11083005119977657186416780000008310000002119000000251000000935000000505000000-400000088000000172000000150000003403000000728600000051060000004440000002760000001820000007400000044400000043600000029300000015100000018700000040800000034540000007286000000282200000060600000012500000021000000800000092000000159000000153000000412000000278000000346000000433000000158300000038240000003832000000674059012500000004100000004330000001070000000.000130000000001175601761108195860.0001120000000019977657199776570.000110000001846184688000000340300000080000001583000000-1250000000150500000082400000020550000002900000001225000000536000000-30000001940000001800000001500000034120000007470000000500300000044600000024400000026400000080000000446000000422000000309000000338000000415000000395800000074700000003167000000607000000263000000220000008000000126000000184000000121000000426000000313000000328000000449000000114800000035040000003512000000674059012500000004590000004780000002120000000.000130000000001165340291097934390.0001120000000019977657199776570.0001100000018121812194000000341200000080000001148000000-125000000017300000015000000-200000029800000029800000059500000040000000310000002.812.80-28000000800000080000004480000005500000001830000003000000-102000000-135000000-19000000013000000190000003600000017000000116000000-165000000-50000000416000000367000000-1100000056100000050000001000000-690000008000000-1000000200000001500000030000001800000012000000160000001000000-149000000120000001000000367000000115600000015000000130000000130000000-1520000005000000-75000000260000006900000032000000-7000000--12-31MAMASTERCARD INC Q120102010-03-3110-Q0001141391Large Accelerated Filerfalse<div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 3. Non-Cash
Investing and Financing Activities</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The following
table includes non-cash investing and financing information for the
three month periods ended March 31:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="84%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2010</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Dividend declared but not
yet paid</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">20</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">20</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Software licenses
financed</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Municipal bonds
cancelled</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">154</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenue bonds
received</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(154</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Building and land assets
recorded pursuant to capital lease</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(154</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Capital lease
obligation</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">154</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value of assets
acquired, net of original investment, cash paid and cash
acquired</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">17</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value of liabilities
assumed related to investments in affiliates</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">15</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value of
non-controlling interest acquired</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">8</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px; WIDTH: 10%; LINE-HEIGHT: 8px; BORDER-BOTTOM: #000000 0.5pt solid">
 </p>
<table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr>
<td valign="top" align="left" width="4%"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></td>
<td valign="top" align="left">
<p align="left"><font style="FONT-FAMILY: Times New Roman" size="2">Includes $9 to be extinguished in 2013 and 2016 for future
benefits to be provided by MasterCard in the establishment of a
joint venture.</font></p>
</td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Effective
March 1, 2009, MasterCard executed a new ten-year lease
between MasterCard, as tenant, and the Missouri Development Finance
Board (“MDFB”), as landlord, for MasterCard’s
global technology and operations center located in O’Fallon,
Missouri, called Winghaven. The lease includes a bargain purchase
option and is thus classified as a capital lease. The building and
land assets and capital lease obligation have been recorded at
$154, which represents the lesser of the present value of the
minimum lease payments and the fair value of the building and land
assets. The Company received refunding revenue bonds issued by MDFB
in the exact amount, $154, and with the same payment terms as the
capital lease and which contain the legal right of setoff with the
capital lease. The Company has netted its investment in the MDFB
refunding revenue bonds and the corresponding capital lease
obligation in the consolidated balance sheet.</font></p>
</div>64000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 9. Accrued
Expenses</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Accrued
expenses consisted of the following:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Customer and merchant
incentives</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">548</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">598</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Personnel costs</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">203</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">367</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Advertising</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">61</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">131</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income taxes</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">30</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">32</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">93</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">97</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total accrued
expenses</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">935</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,225</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
</div>300000091000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 14.
Commitments</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">At
March 31, 2010, the Company had the following future minimum
payments due under non-cancelable agreements:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="66%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Total</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Capital<br />
Leases  <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Operating<br />
Leases</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Sponsorship,<br />
Licensing &<br />
Other</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Remainder of
2010</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">232</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">19</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">210</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">2011</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">167</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">19</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">144</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">2012</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">113</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">16</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">94</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">2013</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">60</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">37</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">13</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">2014</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">8</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Thereafter</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">23</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">612</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">47</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">95</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">470</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px; WIDTH: 10%; LINE-HEIGHT: 8px; BORDER-BOTTOM: #000000 0.5pt solid">
 </p>
<table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr>
<td valign="top" align="left" width="4%"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></td>
<td valign="top" align="left">
<p align="left"><font style="FONT-FAMILY: Times New Roman" size="2">Excludes non-cash transactions relating to the Company’s
Winghaven facility. See Note 3 (Non-Cash Investing and Financing
Activities) for more information.</font></p>
</td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Included in the
table above are capital leases with imputed interest expense of $6
and a net present value of minimum lease payments of $41. In
addition, at March 31, 2010, $38 of the future minimum
payments in the table above for operating leases, sponsorship,
licensing and other agreements was accrued. Consolidated rental
expense for the Company’s leased office space, which is
recognized on a straight line basis over the life of the lease, was
$7 and $14 for the three months ended March 31, 2010 and 2009,
respectively. Consolidated lease expense for automobiles, computer
equipment and office equipment was $2 for each of the three month
periods ended March 31, 2010 and 2009.</font></p>
</div>0.15349000000349000000608000000<div>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 6. Prepaid
Expenses</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Prepaid
expenses consisted of the following:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Customer and merchant
incentives</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Advertising</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">40</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">56</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income taxes</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">93</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Data processing</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">29</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">20</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">18</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total prepaid
expenses</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">624</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">641</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Prepaid expenses,
current</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(278</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(313</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Prepaid expenses,
long-term</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">346</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">328</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Prepaid
customer and merchant incentives represent payments made to
customers and merchants under business agreements.</font></p>
</div>4900000035000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 12. Share Based
Payment and Other Benefits</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
March 1, 2010, the Company granted approximately
150 thousand restricted stock units, 169 thousand stock
options and 42 thousand performance units under the MasterCard
Incorporated 2006 Long-Term Incentive Plan (“LTIP”).
The fair value of the restricted stock units and performance units,
based on the closing price of the Class A common stock, par
value $.0001 per share, on the New York Stock Exchange on
March 1, 2010, was $232.74. The fair value of the stock
options estimated on the date of grant using a Black-Scholes option
pricing model was $84.79. Vesting of the shares underlying the
restricted stock units and performance units will occur on
February 28, 2013. The stock options vest in four equal annual
installments beginning on March 1, 2011, and have a term of
ten years. Compensation expense is recorded net of estimated
forfeitures over the shorter of the vesting period or the date the
individual becomes eligible to retire under the LTIP. The Company
uses the straight-line method of attribution over the requisite
service period for expensing equity awards.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">With regard to
the performance units granted on March 1, 2010, whether and
the extent to which, the performance stock units will vest will be
based on the Company’s performance against a predetermined
return on equity goal, with an average of return on equity over the
three-year period commencing January 1, 2010 against
threshold, target and maximum performance goals. In the event the
performance units do vest on February 28, 2013, the ultimate
number of shares to be released on the vesting date will be based
on meeting or exceeding average annual return on equity goals and
achievement of quantitative and qualitative goals determined by the
Company’s compensation committee over the performance period,
which includes performance against the corporate scorecard. These
performance units have been classified as equity awards, will be
settled by delivering stock to the employees and contain service
and performance conditions. Given that the performance terms are
subjective and not fixed on the date of grant, the performance
units will be remeasured at the end of each reporting period, at
fair value, until the time the performance conditions are fixed and
the ultimate number of shares to be issued is determined. Estimates
are adjusted as appropriate. Compensation expense is calculated
using the number of performance stock units expected to vest;
multiplied by the period ending price of a share of
MasterCard’s Class A common stock on the New York Stock
Exchange; less previously recorded compensation expense.</font></p>
</div><div>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 19. Foreign
Exchange Risk Management</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
enters into foreign currency forward contracts to manage risk
associated with anticipated receipts and disbursements which are
either transacted in a non-functional currency or valued based on a
currency other than its functional currencies. The Company also
enters into foreign currency forward contracts to offset possible
changes in value due to foreign exchange fluctuations of assets and
liabilities denominated in foreign currencies. The objective of
this activity is to reduce the Company’s exposure to
transaction gains and losses resulting from fluctuations of foreign
currencies against its functional currencies.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
does not designate foreign currency forward contracts as hedging
instruments pursuant to the accounting standards for derivative
instruments and hedging activities. The Company records the change
in the estimated fair value of the outstanding forward contracts at
the end of the reporting period to its consolidated balance sheet
and consolidated statement of operations.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">As of
March 31, 2010, all contracts to purchase and sell foreign
currency had been entered into with customers of MasterCard
International. MasterCard’s outstanding forward contracts are
classified by functional currency as summarized below:</font></p>
<p style="MARGIN-TOP: 24px; MARGIN-BOTTOM: 0px" align="center">
<font style="FONT-FAMILY: Times New Roman" size="2"><b>U.S. Dollar
Functional Currency</b></font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="60%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31, 2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31, 2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Notional</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Estimated Fair<br />
Value  <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Notional</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Estimated Fair<br />
Value  <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Commitments to purchase
foreign currency</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">36</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Commitments to sell foreign
currency</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">230</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)</font> <font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">50</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)</font> <font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Balance Sheet
Location:</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Accounts
Receivable</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Other Current
Liabilities</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
</table>
<p style="MARGIN-TOP: 24px; MARGIN-BOTTOM: 0px" align="center">
<font style="FONT-FAMILY: Times New Roman" size="2"><b>Euro
Functional Currency</b></font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="60%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31, 2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31, 2009</b></font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Notional</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Estimated Fair<br />
