<PAGE>

                                 THE CONVERSION

OVERVIEW OF THE CONVERSION

     The conversion refers to the process by which MasterCard International will
merge with a subsidiary of MasterCard Incorporated, a newly formed stock holding
company. After the conversion, MasterCard International will continue as a
non-stock corporation and the principal operating subsidiary of MasterCard
Incorporated, which will own the sole class B membership interest of MasterCard
International. In the conversion, each principal member of MasterCard
International will receive shares of class A redeemable common stock and class B
convertible common stock of MasterCard Incorporated representing that member's
equity interest in MasterCard Incorporated, and a class A membership interest in
MasterCard International representing that member's continued rights as a
licensee to use MasterCard's brands, programs and services. MasterCard
International's rules and standards will not be affected by the conversion and
integration.


     We expect that the conversion will be completed as soon as practicable
after the conditions to conversion are satisfied, including approval of the
conversion by the members and the expiration or termination of any waiting
period under the HSR Act. We anticipate that these conditions will be satisfied
and that the conversion will be completed in the first half of 2002.


EFFECTS OF THE CONVERSION

     As a stockholder of MasterCard Incorporated, you will have the right to
vote on all matters submitted to the stockholders for a vote, including the
election of the board of directors, and extraordinary transactions, such as a
merger, consolidation, or sale of all or substantially all of the assets or
dissolution of MasterCard Incorporated. In any vote for the election of
directors, no stockholder, together with its affiliates, will be entitled to
vote more than 7% of the outstanding shares that are entitled to vote in that
election.

     The board of directors of MasterCard International is required to be the
same as the board of directors of MasterCard Incorporated. You will have the
right to vote on proposed changes to Article I (Membership) of the bylaws of
MasterCard International, but you will no longer be entitled to vote with
respect to any other amendments of the charter or bylaws of MasterCard
International. The rules for the qualification of members of MasterCard
International will be the same as the current rules for the qualification of
members of MasterCard International.

     The directors and executive officers of MasterCard Incorporated after the
conversion and integration will be the same as the directors and executive
officers of MasterCard International before the conversion except for the
addition of two voting directors who will be affiliated with European members
and the addition of Dr. Peter Hoch, currently Chief Executive Officer of
Europay, who will be President of MasterCard's Europe region (an officer of
MasterCard Incorporated) and a non-voting director. In particular, if the
conversion is approved, the current directors of MasterCard International will
serve as the directors of MasterCard Incorporated and MasterCard International
until the annual meeting of MasterCard Incorporated shareholders in 2003. In
addition, the boards of directors of each company, acting pursuant to authority
granted to them in their respective certificates of incorporation and/or bylaws,
will appoint two additional voting directors affiliated with European members
and Dr. Peter Hoch as a non-voting director, in each case to serve until the
annual meeting of MasterCard Incorporated shareholders in 2003. The board of
directors of MasterCard Incorporated will be subject to reelection in 2003. If
the conversion does not occur, the current directors of MasterCard International
will continue in that capacity until an annual meeting of MasterCard
International principal members is held in 2003.

     The bylaws of MasterCard Incorporated provide that during the three year
transition period following the closing of the conversion and integration:

     - one-third of the members of MasterCard Incorporated's board of directors
       will be representatives of MasterCard Incorporated's European
       stockholders;

     - one-third of the members of MasterCard Incorporated's board of directors
       will be representatives of MasterCard Incorporated's U.S. stockholders;

     - the President and Chief Executive Officer of MasterCard Incorporated will
       be a director; and

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     - the remaining directors will be apportioned among the other regions in
       accordance with the percentage of common stock owned by the stockholders
       of those regions.

     After the three-year transition period, the President and Chief Executive
Officer will continue to be a director and all other directors will be
apportioned among the regions according to each region's respective share of the
aggregate vote. The integration agreement provides that the allocation of
one-third of the board seats to Europe during the transition period may not be
altered.

     The board of directors of MasterCard Incorporated will initially consist of
18 voting members -- six from the U.S., six from Europe, three from
Asia/Pacific, one from Canada, one from Latin America and the Caribbean and the
President and Chief Executive Officer of MasterCard Incorporated. The directors
will be elected by the class A and class B stockholders, voting together as a
single class (so long as the class B convertible shares are entitled to vote),
with each share entitled to one vote, subject to the following limitations:

     - no more than two representatives from any member (including its
       affiliates and affiliate members) may sit on the board of directors;

     - no single stockholder, together with its affiliates, may exercise more
       than 7% of the voting power in any election of directors; and

     - no more than one-third of the board of directors may be representatives
       from a single region.

     In addition to the MasterCard Incorporated board of directors, there will
be a regional board for each of MasterCard's six operating regions:
Asia/Pacific, Canada, Europe, Latin America and the Caribbean, Middle
East/Africa and the United States. Each of the regional boards will be elected
by the members from that region. Decisions to establish or eliminate a regional
board or overrule one of its decisions must be approved by a two-thirds majority
vote of the board of directors. In addition, all of the regions will have a
regional president, who will be selected by the President and Chief Executive
Officer of MasterCard Incorporated in concurrence with the regional board (or
otherwise with a two-thirds majority of the global board of directors).
MasterCard Incorporated will also establish a Debit Advisory Board to provide
guidance with respect to the ongoing development of MasterCard's debit programs.
The powers and responsibilities of the regional boards following the conversion
and integration are expected to be substantially similar to the powers and
responsibilities of those boards before the conversion and integration.

     For a description of the supermajority requirements necessary to revise
these governance arrangements, see "Comparison of Rights of MasterCard
International Members Before and After the Conversion and Integration -- Vote on
Extraordinary Transactions/Supermajority Voting Provisions."

CONSIDERATIONS RELATING TO THE CONVERSION

     In approving the conversion and recommending that you approve the
conversion, our board of directors considered a number of advantages of the new
structure. By creating a new holding company, MasterCard Incorporated, which
will own MasterCard International, we expect to realize many of the advantages
of a stock corporation at the holding company level, while maintaining the
flexibility of a membership association in governing the operations of our
global payments programs at the subsidiary level. As is typical of a holding
company structure, the holding company, MasterCard Incorporated, will control
the voting power of its operating subsidiary, MasterCard International, with
regard to all items that require a vote of MasterCard International's members,
except for amendments to Article I (Membership) of the bylaws.

     We believe that the conversion will enhance the value of our business and
our future opportunities by providing us some of the benefits of being a public
company. Specifically, we believe that the conversion will:

     - permit member-stockholders to realize the value of their investment in
       MasterCard as an asset and, subject to certain restrictions, trade
       MasterCard Incorporated shares among themselves;

     - align more closely the interests of MasterCard and our
       member-stockholders. As member-stockholders increase their MasterCard
       business, their relative shareholdings in MasterCard Incorporated may
       increase;

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<PAGE>

     - provide a more flexible structure to respond to opportunities in the
       marketplace, for example, by permitting us to complete the integration
       with Europay more efficiently since Europay already has capital stock
       outstanding or by permitting us to use our class C common stock as
       acquisition currency in future acquisitions;

     - result in greater financial transparency for our member-stockholders,
       since after the conversion MasterCard Incorporated will report financial
       and business information on a quarterly basis in accordance with
       Securities and Exchange Commission rules and regulations; and

     - make it easier, if desired, for MasterCard Incorporated to raise
       financing in the public securities markets to fund technological
       innovations and other projects since MasterCard Incorporated will be a
       public reporting company.

     In approving the conversion and recommending that you approve the
conversion, our board of directors also considered potential disadvantages of
the new structure. Specifically, it is possible that:

     - a market for MasterCard Incorporated common stock may not develop
       sufficiently to provide member-stockholders with enough liquidity in
       trading their shares;

     - stockholders may be required to purchase or sell shares of MasterCard
       Incorporated in order to satisfy certain requirements, which may be
       disadvantageous to them;

     - the conversion will facilitate future strategic transactions that could
       reduce the influence of current MasterCard International members;

     - MasterCard Incorporated and certain member-stockholders will be subject
       to additional regulatory burdens, including Securities and Exchange
       Commission regulations, as a result of the conversion; and

     - the conversion could subject some members to tax liabilities.

     No director or officer or any of their affiliates has a substantial
interest, direct or indirect, in the conversion.

BOARD OF DIRECTORS' AND PRINCIPAL MEMBERS' APPROVAL


     On February 8, 2001, the board of directors of MasterCard International
approved resolutions recommending the conversion to MasterCard International's
members. Approval at the special meeting of at least a majority of voting power
of MasterCard International's principal members is required to complete the plan
of conversion; the quorum for the special meeting is the presence in person or
by proxy of members representing a majority of the votes eligible to be cast.
Notwithstanding member approval, however, the plan of conversion will not be
completed if the integration will not also be completed.


     THE BOARD OF DIRECTORS OF MASTERCARD INTERNATIONAL RECOMMENDS THAT MEMBERS
VOTE FOR APPROVAL OF THE PLAN OF CONVERSION.

THE MERGER AGREEMENT EFFECTING THE CONVERSION

     We summarize below the material terms and other provisions of the merger
agreement. The description is not complete, and we refer you to the merger
agreement, which is contained in Annex A of this proxy statement-prospectus and
which we have filed as an exhibit to the registration statement of which this
proxy statement-prospectus is a part.

CONVERSION OF MEMBERSHIP INTERESTS

     The conversion will be effected pursuant to the Agreement and Plan of
Merger entered into among MasterCard Incorporated, MasterCard International and
MasterCard Merger Sub, Inc., which we refer to as the merger agreement. The
merger agreement provides for the merger of MasterCard International and
MasterCard Merger Sub, Inc. under Delaware law, with MasterCard International
being the surviving entity. Under the merger agreement, each issued and
outstanding principal membership interest in MasterCard International will be
automatically converted by virtue of the merger into a class A membership
interest of MasterCard International and a specified number of shares of class A
redeemable common stock and class B convertible common stock of MasterCard
Incorporated. The number of shares of class A redeemable and

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<PAGE>

class B convertible common stock of MasterCard Incorporated that a principal
member receives in the merger will be proportional to the percentage of the
total voting power of MasterCard International that such member held in
accordance with the historic global proxy formula in effect for the period ended
September 30, 2000. Upon completion of the conversion and integration and as an
integral component thereof, the shares of class A redeemable common stock and
class B convertible common stock of MasterCard Incorporated will initially be
reallocated within each of the European and non-European member-stockholder
groups in accordance with the new global proxy formula based on the 12 month
period ended December 31, 2000. Accordingly, the new global proxy formula,
applied on a regional basis, will determine the number of shares that members
actually receive in the conversion and integration.

     Class A redeemable and class B convertible common stock are fully paid,
non-assessable voting equity interests in MasterCard Incorporated. The class A
membership interest in MasterCard International represents the member's
continued rights as a licensee to use MasterCard's brands, programs and services
and participate in the MasterCard system. For a description of the allocation of
shares resulting from the conversion and integration, see "Share Allocation and
the Global Proxy."

     Under the merger agreement, MasterCard Incorporated will receive the sole
outstanding class B membership interest in MasterCard International, which will
entitle MasterCard Incorporated to substantially all of the voting power, and
all economic rights, in MasterCard International. MasterCard Incorporated's
stockholders will participate indirectly in the voting power of, and economic
rights associated with, the class B membership interest through their ownership
of the class A redeemable and class B convertible common stock of MasterCard
Incorporated.


     The merger will not close, and your existing membership interest will not
be modified as described above, unless a majority of the voting power of
MasterCard International's principal members at a meeting at which a quorum is
present approve the conversion and the merger agreement. The board of directors
of each of MasterCard Incorporated, MasterCard International and MasterCard
Merger Sub, Inc. may terminate the merger agreement at any time prior to the
conversion whether before or after the approval of the members of MasterCard
International.


APPLICATION OF THE SECURITIES LAWS TO SHARES RECEIVED

     As a result of the conversion, stockholders of MasterCard Incorporated will
be subject to various provisions of the U.S. federal securities laws. Pursuant
to Rule 10b-5 under the Securities Exchange Act of 1934, as amended, which we
refer to as the Exchange Act, all stockholders will be prohibited from trading
MasterCard Incorporated shares while in possession of any material, non-public
information about MasterCard Incorporated. In addition, certain significant
stockholders of MasterCard Incorporated may be required to file public reports
with respect to their stockholdings. Other reporting obligations may also apply.
Responsibility for compliance with these laws will reside with the applicable
stockholder, not MasterCard Incorporated.

APPLICATION OF U.S. BANKING REGULATIONS TO SHARES RECEIVED

     Banking regulations in the United States govern, among other things, the
types of equity investments that regulated institutions are permitted to make.
For a description of the potential application of federal and state banking
regulations to the shares received in the conversion, see "Risk Factors -- Risks
Related to the Conversion -- U.S. banking regulations may impact our principal
members' ownership of the common stock of MasterCard Incorporated."

ACCOUNTING TREATMENT OF THE CONVERSION

     We anticipate that upon our conversion to a stock corporation, our retained
earnings will be reallocated to capital stock and additional paid-in capital on
issuance of common stock to members in exchange for their member interests. This
treatment is consistent with accounting for demutualizations in accordance with
accounting principles generally accepted in the United States.

     With respect to the manner in which they account for their equity interest
in MasterCard, members should consult their financial advisors regarding the
potential accounting implications of the conversion.

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                                THE INTEGRATION

OVERVIEW OF THE INTEGRATION

     The integration refers to the acquisition of Europay by MasterCard
Incorporated and the integration of the businesses of Europay and MasterCard
International. In the integration, Europay's shareholders other than MasterCard
International and MEPUK will exchange their Europay shares (and shareholders of
MEPUK will exchange their MEPUK shares) for shares of class A redeemable common
stock and class B convertible common stock of MasterCard Incorporated. For a
description of the allocation of shares resulting from the conversion and
integration, see "Share Allocation and the Global Proxy."

BACKGROUND OF THE INTEGRATION


     History.  MasterCard International has a long-standing relationship with
Europay, originating with Eurocard International's alliance with Interbank Card
Association, MasterCard's predecessor, in 1968. In 1996, MasterCard
International and Europay entered into an alliance agreement under which
MasterCard International delegated to Europay the authority to manage the
MasterCard brand in Europe and to process the licensing of MasterCard's brands
to European financial institutions. MasterCard International and Europay
established Maestro International, a joint venture, in 1991 to oversee the
global development of the Maestro debit service, and entered into an agreement
regarding the Maestro brand in 1997 to further strengthen their cooperation in
this area. Each of MasterCard International and Europay own a 50% interest in
Maestro International Incorporated, a Delaware corporation which owns the
Maestro brand. MasterCard International currently owns approximately 12.25% of
the capital stock of Europay and 15.0% of the capital stock of European Payment
Systems Services (EPSS), Europay's transaction processing subsidiary. Together,
these interests represent an approximate 15% interest in Europay on a
consolidated basis. In addition, European members currently own approximately 7%
of the total voting power, and related economic rights, of MasterCard
International.


     Early Negotiations.  As the MasterCard-Europay relationship developed, the
managements of the organizations came to believe that they could significantly
enhance the value of their alliance if they more fully integrated their
organizations and focused their combined efforts on promoting a core set of
global brands and services. In November 1999, a subcommittee of the MasterCard
International board of directors authorized management to retain the services of
Mercer Management Consulting to advise the board on revisions to MasterCard's
corporate governance structure. Among other things, the board charged Mercer
with the task of evaluating the existing MasterCard/Europay alliance. During a
period of five months, representatives of Mercer met with members of the
management teams of both parties and members of their respective boards of
directors. The purpose of these meetings was to gather information about the
working relationship of the parties and to assess whether improvements could and
should be made.

     At a meeting of MasterCard International's board held on March 23, 2000,
representatives of Mercer reported that, while the relationship between
MasterCard International and Europay under the alliance agreement was generally
positive, the parties would be better served by combining their organizations,
aligning their interests more directly, focusing their considerable combined
resources on promoting MasterCard's core brands and eliminating duplicative
functions.

     On March 23, 2000, the MasterCard International board authorized the
formation of a committee consisting of Donald L. Boudreau, MasterCard
International's then Chairman, and Robert W. Pearce, a director, to enter into
preliminary discussions about the possibility of integrating the organizations.
On April 13, 2000, the board of directors of Europay designated a counterpart
committee consisting of Dr. Kurt Richolt, Europay's then Chairman, Dr. Wolfgang
Klein, then a director of Europay, and Baldomero Falcones Jaquotot, a director
of Europay and MasterCard International.

     The negotiating committees first met on April 14, 2000. A second meeting
was held on April 26, 2000. At these initial meetings, the committee members
discussed the framework for a possible integration, including structural
alternatives. No formal proposals regarding valuation or the type and amount of
consideration to be issued to the stockholders of Europay were discussed at
these initial meetings, although it was generally understood that the
consideration would include some form of equity, rather than cash. Further
meetings were held in May 2000 and in June 2000 (by teleconference). These
meetings focused primarily on issues of

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<PAGE>

consideration. At the June 2000 meeting, the negotiating committees discussed
the first draft of a term sheet that had been prepared by Mercer. In particular,
the parties discussed the relative contribution that Europay's members would
make to the revenues and transaction volume of a combined organization.
Europay's view was that, based on a contribution analysis, the European members
should be entitled to 33 1/3% of the equity in the combined company. MasterCard
wanted to study further the level of contribution that Europay was likely to
make and, in particular, the likelihood that transaction volume associated with
Europay's regional ec Pictogram brand would be converted to Maestro transaction
volume in the future.

