MasterCard 2008 Annual Report Download - page 113

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MASTERCARD INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(In thousands, except percent and per share data)
The following table summarizes expected benefit payments through 2018 including those payments
expected to be paid from the Company’s general assets. Since the majority of the benefit payments are made in
the form of lump-sum distributions, actual benefit payments may differ from expected benefits payments.
2009 .................................................................... $ 19,766
2010 .................................................................... 18,182
2011 .................................................................... 25,518
2012 .................................................................... 21,029
2013 .................................................................... 24,578
2014 – 2018 .............................................................. 118,709
Substantially all of the Company’s U.S. employees are eligible to participate in a defined contribution
savings plan (the “Savings Plan”) sponsored by the Company. The Savings Plan allows employees to contribute a
portion of their base compensation on a pre-tax and after-tax basis in accordance with specified guidelines. The
Company matches a percentage of employees’ contributions up to certain limits. In 2007 and prior years, the
Company could also contribute to the Savings Plan a discretionary profit sharing component linked to Company
performance during the prior year. Beginning in 2008, the discretionary profit sharing amount related to 2007
Company performance was paid directly to employees as a short-term cash incentive bonus rather than as a
contribution to the Savings Plan. In addition, the Company has several defined contribution plans outside of the
United States. The Company’s contribution expense related to all of its defined contribution plans was $35,341,
$26,996 and $43,594 for 2008, 2007 and 2006, respectively.
The Company had a Value Appreciation Program (“VAP”), which was an incentive compensation plan
established in 1995. Annual awards were granted to VAP participants from 1995 through 1998, which entitled
participants to the net appreciation on a portfolio of securities of members of MasterCard International. In 1999,
the VAP was replaced by an Executive Incentive Plan (“EIP”) and the Senior Executive Incentive Plan (“SEIP”)
(together the “EIP Plans”) (See Note 16 (Share Based Payments and Other Benefits)). Contributions to the VAP
have been discontinued, all plan assets have been disbursed and no VAP liability remained as of December 31,
2008. The Company’s liability related to the VAP at December 31, 2007 was $986. The expense (benefit) was
$(6), $(267) and $3,406 for the years ended December 31, 2008, 2007 and 2006, respectively.
Note 12. Postemployment and Postretirement Benefits
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.
The Company amended the life insurance benefits under the Postretirement Plan effective January 1, 2007.
The impact, net of taxes, of this amendment was an increase of $1,715 to accumulated other comprehensive
income in 2007.
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