options and Stock Appreciation Rights relating to Incentive Stock Options, the Change in Control Price will be in all cases the Fair Market Value of the Stock on the date such Incentive Stock Option or Stock Appreciation Right is exercised. To the extent that the consideration paid in any such transaction described above consists all or in part of securities or other non-cash consideration, the value of such securities or other non-cash consideration will be determined in the sole discretion of the Board.

(d) Notwithstanding any other provision of the Plan, during the 60-day period from and after a Change in Control (Exercise Period), the Grantee shall have the right, whether or not this Option is fully exercisable and in lieu of the payment of the exercise price for the Shares of Common Stock being purchased under the Option and by giving notice to the Corporation, to elect (within the Exercise Period) to surrender all or part of the Option to the Corporation and to receive cash, within 30 days of such notice, in an amount equal to the amount by which the Change in Control Price per share of Common Stock on the date of such election shall exceed the exercise price per share of Common Stock under the Option (the Spread) multiplied by the number of Shares of Common Stock granted under the Option as to which the right granted hereunder shall have been exercised; provided, however, that if the Change in Control is within six months of the date of grant of a particular Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b) of the Securities Exchange Act of 1934 no such election shall be made by such Grantee with respect to such Option prior to six months from the date of grant. Notwithstanding any other provision hereof, if the end of such 60-day period from and after a Change in Control is within six months of the date of grant of an Option held by a Grantee who is an officer or director of the Corporation and is subject to Section 16(b), such Option shall be canceled in exchange for a cash payment to the Grantee, effected on the day which is six months and one day after the date of grant of such Option, equal to the Spread multiplied by the number of Shares of Common Stock granted under the Option.

7.  Plan and Plan Interpretations as Controlling. This Option and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Board may amend the Plan, and that the Committee shall administer the Plan. The Grantee, by acceptance of this Option, agrees to be bound by said Plan and such Board and Committee actions.

8.  Termination of the Plan; No Right to Future Grants. By entering into this Non-Qualified Stock Option Agreement, the Grantee acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of an Option is a one-time benefit which does not create any contractual or other right to receive future grants of Options, or benefits in lieu of Options; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Option shall be granted, the number of Shares subject to each Option, the Option price, and the time or times when each Option shall be exercisable, will be at the sole discretion of the Corporation; (d) that the Grantee’s participation in the Plan shall not create a right to further employment with the Grantee’s employer and shall not interfere with the ability of the Grantee’s employer to terminate the Grantee’s employment relationship at any time with or without cause; (e) that the Grantee’s participation in the Plan is voluntary; (f) that the value of the Options is an extraordinary item of compensation which is outside the scope of the Grantee’s employment contract, if any; (g) that the Option is not part of normal and expected compensation for purposes of calculating any severance, resignation, bonuses, pension or retirement benefits or similar payments; (h) that the right to purchase Common Stock ceases upon termination of employment for any reason except as may otherwise be explicitly provided in the Plan or this Option Agreement; (i) that the future value of the Shares is unknown and cannot be predicted with certainty; (j) that if the underlying Shares do not increase in value, the Option will have no value; and (k) the foregoing terms and conditions apply in full with respect to any prior Option grants to Grantee.