     Later Negotiations.  In July 2000, the boards of directors of MasterCard
International and Europay reviewed the progress that had been achieved by the
negotiating committees. At these meetings, representatives of Mercer presented a
report summarizing the work of the negotiating committees to date. At its July
27, 2000 meeting, the MasterCard International board authorized the MasterCard
negotiating committee to continue its work.

     Following these board meetings, the Europay negotiating team advised the
MasterCard International team that the Europay shareholders strongly favored a
stock conversion and viewed it as a critical part of the overall transaction.
MasterCard was amenable to the concept of a stock conversion, subject to review
of the potential tax, securities laws and other consequences. Each of MasterCard
International and Europay retained financial advisers to assist the negotiating
teams in analyzing the companies and to advise them with respect to valuation
matters. MasterCard retained Donaldson, Lufkin & Jenrette (subsequently Credit
Suisse First Boston or CSFB). Europay retained Merrill Lynch & Co. Mercer was
instructed to prepare and circulate a confidential term sheet.

     In September 2000, Mr. Boudreau and Dr. Richolt met by teleconference. They
primarily discussed the formula for the global proxy calculation, which would
become the benchmark for measuring the level of contribution made by the
European members to the combined company. The full negotiating teams met three
times in October 2000. Beginning with the second of these meetings, Robert
Selander, MasterCard's President and Chief Executive Officer, and Peter Hoch,
Europay's Chief Executive Officer, joined the negotiating teams. During these
meetings, the negotiating committees discussed a wide range of strategic and
operational issues, including the following:

     - the valuations of the organizations on a stand-alone and combined basis;

     - ways of measuring the relative contribution of the European members of
       MasterCard International to the business of the combined company;

     - the merits of a global proxy formula that recognized contributions to
       MasterCard International's gross dollar volume and gross acquiring volume
       compared to a formula that was strictly revenue-based;

     - the composition of the board of directors of the combined organization;

     - the level of authority that should be delegated to the regional boards
       and management;

     - the types of fundamental corporate matters that should not be changed
       without the approval of a supermajority of the board of directors or
       stockholders;

     - limitations on the assessability of memberships;

     - the benefits and detriments associated with converting MasterCard
       International to a stock corporation; and

     - the merits of a holding company structure.

     As the parties sought to reach a mutually acceptable understanding with
respect to the consideration to be received by the European members, they
concluded that it would be appropriate to implement a limited transition period
during which the projected level of contribution made to MasterCard's revenues
and transaction volume by the European members, as measured under the new global
proxy calculation, would be applied. The parties decided that the European
members would receive at the closing shares in a percentage amount that
represented what their contribution, as measured by the new global proxy
calculation, would have been if all of their volume were converted to MasterCard
and Maestro brand volumes. In its consideration of the aggregate allocation of
shares of MasterCard Incorporated between European and non-European members that
would result from the integration, MasterCard management developed a model to
project the final relative

                                        40
<PAGE>

regional distribution of shares at year-end 2003, which was the date then
expected for the completion of the share allocations resulting from the
integration. The model projected issuing volumes (GDV) and acquiring volumes
(GAV) by region, which were categorized by type for proxy purposes. European
member volumes and revenues were projected by Europay for the same periods. The
revenue figures that were shared with CSFB for use in connection with its
fairness opinion were not materially different from the revenue figures used in
the proxy analysis. Together, these projections formed the basis for the case
allocating an approximate 33.1% share of MasterCard Incorporated common stock to
European member-stockholders at the conclusion of the transition period.
MasterCard further reviewed these projections and made adjustments to reflect
lower projected revenue and lower conversion rates of ec Pictogram cards to
Maestro only cards during the transition period. MasterCard management used
these assumptions to generate a more conservative case. These adjusted
projections formed the basis for the case allocating an approximate 25.7% share
of MasterCard Incorporated common stock to European member-stockholders at the
conclusion of the transition period. MasterCard management also prepared an
upside case to measure the revenue and the converted ec Pictogram volumes that
would be required for European member-stockholders to own a 44% share of
MasterCard Incorporated common stock at the conclusion of the transition period.
To support that case, European member-stockholders would have to convert all ec
Pictogram cards to Maestro and would have to pay fees on the resulting volumes
generated by the end of the three-year transition period.

     Based on the projections of GDV, GAV, and revenues described above and
deemed to be reasonable by MasterCard International and Europay, the parties
concluded that it would be appropriate to allocate 33 1/3% of the total
outstanding shares to European members at the closing. Similarly, based on
projections of the likely best and worst case for European GDV, GAV and revenue
performance during the transition period, the parties concluded that it would be
appropriate to establish a minimum aggregate European shareholding percentage of
26% and a maximum aggregate European shareholding percentage of 44%, in each
case at the conclusion of the transition period. The European members could lose
some of the shares initially allocated at closing if, at the end of the
transition period, their contribution did not fulfill expectations, which would
most likely be attributable to lower volume conversion than anticipated.
Alternatively, if the contribution as of the end of the transition period
exceeded current expectations, they could receive additional shares, subject to
the maximum ownership percentage of 44%.

     The Europay negotiating team was also concerned about the position of the
European members as minority stockholders in a combined organization. MasterCard
understood these concerns, but felt it was important to strike a balance with
the general proposition that the will of the majority should prevail in
corporate governance matters. The parties agreed that any supermajority voting
requirements should be limited to matters relating to the fundamental
organizational and ownership structure of the combined company.

     At a meeting of the MasterCard International board held in November 2000,
members of the MasterCard International negotiating team and representatives
from Mercer reported that the two sides had made substantial progress. The
Mercer representatives made a presentation to the board concerning the latest
draft of the term sheet. The board engaged in a discussion about particular
aspects of the proposed terms. The board authorized the negotiating team to
proceed with the negotiations and to engage in a formal due diligence
investigation of Europay. Europay would undertake a similar investigation of
MasterCard International.

     The parties began their respective due diligence investigations in December
2000. The parties' due diligence covered financial, accounting, operations,
legal, human resources and other areas. Diligence was performed both on-site, at
the other party's principal offices, and off-site. The diligence process
continued for approximately two months.

     The MasterCard International and Europay negotiating teams met on December
6, 2000 and December 20, 2000, where they again discussed those matters in
MasterCard Incorporated's organizational documents that should be subject to
supermajority stockholder approval. These discussions continued at
teleconference meetings on January 5 and January 11, 2001. On January 16, 2001,
January 18, 2001 and January 22, 2001, the negotiating committees held
additional teleconference meetings in order to finalize the term sheet that
would be presented to the companies' respective boards of directors.

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     The February 8, 2001 Board Meeting.  A special meeting of the MasterCard
International board was held on February 8, 2001 for the purpose of considering
and approving the term sheet. At this meeting, the board adopted resolutions
recommending the conversion and integration to MasterCard International's
members and approving the term sheet, and authorized the MasterCard
International negotiating team to seek to finalize negotiations with Europay.
The board also authorized the conversion of MasterCard International to a stock
corporation. The board considered the following matters at the February 8, 2001
meeting:

     - Representatives of Mercer made a presentation about the changes made to
       the term sheet since the November board meeting.

     - John De Lavis, the MasterCard executive in charge of the MasterCard
       International due diligence team, presented the findings of the diligence
       investigation.

     - Jerry McElhatton, MasterCard International's senior executive in charge
       of technology, made a presentation regarding plans for integrating the
       technology systems of the two companies.

     - Representatives of CSFB presented their relative allocation analysis to
       the MasterCard board and delivered their signed fairness opinion to
       MasterCard. CSFB's presentation and analyses, together with the CSFB
       fairness opinion, are described under the heading "Opinion of Financial
       Advisor to MasterCard International."

     In addition, Denise K. Fletcher, MasterCard International's Chief Financial
Officer, made a presentation at the February 8, 2001 board meeting regarding the
valuation, tax and accounting aspects of the integration and conversion. This
presentation also reviewed the text of certain prepared materials distributed to
the board relating to valuation in advance of the meeting. Mrs. Fletcher
reported on the valuation analysis by stating that management had developed
three scenarios representing the possible ownership of the combined entity by
European member-stockholders. She stated that the three scenarios were: (i) a
26% ownership case that represents the minimum guaranteed amount to the European
member-stockholders; (ii) a 33 1/3% ownership case based on projections provided
by Europay management; and (iii) a 44% ownership case that represents the
maximum amount that European member-stockholders could own of MasterCard
Incorporated regardless of performance. Mrs. Fletcher reported that, with
respect to the 26% case, MasterCard had been valued at approximately $1.6
billion and Europay at approximately $390 million using a 10.5% discount rate
and after applying a 50% reduction for both companies due to their private
ownership structure. Mrs. Fletcher also reported that MasterCard's and Europay's
management estimated that approximately $120 million in business synergies would
result from integration on an after-tax, net present value basis, using a 10.5%
discount rate and after applying the 50% private company discount. She reported
that, in the 26% case, the total value of the combined company after the
integration and including the synergies was estimated to be approximately $2.1
billion, using a 10.5% after-tax discount rate and after giving effect to the
50% private company discount. She stated that MasterCard management, in valuing
Europay, assigned 85% of the synergy savings to Europay because approximately
this portion (81%) of the synergies were expected to be derived from European
operations. She stated that under the 26% case the sum of the synergies and the
discounted cash flow value of the portion of Europay not presently owned by
MasterCard was estimated at approximately $430 million. She then said that
MasterCard management estimated that MasterCard would generate an after-tax
return on investment of 14.8%, 14.4% and 14% for the 26%, 33 1/3% and the 44%
cases, respectively, and that these returns were higher than the 10.5% cost of
capital estimated for MasterCard.

     Mrs. Fletcher then noted that the valuation analysis supported European
members owning 26% of MasterCard Incorporated after the conversion and
integration. She further noted that the initial allocation of 33 1/3% was
supported by the model reported by MasterCard management (with projections
regarding the Europe region coming from Europay management) referred to above.
According to the deal ultimately negotiated between the parties, European
member-stockholders would initially be allocated 33 1/3% of the common stock of
MasterCard Incorporated with a reallocation at the end of the three-year
transition period that adjusts European member-stockholder ownership to a level
between 26% and 44%, depending on actual performance of the Europe region.

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     The information presented to the MasterCard International board on February
8, 2001 by CSFB and Mrs. Fletcher was supported by projections provided to CSFB
by MasterCard management that reflected management's best estimates for 2000
earnings and the 2001 budget. The projections also related to revenue and
operating income for the periods 2000 through 2004. The revenue projections
reflected the assumption that the economy could not continue to grow as it had
in the late 1990s and that revenue growth would slow as the global economy
decelerated. However, margins were expected to expand gradually reflecting
productivity gains, especially in transaction processing.

     Europay management also provided revenue, operating expense and operating
income projections regarding the Europe region to CSFB. These projections, along
with MasterCard management's projections for MasterCard International, formed
the basis for the case for allocating 33 1/3% of the common stock of MasterCard
Incorporated to European member-stockholders at the conclusion of the three-year
transition period. MasterCard management reviewed Europay's projections and
provided CSFB with adjusted projections, which reflected reduced revenue and
operating income estimates. This more conservative case formed the basis for the
case for allocating 26% of the common stock of MasterCard Incorporated to
European member-stockholders at the conclusion of the transition period.
MasterCard management also developed projections that would form the basis for
an upside case, which would allocate 44% of the common stock of MasterCard
Incorporated to European member-stockholders at the conclusion of the transition
period. MasterCard and Europay management also worked together to develop a
synergy plan which projected 81% of the savings being derived from European
operations, predominantly from staff savings and system integration synergies.

     In the fourth quarter of 2001, in connection with its delivery of the
fairness opinion dated January 16, 2002, MasterCard management provided CSFB
with updated projections for the periods from 2001 through 2004, and added 2005.
The updated projections reflected the following adjustments:

     - the most recent 2001 forecast was employed;

     - the most recent 2002 budget projections for Europay and MasterCard,
       reflecting the impact of the slowdown in the economy in general and the
       particular consequences of the events of September 11, 2001 were
       employed;

     - an assumption was made that, by the beginning of 2003, MasterCard and
       Europay would function at the same level that they would have functioned
       had the events of September 11, 2001 not occurred;

     - MasterCard management's projected 2005 Europay revenues, operating
       expenses, pre-tax income and EBITDA (earnings before interest, taxes,
       depreciation and amortization) were provided; and

     - MasterCard management's projected 2005 revenues, operating expenses,
       pre-tax income and EBITDA for MasterCard International were provided.

     MasterCard management also updated the synergy analysis based on the
integration planning and implementation that had taken place since CSFB's
fairness opinion of January 30, 2001.

     The Europay Board Meeting; Implementation Efforts.  On February 12, 2001,
the board of directors of Europay approved resolutions recommending the
integration to Europay's shareholders.

     During the months of February through May 2001, counsel for MasterCard
International and Europay prepared definitive documentation to effect the
conversion and integration. Numerous telephone conversations and meetings were
held among representatives of MasterCard International and Europay and their
legal advisors for the purpose of negotiating the definitive agreements.

     Forms of agreements were provided to the MasterCard International and
MasterCard Incorporated boards in advance of a special meeting called for May
16, 2001. At this meeting, the MasterCard International and MasterCard
Incorporated boards approved the forms of agreements and authorized management
to file the registration statement of which this proxy statement-prospectus
forms a part with the Securities and Exchange Commission. Subsequently, the
managements of MasterCard and Europay finalized the definitive agreements and
prepared the registration statement for filing.

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     Statement Regarding Projections.  The preceding discussion under the
heading "The Integration -- Background of the Integration" contains certain
projections and forward-looking statements. MasterCard and Europay do not, as a
matter of course, make public projections as to future sales, earnings or other
results. The projections set forth above were not prepared with a view to public
disclosure or compliance with published guidelines of the Securities and
Exchange Commission or the guidelines established by the American Institute of
Certified Public Accountants regarding projections. Neither MasterCard's nor
Europay's independent auditors, nor any other independent accountants, have
compiled, examined or performed any procedures with respect to these
projections, nor have they expressed any opinion or other form of assurance with
respect to these projections or their achieveability, and assume no
responsibility for them. The inclusion of these projections in this document
should not be regarded as a representation by MasterCard or Europay or any of
their advisors, agents or representatives that these projections are or will
prove to be correct. Projections of this type are based on a number of
significant uncertainties and contingencies, all of which are difficult to
predict and most of which are beyond MasterCard's and Europay's control. As a
result, there can be no assurance that any of these projections will be
realized.

     The projections are or involve forward-looking statements, assume that the
conversion and integration have occurred and are based upon a variety of
assumptions, including MasterCard's and Europay's ability to achieve strategic
goals, objectives, and targets over the applicable period. These assumptions
involve judgments with respect to future economic, competitive and regulatory
conditions, financial market conditions and future business decisions, all of
which are difficult or impossible to predict accurately and many of which are
beyond MasterCard's and Europay's control. Many important factors, in addition
to those discussed elsewhere in this proxy statement-prospectus, could cause
MasterCard's and Europay's results to differ materially from those expressed or
implied by the forward-looking statements. Accordingly, there can be no
assurance that the projections are indicative of MasterCard's or Europay's
future performance or that actual results will not differ materially from those
in the projections set forth above. See "Cautionary Statement Regarding Forward
Looking Statements."

CONSIDERATIONS RELATING TO THE INTEGRATION

     In approving the integration, our board of directors considered a number of
advantages associated with the acquisition of Europay by MasterCard
Incorporated. The integration represents the opportunity for MasterCard to
enhance its global scope and payment programs by acquiring an important company
that operates in a desirable region of the world and has demonstrated success in
several key business functions. Specifically:

     - In 2001, the Europe region represented approximately 20% of MasterCard's
       worldwide gross dollar volume, not including Maestro and Cirrus
       transactions.

     - European countries are among the largest and most sophisticated payments
       markets in the world and represent a significant portion of the global
       payments industry.

     - Europay has demonstrated expertise in chip and debit programs and
       services, and in the ongoing development of new mobile commerce payment
       applications.

     The integration will also give MasterCard the opportunity to:

     - Establish a more consistent global marketing message, particularly in
       Europe, that is intended to increase MasterCard's presence in Europe and
       thereby make the Europe region more attractive to all MasterCard
       members.  Following completion of the integration, MasterCard will be
       better able to coordinate European marketing programs, enabling us to
       build our brands in Europe in concert with our global brand-building
       efforts. We expect that this increased coordination, combined with
       improved productivity, faster time to market and greater emphasis on
       customized solutions for members, should strengthen the presence of the
       MasterCard family of brands both in Europe and around the world.

     - Take advantage of Europay's expertise in debit and chip cards and mobile
       commerce.  Europay and Maestro have established in Europe a significant
       leadership in the debit and chip card arenas as well as in mobile
       commerce. Given the increasing use by cardholders globally of these
       applications, the skills

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<PAGE>

and knowledge already present at Europay in these areas will represent a key
strength for MasterCard, permitting the development of new business solutions.

     The integration represents the opportunity for Europay to merge with a
well-capitalized industry leader and, as a result, to leverage its own strengths
based on the broader resources of the MasterCard brand and organization. For
European members of the combined company, integration with MasterCard provides
additional opportunities to succeed in an increasingly competitive global
business, in which size, an existing network of members, and the ability to
develop quickly new and profitable products and services will likely
differentiate successful competitors.