Value  <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Notional</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Estimated Fair<br />
Value  <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Commitments to purchase
foreign currency</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">16</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Commitments to sell foreign
currency</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">92</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)</font> <font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font>
<font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Balance Sheet
Location:</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Accounts
Receivable</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><i>Other Current
Liabilities</i></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="60%"></td>
<td valign="bottom" width="18%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="18%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="6"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Amount and Location of 
Gain</b></font><br />
<font style="FONT-FAMILY: Times New Roman" size="1"><b>(Loss) Recognized in Income</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="6"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Three Months Ended March 31,</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Derivatives Not
Designated As Hedging Instruments</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Foreign Currency Forward
Contracts</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">General and
administrative</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(8</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(6</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px; WIDTH: 10%; LINE-HEIGHT: 8px; BORDER-BOTTOM: #000000 0.5pt solid">
 </p>
<table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr>
<td valign="top" align="left" width="4%"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></td>
<td valign="top" align="left">
<p align="left"><font style="FONT-FAMILY: Times New Roman" size="2">Amounts represent gross fair value amounts while these amounts
may be netted for actual balance sheet presentation.</font></p>
</td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The currencies
underlying the foreign currency forward contracts consist primarily
of the Australian dollar, Canadian dollar, Chinese renminbi, euro,
Mexican peso, Turkish lira and U.K. pound sterling. The fair value
of the foreign currency forward contracts generally reflects the
estimated amounts that the Company would receive or (pay), on a
pre-tax basis, to terminate the contracts at the reporting date
based on broker quotes for the same or similar instruments. The
terms of the foreign currency forward contracts are generally less
than 18 months. The Company had no deferred gains or losses in
accumulated other comprehensive income as of March 31, 2010
and December 31, 2009 as there were no derivative contracts
accounted for under hedge accounting.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
Company’s derivative financial instruments are subject to
both credit and market risk. Credit risk is the risk of loss due to
failure of the counterparty to perform its obligations in
accordance with contractual terms. Market risk is the potential
change in an instrument’s value caused by fluctuations in
interest rates and other variables related to currency exchange
rates. Credit and market risk related to derivative instruments
were not material at March 31, 2010 and December 31,
2009.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Generally, the
Company does not obtain collateral related to forward contracts
because of the high credit ratings of the counterparties. The
amount of loss the Company would incur if the counterparties failed
to perform according to the terms of the contracts is not
considered material.</font></p>
</div>200000003.473.46<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 2. Earnings Per
Share</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Earnings per
share (“EPS”) is calculated including the effects of
certain instruments granted in share-based payment transactions
under the two-class method. Unvested share-based payment awards
which receive non-forfeitable dividend rights, or dividend
equivalents, are considered participating securities and are
required to be included in computing EPS under the two-class
method. The Company declared non-forfeitable dividends on
unvested restricted stock units and contingently issuable
performance stock units (“Unvested Units”) which were
granted prior to 2009.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The components
of basic and diluted EPS for common shares are as
follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="84%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Three Months Ended<br />
March 31,</b></font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2010</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2009</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Numerator:</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Net income attributable to
MasterCard</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">455</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">367</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Less: Net income allocated
to Unvested Units</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Net income attributable to
MasterCard allocated to common shares</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">453</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">364</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
<tr>
<td height="8"></td>
<td colspan="3" height="8"></td>
<td colspan="3" height="8"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Denominator:</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Basic EPS weighted average
shares outstanding</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">130</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">130</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Dilutive stock options and
stock units</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Diluted EPS weighted
average shares outstanding</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">131</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">130</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr>
<td height="8"></td>
<td colspan="3" height="8"></td>
<td colspan="3" height="8"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Earnings per
Share</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total Basic</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3.47</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.81</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total Diluted</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3.46</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.80</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The calculation
of diluted EPS for the three month periods ended March 31,
2010 and 2009 excluded 88 thousand and 290 thousand stock
options, respectively, because the effect would be
antidilutive.</font></p>
</div>-850000009100000091000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 4. Fair
Value</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Financial
Instruments – Recurring Measurements</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In accordance
with accounting requirements for financial instruments, the Company
is disclosing the estimated fair values as of March 31, 2010
and December 31, 2009 of the financial instruments that are
within the scope of the accounting guidance, as well as the methods
and significant assumptions used to estimate the fair value of
those financial instruments. Furthermore, the Company classifies
its fair value measurements in the Valuation Hierarchy. No
transfers were made among the three levels in the Valuation
Hierarchy during the three months ended March 31,
2010.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
distribution of the Company’s financial instruments which are
measured at fair value on a recurring basis within the Valuation
Hierarchy is as follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr>
<td width="66%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Quoted Prices<br />
in Active<br />
Markets<br />
(Level 1)</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Significant<br />
Other<br />
Observable<br />
Inputs<br />
(Level 2)</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Significant<br />
Unobservable<br />
Inputs</b></font><br />
<font style="FONT-FAMILY: Times New Roman" size="1"><b>(Level
3)</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value at<br />
March  31,</b></font><br />
<font style="FONT-FAMILY: Times New Roman" size="1"><b>2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Municipal bonds</font>
<font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">519</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">519</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Taxable short-term bond
funds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">312</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">312</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Auction rate
securities</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">172</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">172</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Foreign currency forward
contracts</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">312</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">172</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">998</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td height="16"></td>
<td colspan="3" height="16"></td>
<td colspan="4" height="16"></td>
<td colspan="3" height="16"></td>
<td colspan="4" height="16"></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Quoted Prices<br />
in Active<br />
Markets<br />
(Level 1)</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Significant<br />
Other<br />
Observable<br />
Inputs<br />
(Level 2)</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Significant<br />
Unobservable<br />
Inputs</b></font><br />
<font style="FONT-FAMILY: Times New Roman" size="1"><b>(Level
3)</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value at<br />
December 31,<br />
2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Municipal bonds</font>
<font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Taxable short-term bond
funds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">310</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">310</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Auction rate
securities</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">180</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">180</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Foreign currency forward
contracts</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">310</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">513</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">180</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,003</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px; WIDTH: 10%; LINE-HEIGHT: 8px; BORDER-BOTTOM: #000000 0.5pt solid">
 </p>
<table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr>
<td valign="top" align="left" width="4%"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></td>
<td valign="top" align="left">
<p align="left"><font style="FONT-FAMILY: Times New Roman" size="2">Available-for-sale municipal bonds are carried at fair value
and are included in the above tables. However, held-to-maturity
municipal bonds are carried at amortized cost and excluded from the
above tables.</font></p>
</td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The fair value
of the Company’s available-for-sale municipal bonds are based
on quoted prices for similar assets in active markets and are
therefore included in Level 2 of the Valuation
Hierarchy.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The fair value
of the Company’s short-term bond funds are based on quoted
prices and are therefore included in Level 1 of the Valuation
Hierarchy.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
Company’s auction rate securities (“ARS”)
investments have been classified within Level 3 of the Valuation
Hierarchy as their valuation requires substantial judgment and
estimation of factors that are not currently observable in the
market due to the lack of trading in the securities. This valuation
may be revised in future periods as market conditions evolve. The
Company has considered the lack of liquidity in the ARS market and
the lack of comparable, orderly transactions when estimating the
fair value of its ARS portfolio. Therefore, the Company uses the
income approach, which included a discounted cash flow analysis of
the estimated future cash flows adjusted by a risk premium for the
ARS portfolio, to estimate the fair value of its ARS portfolio. The
Company estimated the fair value of its ARS portfolio to be a 15%
discount to the par value as of March 31, 2010 and
December 31, 2009. When a determination is made to classify a
financial instrument within Level 3, the determination is based
upon the significance of the unobservable parameters to the overall
fair value measurement. However, the fair value determination for
Level 3 financial instruments may include observable
components.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
Company’s foreign currency forward contracts have been
classified within Level 2 of the Valuation Hierarchy, as the fair
value is based on broker quotes for the same or similar derivative
instruments. See Note 19 (Foreign Exchange Risk Management) for
further details.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Financial
Instruments – Non-Recurring Measurements</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Certain
financial instruments are carried on the consolidated balance
sheets at cost, which approximates fair value due to their
short-term, highly liquid nature. These instruments include cash
and cash equivalents, accounts receivable, settlement due from
customers, restricted security deposits held for customers, prepaid
expenses, accounts payable, settlement due to customers and accrued
expenses.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Investment
Securities Held-to-Maturity</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
utilizes quoted prices for similar securities from active markets
to estimate the fair value of its held-to-maturity securities. See
Note 5 (Investment Securities) for fair value
disclosure.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Short-term
and Long-term Debt</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
estimates the fair value of its debt by applying a current period
discount rate to the remaining cash flows under the terms of the
debt. As of March 31, 2010 and December 31, 2009, the
carrying value on the consolidated balance sheet totaled $21 and
$22 and the fair value totaled $21 and $22, respectively, for the
Company’s debt.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Obligations
Under Litigation Settlements</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
estimates the fair value of its obligations under litigation
settlements by applying a current period discount rate to the
remaining cash flows under the terms of the litigation settlements.
At March 31, 2010 and December 31, 2009, the carrying
value on the consolidated balance sheet totaled $731 and $870 and
the fair values totaled $741 and $895, respectively, for these
obligations. For additional information regarding the
Company’s obligations under litigation settlements, see Note
15 (Obligations Under Litigation Settlements).</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Settlement
Guarantee Liabilities</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
estimates the fair value of its settlement guarantees by applying
market assumptions for relevant though not directly comparable
undertakings, as the latter are not observable in the market given
the proprietary nature of such guarantees. Additionally, loss
probability and severity profiles against the Company’s gross
and net settlement exposures are considered. The carrying value and
estimated fair value of settlement guarantee liabilities were de
minimis as of March 31, 2010 and December 31, 2009. For
additional information regarding the Company’s settlement
guarantee liabilities, see Note 18 (Settlement and Travelers Cheque
Risk Management).</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Refunding
Revenue Bonds</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
holds refunding revenue bonds with the same payment terms, and
which contain the right of set-off with a capital lease obligation
related to the Company’s global technology and operations
center located in O’Fallon, Missouri, called Winghaven. The
Company has netted the refunding revenue bonds and the
corresponding capital lease obligation in the consolidated balance
sheet and estimates that the carrying value approximates the fair
value for these bonds. See Note 3 (Non-Cash Investing and Financing
Activities) for further details.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Non-Financial Instruments</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Certain assets
and liabilities are measured at fair value on a nonrecurring basis.