9.  Employee Data Privacy . By entering into the Option Agreement, and as a condition of the grant of the Option, the Grantee consents to the collection, use and transfer of personal data as described in this Section 9. The Grantee understands that the Corporation and its subsidiaries hold certain personal information about the Grantee, including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social/national insurance number, salary, nationality, job title, any Shares of Common Stock or directorships held in the Corporation, details of all Options or other entitlement to Shares of Common Stock awarded, canceled, exercised, vested, unvested or outstanding in the Grantee’s favor, for the purpose of managing and administering the Plan (Data). The Grantee further understands that the Corporation and/or its subsidiaries will transfer Data amongst themselves as necessary for the purposes of implementation, administration and management of the Grantee’s participation in the Plan, and that the Corporation and/or its subsidiaries may each further transfer Data to any third parties assisting the Corporation in the implementation, administration and management of the Plan (Data Recipients). The Grantee understands that these Data Recipients may be located in the Grantee’s country of residence, the European Union, or elsewhere, such as the United States. The Grantee authorizes the Data Recipients to receive, possess, use, retain and transfer Data in electronic or other form, for the purposes of implementing, administering and managing the Grantee’s participation in the Plan, including any transfer of such Data, as may be required for the administration of the Plan and/or the subsequent holding of Shares of Common Stock on the Grantee’s behalf, to a broker or third party with whom the Shares acquired on exercise may be deposited. The Grantee understands that he or she may, at any time, review the Data, require any necessary amendments to it or withdraw the consent herein in writing by contacting the Corporation. The Grantee further understands that withdrawing consent may affect the Grantee’s ability to participate in the Plan.

10.  Governing Law . This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Options to purchase shares of Common Stock of the Corporation may not be exercised whenever such exercise or the issuance of any of the optioned Shares would be contrary to law or the regulations of any governmental authority having jurisdiction.

MONEYGRAM INTERNATIONAL, INC.
2005 OMNIBUS INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT

As Adopted August 17, 2005

(RS — UK)

This Restricted Stock Agreement is between MoneyGram International, Inc., a Delaware corporation (Corporation) and the person (Grantee or Employee) named in the accompanying Notice of Restricted Stock Grant (Notice). This Agreement is effective as of the date of grant set forth in the Notice (Grant Date).

1.  Share Award. The Corporation hereby awards the Grantee the shares (Shares) of Common Stock, par value $0.01 per share (Common Stock) of the Corporation specified in the Notice, pursuant to the MoneyGram International, Inc. 2005 Omnibus Incentive Plan (Plan), and upon the terms and conditions, and subject to the restrictions therein and hereinafter set forth.

2.  Restrictions on Transfer and Restriction Period. During the period commencing on the effective date hereof (Commencement Date) and terminating 3 years thereafter (Restriction Period), the Shares may not be sold, assigned, transferred, pledged, or otherwise encumbered by the Grantee, except as hereinafter provided. The Restriction Period shall lapse and full ownership of Shares will vest at the end of the Restriction Period, subject to forfeiture pursuant to paragraph 3.

The Board of Directors (Board) and the Human Resources Committee of the Board of Directors (Committee) shall have authority, as specified by the Plan, including the authority to accelerate the time at which any or all of the restrictions shall lapse with respect to any Shares, prior to the expiration of the Restriction Period with respect thereto, or to remove any or all of such restrictions, whenever it may determine that such action is appropriate by reason of change in applicable tax or other law, or other change in circumstances.

3.  Forfeiture and Repayment Provisions.

(a)  Termination of Employment. Except as provided in this paragraph 3 and in paragraph 8 below or as otherwise may be determined by the Board, if the Grantee ceases to be an employee of the Corporation or any of its Affiliates for any reason, all Shares which at the time of such termination of employment are subject to the restrictions imposed by paragraph 2 above shall upon such termination of employment be forfeited and returned to the Corporation. Except as otherwise specifically determined by the Human Resources Committee in its absolute discretion on a case by case basis, if the Grantee is terminated by the Corporation or any of its Affiliates for any reason other than for cause or if the Grantee ceases to be an employee of the Corporation or any of its Affiliates by reason of death or total or partial disability, full ownership of the Shares will occur to the extent not previously earned, upon lapse of the Restriction Period as set forth in paragraph 2. If the Grantee ceases to be an employee of the Corporation or any of its Affiliates by reason of normal or early retirement, as defined in the Plan, full ownership of the Shares will occur upon lapse of the Restriction Period as set forth in paragraph 2 and dividends will be paid through such period, in each case on a pro-rata basis, calculated based on the percentage of time such Grantee was employed by the Corporation or any of its Affiliates from the Commencement Date through the date the Grantee ceases to be an employee of the Corporation or any of its Affiliates.