     In particular, the integration with MasterCard provides European members
with the opportunity to:

     - Participate in the MasterCard system on a much more significant scale
       than they currently do.  After the conversion and integration, the
       European members will participate in MasterCard Incorporated as holders
       initially of 33 1/3% of its outstanding common stock, subject to change
       after the transition period, as more fully described in "Share Allocation
       and the Global Proxy."

     - Utilize MasterCard's expertise in brand building and customer-centered
       service.  Following completion of the integration, MasterCard's marketing
       team will coordinate with members and staff in the new Europe region to
       enhance brand-building efforts in that region. This is expected to result
       in increased brand awareness and higher usage and acceptance levels,
       making the European region stronger for all MasterCard members.
       Furthermore, European members will benefit from the reallocation of
       MasterCard's resources to deliver more customized relationship management
       and professional services.

     - Utilize MasterCard's expertise in marketing consulting, Internet and
       corporate expertise.  The integration will permit Europay to take
       advantage of MasterCard's marketing consulting expertise to further
       advance the European credit business. In addition, joining MasterCard's
       Internet experience with Europay's strengths in chip and mobile commerce
       should lead to the development of more electronic business solutions.
       Finally, Europay will be able to draw on the corporate resources of the
       larger MasterCard organization.

     To both MasterCard and Europay, the integration represents the opportunity
to merge separate businesses into one organization, with the resulting
opportunity to develop a stronger, combined operation and to:

     - Establish a global management team and governance structure.  The
       integration of the companies will provide an opportunity for a more
       cohesive and consistent global governance and management structure, which
       is currently divided among the MasterCard, Europay and Maestro
       organizations, each of which has separate governance requirements.
       Integrating MasterCard and Europay is also expected to result in a more
       rapid time to market for products due to enhanced decision-making and
       coordinated product development and management.

     - Establish improved delivery of customized relationship management and
       professional services.  As a result of the integration, we hope that the
       combined company will be in a position to deliver to European members
       more customized relationship management and professional services, such
       as marketing and operations consulting, to foster the growth and
       profitability of existing businesses and to facilitate the establishment
       of new payments programs and applications. In addition, we expect to join
       the technology operations of MasterCard and Europay to improve the
       flexibility, speed of change, interoperability and productivity of
       services provided to members, as well as to reduce costs. Finally,
       standardizing MasterCard's and Europay's programs and services should
       improve and make more consistent the quality of services delivered to
       members.

     - Achieve personnel and system synergies.  By combining the two companies,
       a greater pool of key personnel resources should be available to maintain
       and enhance our competitive advantages, including a wider array of
       customer, product and regional knowledge; technologies; marketing support
       and research; and stronger financial resources. In addition, we expect
       that, by integrating the two companies, we will be able to realize cost
       savings from integrating our transaction processing systems, eliminating
       overlapping staff functions and programs and by taking advantages of
       economies of scale.

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<PAGE>

     In approving the integration, our board of directors and the Europay board
of directors also considered the disadvantages of integration. The integration
may:

     - Create expected synergies that never materialize.  We may be unable to
       reduce costs, merge effectively our management structures or improve
       programs and professional services to our members in a timely or
       efficient manner. It may also prove difficult to streamline our
       technology or other operations, increase the customization and management
       of our member relationships and standardize our combined programs and
       services. Finally, we may not successfully combine personnel or systems
       resources or achieve economies of scale.

     - Cause significant dilution in the ownership of non-European members of
       MasterCard International. The integration will cause the ownership of the
       non-European members of MasterCard International in MasterCard
       Incorporated to be significantly diluted as compared to those members'
       current percentage of the total equity rights in MasterCard
       International.

     - Adversely impact some members through the introduction of the new global
       proxy formula.  Because the new global proxy formula considers additional
       factors (including GDV, GAV and revenues and volumes associated with
       Maestro and Cirrus cards) in allocating equity rights, it will dilute the
       ownership percentage of member-stockholders who are comparatively
       underweighted in such factors.

     No director or officer or any of their affiliates has a substantial
interest, direct or indirect, in the integration.

THE INTEGRATION AGREEMENT

     We summarize below the material terms and other provisions of the
integration agreement. The description is not complete, and we refer you to the
integration agreement, which is contained in Annex B of this proxy
statement-prospectus and which we have filed as an exhibit to the registration
statement of which this proxy statement-prospectus is a part.

EXCHANGE AND ALLOCATION OF SHARES


     The acquisition of Europay will be made pursuant to the Share Exchange and
Integration Agreement entered into by MasterCard Incorporated, MasterCard
International and Europay International, which we refer to as the integration
agreement. In connection with the integration agreement, each shareholder of
Europay (other than MasterCard International and MEPUK) has been required to
enter into a separate share exchange agreement with MasterCard Incorporated and
MasterCard International, pursuant to which it will exchange its Europay shares
for a specified number of shares of class A redeemable common stock and class B
convertible common stock of MasterCard Incorporated. In addition, the
shareholders of MEPUK have been required to enter into the MEPUK agreement with
MasterCard Incorporated and MasterCard International as described under the
heading "-- MEPUK" below, pursuant to which they will exchange their MEPUK
shares for a specified number of shares of class A redeemable common stock and
class B convertible common stock of MasterCard Incorporated. The integration
agreement also provides, as an integral component of the conversion and
integration, that the shares of class A redeemable and class B convertible
common stock of MasterCard Incorporated issued to the principal members of
MasterCard International and the shareholders of Europay and MEPUK will
initially be reallocated within each of the European and non-European member-
stockholder groups in accordance with the new global proxy calculation described
herein.


     The integration agreement defines how the European members of MasterCard,
including those members that are not shareholders of Europay, and the
non-European members of MasterCard, will be treated in the conversion and the
integration. For a description of the allocation of shares resulting from the
conversion and integration, see "Share Allocation and the Global Proxy."

CONDUCT OF BUSINESS PRIOR TO CLOSING OF INTEGRATION

     From the date of the integration agreement until the closing of the
integration, each of MasterCard Incorporated, MasterCard International and
Europay have agreed to conduct their respective businesses in the
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<PAGE>

ordinary course, consistent with past practice, and, among other things, to take
all commercially reasonable steps and to act in good faith in cooperation with
the other party to obtain all necessary government approvals. The parties also
have agreed to the restrictions summarized below.

     Europay has agreed that, except as may be required by law, unless
previously disclosed to MasterCard International or agreed to by MasterCard
Incorporated, it and its subsidiaries will not, and will not enter into an
agreement to, among other things:

     - increase the compensation of its officers, employees or consultants whose
       compensation is, or after giving effect to any change, would be, $100,000
       or more;

     - issue or sell any shares of its capital stock or its other equity
       interests;

     - declare or pay any dividend or other distribution on its capital stock or
       its other equity interests or redeem or purchase any of its capital stock
       or its other equity interests;

     - incur net new debt exceeding E15 million or prepaying any existing debt;

     - make capital expenditures or commitments exceeding E15 million.

     MasterCard Incorporated and MasterCard International have agreed that they
and their subsidiaries will not:

     - liquidate or dissolve themselves;

     - declare or pay any dividend or other distribution on its capital stock or
       other equity interests or redeem or purchase any capital stock or other
       equity interests; or

     - engage in a material business combination transaction unless it has been
       disclosed in this proxy statement-prospectus.

CONDITIONS TO CLOSING OF THE INTEGRATION

     MasterCard Incorporated's and MasterCard International's obligations, on
the one hand, and Europay's obligations, on the other hand, to complete the
integration are subject to satisfaction, or waiver by the other side, of the
following conditions:

     - each party's representations and warranties must be true on the date of
       the closing of the integration;

     - each party must have performed or complied with each of its respective
       agreements contained in the integration agreement;

     - there must not be, on the date of closing of the integration, any order
       or law prohibiting the closing of the integration or conversion or any
       action or proceeding to prohibit the integration before any governmental
       and regulatory authority, and all required consents and approvals with
       any governmental or regulatory authorities, in form and substance
       reasonably satisfactory to the other party, must have been obtained;

     - all consents or waivers to the performance by the parties to the
       integration agreement of their respective obligations under the
       integration agreement and all consents or waivers relating to contracts
       of the parties must be obtained in form and substance reasonably
       satisfactory to the other party;

     - the registration statement of which this proxy statement-prospectus forms
       a part must have been declared effective by the Securities and Exchange
       Commission and must not be subject to any stop order or proceeding by the
       Securities and Exchange Commission relating to a stop order; and

     - each party must have had delivered to the other opinions of counsel,
       officer's certificates, revised charter and bylaws and tax rulings from
       relevant tax authorities or related opinions of tax counsel, in each
       case, as specified in the integration agreement.

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<PAGE>

     In addition, MasterCard Incorporated's and MasterCard International's
obligations to complete the integration are subject to the satisfaction by
Europay, or the waiver by MasterCard Incorporated and MasterCard International,
of the following additional conditions:

     - the board of directors of Europay must have resigned, effective as of the
       date of the closing of the integration;

     - certain of the European members must have entered into an intellectual
       property assignment agreement, as specified in the integration agreement,
       confirming that Europay is the sole owner of the intellectual property
       rights associated with its brands;


     - each shareholder of Europay (other than MEPUK) must have entered into a
       share exchange agreement with MasterCard Incorporated and MasterCard
       International, as specified in the integration agreement, to transfer its
       shares of Europay capital stock to MasterCard Incorporated in exchange
       for class A redeemable common stock and class B convertible common stock
       of MasterCard Incorporated, as summarized above, and the MEPUK agreement
       described under the caption "-- MEPUK" below must have been entered into;


     - all Europay and MEPUK shareholders receiving shares in the integration
       must be principal members of MasterCard International prior to the
       closing of the integration; and

     - a satisfactory U.S. tax opinion from counsel or Internal Revenue Service
       ruling must have been received by MasterCard Incorporated.

     Finally, Europay's obligation to complete the integration is subject to the
satisfaction or waiver of the following additional conditions:

     - the merger agreement must have been executed; and

     - satisfactory tax opinions or rulings from applicable taxing authorities
       with respect to the tax consequences of the conversion and integration in
       certain non-U.S. jurisdictions must have been received.

     Any of the closing conditions to the integration, as described above, may
be waived by the parties to the integration agreement. Since the completion of
the integration is a condition to the conversion, if a material condition to the
integration is waived, MasterCard International will resolicit approval for the
conversion from its principal members.

     The form of the share exchange agreement referred to above is an exhibit to
the integration agreement, which is contained in Annex B to this proxy
statement-prospectus. We have also separately filed the form of share exchange
agreement as Annex C to this proxy statement-prospectus.

POST-CLOSING COVENANTS

     After the closing of the integration, the parties to the integration
agreement agree that:

     - MasterCard Incorporated will initiate and maintain a Global Center of
       Excellence in Waterloo, Belgium as the primary focus of global debit
       activities for three years, so long as it is commercially reasonable to
       do so;

     - MasterCard Incorporated will initiate a Global Center of Excellence for
       mobile commerce and chip products in Waterloo, Belgium for three years,
       so long as it is commercially reasonable to do so;

     - MasterCard will not prohibit the use of Eurocard as a program name so
       long as it is used in a manner consistent with any rules of MasterCard
       concerning the use of program names;

     - subject to the approval of the appropriate internal divisions, the
       parties intend that members will not experience any adverse impact on
       pricing or service levels as a result of a technical convergence; and

     - marketing support to the Eurocard brand in connection with its
       sponsorship of European football will continue until the European
       Football Championships in 2004.
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<PAGE>

TERMINATION

     The parties to the integration agreement may terminate it on any of the
following bases:

     - by mutual agreement of the parties for any reason;

     - in the event of a material breach by Europay, on the one hand, or
       MasterCard Incorporated and MasterCard International, on the other hand,
       that is not cured within five business days following notice of the
       breach or on notice by one party that the satisfaction of its obligations
       under the integration agreement has become impossible or impracticable
       despite the use of commercially reasonable efforts; and

     - at any time after June 30, 2002 if the closing of the integration has not
       occurred and this failure is not a result of a breach of the integration
       agreement by the terminating party.

ALLOCATION OF LIABILITY FOR BREACH

     The bylaws of MasterCard International provide that losses and liabilities
resulting from a breach of the representations and warranties of MasterCard
Incorporated, MasterCard International or Europay contained in the integration
agreement will be distributed equitably among MasterCard's six regions as an
expense. However, losses and liabilities related to a breach by either of
MasterCard Incorporated or MasterCard International of its representations and
warranties in the integration agreement exceeding $21 million in the aggregate
will be allocated solely to regions other than Europe. Conversely, losses and
liabilities related to a breach by Europay of its representations and warranties
in the integration agreement exceeding $7 million in the aggregate will be
allocated solely to Europe.

SUPERMAJORITY VOTING PROVISIONS

     After completion of the conversion and integration, approval of at least
75% of the directors present at a meeting at which a quorum is present and, in
certain cases, the holders of a majority of the outstanding class A redeemable
common stock and class B convertible common stock voting together as a single
class (so long as the class B convertible common stock has voting rights) will
be required to, among other things:

     - alter MasterCard Incorporated's status as a stock corporation;

     - amend the certificate of incorporation of MasterCard Incorporated to
       authorize MasterCard Incorporated to issue stock other than the class A
       redeemable, B convertible or C common stock;

     - sell, lease or exchange all or substantially all of MasterCard
       Incorporated's assets;

     - approve the sale, lease or exchange of all or substantially all of the
       assets of MasterCard International;

     - engage in a business combination (merger or consolidation) involving
       MasterCard Incorporated or MasterCard International;

     - undertake an initial public offering;

     - amend the MasterCard International certificate of incorporation to allow
       MasterCard International to issue capital stock, to create additional
       classes of membership interests in MasterCard International, to subject
       the property of the members of MasterCard International to the
       obligations of MasterCard International or to subject non-U.S. programs
       to the satisfaction of any liabilities arising from the current DOJ and
       merchant antitrust litigations in the United States;

     - amend the provisions of the MasterCard International bylaws relating to
       special assessments that may be imposed upon the members of MasterCard
       International;

     - make any modification to the bylaw provision stating the proportion of
       directors to come from each region;

     - alter MasterCard International's board seating methodology;

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<PAGE>

     - change the definition of the global proxy calculation;

     - raise the limitation on voting for directors applicable to stockholders
       and their affiliates to greater than 15% of the outstanding voting stock
       entitled to be voted;

     - approve the issuance of voting class C common stock or class C common
       stock that, together with all other issuances of class C common stock
       made during the immediately preceding two years, represents greater than
       5% of the total number of shares of class A redeemable and class B
       convertible common stock outstanding prior to the issuance; and

     - modify any of these supermajority requirements.

     After completion of the conversion and integration, the following actions,
among others, will require approval of at least 66 2/3% of the directors present
at a meeting at which a quorum is present:

     - establishing or eliminating regional boards;

     - modifying MasterCard's internal regional cost allocation methodology;

     - modifying the bylaw provision setting forth the overall size of the
       MasterCard Incorporated board of directors;

     - approving the issuance of shares of class C common stock;

     - permitting a stockholder's ownership level to exceed 15%;

     - permitting the issuance of shares of class A redeemable or class B
       convertible common stock of MasterCard Incorporated in excess of the
       number of shares to which a stockholder would be entitled under the
       global proxy;

     - deciding to overrule a decision taken by a regional board that was
       permitted to be taken in accordance with the bylaws;

     - deciding to overrule a recommendation made by the Debit Advisory Board
       that was permitted to be taken in accordance with the bylaws; and

     - modifying any of these supermajority requirements.

     More detailed supermajority voting provisions are contained in the
certificates of incorporation and bylaws of each of MasterCard Incorporated and
MasterCard International. See "Description of Capital Stock of MasterCard
Incorporated" and "Comparison of Rights of MasterCard International Members
Before and After the Conversion and Integration."

MEPUK

     One of the shareholders of Europay is MasterCard/Europay U.K. Limited
("MEPUK"), a company formed by certain financial institutions in the United
Kingdom for the purpose of holding their shares in Europay. MEPUK also manages
rules applicable to the domestic settlement of MasterCard-branded transactions
by financial institutions in the United Kingdom.

     In lieu of the share exchange procedures described elsewhere in this proxy
statement-prospectus, the shareholders of MEPUK have been required to enter into
a related share exchange agreement with MasterCard Incorporated pursuant to
which they will exchange all their MEPUK shares for shares of common stock of
MasterCard Incorporated. As a result of this transaction, MEPUK will become a
wholly-owned subsidiary of MasterCard Incorporated and will continue to hold
shares of Europay. Currently, each shareholder of MEPUK is a shareholder in
Europay through its ownership in MEPUK. In addition, at the time of the closing
of the conversion and integration, all of the shareholders of MEPUK will be
principal members of MasterCard International.

     On or before the closing of the integration, MEPUK will distribute to its
shareholders or otherwise cause to be discharged any and all assets and
liabilities of MEPUK, other than its shares in Europay. In addition, the

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<PAGE>

existing MEPUK shareholders will transfer MEPUK's responsibilities for the U.K.
domestic rules and other operations to a new entity that is not affiliated with
MasterCard Incorporated. Accordingly, at the time of the closing of the
conversion and integration, MEPUK will have no operations and its sole purpose
will be to hold Europay shares.

     In the MEPUK agreement, the MEPUK shareholders have agreed to indemnify
MasterCard Incorporated and MasterCard International for any liability of MEPUK
that relates to the period up to and including the closing of the integration.
MasterCard Incorporated has also agreed to distribute to the MEPUK shareholders,
net of any taxes or liabilities, any assets of MEPUK (other than the Europay
shares) not distributed prior to the closing of the integration. The MEPUK
agreement is filed as an exhibit to the registration statement of which this
proxy statement-prospectus forms a part.