The Company’s assets and liabilities measured at fair value
on a nonrecurring basis include property, plant and equipment,
goodwill and other intangible assets. These assets are not measured
at fair value on an ongoing basis; however, they are subject to
fair value adjustments in certain circumstances, such as when there
is evidence of impairment.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The valuation
methods for goodwill and other intangible assets involve
assumptions concerning comparable company multiples, discount
rates, growth projections and other assumptions of future business
conditions. As the assumptions employed to measure these assets on
a nonrecurring basis are based on management’s judgment using
internal and external data, these fair value determinations are
classified in Level 3 of the Valuation Hierarchy.</font></p>
</div>458000000695000000<div>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 16. Income
Taxes</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The effective
income tax rates were 34.6% and 33.2% for the three months ended
March 31, 2010 and 2009, respectively. The rate for the three
months ended March 31, 2010 was higher than the comparable
period in 2009 due primarily to an adjustment to the
Company’s balance of deferred taxes during the three months
ended March 31, 2009, partially offset by lower state tax
rates and a more favorable geographic distribution of earnings for
the three months ended March 31, 2010.</font></p>
</div>240000000-36000000-19000000-134000000-28000000-40000001500000010000000<div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 5. Investment
Securities</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Amortized
Costs and Fair Values – Available-for-Sale Investment
Securities:</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The major
categories of the Company’s available-for-sale investment
securities, for which unrealized gains and losses are recorded as a
separate component of other comprehensive income (loss) on the
consolidated statements of comprehensive income (loss), and their
respective cost basis and fair values are as follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="60%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Amortized<br />
Cost</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Gross<br />
Unrealized<br />
Gain</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Gross<br />
Unrealized<br />
Loss <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value at<br />
March 31,<br />
2010</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Municipal bonds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">500</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">19</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">519</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Taxable short-term bond
funds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">307</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">5</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">312</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Auction rate
securities</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">202</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(30</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">172</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,009</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">24</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(30</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,003</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
<tr>
<td height="16"></td>
<td colspan="3" height="16"></td>
<td colspan="3" height="16"></td>
<td colspan="4" height="16"></td>
<td colspan="3" height="16"></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Amortized<br />
Cost</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Gross<br />
Unrealized<br />
Gain</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Gross<br />
Unrealized<br />
Loss <sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value at<br />
December 31,<br />
2009</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Municipal bonds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">492</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">22</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">514</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Taxable short-term bond
funds</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">306</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">310</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Auction rate
securities</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">212</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">180</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,010</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,004</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px; WIDTH: 10%; LINE-HEIGHT: 8px; BORDER-BOTTOM: #000000 0.5pt solid">
 </p>
<table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr>
<td valign="top" align="left" width="4%"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="VERTICAL-ALIGN: baseline; BOTTOM: 0.8ex; POSITION: relative">1</sup></font></td>
<td valign="top" align="left">
<p align="left"><font style="FONT-FAMILY: Times New Roman" size="2">The unrealized losses have been in an unrealized loss position
longer than 12 months, but have not been deemed
other-than-temporarily impaired.</font></p>
</td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The municipal
bond portfolio is comprised of tax exempt bonds and is diversified
across states and sectors. The portfolio has an average credit
quality of double-A.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The short-term
bond funds invest in fixed income securities, including corporate
bonds, mortgage-backed securities, and asset-backed
securities.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
holds investments in ARS. Interest on these securities is exempt
from U.S. federal income tax and the interest rate on the
securities typically resets every 35 days. The securities are fully
collateralized by student loans with guarantees (ranging from
approximately 95% to 98% of principal and interest) by the U.S.
government via the Department of Education.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Beginning on
February 11, 2008, the auction mechanism that normally
provided liquidity to the ARS investments began to fail. Since
mid-February 2008, all investment positions in the Company’s
ARS investment portfolio have experienced failed auctions. The
securities for which auctions have failed have continued to pay
interest in accordance with the contractual terms of such
instruments and will continue to accrue interest and be auctioned
at each respective reset date until the auction succeeds, the
issuer redeems the securities or they mature. As of March 31,
2010, the ARS market remained illiquid but issuer call and
redemption activity in the ARS student loan sector has occurred
periodically since the auctions began to fail. During the three
months ended March 31, 2010, the Company did not sell any ARS
in the auction market but there were some calls at par.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The table below
includes a roll-forward of the Company’s ARS investments from
January 1, 2010 to March 31, 2010.</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr>
<td width="82%"></td>
<td valign="bottom" width="15%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Significant<br />
Unobservable<br />
Inputs (Level 3)</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value, January 1,
2010</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">180</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Calls, at par</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(9</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Recovery of unrealized
losses due to issuer calls</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value, March 31,
2010</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">172</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
evaluated the estimated impairment of its ARS portfolio to
determine if it was other-than-temporary. The Company considered
several factors including, but not limited to, the following:
(1) the reasons for the decline in value (changes in interest
rates, credit event, or market fluctuations); (2) assessments
as to whether it is more likely than not that it will hold and not
be required to sell the investments for a sufficient period of time
to allow for recovery of the cost basis; (3) whether the
decline is substantial; and (4) the historical and anticipated
duration of the events causing the decline in value. The evaluation
for other-than-temporary impairments is a quantitative and
qualitative process, which is subject to various risks and
uncertainties. The risks and uncertainties include changes in
credit quality, market liquidity, timing and amounts of issuer
calls, and interest rates. As of March 31, 2010, the Company
believed that the unrealized losses on the ARS were not related to
credit quality but rather due to the lack of liquidity in the
market. The Company believes that it is more likely than not that
the Company will hold and not be required to sell its ARS
investments until recovery of their cost bases which may be at
maturity or earlier if called. Therefore, MasterCard does not
consider the unrealized losses to be other-than-temporary. The
Company estimated a 15% discount to the par value of the ARS
portfolio at March 31, 2010 and December 31, 2009. The
pre-tax impairment included in accumulated other comprehensive
income related to the Company’s ARS was $30 and $32 as of
March 31, 2010 and December 31, 2009, respectively. A
hypothetical increase of 100 basis points in the discount rate used
in the discounted cash flow analysis would have increased the
impairment by $18 and $23 as of March 31, 2010 and
December 31, 2009, respectively.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Carrying and
Fair Values – Held-to-Maturity Investment
Securities:</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">As of
March 31, 2010, the Company also owned held-to-maturity
investment securities, which consisted of U.S. Treasury notes and a
municipal bond yielding interest at 5.0% per annum. The bond
relates to the Company’s back-up processing center in Kansas
City, Missouri. The carrying value, gross unrecorded gains and fair
value of these held-to-maturity investment securities were as
follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="9%"></td>
<td></td>
<td></td>
<td valign="bottom" width="9%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Carrying value</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">338</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">338</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Gross unrecorded
gains</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Fair value</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">340</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">340</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Investment
Maturities:</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The maturity
distribution based on the contractual terms of the Company’s
investment securities at March 31, 2010 was as
follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="62%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Available-For-Sale</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="5"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Held-To-Maturity</b></font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Amortized<br />
Cost</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Carrying Value</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Fair Value</b></font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due within 1
year</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">34</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">34</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">151</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">151</font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due after 1 year through 5
years</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">363</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">379</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">187</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">189</font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due after 5 years through
10 years</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">107</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">109</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due after 10
years</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">198</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">169</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">No contractual
maturity</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">307</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">312</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,009</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,003</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">338</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">340</font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The majority of
securities due after ten years are ARS. Taxable short-term bond
funds have been included in the table above in the no contractual
maturity category, as these investments do not have a stated
maturity date.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The table below
summarizes the maturity ranges of the ARS portfolio, based on
relative par value, as of March 31, 2010:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Par Amount</b></font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center"><font style="FONT-FAMILY: Times New Roman" size="1"><b>% of Total</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due within 10
years</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">% </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due year 11 through year
20</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">13</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">% </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due year 21 through year
30</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">135</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">67</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">% </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Due after year
30</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">37</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">18</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">% </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">202</font></td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">100</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">% </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Investment
Income:</i></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Investment
income was $10 and $17 for the three months ended March 31,
2010 and 2009, respectively. It primarily consisted of interest
income generated from cash, cash equivalents, available-for-sale
investment securities and municipal bonds held-to-maturity.
Dividend income and gross realized gains and losses were not
significant.</font></p>
</div>11500000077000000-2300000095000000455000000-5000000700000000-1000000-10600000020000000330000001000000300000017000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 11. Postemployment
and Postretirement Benefits</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
maintains a postretirement plan (the “Postretirement
Plan”) providing health coverage and life insurance benefits
for substantially all of its U.S. employees and retirees hired
before July 1, 2007. Net periodic postretirement benefit cost
was $1 for each of the three month periods ended March 31,
2010 and 2009. The cost included amounts for interest cost, service
cost and amortization of the transition obligation partially offset
by the amortization of the actuarial gain. The majority of the cost
represented interest cost.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
does not make any contributions to its Postretirement Plan other
than funding benefits payments.</font></p>
</div>11000000200000006000000455000000<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 8. Property, Plant
and Equipment</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Property, plant
and equipment consisted of the following:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Property, plant and
equipment</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">747</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">753</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Less accumulated
depreciation and amortization</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(314</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(304</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Property, plant and
equipment, net</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">433</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">449</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">As of
March 31, 2010 and December 31, 2009, capital leases,
excluding the Winghaven facility, of $10 and $14, respectively,
were included in equipment. Accumulated amortization of these
capital leases was $4 and $6 as of March 31, 2010 and
December 31, 2009, respectively. The Winghaven facility is
discussed further in Note 3 (Non-Cash Investing and Financing
Activities).</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Depreciation
expense for the above property, plant and equipment, including
amortization for capital leases, was $16 and $17 for the three
months ended March 31, 2010 and 2009, respectively.</font></p>
</div>1308000000<div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 10. Pension
Plans</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
maintains a non-contributory, qualified, defined benefit pension
plan (the “Qualified Plan”) with a cash balance feature
covering substantially all of its U.S. employees hired before
July 1, 2007. Company contributions in 2009 and favorable
investment returns increased the Qualified Plan’s fair value
of assets at December 31, 2009 as compared to
December 31, 2008, thereby reducing net periodic pension cost
for the three months ended March 31, 2010 versus the same
period in 2009. Additionally, the Company has an unfunded
non-qualified supplemental executive retirement plan (the
“Non-qualified Plan”) that provides certain key
employees with supplemental retirement benefits in excess of limits
imposed on qualified plans by U.S. tax laws. The term
“Pension Plans” includes both the Qualified Plan and
the Non-qualified Plan. The net periodic pension cost for the
Pension Plans was as follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="82%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="6"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Three Months Ended<br />
March 31,</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Service cost</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">5</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Interest cost</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Expected return on plan
assets</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Amortization:</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Actuarial loss</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 3em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Prior service
credit</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Net periodic pension
cost</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
made voluntary contributions totaling $5 to the Qualified Plan
during the three months ended March 31, 2010 and contributed
an additional $5 in April 2010. The Company currently expects to
make $10 in additional contributions to the Qualified Plan during
the remainder of 2010. During the three months ended March 31,
2009, the Company contributed $14 to the Qualified Plan.</font></p>
</div>16000000<div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px" align="center"></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 1. Summary of
Significant Accounting Policies</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Organization</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
Incorporated and its consolidated subsidiaries, including
MasterCard International Incorporated (“MasterCard
International”) and MasterCard Europe sprl (“MasterCard
Europe”) (together, “MasterCard” or the
“Company”), provide payment solutions, including
transaction processing and related services to customers
principally in support of their credit, deposit access (debit),
electronic cash and Automated Teller Machine (“ATM”)
payment card programs, and travelers cheque programs. Our financial
institution customers are generally either principal members
(“principal members”) of MasterCard International,
which participate directly in MasterCard International’s
business, or affiliate members of MasterCard International, which
participate indirectly in MasterCard International’s business
through a principal member.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Consolidation and basis of
presentation</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
consolidated financial statements include the accounts of
MasterCard and its majority-owned and controlled entities. The
Company also evaluates its interests in variable interest entities,
as applicable, to determine whether consolidation is required.