(b) For purposes of this Agreement, termination for cause shall mean a termination which results from:

(i) a willful and continued failure to perform the required duties of the Grantee’s position;

(ii)

a breach of Grantee’s fiduciary duty to the Corporation;

(iii)

an act of willful or gross misconduct, whether or not such act is the basis for a determination by Company pursuant to 3(d) or (e) below that Grantee has engaged in misconduct or acts contrary to the Corporation; or

(iv)

a conviction or guilty plea to a felony or to a misdemeanor involving an act or acts of fraud, theft or embezzlement.

The Corporation’s determination as to whether a termination was for cause shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

(c)  Non-Compete. Unless a Change in Control (as defined below) shall have occurred after the date hereof:

(i) In order to better protect the goodwill of the Corporation and its Affiliates and to prevent the disclosure of the Corporation’s or its Affiliates’ trade secrets and confidential information and thereby help insure the long-term success of the business, Grantee, without prior written consent of the Corporation, will not engage in any activity or provide any services, whether as a director, manager, supervisor, employee, adviser, agent, consultant, owner of more than five (5) percent of any enterprise or otherwise, for a period of two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates, in connection with the manufacture, development, advertising, promotion, design, or sale of any service or product which is the same as or similar to or competitive with any services or products of the Corporation or its Affiliates (including both existing services or products as well as services or products known to the Grantee, as a consequence of Grantee’s employment with the Corporation or one of its Affiliates, to be in development):

(1) with respect to which Grantee’s work has been directly concerned at any time during the two (2) years preceding termination of employment with the Corporation or one of its Affiliates, or

(2) with respect to which during that period of time Grantee, as a consequence of Grantee’s job performance and duties, acquired knowledge of trade secrets or other confidential information of the Corporation or its Affiliates.

(ii) For purposes of the provisions of paragraph 3(b), it shall be conclusively presumed that Grantee has knowledge of information he or she was directly exposed to through actual receipt or review of memos or documents containing such information, or through actual attendance at meetings at which such information was discussed or disclosed.

(iii) All Shares subject to the restrictions imposed by paragraph 2 above shall be forfeited and returned to the Corporation, if Grantee engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b) at any time within two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates.

(iv) If, at any time within two (2) years following the date of Grantee’s termination of employment with the Corporation or any of its Affiliates, Grantee engages in any conduct agreed to be avoided pursuant to the provisions of paragraph 3(b), then all consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of all Shares which vest during the two (2) year period prior to Grantee’s termination from employment shall be paid by Grantee to the Corporation, or such Shares shall be returned to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation hereunder.

(d)  Misconduct. Unless a Change in Control shall have occurred after the date hereof:

(i) All consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of the Shares shall be paid by Grantee to the Corporation or such Shares shall be returned to the Corporation, if the Corporation reasonably determines that during Grantee’s employment with the Corporation or any of its Affiliates:

(1) Grantee knowingly participated in misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material violation of any code of ethics of the Corporation applicable to Grantee or of the Always Honest compliance program or similar program of the Corporation or any of its Affiliates; or

(2) Grantee was aware of and failed to report, as required by any code of ethics of the Corporation applicable to Grantee or by the Always Honest compliance program or similar program of the Corporation, misconduct that causes a misstatement of the financial statements of MoneyGram International, Inc. or any of its Affiliates or misconduct which represents a material knowing violation of any code of ethics of the Corporation applicable to Grantee or of the Always Honest compliance program or similar program of the Corporation or any of its Affiliates.

(ii) Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation under this paragraph 3(c).