BRAND MIGRATION

     MasterCard Incorporated, MasterCard International and/or Europay intend to
enter into one or more brand migration agreements with principal members in
Europe, including EKS in Germany, pursuant to which, among other things,
MasterCard and Europay will provide support for marketing initiatives designed
to migrate all uses of the Eurocard-MasterCard brand mark on cards, acceptance
decals, advertising and other materials to the MasterCard brand mark.

ACCOUNTING TREATMENT OF THE INTEGRATION

     We anticipate that the integration will be accounted for under the purchase
method of accounting in accordance with accounting principles generally accepted
in the United States. The excess of purchase price over the fair value of
tangible and identifiable intangible assets less liabilities will be recorded as
goodwill. Goodwill and other intangible assets resulting from the integration
that have indefinite useful lives will not be amortized, but will be tested for
impairment at least annually.

     In the Europay share exchange, stockholders of Europay and MEPUK, other
than MasterCard International, will exchange their shares of Europay and MEPUK
for 23.76 million shares of MasterCard Incorporated. The transaction provides
that the number of shares allocated to former shareholders of Europay and MEPUK
will increase or decrease at the end of the transition period as a result of the
application of the global proxy formula for the third year of the transition
period. See "Share Allocation and the Global Proxy." In accounting for the
initial purchase price of Europay, MasterCard will not consider shares above the
minimum number of shares allocable to Europay and MEPUK shareholders at the end
of the transition period because only the minimum number of shares is issued
unconditionally at the closing to such shareholders. Of the 23.76 million shares
attributable to the exchange of Europay and MEPUK shares, 6.15 million shares
are conditional shares subject to reallocation at the end of the transition
period and allocable to Europay and MEPUK shareholders. Europay and MEPUK
shareholders are therefore receiving 17.61 million unconditional shares at
closing. The value of each MasterCard Incorporated share, immediately before the
exchange, is estimated to be $15.21 based on an independent appraisal.
Accordingly, MasterCard's purchase price for the shares of Europay is estimated
to be $267.9 million.

     Since former Europay and MEPUK shareholders would retain or receive shares
of MasterCard Incorporated at the end of the transition period without remitting
any additional consideration, any shares retained or received by them that are
above their minimum allocation at that time would constitute part of the
purchase price. Any such additional shares would be valued at that time based
upon the fair value of the stock of MasterCard Incorporated. Any such
reallocation of shares to former Europay and MEPUK shareholders will increase
the purchase price for Europay and, accordingly, the amount of goodwill and
additional paid-in-capital recorded. The unaudited pro forma combined financial
information does not give effect to any potential contingent consideration.

     With respect to the manner in which they account for their equity interest
in MasterCard, members should consult their financial advisors regarding the
potential accounting implications of the integration.

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REGULATORY MATTERS RELATING TO THE INTEGRATION

     Within the European Union, transactions falling under the European
Commission's merger regulations require prior notification and regulatory
approval. The proposed integration amounts to a concentration within the meaning
of the European Commission merger regulations because it will entail a change of
control of Europay. However, because the consolidated worldwide revenue of
MasterCard and Europay is below the threshold stipulated by the regulations,
prior notification and regulatory approval will not be required at the European
Commission level. Notwithstanding this, Europay has informed the European
Commission of the integration for informational purposes.

     A number of countries within the European Union require notification and
prior regulatory approval depending upon whether the national merger control
thresholds are met or not. National merger control thresholds can relate to the
national and worldwide revenues of the parties and/or to their market share in
the country in question, with thresholds for market share ranging from 20% to
35%. National notification was necessary in Germany and Finland on the basis of
revenue and in Spain and Greece on the basis of national market share. As of the
date of this proxy statement-prospectus, the transaction has been cleared by the
national competition authorities in each of these countries.

     Certain members of MasterCard International and certain shareholders of
Europay that receive shares of MasterCard Incorporated in the transactions may
be required to make filings under the HSR Act if the fair market value of their
MasterCard Incorporated shares exceeds $50 million and they do not intend to
hold those shares solely for investment purposes. Members should consult their
advisors to determine whether they are required to make any filings under the
HSR Act. The completion of both the conversion and the integration would be
subject to the expiration or termination of all waiting periods for which
filings will be made with the U.S. antitrust agencies under the HSR Act, in
connection with both transactions.

                                        52
<PAGE>

                     SHARE ALLOCATION AND THE GLOBAL PROXY

INTRODUCTION

     Since the mid 1990s, the global proxy formula used by MasterCard
International to allocate equity rights at annual meetings of members has been
based solely on revenue received by MasterCard International on MasterCard
transactions. In connection with the conversion and integration, MasterCard
Incorporated will migrate to a new global proxy formula designed to take a more
comprehensive, balanced account of the contributions of member-stockholders to
MasterCard's business. In particular, the new global proxy calculation will
measure each member-stockholder's contribution to three key elements of
MasterCard's business -- gross dollar volume ("GDV"), gross acquiring volume
("GAV") and revenue -- and will also account for revenue and volume earned
principally in connection with MasterCard, Maestro and Cirrus-branded cards.
Revenue will account for one half, and GDV and GAV will each account for one
fourth, of the new global proxy calculation.

     The new global proxy calculation will be used for three purposes. First, in
conjunction with the apportionment of MasterCard Incorporated shares between
members within Europe and members outside of Europe described below, it will be
used to determine the initial allocation of shares to member-stockholders upon
the closing of the conversion and integration. Second, the new global proxy
calculation will be used to determine the reallocation of MasterCard
Incorporated shares among member-stockholders at the end of the three-year
transition period following the closing of the conversion and integration, also
in conjunction with the apportionment of shares between Europe and non-Europe
described below. Finally, it will be used on an ongoing basis to determine the
maximum number of shares of MasterCard Incorporated that a member-stockholder
may own and the minimum number of shares of MasterCard Incorporated that a
member-stockholder will be required to own. MasterCard Incorporated's
calculation of the global proxy for each member-stockholder will be considered
final and binding unless the board of directors determines that an error was
made in the computation, in which case the computation will be corrected in
accordance with directions of the board.

     In connection with the initial allocation of shares, the relevant period
for calculating the new global proxy will be the 12 month period ended December
31, 2000. (In contrast, the last global proxy using the historical, revenue-only
formula was calculated for the 12 month period ended September 30, 2001.) All
subsequent calculations of the new global proxy will be made on the basis of
each successive 12 month period beginning on the first business day of the
fiscal quarter following the closing of the conversion and integration. All
global proxy calculations will be made on an accrual basis of accounting. (In
contrast, the historical global proxy formula was calculated on a cash basis of
accounting). The board of directors of MasterCard Incorporated is empowered to
establish a record date in connection with each global proxy calculation for
purposes of determining the stockholders of record whose GDV, GAV and revenue
will be included in determining the relevant global proxy.

     The new global proxy formula and the regional apportionment of shares are
described in the integration agreement and in the by-laws of MasterCard
Incorporated. Matters relating to the ec Pictogram shares are described
principally in the integration agreement.

     THE NEW GLOBAL PROXY FORMULA WILL ONLY TAKE ACCOUNT OF REVENUES AND VOLUMES
CONTRIBUTED BY PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL, INCLUDING
AFFILIATE MEMBERS WHO PARTICIPATE INDIRECTLY IN THE MASTERCARD BUSINESS THROUGH
PRINCIPAL MEMBERS, CONSISTENT WITH THE HISTORICAL GLOBAL PROXY CALCULATION.
AFFILIATE MEMBERS WILL NOT RECEIVE ANY SHARES IN THE CONVERSION AND INTEGRATION,
BUT PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL WILL RECEIVE SHARES BASED ON
THE NEW GLOBAL PROXY FORMULA THAT REFLECTS REVENUES AND VOLUMES CONTRIBUTED BY
THEIR RESPECTIVE AFFILIATES. FINANCIAL INSTITUTIONS THAT ARE MEMBERS OF MAESTRO
INTERNATIONAL INCORPORATED OR CIRRUS SYSTEMS, INC. BUT ARE NOT ALSO PRINCIPAL
MEMBERS OR AFFILIATES OF PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL WILL NOT
RECEIVE ANY SHARES IN THE CONVERSION AND INTEGRATION BUT WILL BE ELIGIBLE TO
RECEIVE SHARES AT THE CONCLUSION OF THE TRANSITION PERIOD IF THEY APPLY FOR, AND
ARE GRANTED, PRINCIPAL MEMBERSHIP IN MASTERCARD INTERNATIONAL DURING THE
TRANSITION PERIOD AND ARE ALLOCATED SHARES OF MASTERCARD

                                        58
<PAGE>

INCORPORATED DURING THE TRANSITION PERIOD IN ACCORDANCE WITH THE PROCEDURE
DESCRIBED AT THE END OF THE NEXT PARAGRAPH.

     ON THE CLOSING DATE OF THE CONVERSION AND INTEGRATION, EACH PRINCIPAL
MEMBERSHIP INTEREST IN MASTERCARD INTERNATIONAL WILL BE AUTOMATICALLY CONVERTED
INTO A CLASS A MEMBERSHIP INTEREST IN MASTERCARD INTERNATIONAL AND SHARES OF
COMMON STOCK OF MASTERCARD INCORPORATED. HOWEVER, TO RECEIVE SHARES AT CLOSING,
A MEMBER MUST, IN ADDITION TO QUALIFYING AS A PRINCIPAL MEMBER ON THE CLOSING
DATE, HAVE CONTRIBUTED REVENUES AND/OR VOLUMES TO MASTERCARD INTERNATIONAL AS A
PRINCIPAL MEMBER DURING THE 12 MONTH PERIOD ENDED DECEMBER 31, 2000 THAT ARE
ELIGIBLE TO BE CONSIDERED UNDER THE NEW GLOBAL PROXY FORMULA DESCRIBED HEREIN.
IF NO SUCH REVENUES OR VOLUMES WERE CONTRIBUTED, A PRINCIPAL MEMBER WILL
PARTICIPATE IN THE CONVERSION BUT WILL NOT RECEIVE SHARES OF COMMON STOCK OF
MASTERCARD INCORPORATED AT THE CLOSING. THE MASTERCARD INCORPORATED BOARD OF
DIRECTORS EXPECTS TO ADOPT PROCEDURES TO ISSUE SHARES OF MASTERCARD INCORPORATED
COMMON STOCK TO PRINCIPAL MEMBERS DURING THE TRANSITION PERIOD THAT DID NOT
QUALIFY TO RECEIVE SHARES AT CLOSING, IN ORDER TO PERMIT SUCH MEMBERS TO
PARTICIPATE IN THE REALLOCATION OF MASTERCARD INCORPORATED SHARES THAT WILL
OCCUR AT THE CONCLUSION OF THE TRANSITION PERIOD.

THE GLOBAL PROXY

     The Formula.  For each member-stockholder, the global proxy calculation
will be equal to the sum obtained by adding (A) .25 multiplied by a fraction,
the numerator of which is the member-stockholder's GDV and the denominator of
which is MasterCard Incorporated's total GDV attributable to all member-
stockholders, plus (B) .25 multiplied by a fraction, the numerator of which is
the member-stockholder's GAV and the denominator of which is MasterCard
Incorporated's total GAV attributable to all member-stockholders, plus (C) .50
multiplied by a fraction, the numerator of which is the sum of (1) all
non-travelers cheque revenues paid by the member-stockholder to MasterCard
Incorporated and its subsidiaries and (2) two times the travelers cheque
revenues paid by the member-stockholder to MasterCard Incorporated and its
subsidiaries, and the denominator of which is the sum of (1) all non-travelers
cheque revenues paid by all member-stockholders to MasterCard Incorporated and
its subsidiaries and (2) two times the travelers cheque revenues paid by all
member-stockholders to MasterCard Incorporated and its subsidiaries, in each
case for the applicable period. Travelers cheque programs shall be deemed to
have no GDV or GAV for purposes of the global proxy calculation. Only actual, as
opposed to estimated, GDV, GAV and revenues paid will be considered for purposes
of the global proxy calculation. In addition, for purposes of the global proxy
calculation:

     - GDV.  GDV means processed and non-processed issued volumes (including
       domestic and international retail purchases, cash transactions,
       convenience checks, on-us transactions, intra-processor transactions,
       local use only transactions and balance and commercial funds transfers)
       that occur as a result of one or more of (A) a transaction involving any
       one of MasterCard Incorporated's brands (e.g., MasterCard, Eurocard,
       Maestro, Cirrus and ec Pictogram) or (B) a non-MasterCard branded
       transaction involving a card that includes any one of MasterCard
       Incorporated's brand logos as well as other payment brand logos, provided
       that such other payment brands are not in direct competition with any
       MasterCard brands as determined by MasterCard Incorporated.

     - GAV.  GAV means processed and non-processed acquired volumes (including
       domestic and international retail purchases, cash transactions, on-us
       transactions, intra-processor transactions and local use only
       transactions) that occur as a result of one or more of (A) a transaction
       involving any one of MasterCard Incorporated's brands (e.g., MasterCard,
       Eurocard, Maestro, Cirrus and ec Pictogram) or (B) a non-MasterCard
       branded transaction involving a card that includes any one of MasterCard
       Incorporated's brand logos as well as other payment brand logos, provided
       that such other payment brands are not in direct competition with any
       MasterCard brands as determined by MasterCard Incorporated.

     - Revenue.  Revenues paid for a particular member-stockholder are, for any
       period, all revenues of MasterCard Incorporated on a consolidated basis,
       calculated in accordance with U.S. GAAP, that are generated by the
       activities of that member-stockholder, other than (1) any fees or other
       charges

                                        59
<PAGE>

       associated with the termination of that member-stockholder's membership
       in MasterCard International, (2) integration-related assessments paid by
       that member-stockholder, (3) other assessments, fees and charges paid by
       that member-stockholder in its capacity as a member of MasterCard
       International if those assessments, fees and charges were imposed on less
       than all of the members of MasterCard International (except for
       assessments, fees and charges pertaining to business development,
       ordinary course of business and other matters deemed to be includable by
       the management of MasterCard International in management's sole
       discretion) and (4) fines and penalties paid by that member-stockholder
       (except as determined includable in the sole discretion of the management
       of MasterCard International). For purposes of the initial allocation of
       shares associated with the closing of the conversion and integration,
       MasterCard intends generally to include fines and penalties in the
       calculation of revenues paid, except for termination fees.

     - Card Fee Assessment.  A card fee assessment means a bona fide, non de
       minimis fee expressed as a fixed amount in connection with a card.

     - Volume-based Assessment.  A volume-based assessment means a bona fide,
       non de minimis assessment typically expressed as a percentage of the GDV
       or GAV associated with a particular type of transaction.

     GDV and GAV Volume Weightings.  In calculating GDV and GAV, each
member-stockholder's volume must be broken into four categories, each of which
is weighted differently for purposes of the calculation, as described below. The
weighted categories are designed to reflect the relative value of different
activities to MasterCard's overall business, and provide the highest recognition
to transactions that are fully assessed by MasterCard based on volume. Volumes
attributable to transactions involving only card-based assessments are accorded
relatively lower weight. Volumes are included in the global proxy calculation
whether they are assessed directly or the cards to which they relate are subject
to card fee assessments of the type contemplated by the applicable category of
volume. In addition, for each global proxy calculation performed prior to the
expiration of the transition period, volumes in the following categories will be
included even if they are not subject to volume-based or card fee assessments.
Finally, the volume weightings give significant credit to ec Pictogram-branded
volumes (a regional debit brand owned by Europay) and other similar debit
volumes, provided they have been converted to the Maestro brand or are the
subject of binding written commitments to convert to Maestro. Ordinarily, the
global proxy formula accounts only for volumes associated with MasterCard's
principal brands -- MasterCard, Maestro and Cirrus. As a result of negotiations
with Europay, proxy weightings have been extended to ec Pictogram and similar
regional debit volumes to give credit for the significant business currently
done under those brands in Europe. The conversion commitment has also been
implemented to encourage members to consistently migrate those volumes to
MasterCard's principal brands in the future. The ec Pictogram brand will be
owned by MasterCard Incorporated following the conversion and integration.

     - Volumes Weighted at 100%.  All of the following volumes are weighted at
       100% of actual volume: (1) volumes on cards that include a MasterCard
       brand logo and that are subject to volume-based assessments or card fee
       assessments, (2) Maestro and Cirrus processed debit volumes and (3)
       Maestro and Cirrus debit volumes that are subject to volume-based
       assessments, so long as Maestro, a brand representing a stored value
       application that is permitted to be used by members of MasterCard
       International and/or Cirrus is the sole acceptance brand on the card.

     - Volumes Weighted at 75%.  The following volumes are weighted at 75% of
       actual volume: ec Pictogram volumes and other similar debit volumes that
       in each case have been converted to Maestro volumes so long as Maestro, a
       brand representing a stored value application that is permitted to be
       used by members of MasterCard International and/or Cirrus is the sole
       acceptance brand on the card and the card is subject to card fee
       assessments.