Intercompany transactions and balances have been eliminated in
consolidation. Certain prior period amounts have been reclassified
to conform to the 2010 presentation. The Company follows accounting
principles generally accepted in the United States of America
(“GAAP”).</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The balance
sheet as of December 31, 2009 was derived from the audited
consolidated financial statements as of December 31, 2009. The
consolidated financial statements for the three months ended
March 31, 2010 and 2009 and as of March 31, 2010 are
unaudited, and in the opinion of management, include all normal
recurring adjustments that are necessary to present fairly the
results for interim periods. Due to seasonal fluctuations and other
factors, the results of operations for the three months ended
March 31, 2010 are not necessarily indicative of the results
to be expected for the full year. The Company has evaluated
subsequent events through the date that the consolidated financial
statements were issued.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
accompanying unaudited consolidated financial statements are
presented in accordance with the U.S. Securities and Exchange
Commission requirements of Quarterly Reports on Form 10-Q and,
consequently, do not include all of the disclosures required by
GAAP. Reference should be made to the MasterCard Incorporated
Annual Report on Form 10-K for the year ended December 31,
2009 for additional disclosures, including a summary of the
Company’s significant accounting policies.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 2%">
<font style="FONT-FAMILY: Times New Roman" size="2"><b><i>Recent
accounting pronouncements</i></b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Transfers of
financial assets</i> - In June 2009, the accounting standard for
transfers and servicing of financial assets and extinguishments of
liabilities was amended. The change eliminates the qualifying
special purpose entity concept, establishes a new unit of account
definition that must be met for the transfer of portions of
financial assets to be eligible for sale accounting, clarifies and
changes the derecognition criteria for a transfer to be accounted
for as a sale, changes the amount of gain or loss on a transfer of
financial assets accounted for as a sale when beneficial interests
are received by the transferor, and requires additional new
disclosures. The Company adopted the new standard upon its
effective date of January 1, 2010. The adoption did not have
an impact on the Company’s financial position or results of
operations as of or for the three months ended March 31,
2010.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Variable
interest entities</i> - In June 2009, there was a revision to the
accounting standard for the consolidation of variable interest
entities. The revision eliminates the exemption for qualifying
special purpose entities, requires a new qualitative approach for
determining whether a reporting entity should consolidate a
variable interest entity, and changes the requirement of when to
reassess whether a reporting entity should consolidate a variable
interest entity. During February 2010, the scope of the revised
standard was modified to indefinitely exclude certain entities from
the requirement to be assessed for consolidation. The Company
adopted the new standard upon its effective date of January 1,
2010. The adoption did not have an impact on the Company’s
financial position or results of operations as of or for the three
months ended March 31, 2010.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Revenue
arrangements with multiple deliverables -</i> In September 2009,
the accounting standard for the allocation of revenue in
arrangements involving multiple deliverables was amended. Current
accounting standards require companies to allocate revenue based on
the fair value of each deliverable, even though such deliverables
may not be sold separately either by the company itself or other
vendors. The new accounting standard eliminates (i) the
residual method of revenue allocation and (ii) the requirement
that all undelivered elements must have objective and reliable
evidence of fair value before a company can recognize the portion
of the overall arrangement fee that is attributable to items that
already have been delivered. The Company will adopt the revised
accounting standard effective January 1, 2011 via prospective
adoption. The Company is currently evaluating the requirements of
the standard to determine the impact on the Company’s
financial position or results of operations.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Improving
fair value disclosures</i> - The Company measures certain of its
assets and liabilities at fair value on a recurring basis by
estimating the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between
market participants at the measurement date. When valuing
liabilities, the Company also considers the Company’s
creditworthiness. The Company classifies these recurring fair value
measurements into a three-level hierarchy (“Valuation
Hierarchy”) and discloses the significant assumptions
utilized in measuring assets and liabilities at fair value. In
January 2010, fair value disclosure requirements were amended such
that MasterCard is required to present detailed disclosures about
transfers to and from Level 1 and 2 of the Valuation Hierarchy
effective January 1, 2010 and MasterCard will also be required
to disclose purchases, sales, issuances, and settlements on a
“gross” basis within the Level 3 (of the Valuation
Hierarchy) reconciliation effective January 1, 2011. The
Company adopted the new guidance for disclosures about transfers to
and from Level 1 and 2 of the Valuation Hierarchy effective
January 1, 2010. The adoption did not have an impact on the
Company’s financial position or results of operations as of
or for the three months ended March 31, 2010. The Company will
adopt the guidance that requires disclosure of a reconciliation of
purchases, sales, issuances, and settlements on a
“gross” basis within Level 3 (of the Valuation
Hierarchy) during 2011, as required, and the adoption will have no
impact on the Company’s financial position or results of
operations.</font></p>
</div><div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 13.
Stockholders’ Equity</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In February
2010, the Company’s Board of Directors authorized programs to
facilitate conversions of shares of Class B common stock on a
one-for-one basis into shares of Class A common stock for
subsequent sale or transfer to public investors, beginning after
May 31, 2010. The conversion programs follow the expiration on
May 31, 2010 of a 4-year post initial public offering
restriction period with respect to the conversion of shares of
Class B common stock. The Company currently expects that the first
2010 conversion program will consist of four one-week periods in
June 2010. Holders of shares of Class B common stock will be able
to make conversion elections in a program to be modeled on the
Company’s 2008 and 2009 programs, except that there will not
be a limit on the number of shares of Class B common stock that are
eligible for conversion by any one holder. Starting in early July
2010, the Company expects to run a subsequent, continuous
conversion program for remaining shares of Class B common stock,
featuring an “open window” for elections of any
size.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">All outstanding
Class M common stock will be automatically transferred to the
Company and retired and unavailable for issue or reissue on the day
on which the number of outstanding shares of Class B common stock
represent less than 15% of the total outstanding shares of
Class A common stock and Class B common stock.</font></p>
</div>160000006000000131000000130000000-150000000<div>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 17. Legal and
Regulatory Proceedings</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard is a
party to legal and regulatory proceedings with respect to a variety
of matters in the ordinary course of business. Some of these
proceedings involve complex claims that are subject to substantial
uncertainties and unascertainable damages. Therefore, the
probability of loss and an estimation of damages are not possible
to ascertain at present. Accordingly, except as discussed below,
MasterCard has not established reserves for any of these
proceedings. MasterCard has recorded liabilities for certain legal
proceedings which have been settled through contractual agreements.
Except as described below, MasterCard does not believe that any
legal or regulatory proceedings to which it is a party would have a
material impact on its results of operations, financial position,
or cash flows. Although MasterCard believes that it has strong
defenses for the litigations and regulatory proceedings described
below, it could in the future incur judgments and/or fines, enter
into settlements of claims or be required to change its business
practices in ways that could have a material adverse effect on its
results of operations, financial position or cash flows.
Notwithstanding MasterCard’s belief, in the event it were
found liable in a large class-action lawsuit or on the basis of a
claim entitling the plaintiff to treble damages or under which it
were jointly and severally liable, charges it may be required to
record could be significant and could materially and adversely
affect its results of operations, cash flow and financial
condition, or, in certain circumstances, even cause MasterCard to
become insolvent. Moreover, an adverse outcome in a regulatory
proceeding could result in fines and/or lead to the filing of civil
damage claims and possibly result in damage awards in amounts that
could be significant and could materially and adversely affect the
Company’s results of operations, cash flows and financial
condition.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Department of Justice
Antitrust Litigation and Related Private Litigations</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In October
1998, the U.S. Department of Justice (“DOJ”) filed suit
against MasterCard International, Visa U.S.A., Inc. and Visa
International Corp. in the U.S. District Court for the Southern
District of New York alleging that both MasterCard’s and
Visa’s governance structure and policies violated U.S.
federal antitrust laws. First, the DOJ claimed that “dual
governance”— the situation where a financial
institution has a representative on the Board of Directors of
MasterCard or Visa while a portion of its card portfolio is issued
under the brand of the other association—was anti-competitive
and acted to limit innovation within the payment card industry.
Second, the DOJ challenged MasterCard’s Competitive Programs
Policy (“CPP”) and a Visa bylaw provision that
prohibited financial institutions participating in the respective
associations from issuing competing proprietary payment cards (such
as American Express or Discover). The DOJ alleged that
MasterCard’s CPP and Visa’s bylaw provision acted to
restrain competition.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
October 9, 2001, District Court Judge Barbara Jones issued an
opinion upholding the legality and pro-competitive nature of dual
governance. However, the judge also held that MasterCard’s
CPP and the Visa bylaw constituted unlawful restraints of trade
under the federal antitrust laws. On November 26, 2001, the
judge issued a final judgment that ordered MasterCard to repeal the
CPP insofar as it applies to issuers and enjoined MasterCard from
enacting or enforcing any bylaw, rule, policy or practice that
prohibits its issuers from issuing general purpose credit or debit
cards in the United States on any other general purpose card
network. The Second Circuit upheld the final judgment and the
Supreme Court denied certiorari.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Shortly after
the Supreme Court’s denial of certiorari, both American
Express and Discover Financial Services, Inc. filed complaints
against MasterCard and Visa in which they alleged that the
implementation and enforcement of MasterCard’s CPP and
Visa’s bylaw provision violated both Section 1 of the
Sherman Act, which prohibits contracts, combinations and
conspiracies that unreasonably restrain trade and Section 2 of
the Sherman Act, which prohibits monopolization and attempts or
conspiracy to monopolize a particular market. These actions were
designated as related cases to the DOJ litigation. On June 24,
2008, MasterCard entered into a settlement agreement with American
Express to resolve all current litigation between American Express
and MasterCard. Under the terms of the settlement agreement,
MasterCard is obligated to make twelve quarterly payments of up to
$150 per quarter with the first payment having been made in
September 2008. See Note 15 (Obligations under Litigation
Settlements) for additional discussion. On October 27, 2008,
MasterCard and Visa entered into a settlement agreement with
Discover, ending all litigation between the parties for a total of
$2,750. The MasterCard share of the settlement, paid to Discover in
November 2008, was approximately $863. In addition, in connection
with the Discover Settlement and pursuant to a separate agreement,
Morgan Stanley, Discover’s former parent company, paid
MasterCard $35 in November 2008.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
April 29, 2005, a complaint was filed in California state
court on behalf of a putative class of consumers under California
unfair competition law (Section 17200) and the Cartwright Act (the
“Attridge action”). The claims in this action seek to
piggyback on the portion of the DOJ antitrust litigation discussed
above with regard to the district court’s findings concerning
MasterCard’s CPP and Visa’s related bylaw. MasterCard
and Visa moved to dismiss the complaint and the court granted the
defendants’ motion to dismiss the plaintiffs’
Cartwright Act claims but denied the defendants’ motion to
dismiss the plaintiffs’ Section 17200 unfair competition
claims. MasterCard filed an answer to the complaint on
June 19, 2006 and the parties have proceeded with discovery.