(e)  Acts Contrary to Corporation. Unless a Change in Control shall have occurred after the date hereof, if the Corporation reasonably determines that at any time within two (2) years after the lapse of the Restriction Period Grantee has acted significantly contrary to the best interests of the Corporation, including, but not limited to, any direct or indirect intentional disparagement of the Corporation, then all consideration (without regard to tax effects) received directly or indirectly by Grantee from the sale or other disposition of all Shares which vest during the two (2) year period prior to the Corporation’s determination shall be paid by Grantee to the Corporation, or such Shares shall be returned to the Corporation. Grantee consents to the deduction from any amounts the Corporation or any of its Affiliates owes to Grantee to the extent of the amounts Grantee owes the Corporation under this paragraph 3(d).

(f) The Corporation’s reasonable determination required under Sections 3(c)(i) and 3(d) shall be made by the Human Resources Committee of the Corporation’s Board of Directors, in the case of executive officers of the Corporation, and by the Chief Executive Officer and General Counsel of the Corporation, in the case of all other officers and employees.

4.  Certificates for the Shares. The Corporation shall issue a certificate in respect of the Shares or shall direct the Corporation’s transfer agent to record ownership in respect of the Shares in the Corporation’s stock ledger in the name of the Grantee, the number of Shares of which shall equal the amount of the award specified herein, and shall prohibit the transfer of such Shares by the Grantee until the expiration of the restrictions set forth in paragraph 2 above. In the alternative, the Corporation may, at its option, issue the shares in book entry. The certificate or record of ownership or book entry shall bear the following legend:

The transferability of the Shares of stock represented hereby are subject to the terms and conditions (including forfeiture) contained in the MoneyGram International, Inc. 2005 Omnibus Incentive Plan and an Agreement entered into between the registered owner and MoneyGram International, Inc. Copies of such Plan and Agreement are on file with the Vice President-General Counsel of MoneyGram International, Inc., 1550 Utica Avenue South, Minneapolis, MN 55416.

The Grantee further agrees that simultaneously with his or her acceptance of this Agreement, he or she shall execute a stock power covering such award endorsed in blank and that he or she shall promptly deliver such stock power to the Corporation.

5.  Grantee’s Rights. Except as otherwise provided herein, the Grantee, as owner of the Shares, shall have all rights of a shareholder, including, but not limited to, the right to receive all dividends paid on the Shares and the right to vote the Shares.

6.  Expiration of Restriction Period. Upon the lapse or expiration of the Restriction Period with respect to any Shares, the Corporation shall redeliver to the Grantee the certificate in respect of such Shares (reduced appropriately in number in the event of early or normal retirement) and the related stock power held by the Corporation pursuant to paragraph 4 above, or shall, if the Shares are held in book entry form, cause the removal of the restrictive legend from such Shares. The Shares as to which the Restriction Period shall have lapsed or expired and which are represented by such certificate or held in book entry form shall be free of the restrictions referred to in paragraph 2 above and shall not bear thereafter the legend provided for in paragraph 4 above.

To the extent permissible under applicable tax, securities, and other laws, the Corporation may, in its sole discretion, permit Grantee to satisfy a tax withholding requirement by directing the Corporation to apply Shares to which Grantee is entitled as a result of termination of the Restricted Period with respect to any Shares of Restricted Stock, in such manner as the Corporation shall choose in its discretion to satisfy such requirement.

7.  Adjustments for Changes in Capitalization of Corporation. In the event of a change in the Common Stock through stock dividends, stock splits, recapitalization or other changes in the corporate structure of the Corporation during the Restriction Period, the number of Shares of Common Stock subject to restrictions as set forth herein shall be appropriately adjusted and the determination of the Board of Directors of the Corporation as to any such adjustments shall be final, conclusive and binding upon the Grantee. Any Shares of Common Stock or other securities received, as a result of the foregoing, by the Grantee with respect to Shares subject to the restrictions contained in paragraph 2 above also shall be subject to such restrictions and the certificate(s) or other instruments representing or evidencing such Shares or securities shall be legended and deposited with the Corporation, along with an executed stock power, in the manner provided in paragraph 4 above.

8.  Effect of Change in Control. In the event of a Change in Control (as defined below), the restrictions applicable to any Shares subject to this Agreement shall lapse, and such Shares shall be free of all restrictions and become fully vested and transferable to the full extent of the original grant.