     - Sliding Scale of Weightings for Certain Regional Debit Volumes.  Volumes
       for regional debit brands owned (or in the case of the initial allocation
       of shares to be owned) solely by MasterCard Incorporated on cards that
       include a Maestro and/or Cirrus logo are weighted at the following
       percentages for the period indicated; provided that such cards are
       subject to volume-based assessments

                                        60
<PAGE>

       or card fee assessments; and provided, further, that for calculations for
       the last year of the transition period through the year ending on the
       second anniversary of the end of the transition period, there is a
       binding written commitment to remove all acceptance brand logos other
       than the Maestro brand logo, the Cirrus brand logo or the logo of a brand
       representing a stored value application that is permitted to be used by
       members of MasterCard International, on the cards not later than the
       fifth anniversary of the first fiscal quarter beginning after the fiscal
       quarter in which the closing of the conversion and integration occurs:

      - 10% of such volumes for all calculations until the last year of the
        transition period;

      - 40% of such volumes for the last year of the transition period;

      - 30% of such volumes for the year ending on the one-year anniversary of
        the end of the transition period;

      - 20% of such volumes for the year ending on the two-year anniversary of
        the end of the transition period; and

      - 10% of such volumes for subsequent years.

     - Volumes Weighted at 1%.  Volumes for (i) regional debit brands not owned
       by MasterCard Incorporated on cards that include a Maestro and/or Cirrus
       brand logo and are subject to volume-based assessments or card fee
       assessments and (ii) balance and commercial funds transfers relating to
       cards that are subject to volume-based or card fee assessments are
       weighted at 1%.

     Currency Conversion.  In performing the global proxy calculation, the
conversion of euros to U.S. dollars, to the extent necessary, will be based on
the average exchange rate during the twenty-day period ending on the day prior
to the applicable measurement date, which we refer to as the average currency
conversion rate, provided that during the transition period and for the two
years thereafter the average currency conversion rate shall be $.9565 U.S. = 1
euro for so long as 1 euro is not less than $.9065 U.S. and not greater than
$1.0065 U.S. In the event that the average currency conversion rate does not
fall within this range, the rate to convert euros to U.S. dollars will be $.9565
U.S. = 1 euro adjusted by the difference between such average currency
conversion rate and the upper or lower limit of the range, as applicable.

     For purposes of determining the global proxy calculation during the
transition period and for the two years thereafter, amounts denominated in the
currency of a country within the Europe region other than the euro will first be
converted into euros and subsequently converted into U.S. dollars in accordance
with the previous paragraph.

     Travelers Cheques.  The revenue component of the global proxy formula
provides that MasterCard International's travelers cheque members will calculate
their respective global proxies using 100% of revenues paid by them to
MasterCard Incorporated and its subsidiaries in connection with their travelers
cheque programs (in other words, revenues for travelers cheque members are
doubled before being discounted by the 50% factor set forth in the global proxy
formula). However, travelers cheque members will not receive credit for GDV or
GAV in connection with their global proxy calculations, as the integration
agreement provides that GDV and GAV will be deemed to be zero for travelers
cheque programs.

THE INITIAL ALLOCATION OF SHARES

     The allocation of shares of MasterCard Incorporated to each
member-stockholder upon the closing of the conversion and integration will be
determined in accordance with the detailed procedures described in the merger
agreement, the integration agreement and the by-laws of MasterCard Incorporated.
The new global proxy formula based on the 12 month period ended December 31,
2000, applied on a regional basis to Europe and non-Europe, will determine the
number of shares that members receive initially in the conversion and
integration. However, this outcome is the result of an integrated series of
transaction steps in the conversion and integration, as described more fully
below.

                                        61
<PAGE>

     Shares Issued in the Conversion.  In the conversion, each principal member
of MasterCard International, including each MasterCard principal member in
Europe, will receive a number of shares of class A redeemable and class B
convertible common stock of MasterCard Incorporated that is proportional to the
percentage of the total equity rights in MasterCard International that such
member held in accordance with the historic proxy formula in effect for the
period ended September 30, 2000. The historic global proxy calculation will be
used to determine the shares allocated in the conversion step only and will have
no further bearing on the outcome of the transaction.

     Shares Issued in the Integration.  In the integration, each shareholder of
Europay and MEPUK will receive a number of shares of class A redeemable and
class B convertible common stock of MasterCard Incorporated in exchange for its
shares of Europay or MEPUK, as the case may be, as specified in the share
exchange agreement and MEPUK agreement, respectively. To the extent practicable,
the shares issued in the integration step will be proportional to each
shareholder's direct (in the case of Europay shareholders) or indirect (in the
case of MEPUK shareholders) prior interest in Europay. Because all Europay and
MEPUK shareholders will be principal members of MasterCard International at the
closing of the conversion and integration, the issuance of additional shares in
the integration will have the effect, when taken together with the shares issued
in the conversion, of allocating 33 1/3% of the total shares of class A
redeemable and class B convertible common stock then outstanding to European
members. Accordingly, the shares issued in the integration will have the result
of diluting current non-European members' ownership from approximately 93% of
MasterCard International before the conversion and integration to 66 2/3% of
MasterCard Incorporated after the conversion and integration.

     Initial Reallocation of Shares Pursuant to the Global Proxy
Calculation.  At the closing of the conversion and integration, the shareholders
of Europay and MEPUK will be principal members of MasterCard in Europe.
Accordingly, the share issuances described above in connection with the
conversion and integration will produce in the aggregate two pools of shares,
one for European member-stockholders and the other for non-European
member-stockholders. The integration agreement provides that the shares of class
A redeemable and class B convertible common stock will then initially be
reallocated within each of the European and non-European pools of shares in
accordance with the new global proxy formula. This reallocation will occur as an
integral component of, and contemporaneously with, the closing of the conversion
and integration. Accordingly, the new global proxy formula will determine the
number of shares that members ultimately receive in the conversion and
integration; the number of shares received by European members may vary across
members compared to the number of Europay and/or MEPUK shares exchanged. Based
on the new global proxy calculation, each member-stockholder in Europe will be
entitled to a percentage of the European shares equivalent to the percentage
that its aggregate GDV, GAV and revenue represents of the total GDV, GAV and
revenue for Europe, using the methodology of the new global proxy. Similarly,
outside of Europe, each member-stockholder will be entitled to a percentage of
the non-European shares equivalent to the percentage that its aggregate GDV, GAV
and revenue represents of the total GDV, GAV and revenue outside of Europe,
using the methodology of the new global proxy.

     The accompanying proxy card sets forth the number of class A redeemable and
class B convertible shares of MasterCard Incorporated common stock that you, as
a current principal member of MasterCard International, will receive upon the
closing of the conversion and integration (including in connection with the
initial reallocation of shares described above). For principal members that are
also shareholders of Europay or MEPUK, the number of shares reported on the
proxy card includes all shares issued in connection with the acquisition of
their Europay or MEPUK stock in the integration. Principal members should note
that the number of shares set forth on the proxy card may be adjusted to reflect
changes in the attribution of ICA numbers to principal members or the
termination of principal members prior to the closing date of the conversion and
integration. ICA numbers are the primary method used by MasterCard International
to attribute revenues and volumes associated with card activity to members for
proxy and other purposes. For example, if a principal member acquires ownership
of an ICA number from another principal member prior to the closing date but
after the date used to calculate share ownership information for the proxy card,
the shares to be issued in respect of the revenues and volumes related to that
principal ICA number will be distributed to

                                        62
<PAGE>

the purchasing member on the closing date, and the selling member will receive a
corresponding fewer number of shares as compared to the information printed on
its proxy card.

     Member-stockholders other than travelers cheque members can also estimate
the aggregate number of class A redeemable and class B convertible shares of
MasterCard Incorporated to be allocated to them at the closing of the conversion
and integration using their own revenue and weighted GDV and GAV data and the
following figures:

     For the 12 months ended December 31, 2000:


<Table>
            <S>                                                           <C>
            Aggregate Weighted European GDV (gross euro issuing volume):  E304.0 billion
            Aggregate Weighted European GAV (gross euro acquiring
              volume):                                                    E303.6 billion
            Aggregate European Revenue:                                   E355.2 million
            Aggregate Weighted non-European GDV:                          $548.9 billion
            Aggregate Weighted non-European GAV:                          $535.9 billion
            Aggregate non-European Revenue:                               $1,349.5 million
</Table>


     The formula to be applied with these figures is as follows:

<Table>
<S>  <C>                             <C>  <C>                           <C>  <C>
     (0.5)(Revenue paid by Member)        (0.25)(Member Weighted GDV)        (0.25)(Member Weighted GAV)
                                      +                                  +
     -----------------------------        ---------------------------        ---------------------------
           Aggregate Revenue                Aggregate Weighted GDV             Aggregate Weighted GAV
</Table>

For purposes of this calculation, European members should use the aggregate
European figures and non-European members should use the aggregate non-European
figures. For ease of calculation, this formula does not account for travelers
cheque revenues and, as such, produces an estimated result only. However,
travelers cheque revenues do not have a material impact on the proxy calculation
for principal and association members that are not also travelers cheque
members. Travelers cheque members should consult the formula described under the
caption "The Global Proxy -- The Formula" and set forth in the integration
agreement to prepare an estimate of the aggregate number of shares of class A
redeemable and class B convertible common stock of MasterCard Incorporated to be
allocated to them.

     The foregoing formula produces a percentage that can be multiplied by the
number of shares in the applicable pool of shares to derive an estimate of the
number of shares to be received in the conversion and integration. A description
of the total number of shares allocated to each pool is provided below.

     For all members, 84% of the shares received will be in the form of class A
redeemable common stock and 16% of the shares received will be in the form of
class B convertible common stock. In addition, as discussed above, the shares
issued upon the closing of the conversion and integration will result in
European member-stockholders receiving shares of class A redeemable and class B
convertible common stock that together represent 33 1/3% of all of the shares of
class A redeemable common stock and class B convertible common stock together
outstanding. The shares of class A redeemable common stock issued to the
European member-stockholders will represent 28%, and the shares of class B
convertible common stock issued to the European member-stockholders will
represent 5 1/3%, of the respective total number of shares of class A redeemable
common stock and class B convertible common stock together outstanding
immediately after the closing of the conversion and integration. The remaining
class A redeemable and class B convertible common stock, representing in the
aggregate 66 2/3% of the class A redeemable and class B convertible common stock
together outstanding, will be held by the non-European member-stockholders of
MasterCard. The shares of class A redeemable common stock issued to the
non-European member-stockholders will represent 56%, and the shares of class B
convertible common stock issued to the non-European member-stockholders will
represent 10 2/3%, of the total number of shares of class A redeemable common
stock and class B convertible common stock together outstanding immediately
after the closing of the conversion and integration.

                                        63
<PAGE>

     Accordingly, immediately after the closing of the conversion and
integration, shares of MasterCard Incorporated class A redeemable and class B
convertible common stock will be allocated as follows:

<Table>
<Caption>
                                                 EUROPEAN      NON-EUROPEAN
                                                  MEMBER          MEMBER       TOTAL SHARE
                                               STOCKHOLDERS    STOCKHOLDERS    DISTRIBUTION
                                               ------------    ------------    ------------
<S>                                            <C>             <C>             <C>
class A redeemable...........................   28,000,000      56,000,000      84,000,000
class B convertible..........................    5,333,333      10,666,667      16,000,000
                                                ----------      ----------     -----------
          Total..............................   33,333,333      66,666,667     100,000,000
                                                ==========      ==========     ===========
</Table>

     For the purposes of the global proxy calculation, European
member-stockholders constitute those member-stockholders whose revenue and
volume is generated from activity from and in Europe. Europe is defined to
include the following countries: Albania, Andorra, Armenia, Austria, Azerbaijan,
Belarus, Belgium, Bosnia-Herzegovina, Bulgaria, Channel Islands, Croatia,
Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany,
Gibraltar, Greece, Hungary, Iceland, Ireland, Israel, Italy, Kazakhstan,
Kyrgyzstan, Latvia, Liechtenstein, Lithuania, Luxembourg, Macedonia (former
Yugoslav Republic), Malta, Moldova, Monaco, Netherlands, Norway, Poland,
Portugal, Romania, Russian Federation, San Marino, Slovakia, Slovenia, Spain,
Sweden, Switzerland, Tajikistan, Turkey, Turkmenistan, Ukraine, United Kingdom,
Uzbekistan, Vatican City and Yugoslavia (Serbia and Montenegro).

REALLOCATION OF SHARES AT THE CONCLUSION OF THE TRANSITION PERIOD

     During the three year transition period after the closing of the conversion
and integration, the member-stockholders will be entitled to the class A
redeemable and class B convertible common stock that they held as of the closing
of the transaction, regardless of changes in the respective global proxy
calculations of those member-stockholders during the transition period, provided
that they remain as principal members of MasterCard International and do not
sell all or substantially all of their MasterCard card portfolios. Financial
institutions that become principal members of MasterCard International after the
period of the global proxy calculation used in connection with the initial
allocation of shares will be eligible to be allocated shares at the end of the
transition period in accordance with procedures to be determined by the board of
directors. Until shares are allocated, those financial institutions will not be
entitled to vote at any meetings of stockholders of MasterCard Incorporated.

     The reallocation of shares of MasterCard Incorporated at the conclusion of
the three year transition period will be determined according to a multi-step
process. First, the number of class B convertible shares that constitute ec
Pictogram shares will be determined in accordance with the process described
below. Second, the class B convertible shares (other than ec Pictogram shares)
will be converted into class A redeemable shares on a one-for-one basis. Third,
all class A redeemable shares will be reapportioned between Europe and
non-Europe using the procedures described below. Fourth, each member-stockholder
will be allocated class A redeemable shares according to the new global proxy,
again calculated on both a European and non-European basis, as described in more
detail below.

     As a result of this reallocation (and the subsequent reallocation involving
ec Pictogram shares), member-stockholders may ultimately receive more or fewer
shares than initially allocated to them, depending on the relative performance
of the Europe region and their individual global proxy calculations at the time.
If a member's revenue contribution, GDV and/or GAV during the period prior to
reallocation grows more slowly than the membership as a whole, if any of these
amounts decline for a member relative to other members, or if a member with ec
Pictogram volumes fails to convert these to Maestro as required, the member may
be entitled to fewer shares upon reallocation than at the closing of the
conversion and integration. Members receiving additional shares upon
reallocation will do so pursuant to rights initially granted with all shares of
class A redeemable and class B convertible common stock of MasterCard
Incorporated.

     ec Pictogram Shares.  ec Pictogram shares are class B convertible shares
that do not convert to class A redeemable shares at the conclusion of the
transition period. Instead, ec Pictogram shares will convert to class A
redeemable shares on the second anniversary of the end of the transition period.
This additional two-

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year holding period is designed to recognize that additional time may be needed
before the transaction volumes associated with ec Pictogram, a regional debit
program owned by Europay, can be converted to Maestro volumes. All class B
convertible shares representing ec Pictogram shares become non-voting at the end
of the transition period when the other class B convertible shares convert to
class A redeemable shares.

     The number of ec Pictogram shares will be calculated at the end of the
transition period according to the following procedures:

     - The aggregate global proxy calculation of Europe during the third year of
       the transition period will be determined.

     - Then, a simulated global proxy will be calculated assuming that certain
       ec Pictogram transactions are converted to Maestro transactions as of the
       beginning of the third year of the transition period. Because Maestro
       transactions are accorded a higher GDV and GAV weighting than ec
       Pictogram transactions, the simulated result is likely to be higher than
       the actual European aggregate global proxy calculation. ec Pictogram
       transactions will be accorded a higher weighting in the simulated proxy
       if they are associated with binding contracts to convert to Maestro
       within a two-year period following the end of the transition period.

     - The difference between the actual global proxy and the simulated global
       proxy results described above, measured in terms of a percentage of the
       outstanding class A redeemable common stock and class B convertible
       common stock of MasterCard Incorporated, will determine the number of
       shares of class B convertible common stock that constitutes the ec
       Pictogram shares. If the simulated global proxy is equal to or less than
       the actual global proxy (as measured), there will be no ec Pictogram
       shares.

     - Notwithstanding the preceding paragraph, ec Pictogram shares cannot
       exceed 5 1/3% of the total shares of MasterCard Incorporated then
       outstanding. In addition, ec Pictogram shares will be reduced by a
       percentage equal to the percentage of any over-apportionment of shares to
       Europe in connection with the thresholds described below under the
       heading "-- Reapportionment of class A redeemable Shares Between Europe
       and Non-Europe."

     Reapportionment of Class A Redeemable Shares Between Europe and
Non-Europe.  At the end of the three-year transition period, MasterCard
Incorporated will determine the global proxy calculation of all
member-stockholders (calculated on a single worldwide basis) for the last 12
months of the transition period. The European member-stockholders will be
entitled to more or fewer class A redeemable shares depending upon their
aggregate global proxy calculation, and the non-European member-stockholders
will be entitled to the remaining class A redeemable shares. The purpose of the
reapportionment is to permit the final allocation of shares of MasterCard
Incorporated to be based on the relative aggregate global proxy calculations of
the European and non-European areas during the last year of the transition
period. Specifically:

     - Europe Less than or Equal to 26%.  If the global proxy calculation
       indicates that European member-stockholders in the aggregate represent
       26% or less of the worldwide global proxy calculation for the last year
       of the transition period, then the European member-stockholders will be
       entitled to an allocation of shares of class A redeemable common stock
       that represents 26% of the number of shares of outstanding class A
       redeemable common stock and class B convertible common stock.