On September 14, 2009, MasterCard executed a settlement
agreement that is subject to court approval in the California
consumer litigations (see “—U.S. Merchant and Consumer
Litigations”). The agreement includes a release that the
parties believe encompasses the claims asserted in the Attridge
action. On January 5, 2010, the court in the California
consumer actions executed an order preliminarily approving the
settlement, overruling objections by the plaintiff in the Attridge
case. A hearing on final approval of the settlement is set for
July 16, 2010. At this time, it is not possible to determine
the outcome of, or estimate the liability related to, the Attridge
action and no incremental provision for losses has been provided in
connection with it.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Currency Conversion
Litigations</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
International, together with Visa U.S.A., Inc. and Visa
International Corp., are defendants in a state court lawsuit in
California. The lawsuit alleges that MasterCard and Visa wrongfully
imposed an asserted one percent currency conversion
“fee” on every credit card transaction by U.S.
MasterCard and Visa cardholders involving the purchase of goods or
services in a foreign country, and that such alleged
“fee” is unlawful. This action, titled Schwartz v. Visa
Int’l Corp., et al. (the “Schwartz action”), was
brought in the Superior Court of California in February 2000,
purportedly on behalf of the general public. Trial of the Schwartz
action commenced on May 20, 2002 and concluded on
November 27, 2002. The Schwartz action claims that the alleged
“fee” grossly exceeds any costs the defendants might
incur in connection with currency conversions relating to credit
card purchase transactions made in foreign countries and is not
properly disclosed to cardholders. MasterCard denies these
allegations.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
April 8, 2003, the trial court judge issued a final decision
in the Schwartz matter. In his decision, the trial judge found that
MasterCard’s currency conversion process does not violate the
Truth in Lending Act or regulations, nor is it unconscionably
priced under California law. However, the judge found that the
practice is deceptive under California law, and ordered that
MasterCard mandate that members disclose the currency conversion
process to cardholders in cardholder agreements, applications,
solicitations and monthly billing statements. As to MasterCard, the
judge also ordered restitution to California cardholders. The judge
issued a decision on restitution on September 19, 2003, which
requires a traditional notice and claims process in which consumers
have approximately nine months to submit their claims. The court
issued its final judgment on October 31, 2003. On
December 29, 2003, MasterCard appealed the judgment. The final
judgment and restitution process were stayed pending
MasterCard’s appeal. On August 6, 2004, the court
awarded plaintiff’s attorneys’ fees and costs in the
amount of approximately $28 to be paid equally by MasterCard and
Visa. Accordingly, during the three months ended September 30,
2004, MasterCard accrued amounts totaling approximately $14.
MasterCard subsequently filed a notice of appeal on the
attorneys’ fee award on October 1, 2004. With respect to
restitution, MasterCard believed that it was likely to prevail on
appeal. In February 2005, MasterCard filed an appeal regarding the
applicability of Proposition 64, which amended sections 17203 and
17204 of the California Business and Professions Code, to this
action. On September 28, 2005, the appellate court reversed
the trial court, finding that the plaintiff lacked standing to
pursue the action in light of Proposition 64. On May 8, 2007,
the trial court dismissed the case.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
International, Visa U.S.A., Inc., Visa International Corp., several
member banks including Citibank (South Dakota), N.A., Chase
Manhattan Bank USA, N.A., Bank of America, N.A. (USA), MBNA, and
Citicorp Diners Club Inc. are also defendants in a number of
federal putative class actions that allege, among other things,
violations of federal antitrust laws based on the asserted one
percent currency conversion “fee.” Pursuant to an order
of the Judicial Panel on Multidistrict Litigation, the federal
complaints have been consolidated in MDL No. 1409 before Judge
William H. Pauley III in the U.S. District Court for the Southern
District of New York. In January 2002, the federal plaintiffs filed
a Consolidated Amended Complaint (“MDL Complaint”)
adding MBNA Corporation and MBNA America Bank, N.A. as defendants.
This pleading asserts two theories of antitrust conspiracy under
Section 1 of the Sherman Act: (i) an alleged
“inter-association” conspiracy among MasterCard
(together with its members), Visa (together with its members) and
Diners Club to fix currency conversion “fees” allegedly
charged to cardholders of “no less than 1% of the transaction
amount and frequently more”; and (ii) two alleged
“intra-association” conspiracies, whereby each of Visa
and MasterCard is claimed separately to have conspired with its
members to fix currency conversion “fees” allegedly
charged to cardholders of “no less than 1% of the transaction
amount” and “to facilitate and encourage
institution—and collection—of second tier currency
conversion surcharges.” The MDL Complaint also asserts that
the alleged currency conversion “fees” have not been
disclosed as required by the Truth in Lending Act and Regulation
Z.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
July 20, 2006, MasterCard and the other defendants in the MDL
action entered into agreements settling the MDL action and related
matters, as well as the Schwartz matter. Pursuant to the settlement
agreements, MasterCard paid approximately $72 to be used for the
defendants’ settlement fund to settle the MDL action and
approximately $13 to settle the Schwartz matter. On
November 8, 2006, Judge Pauley granted preliminary approval of
the settlement agreements, which were subject to both final
approval by Judge Pauley and resolution of all appeals. On
November 15, 2006, the plaintiff in one of the New York state
court cases appealed the preliminary approval of the settlement
agreement to the U.S. Court of Appeals for the Second Circuit. On
November 3, 2009, Judge Pauley signed a Final Judgment and
Order of Dismissal granting final approval to the settlement
agreements. On November 20, 2009, the same plaintiff in the
New York state cases filed notice of appeal of final settlement
approval in the MDL action. Within the time period for appeal in
the MDL action, twelve other such notices of appeal were filed.
Subsequently, several plaintiffs have requested to withdraw their
appeals. With regard to other state court currency conversion
actions, MasterCard has reached agreements in principle with the
plaintiffs for a total of approximately $4, which has been accrued.
Settlement agreements have been executed with plaintiffs in the
Ohio, Pennsylvania, Florida, Texas, Arkansas, Tennessee, Arizona,
New York, Minnesota, Illinois and Missouri actions. At this time,
it is not possible to predict with certainty the ultimate
resolution of these matters.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>U.S. Merchant and
Consumer Litigations</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Commencing in
October 1996, several class action suits were brought by a number
of U.S. merchants against MasterCard International and Visa U.S.A.,
Inc. challenging certain aspects of the payment card industry under
U.S. federal antitrust law. Those suits were later consolidated in
the U.S. District Court for the Eastern District of New York. The
plaintiffs claimed that MasterCard’s “Honor All
Cards” rule (and a similar Visa rule), which required
merchants who accept MasterCard cards to accept for payment every
validly presented MasterCard card, constituted an illegal tying
arrangement in violation of Section 1 of the Sherman Act.
Plaintiffs claimed that MasterCard and Visa unlawfully tied
acceptance of debit cards to acceptance of credit cards. On
June 4, 2003, MasterCard International signed a settlement
agreement to settle the claims brought by the plaintiffs in this
matter, which the Court approved on December 19, 2003. On
January 24, 2005, the Second Circuit Court of Appeals issued
an order affirming the District Court’s approval of the
settlement agreement thus making it final. On July 1, 2009,
MasterCard International entered into an agreement with the
plaintiffs to prepay MasterCard International’s remaining
payment obligations under the settlement agreement at a discount.
On August 26, 2009, the court entered a final order approving
the prepayment agreement. The agreement became final pursuant to
its terms on September 25, 2009 as there were no appeals of
the court’s approval, and the prepayment was made on
September 30, 2009.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In addition,
individual or multiple complaints have been brought in nineteen
different states and the District of Columbia alleging state unfair
competition, consumer protection and common law claims against
MasterCard International (and Visa) on behalf of putative classes
of consumers. The claims in these actions largely mirror the
allegations made in the U.S. merchant lawsuit and assert that
merchants, faced with excessive merchant discount fees, have passed
these overcharges to consumers in the form of higher prices on
goods and services sold. MasterCard has been successful in
dismissing cases in seventeen of the jurisdictions as courts have
granted MasterCard’s motions to dismiss for failure to state
a claim or plaintiffs have voluntarily dismissed their complaints.
However, there are outstanding cases in New Mexico and California.
The parties are awaiting a decision on MasterCard’s motion to
dismiss in New Mexico. As discussed above under “Department
of Justice Antitrust Litigation and Related Private
Litigations,” on September 14, 2009, the parties to the
California state court actions executed a settlement agreement
which required a payment by MasterCard of $6, subject to approval
by the California state court. On January 5, 2010, the court
executed an order preliminarily approving the settlement. A hearing
on final approval of the settlement is set for July 16,
2010.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">At this time,
it is not possible to determine the outcome of, or, except as
indicated above in the California consumer action, estimate the
liability related to, the remaining consumer cases and no provision
for losses has been provided in connection with them. The consumer
class actions are not covered by the terms of the settlement
agreement in the U.S. merchant lawsuit.</font></p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Interchange Litigation
and Regulatory Proceedings</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Interchange
fees represent a sharing of payment system costs among the
financial institutions participating in a four-party payment card
system such as MasterCard’s. Typically, interchange fees are
paid by the acquirer to the issuer in connection with purchase
transactions initiated with the payment system’s cards. These
fees reimburse the issuer for a portion of the costs incurred by it
in providing services which are of benefit to all participants in
the system, including acquirers and merchants. MasterCard or its
customer financial institutions establish default interchange fees
in certain circumstances that apply when there is no other
interchange fee arrangement between the issuer and the acquirer.
