8-KMaterial Agreements

Mastercard Inc 8-K Report, Material Agreement (Nov 29, 2004)

Filed November 29, 2004For Securities:MA

Summary

This 8-K filing from November 29, 2004, reports a material definitive agreement entered into by Mastercard Incorporated on November 23, 2004. The agreement involves an amendment to a guarantee related to Mastercard International's 7.36% Series A Senior Secured Notes, originally issued in 1999 to finance a technology and operations facility. The primary change is the transfer of certain guarantee obligations from Mastercard International to its parent company, Mastercard Incorporated. This amendment signifies a restructuring aimed at better aligning Mastercard's corporate structure with its financial reporting and debt covenant obligations. Mastercard Incorporated now assumes responsibility for specific covenant compliance, including financial reporting and maintaining consolidated net worth, which will now be consistent with obligations under its other debt instruments. The company states this change is intended to simplify compliance and reduce administrative burdens.

Key Highlights

  • 1Mastercard Incorporated amended a material definitive agreement concerning its 7.36% Series A Senior Secured Notes.
  • 2Obligations under the guarantee for these notes have been transferred from Mastercard International to the parent company, Mastercard Incorporated.
  • 3Mastercard Incorporated has assumed covenant compliance obligations, including financial reporting and consolidated net worth maintenance.
  • 4The amendment aims to align financial reporting and net worth covenants with those of other debt instruments.
  • 5The change reflects Mastercard's corporate structure and is intended to reduce compliance costs and administrative burdens.
  • 6The Senior Secured Notes were originally issued in 1999 to finance a global technology and operations facility in O'Fallon, Missouri.

Frequently Asked Questions

This filing reports a material definitive agreement where Mastercard Incorporated amended a guarantee related to its Series A Senior Secured Notes. The primary change is the transfer of certain guarantee obligations from its subsidiary, Mastercard International, to the parent company, Mastercard Incorporated.

Mastercard Incorporated is assuming certain covenant compliance obligations under the guarantee. This includes responsibilities related to financial reporting and the maintenance of consolidated net worth.

The company states the amendment is intended to better reflect its corporate structure, align financial reporting and net worth covenant obligations with those of its other debt instruments, and reduce the costs and administrative burden associated with complying with different debt covenants.

The amendment primarily affects the guarantee and the allocation of covenant compliance responsibilities between Mastercard International and Mastercard Incorporated. The notes themselves remain outstanding, but the parent company is now taking on direct responsibility for certain aspects of the guarantee's compliance.