     - Europe Greater than 26% but Less than or Equal to 28%.  If the global
       proxy calculation indicates that European member-stockholders in the
       aggregate represent greater than 26% but less than or equal to 28% of the
       worldwide global proxy calculation for the last year of the transition
       period, then the European member-stockholders will be entitled to an
       allocation of shares of class A redeemable common stock that represents
       28% of the number of shares of outstanding class A redeemable common
       stock and class B convertible common stock.

     - Europe Greater than 28%.  If the global proxy calculation indicates that
       European member-stockholders in the aggregate represent greater than 28%
       of the worldwide global proxy calculation for the last year of the
       transition period, then the European member-stockholders will be entitled
       to an allocation of shares of class A redeemable common stock that is
       equal in percentage terms to their

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<PAGE>

       aggregate global proxy calculation for the last year of the transition
       period, up to a maximum amount, when taken together with any ec Pictogram
       shares, of 44% of the number of shares of outstanding class A redeemable
       common stock and class B convertible common stock.

Because of the conversion of the class B convertible common stock at the end of
the transition period, the only class B convertible common stock outstanding at
the time of this calculation will be the ec Pictogram shares, if any. In the
reapportionment, stockholders of MasterCard Incorporated whose initial share
allocations decrease will return shares initially allocated to them to
MasterCard Incorporated, which will deliver shares to stockholders whose initial
share allocations increase.

     Each Member-Stockholder's Global Proxy Calculation.  As in the case of the
allocation of shares at the closing, the apportionment of class A redeemable
shares between Europe and non-Europe described above will produce two pools of
class A redeemable shares, one for European member-stockholders and the other
for non-European member-stockholders. The allocation of class A redeemable
shares within each pool will be determined according to the new global proxy
calculated on a regional basis for the last year of the transition period, as
described above under the heading "-- The Initial Allocation of
Shares -- Initial Reallocation of Shares Pursuant to the Global Proxy
Calculation."

CONVERSION AND REALLOCATION OF EC PICTOGRAM SHARES

     At the end of the additional two-year holding period, all ec Pictogram
shares will be converted to class A redeemable shares, and the class A
redeemable shares will then be subject to reallocation. European member-
stockholders with ec Pictogram volumes that have converted to Maestro volumes
will be entitled to some or all of those class A redeemable shares depending
upon the percentage of ec Pictogram volumes that have actually been converted to
Maestro by that time. Non-European member-stockholders will be entitled to the
balance, which will be distributed to those member-stockholders in accordance
with the new global proxy formula based on the 12 month period ending at the end
of the additional two-year holding period. Any reallocation of class A
redeemable shares resulting from the conversion of ec Pictogram shares will be
effected by a return of shares to MasterCard Incorporated and delivery of shares
by MasterCard Incorporated. Members receiving additional shares upon
reallocation will do so pursuant to rights initially granted with all shares of
class A redeemable and class B convertible common stock of MasterCard
Incorporated.

GLOBAL PROXY CALCULATION FOLLOWING THE TRANSITION PERIOD AND CONVERSION OF THE
EC PICTOGRAM SHARES

     Following the transition period and the conversion of the ec Pictogram
shares to class A redeemable voting shares, the global proxy calculation will be
performed on an individual member-stockholder basis according to the procedures
described above under the heading "-- The Global Proxy." The European and
non-European areas will cease to have any significance in connection with the
determination of the global proxy. After the transition period,
member-stockholders will be required to maintain an ownership percentage of
MasterCard's outstanding common stock of not less than 75% nor more than 125% of
that member-stockholder's most recent global proxy calculation. Stockholders may
be required to purchase or sell shares of MasterCard Incorporated in order to
satisfy these requirements within 12 months of receipt of notice from MasterCard
Incorporated that such purchase or sale is required. Any sales of shares would
ordinarily constitute taxable transactions. Stockholders who need to sell shares
in order to satisfy the 125% requirement are obligated under the bylaws of
MasterCard Incorporated to accept the highest price offered to them for the
shares that are required to be sold.

     To the extent that member-stockholders are required to purchase shares in
order to satisfy the 75% minimum ownership requirement, shares will be available
either directly from MasterCard Incorporated or from other member-stockholders
that either are required to sell shares in order to satisfy the 125% maximum
ownership requirement or otherwise desire to sell shares. The board of directors
of MasterCard Incorporated is authorized to establish procedures by which shares
of MasterCard Incorporated common stock will be traded among member-stockholders
or purchased or sold by MasterCard. Methods for the purchase and disposition of
shares may include some or all of the following: an on-line bulletin board that
matches buyers and sellers of shares; a periodic auction conducted on behalf of
MasterCard Incorporated for buyers and sellers of shares; and directly
negotiated purchases and sales of shares. The price at which shares may be
purchased or sold will
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be determined through these methods. MasterCard Incorporated will not charge
member-stockholders any commissions for facilitating trading in its shares.

     MasterCard Incorporated will purchase or sell its common stock subject to
its having sufficient capital available to effect each purchase transaction, and
only if each purchase or sale transaction is permitted under the laws, rules and
regulations applicable to MasterCard Incorporated at the time (including
securities laws). In particular, to the extent any offer by MasterCard
Incorporated to purchase its shares constitutes a tender offer under the
Exchange Act, MasterCard Incorporated will comply with the applicable tender
offer rules and regulations. In addition, MasterCard Incorporated will undertake
activities to facilitate trading of its common stock among member-stockholders
only to the extent such activities are permitted under the federal and state
securities laws of the United States and related rules and regulations. Any
shares subsequently sold by MasterCard Incorporated may not be registered under
the Securities Act of 1933, as amended, and accordingly may be subject to resale
restrictions under the Securities Act.

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<PAGE>

                                   MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

     The directors and executive officers of MasterCard Incorporated after the
conversion and integration will be the same as the directors and executive
officers of MasterCard International before the conversion and integration,
except for the addition of two voting directors affiliated with European members
and the addition of Dr. Peter Hoch, currently Chief Executive Officer of
Europay, who will be President of MasterCard's Europe region and a non-voting
director. The certificate of incorporation of MasterCard International requires
MasterCard Incorporated, as the sole class B member, to elect the directors of
MasterCard Incorporated to serve as the directors of MasterCard International.
MasterCard Incorporated will have a board comprised of 18 voting directors. One
member-stockholder of MasterCard Incorporated holding more than 5% of MasterCard
Incorporated common stock is entitled to cancel its customized member agreement
with MasterCard International if one of its employees does not have a board
seat.

     If the conversion is approved, the current directors of MasterCard
International will serve as the directors of MasterCard Incorporated and
MasterCard International until the annual meeting of MasterCard Incorporated
shareholders in 2003. In addition, the boards of directors of each company,
acting pursuant to authority granted to them in their respective certificates of
incorporation and/or bylaws, will appoint two additional voting directors
affiliated with European members and Dr. Peter Hoch as a non-voting director, in
each case to serve until the annual meeting of MasterCard Incorporated
shareholders in 2003. The board of directors of MasterCard Incorporated will be
subject to reelection in 2003. If the conversion does not occur, the current
directors of MasterCard International will continue in that capacity until an
annual meeting of MasterCard International principal members is held in 2003.

     A number of the largest members of MasterCard International that generate
significant business for MasterCard have representatives on the MasterCard
Incorporated board of directors. If any of these members were to lose its
representation on the board, this could have a detrimental effect on our
business relationship with that member.

     The bylaws of MasterCard Incorporated require that directors be officers of
a member institution of MasterCard International or an individual otherwise
uniquely qualified to provide guidance on MasterCard's affairs. For a
description of the requirements for the regional allocation of board seats
arising from the conversion and integration, see "The Conversion -- Effects of
the Conversion." In accordance with the restrictions described in that section,
the nominating committee of the MasterCard Incorporated board is charged with
nominating individuals to serve as directors, subject to election by the
stockholders. Presently, MasterCard Incorporated does not grant automatic board
seats to members that generate specified levels of revenues or transaction
volumes for MasterCard.

     Under the nominating committee's current procedures, the committee accepts
nominations from regional boards as well as individual member-stockholders, and
also considers nominees of its own volition. In selecting nominees, the
committee typically considers the following factors, among others:

     - the experience and qualifications of the individual nominee;

     - the region with which the nominee is associated;

     - whether the nominee represents an issuing or acquiring institution;

     - the size of the financial institution of which the nominee is an officer,
       the extent of such institution's business with MasterCard (in terms of
       revenues, issuing volumes and/or acquiring volumes), and the degree of
       such institution's relative dedication to the MasterCard brand; and

     - whether the financial institution of which the nominee is an officer is
       of particular strategic importance to MasterCard.

     Because the size of member-stockholders and their dedication to MasterCard
are important factors considered by the nominating committee, it is possible
that a director associated with a member-stockholder whose business with
MasterCard declines relative to others may not be proposed for reelection by the

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<PAGE>

nominating committee. Similarly, officers of member-stockholders that make large
and growing contributions to MasterCard's revenues and volumes are more likely
to be considered by the nominating committee for nomination to the board of
directors.

     The following table sets forth certain information regarding the executive
officers and directors of MasterCard Incorporated and MasterCard International
after the conversion and integration.

<Table>
<Caption>
NAME                                   AGE                           POSITION
----                                   ---                           --------
<S>                                    <C>   <C>
Lance L. Weaver......................  47    Chairman of the Board and Director
Baldomero Falcones Jaquotot..........  55    Vice Chairman and Director
Donald L. Boudreau...................  60    Chairman Emeritus and non-voting Director
Robert W. Selander...................  51    President, Chief Executive Officer and Director
William F. Aldinger..................  54    Director
Hiroshi Arai.........................  72    Director
David A. Coulter.....................  54    Director
William R.P. Dalton..................  58    Director
Augusto M. Escalante Juanes..........  52    Director
Jan A.M. Hendrikx....................  56    Director
Jean-Pierre Ledru....................  63    Director
Norman C. McLuskie...................  57    Director
John Francis Mulcahy.................  51    Director
Robert W. Pearce.....................  47    Director
Robert B. Willumstad.................  56    Director
Mark H. Wright.......................  56    Director
Ronald N. Zebeck.....................  47    Director
Denise K. Fletcher...................  53    Executive Vice President and Chief Financial Officer
Noah J. Hanft........................  49    General Counsel and Secretary
Alan J. Heuer........................  60    Senior Executive Vice President, Customer Group
Peter Hoch...........................  61    President, MasterCard Europe region and non-voting
                                             Director
Jerry McElhatton.....................  63    Senior Executive Vice President, Global Technology &
                                             Operations
Michael W. Michl.....................  56    Executive Vice President, Central Resources
Christopher D. Thom..................  53    Senior Executive Vice President, Global Development
                                             Group
Spencer Schwartz.....................  35    Senior Vice President and Controller
</Table>

BOARD OF DIRECTORS

     Biographies of the directors of MasterCard Incorporated after the
conversion and integration are set forth below. All of the following persons are
currently directors or non-voting advisory directors of MasterCard
International. With the exception of Mr. Selander, the President and Chief
Executive Officer of MasterCard Incorporated, Mr. Boudreau, the Chairman
Emeritus, and Mr. Hoch, the Chief Executive Officer of Europay, all MasterCard
Incorporated directors are presently employees of members of MasterCard
International.


     Lance L. Weaver is an Executive Vice Chairman of MBNA America Bank, N.A.
and Chairman of the board of MasterCard Incorporated. Mr. Weaver was first
elected to the MasterCard International board of directors in 1997 and was
elected chairman of the board of MasterCard International in 2001. Before
joining MBNA America Bank in 1991, Mr. Weaver held various management positions
with Wells Fargo and Citicorp/Citibank. He is director of MBNA America Bank and
MBNA Information Services. He also serves on the board of directors of the
Christiana Care Corporation and the Wilmington Renaissance Corporation. He is a
member of the Georgetown University Board of Directors and the Tower Hill School
Board of Trustees.


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<PAGE>


     Baldomero Falcones Jaquotot is Vice Chairman of the board of MasterCard
International. He has been a member of the MasterCard International board of
directors since 1997. Mr. Falcones joined Banco Hispano Industrial, a
predecessor of Banco Santander Central Hispano, in 1984 and has served as Senior
Executive Vice President and a member of the Executive Committee of Banco
Santander Central Hispano for fifteen years. Mr. Falcones also serves as
Chairman of Aquanima Holding, S.A. and Aquanima Iberica, S.A. and as a director
and a member of the Executive Committee of Europay International S.A. He is a
director of Union Fenosa, S.A., S.C.H. Seguros y Reaseguros, S.A., Sistema 4B,
S.A., and B2BF, S.A.



     Donald L. Boudreau is Chairman Emeritus and a non-voting advisory director
of MasterCard Incorporated. Mr. Boudreau has served on the MasterCard
International board of directors since 1997 and was the Chairman of the
MasterCard International board of directors from April 1998 to March 2001. Mr.
Boudreau recently retired as a Vice Chairman of The Chase Manhattan Corporation
and The Chase Manhattan Bank, where he was a member of the Executive Committee.
Mr. Boudreau served in a variety of positions during his 40 year career at
Chase, and most recently was responsible for all of Chase's small and consumer
and middle market businesses. Mr. Boudreau is a member of the board of directors
of the New York City Blood Center, and a member of the board of trustees of the
New York Presbyterian Hospital, Pace University and the United Way of Tri-State.


     Robert W. Selander will be President and Chief Executive Officer of
MasterCard Incorporated and presently holds the same position at MasterCard
International. Mr. Selander has served on the MasterCard International board of
directors since 1997. Prior to his election as President and Chief Executive
Officer of MasterCard International, Mr. Selander was an Executive Vice
President and President of the MasterCard International Europe, Middle
East/Africa and Canada regions. He also currently serves as a director of
Hartford Financial Services Group and Europay International. Before joining
MasterCard in 1994, Mr. Selander spent two decades with Citicorp/Citibank, N.A.

     William F. Aldinger is the Chairman and Chief Executive Officer of
Household International. Mr. Aldinger was first elected to the MasterCard
International board of directors in 1998 and is a former member of MasterCard
International's U.S. region board of directors. Mr. Aldinger joined Household
International in 1994, and prior to that time served in various positions at
Wells Fargo Bank, including Vice Chairman. Mr. Aldinger is a member of the
boards of directors of Illinois Tool Works, Inc. and Evanston Northwestern
Healthcare. He is a member of the combined boards of directors of Children's
Memorial Medical Center/Children's Memorial Hospital and the Children's Memorial
Foundation located in Chicago. Mr. Aldinger is also a member of the board of
trustees of Northwestern University and the J.L. Kellogg Graduate School of
Management.

     Hiroshi Arai is the Chairman of the Board of Orient Corporation, a position
he has held since 1999. Mr. Arai has been a member of the MasterCard
International board of directors since 1999 and is currently a member of
MasterCard International's Asia/Pacific region board of directors. Prior to
joining Orient Corporation in 1993, Mr. Arai was employed for forty years with
Dai-ichi Kangyo Bank, where he held various positions including Deputy
President.


     David A. Coulter is Vice Chairman of J.P. Morgan Chase & Co. and head of
its retail and middle market business, as well as its investment management and
private banking activities. Mr. Coulter has been a member of MasterCard
International's board of directors since 2001. Prior to the merger between J.P.
Morgan and The Chase Manhattan Corporation, Mr. Coulter was Vice Chairman of The
Chase Manhattan Corporation and The Chase Manhattan Bank. In 1999 and 2000, Mr.
Coulter was a partner of The Beacon Group. From 1996 to 1998, Mr. Coulter was
Chairman and Chief Executive Officer of BankAmerica Corporation. He is a
director of PG&E Corporation and Pacific Gas and Electric Company. Mr. Coulter
also serves on the boards of directors of the San Francisco Art Institute, the
Asia Society and the National Mentoring Partnership, and is a member of The
Business Council. He is also a trustee of Carnegie Mellon University and the
Public Policy Institute of California.


     William R. P. Dalton is Chief Executive of HSBC Bank plc (formerly Midland
Bank plc) and a director of HSBC Holdings plc. Mr. Dalton was first elected to
the MasterCard International board of directors in 1998. Prior to joining HSBC
Bank plc in 1998, Mr. Dalton served as President and Chief Executive Officer of
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<PAGE>


HSBC Bank Canada. Mr. Dalton joined HSBC Bank Canada in 1980. Mr. Dalton is
Deputy Chairman of Merrill Lynch HSBC Limited and is also a director of HSBC
Investment Bank Holdings plc, CCF SA and HSBC Private Banking Holdings (Suisse)
SA. He is Chairman of Young Enterprise in the United Kingdom and Vice President
of the Chartered Institute of Bankers. In addition, Mr. Dalton is a Fellow of
the Institute of Canadian Bankers and a Fellow of the Chartered Institute of
Bankers.


     Augusto M. Escalante Juanes is Deputy President, Consumer Product and
Marketing Areas, Banco Nacional de Mexico, S.A. Mr. Escalante Juanes was elected
to the MasterCard International board of directors in 2001 after having
previously served on the board from April 1998 to March 1999, and is currently
chairman of MasterCard International's Latin America and Caribbean region board
of directors. Mr. Escalante Juanes joined Banco Nacional de Mexico in 1991. At
Banco Nacional de Mexico, Mr. Escalante Juanes is responsible for all consumer
products, both deposit and credit, and all marketing and advertising for the
Financial Group of Banco Nacional de Mexico. He was previously Deputy President,
Bank Card and Electronic Services Area, and Deputy President, Consumer Loans
Area of Banco Nacional de Mexico.