(a) For purposes of this Agreement, a Change in Control shall mean:

(i) An acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either: (1) the then outstanding shares of Common Stock of the Corporation (the “Outstanding Corporation Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Corporation Voting Securities”); excluding, however the following:

(1) any acquisition directly from the Corporation or any entity controlled by the Corporation other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Corporation or any entity controlled by the Corporation,

(2) any acquisition by the Corporation, or any entity controlled by the Corporation,

(3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any entity controlled by the Corporation or

(4) any acquisition pursuant to a transaction which complies with clauses (1), (2) and (3) of Section (iii) below; or

(ii) A change in the composition of the Board such that the individuals who, as of the effective date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided , however , for purposes of this Section (b) that any individual, who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), shall be considered as though such individual were a member of the Incumbent Board; but provided further , that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board, or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Corporate Transaction”) excluding, however, such a Corporate Transaction pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities immediately prior to such Corporate Transaction (the “Prior Stockholders”) beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding  shares of Common Stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Corporation or other entity resulting from such Corporate Transaction (including, without limitation, a corporation or other entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, as the case may be, (2) no Person (other than the Corporation or any entity controlled by the Corporation, any employee benefit plan (or related trust) of the Corporation or any entity controlled by the Corporation or such corporation or other entity resulting from such Corporate Transaction) will beneficially own, directly or indirectly, 20% or more of, respectively, the outstanding shares of Common Stock of the Corporation or other entity resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of the Corporation or such other entity entitled to vote generally in the election of directors except to the extent that such ownership existed prior to the Corporate Transaction and (3) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; and further excluding any disposition of all or substantially all of the assets of the Corporation pursuant to a spin-off, split-up or similar transaction (a “Spin-off”) if, immediately following the Spin-off, the Prior Stockholders beneficially own, directly or indirectly, more than 80% of the outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of both entities resulting from such transaction, in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Corporation Common Stock and Outstanding Corporation Voting Securities, respectively; provided , that if another Corporate Transaction involving the Corporation occurs in connection with or following a Spin-off, such Corporate Transaction shall be analyzed separately for purposes of determining whether a Change in Control has occurred; or

(iv) The approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

9.  Plan and Plan Interpretations as Controlling. The Shares hereby awarded and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Plan, which are controlling. The Plan provides that the Corporation’s Board of Directors or a Committee thereof may from time to time make changes therein, interpret it and establish regulations for the administration thereof. The Grantee, by acceptance of this Agreement, agrees to be bound by said Plan and such Board and Committee actions.

10.  Employee Data Privacy. By entering into the Restricted Stock Agreement, and as a condition of the grant of restricted stock, the Grantee consents to the collection, use and transfer of personal data as described in this Section 10. The Grantee understands that the Corporation and its subsidiaries hold certain personal information about the Grantee, including, but not limited to, the Grantee’s name, home address and telephone number, date of birth, social/national insurance number, salary, nationality, job title, any Shares of Common Stock or directorships held in the Corporation, details of all Options or other entitlement to Shares of Common Stock awarded, canceled, exercised, vested, unvested or outstanding in the Grantee’s favor, for the purpose of managing and administering the Plan (Data). The Grantee further understands that the Corporation and/or its subsidiaries will transfer Data amongst themselves as necessary for the purposes of implementation, administration and management of the Grantee’s participation in the Plan, and that the Corporation and/or its subsidiaries may each further transfer Data to any third parties assisting the Corporation in the implementation, administration and management of the Plan (Data Recipients). The Grantee understands that these Data Recipients may be located in the Grantee’s country of residence, the European Union, or elsewhere, such as the United States. The Grantee authorizes the Data Recipients to receive, possess, use, retain and transfer Data in electronic or other form, for the purposes of implementing, administering and managing the Grantee’s participation in the Plan, including any transfer of such Data, as may be required for the administration of the Plan and/or the subsequent holding of Shares of Common Stock on the Grantee’s behalf, to a broker or third party with whom the Shares acquired on exercise may be deposited. The Grantee understands that he or she may, at any time, review the Data, require any necessary amendments to it or withdraw the consent herein in writing by contacting the Corporation. The Grantee further understands that withdrawing consent may affect the Grantee’s ability to participate in the Plan.