MasterCard establishes a variety of interchange rates depending on
such considerations as the location and the type of transaction,
and collects the interchange fee on behalf of the institutions
entitled to receive it and remits the interchange fee to eligible
institutions. As described more fully below, MasterCard’s
interchange fees are subject to regulatory and/or legal review
and/or challenges in a number of jurisdictions. At this time, it is
not possible to determine the ultimate resolution of, or estimate
the liability related to, any of the interchange proceedings
described below. Except as described below, no provision for losses
has been provided in connection with them.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>United
States.</i> On June 22, 2005, a purported class action lawsuit
was filed by a group of merchants in the U.S. District Court of
Connecticut against MasterCard International Incorporated, Visa
U.S.A., Inc., Visa International Service Association and a number
of member banks alleging, among other things, that
MasterCard’s and Visa’s purported setting of
interchange fees violates Section 1 of the Sherman Act, which
prohibits contracts, combinations and conspiracies that
unreasonably restrain trade. In addition, the complaint alleges
MasterCard’s and Visa’s purported tying and bundling of
transaction fees also constitutes a violation of Section 1 of
the Sherman Act. The suit seeks treble damages in an unspecified
amount, attorneys’ fees and injunctive relief. Since the
filing of this complaint, there have been approximately fifty
similar complaints (the majority of which are styled as class
actions, although a few complaints are on behalf of individual
plaintiffs) filed on behalf of merchants against MasterCard and
Visa (and in some cases, certain member banks) in federal courts in
California, New York, Wisconsin, Pennsylvania, New Jersey, Ohio,
Kentucky and Connecticut. On October 19, 2005, the Judicial
Panel on Multidistrict Litigation issued an order transferring
these cases to Judge Gleeson of the U.S. District Court for the
Eastern District of New York for coordination of pre-trial
proceedings in MDL No. 1720. On April 24, 2006, the group
of purported class plaintiffs filed a First Amended Class Action
Complaint. Taken together, the claims in the First Amended Class
Action Complaint and in the complaints brought on the behalf of the
individual merchants are generally brought under both
Section 1 of the Sherman Act and Section 2 of the Sherman
Act, which prohibits monopolization and attempts or conspiracies to
monopolize a particular industry. Specifically, the complaints
contain some or all of the following claims: (i) that
MasterCard’s and Visa’s setting of interchange fees
(for both credit and offline debit transactions) violates
Section 1 of the Sherman Act; (ii) that MasterCard and
Visa have enacted and enforced various rules, including the no
surcharge rule and purported anti-steering rules, in violation of
Section 1 or 2 of the Sherman Act; (iii) that
MasterCard’s and Visa’s purported bundling of the
acceptance of premium credit cards to standard credit cards
constitutes an unlawful tying arrangement; and (iv) that
MasterCard and Visa have unlawfully tied and bundled transaction
fees. In addition to the claims brought under federal antitrust
law, some of these complaints contain certain unfair competition
law claims under state law based upon the same conduct described
above. These interchange-related litigations seek treble damages,
as well as attorneys’ fees and injunctive relief. On
June 9, 2006, MasterCard answered the complaint and moved to
dismiss or, alternatively, moved to strike the pre-2004 damage
claims that were contained in the First Amended Class Action
Complaint and moved to dismiss the Section 2 claims that were
brought in the individual merchant complaints. On January 8,
2008, the district court dismissed the plaintiffs’ pre-2004
damage claims. On May 14, 2008, the court denied
MasterCard’s motion to dismiss the Section 2
monopolization claims. Fact discovery has been proceeding and was
generally completed by November 21, 2008. Briefs have been
submitted on plaintiffs’ motion for class certification. The
court heard oral argument on the plaintiffs’ class
certification motion on November 19, 2009. The parties are
awaiting a decision on the motion.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
January 29, 2009, the class plaintiffs filed a Second
Consolidated Class Action Complaint. The allegations and claims in
this complaint generally mirror those in the first amended class
action complaint described above although plaintiffs have added
additional claims brought under Sections 1 and 2 of the Sherman Act
against MasterCard, Visa and a number of banks alleging, among
other things, that the networks and banks have continued to fix
interchange fees following each network’s initial public
offering. On March 31, 2009, MasterCard and the other
defendants in the action filed a motion to dismiss the Second
Consolidated Class Action Complaint in its entirety, or
alternatively, to narrow the claims in the complaint. The parties
have fully briefed the motion and the court heard oral argument on
the motion on November 18, 2009. The parties are awaiting
decisions on the motions.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On July 5,
2006, the group of purported class plaintiffs filed a supplemental
complaint alleging that MasterCard’s initial public offering
of its Class A Common Stock in May 2006 (the
“IPO”) and certain purported agreements entered into
between MasterCard and its member financial institutions in
connection with the IPO: (1) violate Section 7 of the
Clayton Act because their effect allegedly may be to substantially
lessen competition, (2) violate Section 1 of the Sherman
Act because they allegedly constitute an unlawful combination in
restraint of trade and (3) constitute a fraudulent conveyance
because the member banks are allegedly attempting to release
without adequate consideration from the member banks
MasterCard’s right to assess the member banks for
MasterCard’s litigation liabilities in these
interchange-related litigations and in other antitrust litigations
pending against it. The plaintiffs seek unspecified damages and an
order reversing and unwinding the IPO. On September 15, 2006,
MasterCard moved to dismiss all of the claims contained in the
supplemental complaint. On November 25, 2008, the district
court granted MasterCard’s motion to dismiss the
plaintiffs’ supplemental complaint in its entirety with leave
to file an amended complaint. On January 29, 2009, the class
plaintiffs repled their complaint directed at MasterCard’s
IPO by filing a First Amended Supplemental Class Action Complaint.
The causes of action in the complaint generally mirror those in the
plaintiffs’ original IPO-related complaint although the
plaintiffs have attempted to expand their factual allegations based
upon discovery that has been garnered in the case. The class
plaintiffs seek treble damages and injunctive relief including, but
not limited to, an order reversing and unwinding the IPO. On
March 31, 2009, MasterCard filed a motion to dismiss the First
Amended Supplemental Class Action Complaint in its entirety. The
parties have fully briefed the motion to dismiss and the court
heard oral argument on the motion on November 18, 2009. The
parties are awaiting a decision on the motion. On July 2,
2009, the class plaintiffs and individual plaintiffs served
confidential expert reports detailing the plaintiffs’
theories of liability and alleging damages in the tens of billions
of dollars. The defendants served their expert reports on
December 14, 2009 countering the plaintiffs’ assertions
of liability and damages. Briefing on dispositive motions,
including summary judgment motions, is currently scheduled to be
completed on February 4, 2011. No trial date has been
scheduled. The parties have also entered into court-recommended
mediation.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
October 10, 2008, the Antitrust Division of the DOJ issued a
civil investigative demand to MasterCard and other payment industry
participants seeking information regarding certain rules relating
to merchant point of acceptance rules, particularly with respect to
merchants’ ability to steer customers to payment forms
preferred by merchants. Subsequently, MasterCard received requests
for similar information from certain State Attorneys General,
including the Attorneys General of Ohio and Texas. In addition, on
December 23, 2009, MasterCard received a request from the
Texas Attorney General’s office for MasterCard’s
responses to questions concerning both its merchant point of
acceptance rules as well as its practices surrounding the setting
of default interchange rates. MasterCard is cooperating with the
DOJ and the offices of the State Attorneys General in connection
with their requests for information.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>European
Union.</i> In September 2000, the European Commission issued a
“Statement of Objections” challenging Visa
International’s cross-border default interchange fees under
European Community competition rules. On July 24, 2002, the
European Commission announced its decision to exempt the Visa
interchange fees from these rules through the end of 2007 based on
certain changes proposed by Visa to its interchange fees. Among
other things, in connection with the exemption order, Visa agreed
to adopt a cost-based methodology for calculating its interchange
fees similar to the methodology employed by MasterCard, which
considers the costs of certain specified services provided by
issuers, and to reduce its interchange rates for debit and credit
transactions to amounts at or below certain specified
levels.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
September 25, 2003, the European Commission issued a Statement
of Objections challenging MasterCard Europe’s cross-border
default interchange fees. On June 23, 2006, the European
Commission issued a supplemental Statement of Objections covering
credit, debit and commercial card fees. On November 14 and 15,
2006, the European Commission held hearings on MasterCard
Europe’s cross-border default interchange fees. On
March 23, 2007, the European Commission issued a Letter of
Facts, also covering credit, debit and commercial card fees and
discussing its views on the impact of the IPO on the case.
MasterCard Europe responded to the Statements of Objections and
Letter of Facts and made presentations on a variety of issues at
the hearings.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The European
Commission announced its decision on December 19, 2007. The
decision applies to MasterCard’s default cross-border
interchange fees for MasterCard and Maestro branded consumer
payment card transactions in the European Economic Area
(“EEA”) (the European Commission refers to these as
“MasterCard’s MIF”), but not to commercial card
transactions (the European Commission stated publicly that it has
not yet finished its investigation of commercial card interchange
fees). The decision applies to MasterCard’s MIF for
cross-border consumer card payments and to any domestic consumer
card transactions that default to MasterCard’s MIF, of which
currently there are none. The decision required MasterCard to stop
applying the MasterCard MIF, to refrain from repeating the conduct,
and not apply its then recently adopted (but never implemented)
Maestro SEPA and Intra-Eurozone default interchange fees to debit
card payment transactions within the Eurozone. MasterCard
understood that the decision gave MasterCard until June 21,
2008 to comply, with the possibility that the European Commission
could have extended this time at its discretion. The decision also
required MasterCard to issue certain specific notices to financial
institutions and other entities that participate in its MasterCard
and Maestro payment systems in the EEA and make certain specific
public announcements regarding the steps it has taken to comply.
The decision did not impose a fine on MasterCard, but provides for
a daily penalty of up to 3.5% of MasterCard’s daily
consolidated global turnover in the preceding business year (which
MasterCard estimates to be approximately $0.5 U.S. per day) in the
event that MasterCard fails to comply. On March 1, 2008,
MasterCard filed an application for annulment of the European
Commission’s decision with the General Court of the European
Union.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
March 26, 2008, the European Commission announced that it has
opened formal antitrust proceedings against, and on April 6,
2009, the European Commission announced that it had issued a
Statement of Objections to, Visa Europe Limited, under Article 81
of the EC Treaty. The proceedings are in relation to Visa’s
multilateral interchange fees for cross-border and certain domestic
consumer payment card transactions within the EEA and Visa’s
‘honor all cards’ rule as it applies to these
transactions.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The
December 19, 2007 decision against MasterCard permits
MasterCard to establish other default cross-border interchange fees
for MasterCard and Maestro branded consumer payment card
transactions in the EEA if MasterCard can demonstrate by empirical
proof to the European Commission’s satisfaction that the new
interchange fees create efficiencies that outweigh the restriction
of competition alleged by the European Commission, that consumers
get a fair share of the benefits of the new interchange fees, that
there are no less restrictive means of achieving the efficiencies
of MasterCard’s payment systems, and that competition is not
eliminated altogether. In March 2008, MasterCard entered into
discussions with the European Commission about, among other things,
the nature of the empirical proof it would require for MasterCard
to establish other default cross-border interchange fees consistent
with the decision and so as to understand more fully the European
Commission’s position as to how it may comply with the
decision. MasterCard requested an extension of time to comply with
the decision and, on April 26, 2008, the European Commission
informed MasterCard that it had rejected such request. On
June 12, 2008, MasterCard announced that, effective
June 21, 2008, MasterCard would temporarily repeal its then
current default intra-EEA cross-border consumer card interchange
fees in conformity with the decision. On October 17, 2008,
MasterCard received an information request from the European
Commission in connection with the decision concerning certain
pricing changes that MasterCard implemented as of October 1,
2008. MasterCard submitted its response on November 13,
2008.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
March 30, 2009, MasterCard gave certain undertakings to the
European Commission and, in response, on April 1, 2009, the
Commissioner for competition policy and DG Competition informed
MasterCard that, subject to MasterCard’s fulfilling its
undertakings, they do not intend to pursue proceedings for
non-compliance with or circumvention of the decision of
December 19, 2007 or for infringing the antitrust laws in
relation to the October 1, 2008 pricing changes, the
introduction of new cross-border consumer default interchange fees
or any of the other MasterCard undertakings. MasterCard’s
undertakings include: (1) repealing the October 1, 2008
pricing changes; (2) adopting a specific methodology for the
setting of cross-border consumer default interchange fees;
(3) establishing new default cross-border consumer interchange
fees as of July 1, 2009 such that the weighted average
interchange fee for credit card transactions does not exceed 30
basis points and for debit card transactions does not exceed 20
basis points; (4) introducing a new rule prohibiting its
acquirers from requiring merchants to process all of their
MasterCard and Maestro transactions with the acquirer; and
(5) introducing a new rule requiring its acquirers to provide
merchants with certain pricing information in connection with
MasterCard and Maestro transactions. The undertakings will be
effective until a final decision by the General Court of the
European Union regarding MasterCard’s application for
annulment of the European Commission’s December 19, 2007
decision.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Although
MasterCard believes that any other business practices it would
implement in response to the decision would be in compliance with
the December 19, 2007 decision, the European Commission may
deem any such practice not in compliance with the decision, or in
violation of European competition law, in which case MasterCard may
be assessed fines for the period that it is not in compliance.