     Jan A.M. Hendrikx is Chief Executive Officer of EURO Kartensysteme. Mr.
Hendrikx was first elected to the MasterCard International board of directors in
2001. Mr. Hendrikx joined EURO Kartensysteme in 1997 as chief executive officer
and prior to that time served in senior positions in the European offices of
Visa International and Citibank. He has served on the Europay International
board of directors since 1998.


     Jean-Pierre Ledru is Senior Executive Vice President of Credit Agricole SA.
He has served on the MasterCard International board of directors since 1991. In
addition, Mr. Ledru is Chairman of Cedicam, Chairman and C.E.O. of Europay
France, Chairman of Europay International, and Vice Chairman of the Groupement
des Cartes Bancaires. In addition, Mr. Ledru is Executive Vice Chairman of BMS
(Billetique Monetique Services) and a member of the board of directors of AROP
(Association pour le Rayonnement de l'Opera National de Paris).


     Norman C. McLuskie is a Director of the Royal Bank of Scotland Group plc,
the Royal Bank of Scotland plc and National Westminister Bank plc. Mr. McLuskie
was first elected to the MasterCard International board of directors in 2000.
Mr. McLuskie joined Royal Bank of Scotland in 1982. Following the acquisition of
Natwest by the Royal Bank of Scotland in March 2000, he was appointed Chief
Executive of Retail Direct, a division of the Royal Bank of Scotland Group
encompassing its card and consumer finance businesses, among others. Mr.
McLuskie's other directorships include: Chairman of Royscot Financial Services
Ltd, Chairman of RBS Cards Ltd, Chairman of Virgin Direct Personal Finance Ltd
and Deputy Chairman of Tesco Personal Finance. Mr. McLuskie is also Vice
Chairman of Europay International and a fellow of the Chartered Institute of
Bankers in Scotland.


     John Francis Mulcahy is Head of Australian Financial Services Division,
Commonwealth Bank of Australia. He has served on the MasterCard International
board of directors since 1998 and is currently a member of MasterCard
International's Asia/Pacific region board of directors. Prior to joining the
Commonwealth Bank of Australia in 1995, Mr. Mulcahy was Chief Executive Officer
of Lend Lease Property Investment Services. He currently serves as a director of
IPAC Securities Limited, EDS Australia Pty. Limited and TCNZ Australia Pty
Limited.

     Robert W. Pearce is President of Distribution in the Personal & Commercial
Client Group for Bank of Montreal, where he has worked for over twenty years. He
has served on the MasterCard International board of directors since 1999. He
previously served as Executive Vice-President of North American Electronic
Banking Services for Bank of Montreal and was responsible for Bank of Montreal's
MasterCard Cardholder and Merchant Services lines of business, Debit Card
business, and Electronic Banking.


     Robert B. Willumstad is President of Citigroup and Chairman and Chief
Executive Officer of Citigroup's Consumer Group, overseeing its North American
cards businesses, Citibanking North America, Europe and Japan, CitiFinancial,
Citigroup's Mortgage Banking business and Primerica, and has product
responsibility for Global Cards and Consumer Finance. Mr. Willumstad is also
responsible for, among other things, Citigroup's e-consumer unit, which provides
Internet payment solutions and financial services offerings across all of


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<PAGE>

Citigroup's consumer businesses. Mr. Willumstad has served on the MasterCard
International board of directors since 1999. Mr. Willumstad was Chairman and CEO
of Travelers Group Consumer Finance Services prior to the merger between
Citicorp and Travelers Group in 1998. Mr. Willumstad joined Commercial Credit,
now CitiFinancial, in 1987. Prior to joining Citigroup's predecessor companies,
Mr. Willumstad served in various positions with Chemical Bank for twenty years,
last holding the position of President of Chemical Technologies Corporation.


     Mark H. Wright is President and Chief Executive Officer of USAA Federal
Savings Bank, and serves as Vice Chairman of USAA Federal Savings Bank's board
of directors. He also serves as Chairman of the Board of USAA Savings Bank. Mr.
Wright joined USAA in 1993. Mr. Wright has been a member of the MasterCard
International board of directors since 1996, is chairman of the audit committee
of MasterCard International's board, and is currently a member of MasterCard
International's U.S. region board of directors. He is on the board of the Alamo
Bowl in San Antonio. Mr. Wright also serves as a trustee on the board of Our
Lady of the Lake University in San Antonio. Mr. Wright is a member and President
of the Thrift Institutions Advisory Council appointed by the Federal Reserve
Bank.


     Ronald N. Zebeck is Chairman and Chief Executive Officer of Metris
Companies Inc., as well as Chief Executive Officer of Direct Merchants Credit
Card Bank. Mr. Zebeck has served on the MasterCard International board of
directors since 1997 and is currently a member of MasterCard International's
U.S. Region board of directors. Prior to joining Metris Companies Inc. in 1994,
Mr. Zebeck held various credit card related positions at Citicorp, Advanta and
General Motors.

EXECUTIVE OFFICERS

     Biographies of the executive officers of MasterCard Incorporated and
MasterCard International after the conversion and integration other than Mr.
Selander are set forth below. Each of the following officers currently hold the
same position with MasterCard International before the conversion and
integration that they will hold in MasterCard Incorporated and MasterCard
International after the conversion and integration, except for Dr. Peter Hoch,
who is currently the Chief Executive Officer of Europay International.

     Denise K. Fletcher will be Executive Vice President and Chief Financial
Officer of MasterCard Incorporated and a member of MasterCard's Executive
Management Group. Ms. Fletcher will be responsible for the corporate finance,
planning, audit, purchasing and new markets and investments functions at
MasterCard. Prior to joining MasterCard in 2000, Ms. Fletcher spent four years
as Senior Vice President and Chief Financial Officer of Bowne & Company, the
world's largest financial printer, with responsibility for finance and strategy.
She serves on the boards of directors of Girl Scouts USA and the YWCA of the
City of New York.

     Noah J. Hanft will be General Counsel and Secretary of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Hanft
has served in various increasingly senior legal positions at MasterCard since
1984, except for 1990 to 1993, when Mr. Hanft was Senior Vice President and
Assistant General Counsel at AT&T Universal Card Services. Prior to joining
MasterCard, Mr. Hanft was associated with the intellectual property law firm of
Ladas & Parry in New York.

     Alan J. Heuer will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Heuer
will be responsible for MasterCard's Customer Group, which encompasses all
member relations, global marketing and consulting/cardholder services functions,
as well as MasterCard's regional activities. Mr. Heuer joined MasterCard in
1995. Prior to that time, Mr. Heuer served as Executive Vice President, Retail
Banking, for the Bank of New York.


     Dr. Peter Hoch will be President of MasterCard's Europe region and a member
of MasterCard's Executive Management Group. Dr. Hoch will also be a non-voting,
advisory director of MasterCard Incorporated. Dr. Hoch was a Vice Chairman of
Europay International from 1992 until 2000, and became Europay's Chief Executive
Officer in November 2000. From 1984 to 1999, Dr. Hoch was a member of the board
of management of Hypo-Bank AG, responsible for information technology and
payment systems, and a part of the branch network. He was responsible for
managing the merger between Hypo-Bank and Bayerische


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Vereinsbank to form Hypo Vereinsbank, and served on the management board of Hypo
Vereinsbank in 1998 and 1999. Dr. Hoch is currently a member of the board of
directors of Giesecke & Devrient.

     Jerry McElhatton will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr.
McElhatton will be responsible for MasterCard's Global Technology and Operations
group, which includes the St. Louis transaction processing facility. Before
joining MasterCard in 1994, Mr. McElhatton was President and Chief Executive
Officer of Dallas-based Payment Systems Technology & Consulting, Inc. Mr.
McElhatton currently serves on the board of directors of Ignite Sales, Inc. and
Mascon, a development firm based in India; the board of directors of St. Louis
University; the board of directors of the Regional Commerce and Growth
Association in St. Louis; the National Council for the Olin School of Business
of Washington University in St. Louis; and the boards of directors of Rainbow
Village in St. Louis and the United Way (St. Louis).

     Michael W. Michl will be Executive Vice President of MasterCard
Incorporated and will be a member of MasterCard's Executive Management Group.
Mr. Michl will be responsible for MasterCard's Central Resources unit,
encompassing the communications, global human resources and corporate services
functions. Mr. Michl joined MasterCard in 1998 from Avon Products, where he was
Vice President of Human Resources.

     Christopher D. Thom will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Thom
will be responsible for MasterCard's Global Development Group, which manages the
brand and program development functions at MasterCard, as well as MasterCard's
initiatives in the areas of electronic commerce, mobile commerce and chip-based
smart cards. Prior to joining MasterCard in 1995, Mr. Thom served in a variety
of positions at HSBC Group in the United Kingdom, including as general manager,
Strategic Development and general manager, Retail. In the latter position, Mr.
Thom was responsible for the core banking services and products delivered
through HSBC's branch network, as well as HSBC's card service, private banking
and other businesses. Mr. Thom is a director of MXI.

     Spencer Schwartz will be Senior Vice President and Controller for
MasterCard Incorporated. Mr. Schwartz will be primarily responsible for all
accounting and financial control functions at MasterCard. Prior to assuming the
Controller position for MasterCard International in 2000, Mr. Schwartz was the
Vice President of Taxation for MasterCard International. Before joining
MasterCard in 1996, Mr. Schwartz headed the tax department for Carl Zeiss, Inc.,
operated his own accounting and tax firm and held various positions with Price
Waterhouse.

COMMITTEES OF THE BOARD

     The board of MasterCard Incorporated is authorized to designate from among
its members an executive committee, which will have all the authority of the
board of directors, and other committees. The Chairman of the board will be an
ex officio member of all committees. The board of MasterCard Incorporated will
have the same committees with the same functions and members as MasterCard
International had before the conversion. In addition, the board of MasterCard
Incorporated may appoint additional regular committees of the board of
MasterCard Incorporated. The committees of the board are described below.

     EXECUTIVE.  The executive committee may exercise the authority of the board
of directors when the board is not in session, as permitted by law and the
bylaws of MasterCard Incorporated. At present, the board of MasterCard
Incorporated does not expect to appoint an executive committee.

     AUDIT.  The audit committee will assist the board of directors in
fulfilling its oversight responsibilities. Among other things, it will review
the activities, results and effectiveness of internal and external auditors,
confirm the independence of the external auditors and recommend to the board of
directors the appointment of the external auditors. The audit committee will
also review MasterCard Incorporated's key risks and controls and its quarterly
and annual financial statements. The members of the audit committee are expected
to be Messrs. Weaver, Wright, Boudreau, McLuskie, Pearce and Zebeck.

                                       130
<PAGE>

     COMPENSATION.  The compensation committee will establish the compensation
policies and criteria of the Chief Executive Officer and other executive
officers of MasterCard Incorporated. The members of the compensation committee
are expected to be Messrs. Weaver, Aldinger, Boudreau and Falcones.

     NOMINATING.  The nominating committee will consider and nominate
individuals to serve as directors of MasterCard Incorporated for approval by the
class A and class B stockholders at the annual meeting of stockholders, based
upon proposals made by each regional board of MasterCard Incorporated. The
members of the nominating committee are expected to be Messrs. Weaver, Aldinger,
Boudreau, Dalton, Falcones, Ledru and Willumstad.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION

     The following table shows the before-tax compensation for the Chief
Executive Officer and the four next highest paid executive officers of
MasterCard International at the end of 2001, which we collectively refer to as
the named executive officers.

<Table>
<Caption>
                                                                                 LONG-TERM
                                           ANNUAL COMPENSATION                  COMPENSATION
                             -----------------------------------------------    ------------
                                                              OTHER ANNUAL          LTIP           ALL OTHER
NAME AND PRINCIPAL POSITION  YEAR   SALARY      BONUS(1)     COMPENSATION(2)      PAYOUTS       COMPENSATION(3)
---------------------------  ----  --------    ----------    ---------------    ------------    ---------------
<S>                          <C>   <C>         <C>           <C>                <C>             <C>
Robert W. Selander.......    2001  $783,333    $2,500,000       $205,499         $3,479,000        $451,447
  President & CEO            2000  $700,000    $2,000,000       $198,760                 --        $419,360
Alan J. Heuer............    2001  $575,000    $  900,000       $153,971         $2,380,000        $201,341
  Senior Executive VP        2000  $575,000    $  800,000       $137,796                 --        $174,317
Jerry McElhatton.........    2001  $575,000    $  825,000       $149,047         $2,047,500        $395,586
  Senior Executive VP        2000  $575,000    $  725,000       $133,849                 --        $375,758
Christopher D. Thom......    2001  $500,000    $  700,000       $113,747         $2,072,000        $196,316
  Senior Executive VP        2000  $500,000    $  700,000       $116,470                 --        $129,283
Denise K. Fletcher(4)....    2001  $375,000    $  450,000       $ 42,182                 --        $ 44,485
  Executive VP               2000  $120,913    $  200,000             --                 --        $210,000(5)
</Table>

---------------
(1) Additional bonuses for services performed in 2001 will be paid to Mr.
    Selander ($250,000 at the closing of the conversion and integration and
    $250,000 per year for each of the following three years), Mr. Thom ($200,000
    at the closing and $66,667 per year for each of the following three years)
    and Ms. Fletcher ($200,000 at the closing and $66,667 per year for each of
    the following three years), if, and only if, the conversion and integration
    is consummated.

(2) Amounts principally represent reimbursement for tax obligations in
    connection with non-qualified retirement benefits.

(3) For 2001, includes matching contributions under the MasterCard
    International's 401(k) plan (Mr. Selander -- $22,134; Mr. Heuer -- $22,134;
    Mr. McElhatton -- $22,190; Mr. Thom -- $22,190; Ms. Fletcher -- $7,378);
    MasterCard International's contributions to both a non-qualified defined
    benefit and defined contribution plan -- Annuity Bonus Plan (Mr.
    Selander -- $186,513; Mr. Heuer -- $131,087; Mr. McElhatton -- $124,871; Mr.
    Thom -- $80,314; Ms. Fletcher -- $2,107); the dollar value of the benefit of
    premiums paid for a split-dollar life insurance policy projected on an
    actuarial basis (Mr. Thom -- $47,579); the full amount of all premiums paid
    by MasterCard International for executive life insurance coverage (Mr.
    Selander -- $36,800; Mr. Heuer -- $3,120; Mr. McElhatton -- $3,524; Mr.
    Thom -- $1,232); MasterCard International's contributions to a deferred
    compensation plan -- Rabbi Trust (Mr. Selander -- $150,000; Mr.
    McElhatton -- $200,000); cash payments in lieu of executive perquisites (Mr.
    Selander -- $56,000; Mr. Heuer -- $45,000; Mr. McElhatton -- $45,000; Mr.
    Thom -- $45,000; Ms. Fletcher -- $35,000).

(4) Ms. Fletcher joined MasterCard International in September 2000. Her salary
    and bonus amounts for fiscal 2000 reflect a partial year.

(5) Represents a one-time bonus paid upon hiring.

                                       131
<PAGE>

LONG-TERM INCENTIVE PLAN-AWARDS IN FISCAL YEAR 2001

     The following table lists grants of performance units in 2001 to the named
executive officers:

<Table>
<Caption>
                       NUMBER OF
                         UNITS       PERFORMANCE OR OTHER
NAME                   AWARDED(1)   PERIOD UNTIL MATURATION   THRESHOLD ($)   TARGET ($)   MAXIMUM ($)
----                   ----------   -----------------------   -------------   ----------   -----------
<S>                    <C>          <C>                       <C>             <C>          <C>
Robert W. Selander...    35,225     1/1/2001 -- 12/31/2003      1,761,250      3,522,500    7,045,000
  President and CEO      19,050(2)  1/1/2001 -- 12/31/2003        952,500      1,905,000    3,810,000
Alan J. Heuer........    20,250     1/1/2001 -- 12/31/2003      1,012,500      2,025,000    4,050,000
  Senior Executive VP    11,500(2)  1/1/2001 -- 12/31/2003        575,000      1,150,000    2,300,000
Jerry McElhatton.....    15,525     1/1/2001 -- 12/31/2003        776,250      1,552,500    3,105,000
  Senior Executive VP     8,625(2)  1/1/2001 -- 12/31/2003        431,250        862,500    1,725,000
Christopher D.           17,625
  Thom...............               1/1/2001 -- 12/31/2003        881,250      1,762,500    3,525,000
  Senior Executive VP
Denise K. Fletcher...     8,800     1/1/2001 -- 12/31/2003        440,000        880,000    1,760,000
  Executive VP            1,450(2)  1/1/2001 -- 12/31/2003         72,500        145,000      290,000
</Table>

---------------
(1) The performance units were granted under MasterCard International's
    Executive Incentive Plan. Each performance unit has a target value equal to
    $100. The actual value of each unit will be calculated based on MasterCard
    International's performance over a three-year period based on a combination
    of qualitative and quantitative measures that include: improving profitable
    share with key members in key markets; improving customer focused strategy;
    achieving corporate financial targets and enhancing organizational
    capabilities. Each unit will be valued at target ($100) if, on a
    weighted-average basis, target performance is achieved for all of the
    performance measures. Each unit will be valued at threshold ($50) if, on a
    weighted-average basis, threshold performance is achieved. Each unit will be
    valued at maximum ($200) if, on a weighted-average basis, maximum
    performance is achieved. For performance between threshold and target or
    target and maximum, the value of the units will be increased on a straight
    line basis. The units will have no value if performance is below threshold.

(2) Represents one-time special grants awarded pursuant to the Executive
    Incentive Plan that vests 100% after five years for Mr. Selander; three
    years for Mr. Heuer, Mr. McElhatton and Ms. Fletcher.