11.  Termination of the Plan; No Right to Future Grants. By entering into this Restricted Stock Agreement, the Grantee acknowledges: (a) that the Plan is discretionary in nature and may be suspended or terminated by the Corporation at any time; (b) that each grant of Restricted Stock is a one-time benefit which does not create any contractual or other right to receive future grants of Restricted Stock, or benefits in lieu of Restricted Stock; (c) that all determinations with respect to any such future grants, including, but not limited to, the times when the Restricted Stock shall be granted, the number of Shares, the restriction period, and the time or times when any such grants shall vest, will be at the sole discretion of the Corporation; (d) that the Grantee’s participation in the Plan shall not create a right to further employment with the Grantee’s employer and shall not interfere with the ability of the Grantee’s employer to terminate the Grantee’s employment relationship at any time with or without cause; (e) that the Grantee’s participation in the Plan is voluntary; (f) that the value of the Restricted Stock is an extraordinary item of compensation which is outside the scope of the Grantee’s employment contract, if any; (g) that the Restricted Stock is not part of normal and expected compensation for purposes of calculating any severance, resignation, bonuses, pension or retirement benefits or similar payments; (h) that the right to any unvested portion of Restricted Stock ceases upon termination of employment for any reason except as may otherwise be explicitly provided in the Plan or this Restricted Stock Agreement; (i) that the future value of the Restricted Stock is unknown and cannot be predicted with certainty; and (j) the foregoing terms and conditions apply in full with respect to any prior grants of Restricted Stock to Grantee.

12.  Governing Law. This agreement is governed by and is to be construed and enforced in accordance with the laws of Delaware. Shares may not be issued hereunder, or redelivered, whenever such issuance or redelivery would be contrary to law or the regulations of any governmental authority having jurisdiction.

EXHIBIT 99.10

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Contact: Tim Gallaher
Investor Relations
952-591-3840
ir@moneygram.com

MoneyGram International, Inc. Announces New Board Member

MINNEAPOLIS, MINN., August 18, 2005 – MoneyGram International, Inc. (NYSE: MGI), a leading global payment services company, today announced the unanimous election of Othón Ruiz-Montemayor to its board of directors. Ruiz’s term continues until MoneyGram’s annual meeting of stockholders in May 2006.

Ruiz currently is the chairman of Grupo Inversiones Monterrey, S.A. de C.V., a private investment firm. From 1996 to 2004 he was the chief executive officer of Grupo Financiero Banorte S.A. de C.V., one of the leading bank groups in Mexico. Prior to that he worked at Fomento Económico Mexicano, S.A. de C.V. (FEMSA) (NYSE ADS:FMX) in various positions, including chief financial officer from 1974 until 1985 and chief executive officer from 1985 until 1995. He currently serves on the boards of the Monterrey Technical Institute, Hospital San José, and Banregio S.A. Ruiz has served on of the boards of FEMSA, Banca Serfin S.A. de C.V., Grupo Financiero Bancomer S.A. de C.V., Seguros y Fianzas Monterrey, S.A. de C.V., Sigma Alimentos S.A. de C.V., Grupo Financiero Banorte S.A. de C.V. and Gruma S.A. de C.V. He also has been very active in various civic and public organizations, including serving as the president of Mexico’s National Bankers’ Association in 2002 and 2003 and as the secretary of finance and general treasurer of the State of Nuevo León from 1995 to 1996.

Phil Milne, chief executive officer of MoneyGram, stated, “It is a pleasure to welcome a high caliber board member such as Mr. Ruiz. He is a very talented and accomplished executive with extensive international banking experience. I join everyone at MoneyGram in looking forward to his future contributions to the company.”