Furthermore, because a balancing mechanism like default
cross-border interchange fees constitutes an essential element of
MasterCard Europe’s operations, the December 19, 2007
decision could also significantly impact MasterCard
International’s European customers’ and MasterCard
Europe’s business. The European Commission decision could
also lead to additional competition authorities in European Union
member states commencing investigations or proceedings regarding
domestic interchange fees or, in certain jurisdictions, regulation.
In addition, the European Commission’s decision could lead to
the filing of private actions against MasterCard Europe by
merchants and/or consumers which, if MasterCard is unsuccessful in
its application for annulment of the decision, could result in
MasterCard owing substantial damages.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>United
Kingdom Office of Fair Trading</i>. On September 25, 2001, the
Office of Fair Trading of the United Kingdom (“OFT”)
issued a Rule 14 Notice under the U.K. Competition Act 1998
challenging the MasterCard default interchange fees and
multilateral service fee (“MSF”), the fee paid by
issuers to acquirers when a customer uses a MasterCard-branded card
in the United Kingdom either at an ATM or over the counter to
obtain a cash advance. Until November 2004, the interchange fees
and MSF were established by MasterCard U.K. Members Forum Limited
(“MMF”) (formerly MasterCard Europay U.K. Ltd.) for
domestic credit card transactions in the United Kingdom. The notice
contained preliminary conclusions to the effect that the MasterCard
U.K. default interchange fees and MSF infringed U.K. competition
law and did not qualify for an exemption in their present forms. On
February 11, 2003, the OFT issued a supplemental Rule 14
Notice, which also contained preliminary conclusions challenging
MasterCard’s U.K. interchange fees (but not the MSF) under
the Competition Act. On November 10, 2004, the OFT issued a
third notice (now called a Statement of Objections) claiming that
the interchange fees infringed U.K. and European Union competition
law.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
November 18, 2004, MasterCard’s board of directors
adopted a resolution withdrawing the authority of the U.K. members
to set domestic MasterCard interchange fees and MSFs and conferring
such authority on MasterCard’s President and Chief Executive
Officer.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
September 6, 2005, the OFT issued its decision, concluding
that MasterCard’s U.K. interchange fees that were established
by MMF prior to November 18, 2004 contravene U.K. and European
Union competition law. The OFT decided not to impose penalties on
MasterCard or MMF. MMF and MasterCard appealed the OFT’s
decision to the U.K. Competition Appeals Tribunal. On June 19,
2006, the U.K. Competition Appeals Tribunal set aside the
OFT’s decision, following the OFT’s request to the
Tribunal to withdraw the decision and end its case against
MasterCard’s U.K. default interchange fees in place prior to
November 18, 2004.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Shortly
thereafter, the OFT commenced a new investigation of
MasterCard’s current U.K. default credit card interchange
fees and announced on February 9, 2007 that the investigation
would also cover so-called “immediate debit” cards. To
date, the OFT has issued a number of requests for information to
MasterCard Europe and financial institutions that participate in
MasterCard’s payment system in the United Kingdom. MasterCard
understands that the OFT is considering whether to commence a
formal proceeding through the issuance of a Statement of
Objections. The OFT has informed MasterCard that it does not intend
to issue such a Statement of Objections prior to the judgment of
the General Court of the European Union with respect to
MasterCard’s appeal of the December 2007 decision of the
European Commission. If the OFT ultimately determines that any of
MasterCard’s U.K. interchange fees contravene U.K. and
European Union competition law, it may issue a new decision and
possibly levy fines accruing from the date of its first decision.
MasterCard would likely appeal a negative decision by the OFT in
any future proceeding to the Competition Appeals Tribunal. Such an
OFT decision could lead to the filing of private actions against
MasterCard by merchants and/or consumers which, if its appeal of
such an OFT decision were to fail, could result in an award or
awards of substantial damages and could have a significant adverse
impact on the revenues of MasterCard International’s U.K.
customers and MasterCard’s overall business in the
U.K.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Poland.</i>
In April 2001, in response to merchant complaints, the Polish
Office for Protection of Competition and Consumers (the
“PCA”) initiated an investigation of MasterCard’s
(and Visa’s) domestic credit and debit card default
interchange fees. MasterCard Europe filed several submissions and
met with the PCA in connection with the investigation. In January
2007, the PCA issued a decision that MasterCard’s (and
Visa’s) interchange fees are unlawful under Polish
competition law, and imposed fines on MasterCard’s (and
Visa’s) licensed financial institutions. As part of this
decision, the PCA also decided that MasterCard (and Visa) had not
violated the law. MasterCard and the financial institutions
appealed the decision to the court of first instance. On
November 12, 2008, the court of first instance reversed the
decision of the PCA and also rejected MasterCard’s appeal on
the basis that MasterCard did not have a legal interest in the
PCA’s decision because its conduct was not found to be in
breach of the relevant competition laws. MasterCard has appealed
this part of the court of first instance’s decision because
it has significant interest in the outcome of the case. The PCA
appealed the other parts of the decision. On April 22, 2010
the court of appeals issued an oral decision (to be followed by a
written decision) in which it reinstated MasterCard’s appeal,
reversed a specific finding of the court of first instance and sent
the case back to the court of first instance for further
proceedings. If on appeal the PCA’s decision is ultimately
allowed to stand, it could have a significant adverse impact on the
revenues of MasterCard’s Polish customers and on
MasterCard’s overall business in Poland.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Hungary.</i>
In January 2008, the Hungarian Competition Authority
(“HCA”) notified MasterCard that it had commenced a
formal investigation of MasterCard Europe’s (and Visa
Europe’s) domestic interchange fees. This followed an
informal investigation that the HCA had been conducting since the
middle of 2007. On July 12, 2009, the HCA issued to MasterCard
a Preliminary Position that MasterCard Europe’s historic
domestic interchange fees violate Hungarian competition law.
MasterCard responded to the Preliminary Position both in writing
and at a hearing which was held on September 8 and 9, 2009. On
September 24, 2009, the HCA ruled that MasterCard’s (and
Visa’s) historic interchange fees violated the law and fined
MasterCard Europe and Visa Europe each approximately $3, which was
paid during the fourth quarter of 2009. The HCA issued its formal
decision on December 2, 2009 and on December 18, 2009,
MasterCard appealed the decision to the Hungarian courts. If the
HCA’s decision is not reversed on appeal, it could have a
significant adverse impact on the revenues of MasterCard’s
Hungarian customers and on MasterCard’s overall business in
Hungary.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Italy.</i>
On July 15, 2009, the Italian Competition Authority
(“ICA”) commenced a proceeding against MasterCard and a
number of its customers concerning MasterCard Europe’s
domestic interchange fees in Italy. MasterCard, as well as each of
the banks involved in the proceeding, offered to give certain
undertakings to the ICA, which were rejected (and which MasterCard
has now sought to appeal). If the Italian Competition Authority
issues a Statement of Objections to MasterCard in connection with
the matter, MasterCard would have the opportunity to respond both
in writing and at a hearing and, if a negative decision were
reached, to appeal the decision. A negative decision could result
in MasterCard and/or its customers being fined and, if not reversed
on appeal, could have a significant adverse impact on the revenues
of MasterCard’s Italian customers and on MasterCard’s
overall business in Italy.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Australia.</i> In 2002, the Reserve Bank of Australia
(“RBA”) announced regulations under the Payments
Systems (Regulation) Act of 1998 applicable to four-party credit
card payment systems in Australia, including MasterCard’s.
Those regulations, among other things, mandate the use of a formula
for determining domestic interchange fees that effectively caps
their weighted average at 50 basis points. Operators of three-party
systems, such as American Express and Diners Club, were unaffected
by the interchange fee regulation. In 2007, the RBA commenced a
review of such regulations and, on September 26, 2008, the RBA
released its final conclusions. These indicated that the RBA was
willing to withdraw its regulations if MasterCard and Visa made
certain undertakings regarding the future levels of their
respective credit card interchange fees and other practices,
including their “honor all cards” rules. If the
undertakings were not made, the RBA said it would consider imposing
in 2009 additional regulations that could further reduce the
domestic interchange fees of MasterCard and Visa in Australia. On
August 26, 2009, the RBA announced that it had decided not to
withdraw its regulations and that it would maintain them in their
current form pending further consideration of the regulations.