About MoneyGram International, Inc.
MoneyGram International, Inc. is a leading global payment services company and S&P
MidCap 400 company. The company’s major products and services include global money transfers, money orders and payment processing solutions for financial institutions and retail customers. MoneyGram is a New York Stock Exchange listed company, with over $825 million in revenue in 2004 and over 81,000 global money transfer agent locations in 170 countries. For more information, visit the company’s website at www.moneygram.com .

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EXHIBIT 99.11 [MGI LOGO]

Contact: Tim Gallaher
Investor Relations
952-591-3840
ir@moneygram.com

MoneyGram International Increases Share Repurchase Authorization;
Declares Quarterly Dividend

MINNEAPOLIS, Minn., Aug. 18, 2005 – The board of directors of MoneyGram International, Inc. (NYSE:MGI) today announced that it has increased the company’s common stock share repurchase authorization by 5 million shares, bringing the current authorization to 7 million shares. The company has repurchased approximately 1.8 million shares during the past twelve months, and will continue to purchase shares from time to time at prevailing prices in the open market. The increase to the authorization becomes effective on Aug. 19, 2005.

MoneyGram also declared a quarterly dividend of $0.01 per share on common stock, payable on Oct. 3, 2005 to stockholders of record at the close of business on Sept. 15, 2005.

Phil Milne, chief executive officer and president, said, “We continue to evaluate the best uses of our cash to enhance shareholder value, and today’s announcement increases our flexibility in achieving this. We do, however, continue to invest capital in the money transfer business and in developing new products for our customers.”

MoneyGram International, Inc. is a leading global payment services company and S&P MidCap 400 company. The company’s major products and services include global money transfers, money orders and payment processing solutions for financial institutions and retail customers. MoneyGram is a New York Stock Exchange listed company, with more than $825 million in revenue in 2004 and more than 81,000 global money transfer agent locations in 170 countries. For more information, visit the company’s website at www.moneygram.com .

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Cautionary Information Regarding Forward-Looking Statements

The statements contained in this press release regarding the business of MoneyGram International, Inc. that are not historical facts are forward-looking statements and are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances due to a number of factors, including, but not limited to: (a) fluctuations in interest rates that may materially affect revenue derived from investment of funds received from the sale of payment instruments and commissions paid to financial institution customers; (b) material changes in the market value of securities we hold; (c) material changes in our need for and the availability of liquid assets; (d) successful management of the credit and fraud risks of retail agents, and the credit risk related to our investment portfolio; (e) continued growth rates approximating recent levels for consumer money transfer transactions and other payment product markets; (f) renewal of material retail agent and financial institution customer contracts, or loss of business from significant agents or customers; (g) technological and competitive changes in the payment services industry; (h) timely and successful implementation of new and/or improved technology, delivery methods, and product offerings including pre-paid debit/stored value cards and new bill payment services; (i) changes in laws, regulations or other industry practices and standards which may require significant systems redevelopment, reduce the market for or value of the company’s products or services or render products or services less profitable or obsolete; (j) continued political stability in countries in which MoneyGram has material agent relationships; (k) material lawsuits or investigations; (l) catastrophic events that could materially adversely impact operating facilities, communication systems and technology of MoneyGram, its clearing banks or major customers, or that may have a material adverse impact on current economic conditions or levels of consumer spending; (m) material breach of security of any of our systems; (n) our ability to comply with the requirements of Sarbanes-Oxley Section 404 regarding the effectiveness of internal controls; (o) potential patent liability for intellectual property related to our development of new and enhanced products and services and (p) other factors more fully discussed in MoneyGram’s filings with the Securities and Exchange Commission. Actual results may differ materially from historical and anticipated results. These forward-looking statements speak only as of the date on which such statements are made, and MoneyGram undertakes no obligation to update such statements to reflect events or circumstances arising after such date.