MasterCard plans to continue discussions with the RBA as to the
nature of the undertakings that MasterCard may be willing to
provide. The effect of the undertakings or any such additional
regulations could put MasterCard at an even greater competitive
disadvantage relative to competitors in Australia that purportedly
do not operate four-party systems or, in the case of the
undertakings, possibly increase MasterCard’s legal exposure
under Australian competition laws, which could have a significant
adverse impact on MasterCard’s business in
Australia.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>South
Africa.</i> On August 4, 2006, the South Africa Competition
Commission created a special body, the Jali Enquiry (the
“Enquiry”), to examine competition in the payments
industry in South Africa, including interchange fees. After nearly
two years of investigation, including several rounds of public
hearings in which MasterCard participated, on June 25, 2008,
the Enquiry published an Executive Summary of its findings. The
Enquiry’s full report was made public on December 12,
2008. The Enquiry recommends, among other things, that an
independent authority be established to set payment card
interchange fees in South Africa and that payment systems’
(including MasterCard’s) respective “honor all
cards” rules be modified to give merchants greater freedom to
choose which types of cards to accept. The Enquiry’s report
is non-binding but is under active consideration by South African
regulators. If adopted, the Enquiry’s recommendations could
have a significant adverse impact on MasterCard’s business in
South Africa.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">On
October 21, 2008, the South African National Assembly (the
“National Assembly”) adopted amendments to that
country’s competition laws concerning so-called
“complex monopolies” and criminalizing certain
violations of those laws (the “South Africa Bill”). On
January 29, 2009, the then President of South Africa referred
the South Africa Bill back to the National Assembly for further
consideration and, in early February 2009, the National Assembly
readopted the South Africa Bill. The President also stated that he
might submit the South Africa Bill to that country’s
Constitutional Court for review. In April 2009, South Africa
elected a new President, who signed the South Africa Bill on
August 27, 2009 without either referring it to the
Constitutional Court or setting a date on which the South Africa
Bill will enter into force. If and when the South Africa Bill
becomes effective, it could have a significant adverse impact on
MasterCard’s business in South Africa.</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2"><i>Other
Jurisdictions.</i> In January 2006, a German retailers association
filed a complaint with the Federal Cartel Office
(“FCO”) in Germany concerning MasterCard’s (and
Visa’s) domestic default interchange fees. The complaint
alleges that MasterCard’s (and Visa’s) German domestic
interchange fees are not transparent to merchants and include
so-called “extraneous costs”. On December 21,
2009, the FCO sent MasterCard a questionnaire concerning its
domestic interchange fees.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In July 2009,
the Canadian Competition Bureau informed MasterCard that it intends
to review MasterCard’s (and Visa’s) interchange fees
and related rules, such as the “honor all cards” and
“no surcharge” rules.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard is
aware that regulatory authorities and/or central banks in certain
other jurisdictions including Belgium, Brazil, Colombia, Czech
Republic, Estonia, France, Israel, the Netherlands, Norway,
Switzerland, Turkey and Venezuela are reviewing MasterCard’s
and/or its members’ interchange fees and/or related practices
(such as the “honor all cards” rule) and may seek to
regulate the establishment of such fees and/or such
practices.</font></p>
</div><div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 7. Other
Assets</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Other assets
consisted of the following:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Customer and merchant
incentives</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">156</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">216</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Cost and equity method
investments</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">36</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">35</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Cash surrender value of
keyman life insurance</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">25</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">34</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">36</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Total other
assets</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">251</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">310</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other assets,
current</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(92</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(126</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other assets,
long-term</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">159</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">184</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Certain
customer and merchant business agreements provided incentives upon
entering into the agreement. As of March 31, 2010 and
December 31, 2009, other assets included amounts to be paid
for these incentives and the related liability was included in
accrued expenses and other liabilities. Once the payment is made,
the liability is relieved and the other asset is reclassified to a
prepaid expense.</font></p>
</div><div>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 15. Obligations
Under Litigation Settlements</b></font></p>
<p style="MARGIN-TOP: 6px; TEXT-INDENT: 4%; MARGIN-BOTTOM: 0px">
<font style="FONT-FAMILY: Times New Roman" size="2">On
June 24, 2008, MasterCard entered into a settlement agreement
(the “American Express Settlement”) with American
Express Company (“American Express”) relating to the
U.S. federal antitrust litigation between MasterCard and American
Express. The American Express Settlement ended all existing
litigation between MasterCard and American Express. Under the terms
of the American Express Settlement, MasterCard is obligated to make
12 quarterly payments of up to $150 per quarter beginning in the
third quarter of 2008. MasterCard’s maximum nominal payments
will total $1,800. The amount of each quarterly payment is
contingent on the performance of American Express’s U.S.
Global Network Services business. The quarterly payments will be in
an amount equal to 15% of American Express’s U.S. Global
Network Services billings during the quarter, up to a maximum of
$150 per quarter. If, however, the payment for any quarter is less
than $150, the maximum payment for subsequent quarters will be
increased by the difference between $150 and the lesser amount that
was paid in any quarter in which there was a shortfall. MasterCard
has assumed American Express will achieve these financial hurdles.
MasterCard recorded the present value of $1,800, at a 5.75%
discount rate, or $1,649 in the quarter ended June 30, 2008
with respect to the American Express Settlement.</font></p>
<p style="MARGIN-TOP: 12px; TEXT-INDENT: 4%; MARGIN-BOTTOM: 0px">
<font style="FONT-FAMILY: Times New Roman" size="2">Total
liabilities for the American Express Settlement and other
litigation settlements changed from December 31, 2009, as
follows:</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px">
 </p>
<table border="0" cellspacing="0" cellpadding="0" width="68%" align="center">
<tr>
<td width="90%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Balance as of
December 31, 2009</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">870</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Interest accretion on
American Express Settlement</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Payments on American
Express Settlement</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(150</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr>
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Other payments, accruals
and accretion, net</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">—  </font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Balance as of
March 31, 2010</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">731</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 12px; TEXT-INDENT: 4%; MARGIN-BOTTOM: 0px">
<font style="FONT-FAMILY: Times New Roman" size="2">See Note 17
(Legal and Regulatory Proceedings) for additional discussion
regarding the Company’s legal proceedings.</font></p>
</div><div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
</p>
<p style="MARGIN-TOP: 18px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Note 18. Settlement and
Travelers Cheque Risk Management</b></font></p>
<p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
International’s rules generally guarantee the payment of
certain MasterCard, Cirrus and Maestro branded transactions between
its principal members. The term and amount of the guarantee are
unlimited. Settlement risk is the exposure to members under
MasterCard International’s rules (“Settlement
Exposure”), due to the difference in timing between the
payment transaction date and subsequent settlement. Settlement
Exposure is estimated using the average daily card volumes during
the quarter multiplied by the estimated number of days to settle.
The Company has global risk management policies and procedures,
which include risk standards, to provide a framework for managing
the Company’s settlement risk. Member-reported transaction
data and the transaction clearing data underlying the settlement
risk calculation may be revised in subsequent reporting
periods.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">In the event
that MasterCard International effects a payment on behalf of a
failed member, MasterCard International may seek an assignment of
the underlying receivables. Subject to approval by the Board of
Directors, members may be charged for the amount of any settlement
loss incurred during the ordinary activities of the
Company.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
requires certain members that are not in compliance with the
Company’s risk standards in effect at the time of review to
post collateral, typically in the form of cash, letters of credit,
or bank guarantees. This requirement is based on management review
of the individual risk circumstances for each member that is out of
compliance. In addition to these amounts, MasterCard holds
collateral to cover variability and future growth in member
programs. The Company also holds collateral to pay merchants in the
event of merchant bank/acquirer failure. Although it is not
contractually obligated under MasterCard International’s
rules to effect such payments to merchants, the Company may elect
to do so to protect brand integrity. MasterCard monitors its credit
risk portfolio on a regular basis and the adequacy of collateral on
hand. Additionally, from time to time, the Company reviews its risk
management methodology and standards. As such, the amounts of
estimated settlement risk are revised as necessary.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Estimated
Settlement Exposure, and the portion of the Company’s
uncollateralized Settlement Exposure for MasterCard-branded
transactions that relates to members that are deemed not to be in
compliance with, or that are under review in connection with, the
Company’s risk management standards, were as
follows:</font></p>
<p style="MARGIN-TOP: 0px; FONT-SIZE: 12px; MARGIN-BOTTOM: 0px">
 </p>
<table cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr>
<td width="76%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>March 31,<br />
2010</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" align="center" colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1"><b>December 31,<br />
2009</b></font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>MasterCard-branded
transactions:</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Gross Settlement
Exposure</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">25,669</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26,373</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Collateral held for
Settlement Exposure</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,444</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2,759</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Net uncollateralized
Settlement Exposure</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">22,225</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">23,614</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td height="8"></td>
<td colspan="4" height="8"></td>
<td colspan="4" height="8"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Uncollateralized
Settlement Exposure attributable to non-compliant
members</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">195</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">211</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td height="8"></td>
<td colspan="4" height="8"></td>
<td colspan="4" height="8"></td>
</tr>
<tr>
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Cirrus and Maestro
transactions:</b></font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-LEFT: 1em; TEXT-INDENT: -1em"><font style="FONT-FAMILY: Times New Roman" size="2">Gross Settlement
Exposure</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2,851</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">3,433</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font size="1"> </font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Although
MasterCard holds collateral at the member level, the Cirrus and
Maestro estimated settlement exposures are calculated at the
regional level. Therefore, these settlement exposures are reported
on a gross basis, rather than net of collateral.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Of the total
uncollateralized Settlement Exposure under the MasterCard brand,
the United States accounted for approximately 42% and 40% at
March 31, 2010 and December 31, 2009, respectively. No
individual country other than the United States accounted for more
than 10% of total uncollateralized Settlement Exposure at either
March 31, 2010 or December 31, 2009. Of the total
uncollateralized Settlement Exposure attributable to non-compliant
members, five members represented approximately 64% and 56% at
March 31, 2010 and December 31, 2009,
respectively.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">MasterCard
guarantees the payment of MasterCard-branded travelers cheques in
the event of issuer default. The guarantee estimate is based on all
outstanding MasterCard-branded travelers cheques, reduced by an
actuarial determination of cheques that are not anticipated to be
presented for payment. The term and amount of the guarantee are
unlimited. MasterCard calculated its MasterCard-branded travelers
cheques exposure under this guarantee as $378 and $401 at
March 31, 2010 and December 31, 2009, respectively. The
reduction in travelers cheques exposure is attributable to
MasterCard-branded travelers cheques no longer being
issued.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">A significant
portion of the Company’s travelers cheques risk is
concentrated in one MasterCard travelers cheques issuer. MasterCard
obtained an unlimited guarantee estimated at $294 and $313 at
March 31, 2010 and December 31, 2009, respectively, from
a financial institution that is a member, to cover all of the
exposure of outstanding travelers cheques with respect to such
issuer. In addition, MasterCard obtained a limited guarantee
estimated at $14 as of March 31, 2010 and December 31,
2009 from a financial institution that is a member in order to
cover the exposure of outstanding travelers cheques with respect to
another issuer. These guarantee amounts have also been reduced by
an actuarial determination of travelers cheques that are not
anticipated to be presented for payment.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">Beginning in
2008 and continuing in 2009, many of the Company’s financial
institution customers were directly and adversely impacted by the
unprecedented events that occurred in the financial markets around
the world. The ongoing economic turmoil presents increased risk
that the Company may have to perform under its settlement and
travelers cheque guarantees. General economic conditions and
political conditions in countries in which MasterCard operates may
also affect the Company’s settlement risk. The
Company’s global risk management policies and procedures,
which are revised and enhanced from time to time, continue to be
effective as evidenced by the historically low level of losses that
the Company has experienced from customer financial institution
failures, including no losses in the last several years.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; TEXT-INDENT: 4%">
<font style="FONT-FAMILY: Times New Roman" size="2">The Company
enters into business agreements in the ordinary course of business
under which the Company agrees to indemnify third parties against
damages, losses and expenses incurred in connection with legal and
other proceedings arising from relationships or transactions with
the Company. As the extent of the Company’s obligations under
these agreements depends entirely upon the occurrence of future
events, the Company’s potential future liability under these
agreements is not determinable.</font></p>
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