     The performance units described in the preceding table are subject to
vesting as described below. Performance units that relate to a three-year
performance period will vest in annual increments according to the following
schedule if the participant completes 1,000 hours of service and is employed by
MasterCard International on the last day of the respective twelve-month cycle:

<Table>
<Caption>
                     TWELVE-MONTH CYCLE
                  ENDING ON THE FOLLOWING
                     ANNIVERSARY OF THE                       % OF PERFORMANCE
                       DATE OF GRANT                            UNITS VESTED
                  -----------------------                     ----------------
<S>                                                           <C>
1st Anniversary.............................................       26.67%
2nd Anniversary.............................................       26.67%
3rd Anniversary.............................................       26.67%
4th Anniversary.............................................           0%
5th Anniversary.............................................          20%
</Table>

     Unvested performance units relating to the twelve-month cycle in which a
participant terminates employment with MasterCard International, and subsequent
twelve-month cycles during the vesting period for the award, will be forfeited
upon termination of employment. If a participant is rehired during a subsequent
twelve-month cycle in the vesting period for the same award of performance
units, the participant will be eligible to vest in the performance units for the
award that relate to the twelve-month cycle of rehiring and subsequent
twelve-month cycles if the participant otherwise meets the terms and conditions
specified in the award and completes 1,000 hours of service in, and is employed
by MasterCard International on the last day of, the twelve-month cycle.

                                       132
<PAGE>

     Upon completion of the three-year performance period, participants will
receive a payout equal to 80% of the award earned. The remaining 20% of the
award will be paid upon completion of two additional years of service, (i.e., 5
years of service in total). Participants who retire (with at least six months of
service during the performance period), die or become permanently disabled prior
to the end of the three-year performance period and/or prior to the end of the
five-year performance period are eligible for 100% vesting of their units, and
receive a payout equal to the number of units granted for the period multiplied
by the target unit value of $100. If a participant is terminated for cause, all
units will be forfeited. Upon any other termination, only unvested units will be
forfeited and vested units will be paid at target.

RETIREMENT BENEFITS

MASTERCARD ACCUMULATION PLAN (MAP)

     Any employee who participates in the MAP earns benefits under the MAP as
soon as he or she becomes an employee of MasterCard. Benefits generally vest
after four years of service. For each plan year after January 1, 2000,
participants are credited with a percentage of their compensation for the plan
year in accordance with the table below:

<Table>
<Caption>
                                                              PAY CREDIT
                                                              FOR CURRENT
COMPLETED YEARS OF SERVICE AT DECEMBER 31 OF PRIOR PLAN YEAR   PLAN YEAR
------------------------------------------------------------  -----------
<S>                                                           <C>
 0 -  4.....................................................      4.50%
 5 -  9.....................................................      5.75%
10 - 14.....................................................      8.00%
15 - 19.....................................................     10.00%
20 - 29.....................................................     12.00%
</Table>

     Compensation is defined as base pay plus annual incentive compensation.
These accounts also receive investment credits. Participants elect to allocate
their account balance prior to the start of each plan year, during open
enrollment, based on the following allocation options:

<Table>
<Caption>
                                                              S&P 500
THIRTY-YEAR TREASURY ACCOUNT                                  ACCOUNT
----------------------------                                  -------
<S>                                                           <C>
100%........................................................      0%
80%.........................................................     20%
50%.........................................................     50%
20%.........................................................     80%
0%..........................................................    100%
</Table>

     The annual investment credits on the Standard & Poor's 500 Account are
restricted to a minimum of 0% and a maximum of 15%. No election can be made for
plan years beginning after December 31, 2002. When a participant terminates
employment, the amount credited to the participant's account is paid in a lump
sum or converted into an annuity.

SUPPLEMENTAL RETIREMENT BENEFITS

     Supplemental retirement benefits are provided to all named executive
officers and certain other participants under various funded and unfunded
nonqualified plans. Benefits are provided to certain employees whose benefits
are limited by compensation or amount under applicable federal tax laws and
regulations. Designated employees may also receive an annual benefit at
retirement equal to a designated percentage of their final average base
compensation reduced by the amount of all benefits received under the MAP and
other qualified and nonqualified arrangements.

                                       133
<PAGE>

ESTIMATED ANNUAL RETIREMENT BENEFITS PAYABLE TO CERTAIN EXECUTIVE OFFICERS

     The following table shows the estimated annual retirement benefits,
including supplemental retirement benefits under the plans applicable to the
individuals, which would be payable to each executive officer listed assuming
retirement at age 65 at his or her 2001 base salary with payments made for the
life of each participant.

<Table>
<Caption>
                                                          YEAR OF 65TH    ESTIMATED ANNUAL
NAME                                                        BIRTHDAY         BENEFIT(1)
----                                                      ------------    -----------------
<S>                                                       <C>             <C>
Robert W. Selander......................................      2015            $783,000
Alan J. Heuer...........................................      2006            $460,000
Jerry McElhatton........................................      2004            $460,000
Christopher D. Thom.....................................      2013            $400,000
Denise K. Fletcher......................................      2013            $ 57,000
</Table>

---------------
(1) Assumes MAP and Annuity Bonus Plan account balance increases with annual
    salary credits and interest credits projected at 6% per year.

     Included in the Estimated Annual Benefit in the table above is the MAP
Conversion Annuity, part of MasterCard's nonqualified defined benefit plan,
which was applicable to all executives with earnings exceeding the Internal
Revenue Code section 401(a)(17) limit. This annuity was designed to cover
certain early retirement subsidies applicable under the former pension plan to
all plan participants. The aggregate annuity for certain named executive
officers exceeded $100,000 (Mr. Selander -- $194,693, Mr. Heuer -- $136,696, Mr.
McElhatton -- $130,514, Mr. Thom -- $114,057).

401(k) SAVINGS PLAN

     Employees who participate in the 401(k) plan may contribute from 2% to 6%
of base pay on a tax-deferred basis. In addition, after-tax contributions are
permitted, and employees may also contribute supplemental tax-deferred and
after-tax amounts from 1% to 3%. Internal Revenue Service limits apply to all
tax-deferred contributions.

     A 217% match is provided on employee contributions up to 6% of base pay.
Employees must contribute to the 401(k) plan to receive matching contributions.
Matching contributions are 100% vested after 4 years of service under a graded
vesting schedule. Loans and certain types of withdrawals are permitted.

COMPENSATION OF DIRECTORS

     Members of the board of MasterCard Incorporated will receive the same
compensation as members of the board of MasterCard International before the
conversion as set forth below. The board of MasterCard Incorporated does not
intend to establish any compensation for members of the board of MasterCard
International.

     In fiscal year 2001, directors who were not employees of MasterCard
International were paid an annual retainer of $25,000. The chairman of the board
received an annual retainer of $30,000. Non-employee directors also received an
annual retainer of $5,000 for serving as a chairperson of a standing committee;
a $1,500 meeting fee for attendance at global and U.S. regional board meetings;
a $1,000 meeting fee for attendance at committee meetings and a $500 meeting fee
for telephonic meetings. In addition, customary expenses for attending board and
committee meetings were reimbursed.

     Under the MasterCard Deferral Plan, up to 100% of non-employee director's
meeting fees and annual retainer may be deferred and invested among several
investment return options. In general, deferred amounts are not paid until after
the director retires from the board. The amounts are then paid, at the
director's option, either in a lump sum or in ten annual installments.

                                       134
<PAGE>

EMPLOYMENT AGREEMENTS AND CHANGE-IN-CONTROL ARRANGEMENTS

EMPLOYMENT AGREEMENT

     MasterCard International is party to an employment agreement with Mr.
Selander. Under the terms of the agreement, Mr. Selander's employment shall
automatically terminate if he: (1) retires or becomes eligible to receive
retirement benefits; (2) dies or (3) becomes disabled. In addition, both he and
MasterCard can terminate the agreement for any reason upon ninety (90) days'
prior written notice. During the employment term, Mr. Selander is eligible to
participate in MasterCard's rewards plans and arrangements on a level
commensurate with his position.

     The agreement also provides that if Mr. Selander's employment is terminated
either by MasterCard other than for cause or by him for certain specified
reasons, he shall receive any earned, but unpaid base salary, a pro rata portion
of his target bonus and severance pay in the form of base salary continuation
and his average annual incentive bonus, received over the prior three years, for
a period of thirty-six (36) months. He is also subject to non-competition and
non-solicitation covenants for a minimum period of twelve (12) months, up to the
full length of the severance period.

     Pursuant to the agreement, Mr. Selander is eligible for annual company
contributions of up to $150,000 to a rabbi trust or other tax deferred
investment vehicle. $50,000 of this amount is guaranteed and the remaining
$100,000 is based upon MasterCard attaining certain threshold and target
performance goals. Generally, the vested portion of the assets is payable at the
later of age 55 or his termination of employment.

CHANGE-IN-CONTROL ARRANGEMENTS

     MasterCard International has approved a change in control agreement for
certain of its executive officers, including all of the named executive
officers. To date, Mr. Selander is the only executive officer who has executed
the change in control agreement. Under the agreement, if an executive officer's
employment is terminated without "cause" or for "good reason" (as defined in the
agreement) during the six-month period preceding or the two-year period
following a "change in control" of MasterCard International, the executive will
be entitled to the following:

     - a severance payment equal to two times the average base salary and bonus
       (three times in the case of the CEO), payable over a 24-month period (36
       months in the case of the CEO), subject to recalculation to be payable
       over the period until the executive is eligible to retire (without any
       increase in the amount payable);

     - continued coverage under the executive's individual long-term disability
       plan for the 24- or 36-month period;

     - continued coverage in the medical, dental, hospitalization and vision
       care plans for up to eighteen months;

     - accelerated vesting of performance units including special grants awarded
       prior to the change in control under the Executive Incentive Plan, with
       payout at 125% of target;

     - accelerated vesting of appreciation of share units granted under the
       value appreciation plan;

     - accelerated vesting of special grants awarded pursuant to the Executive
       Incentive Plan, nonqualified retirement and deferred compensation
       benefits;

     - lump sum payment equal to the value of unvested qualified plan benefits;

     - outplacement assistance; and

     - an excise tax gross-up for any taxes incurred as a result of Section 4999
       of the Internal Revenue Code.

     The executive would be subject to a covenant not to compete and not to
solicit employees for up to 24-months (36 in the case of the CEO).

                                       135
<PAGE>

     For purposes of the agreement, a "change in control" is defined as follows:

          (a) as long as MasterCard International is a non-stock membership
     corporation or it or any of its affiliates is a private share corporation,
     if (1) at any time three members have become entitled to cast at least 45
     percent of the votes eligible to be cast by all the members of MasterCard
     International (or all the shareholders of such private share corporation)
     on any issue, (2) at any time, a plan or agreement is approved by the
     members or shareholders, as the case may be, to sell, transfer, assign,
     lease or exchange substantially all of MasterCard International's (or such
     private share corporations') assets, or (3) at any time, a plan is approved
     by the members of MasterCard International (or the shareholders of such
     private share corporation) for the sale or liquidation of MasterCard
     International or such private share corporation. The foregoing
     notwithstanding, a reorganization in which the members continue to have all
     of the ownership rights in the continuing entity shall not in and of itself
     be deemed a "change of control" under (2) and/or (3), and a reorganization
     to convert MasterCard International from a membership to a stock company or
     a transaction resulting in the integration of Europay and MasterCard
     International shall not in and of itself constitute a "change of control;"

          (b) if MasterCard International becomes a stock corporation, the
     approval of its stockholders of (1) any consolidation or merger in which it
     is not the continuing or surviving corporation or pursuant to which shares
     of stock would be converted into cash, securities or other property, other
     than a merger in which the holders of stock immediately prior to the merger
     will have the same proportionate ownership interest (i.e., still own 100%
     of total) of common stock of the surviving corporation immediately after
     the merger, (2) any sale, lease, exchange or other transfer (in one
     transaction or a series of related transactions) of all or substantially
     all of its assets, or (3) adoption of any plan or proposal for its
     liquidation or dissolution;

          (c) any "person" (as defined in Section 13(d) of the Securities
     Exchange Act of 1934), other than MasterCard International or a subsidiary
     or employee benefit plan or trust maintained by MasterCard International or
     any of its subsidiaries, becoming (together with its "affiliates" and
     "associates," as defined in Rule 12b-2 under the Exchange Act) the
     "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
     directly or indirectly, of more than 25% of the stock outstanding at the
     time, without the prior approval of the board of directors; or

          (d) a majority of the voting directors proposed on a slate for
     election by the members are rejected by a vote of those members.

                                       136
<PAGE>

                         SECURITY OWNERSHIP OF CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT


     The table below sets forth certain information with respect to the
principal members of MasterCard International who, together with their
affiliates, are entitled to vote 5% or more of the total number of votes
eligible to be cast at the special meeting of principal members of MasterCard
International in connection with which we are distributing this proxy
statement-prospectus. None of the directors or executive officers of MasterCard
International beneficially owns any of the voting power with respect to the
votes to be cast at the meeting. To the best of our knowledge, each beneficial
owner has sole voting power and investment power with respect to the votes that
it is eligible to cast. A total number of 1,536,772,585 votes are eligible to be
cast at the meeting.


     Information in the following table is based on the historic global proxy
calculation for the period ended September 30, 2001.


<Table>
<Caption>
                                                                 PRIOR TO CONVERSION AND INTEGRATION
                                                              -----------------------------------------
                      NAME AND ADDRESS                          NUMBER OF VOTES      PERCENT OF VOTES
                    OF BENEFICIAL OWNER                       ELIGIBLE TO BE CAST   ELIGIBLE TO BE CAST
                    -------------------                       -------------------   -------------------
<S>                                                           <C>                   <C>
Citicorp Credit Services, Inc. .............................      124,081,529              8.1%
  14700 Citicorp Drive
  Hagerstown, MD 21742
Chase Manhattan Bank USA, N.A. .............................      122,591,588              8.0%
  100 Duffy Avenue
  Hicksville, NY 11801
First USA Bank, N.A. .......................................      104,596,601              6.8%
  A Bank One Company
  201 North Walnut Street
  15th Floor
  Wilmington, DE 19801
</Table>


     Additionally, the table below sets forth certain information, as of the
date immediately following the completion of the conversion and integration,
with respect to the beneficial ownership of our class A redeemable common stock
and class B convertible common stock by each person who we know will be the
beneficial owner of more than 5% of any class or series of our capital stock.
None of the directors or executive officers of MasterCard Incorporated will
beneficially own any of our class A redeemable or class B convertible common
stock following the conversion and integration. To the best of our knowledge,
each beneficial owner of class A redeemable common stock and class B convertible
common stock will have sole voting power and sole investment power with respect
to all of the class A redeemable and class B convertible shares that it owns.
This table does not give effect to shares that may be acquired pursuant to
options because no shares may be so acquired within 60 days from the date of
this proxy statement-prospectus.


<Table>
<Caption>
                                                      AFTER CONVERSION AND INTEGRATION
                                  ------------------------------------------------------------------------
                                   SHARES OF      PERCENT OF     SHARES OF      PERCENT OF     PERCENT OF
                                    CLASS A        CLASS A        CLASS B        CLASS B         TOTAL
                                   REDEEMABLE     REDEEMABLE    CONVERTIBLE    CONVERTIBLE    OUTSTANDING
                                  COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK
NAME AND ADDRESS                  BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY
OF BENEFICIAL OWNER                  OWNED          OWNED          OWNED          OWNED          OWNED
-------------------               ------------   ------------   ------------   ------------   ------------
<S>                               <C>            <C>            <C>            <C>            <C>
Citicorp Credit Services,
  Inc...........................  5.08 million       6.0%       .97 million         6.0%          6.0%
  14700 Citicorp Drive
  Hagerstown, MD 21742
Chase Manhattan Bank USA, N.A...  4.50 million       5.4%       .86 million         5.4%          5.4%
  100 Duffy Avenue
  Hicksville, NY 11801
EURO Kartensysteme EUROCARD und
  eurocheque GmbH...............  4.39 million       5.2%       .84 million         5.2%          5.2%
  Solmsstrasse 2-26
  60648 Frankfurt/Main
  Germany
</Table>


                                       137
<PAGE>


<Table>
<Caption>
                                                      AFTER CONVERSION AND INTEGRATION
                                  ------------------------------------------------------------------------
                                   SHARES OF      PERCENT OF     SHARES OF      PERCENT OF     PERCENT OF
                                    CLASS A        CLASS A        CLASS B        CLASS B         TOTAL
                                   REDEEMABLE     REDEEMABLE    CONVERTIBLE    CONVERTIBLE    OUTSTANDING
                                  COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK
NAME AND ADDRESS                  BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY
OF BENEFICIAL OWNER                  OWNED          OWNED          OWNED          OWNED          OWNED
-------------------               ------------   ------------   ------------   ------------   ------------
<S>                               <C>            <C>            <C>            <C>            <C>
First USA Bank, N.A. ...........  4.20 million       5.0%       .80 million         5.0%          5.0%
  A Bank One Company
  201 North Walnut Street
  15th Floor
  Wilmington, DE 19801
Europay France S.A. ............  4.22 million       5.0%       .80 million         5.0%          5.0%
  44, rue Cambronne
  75740 Paris Cedex 15
  France
</Table>


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                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


     Pursuant to an agreement, dated as of March 1, 1999, among MasterCard
International and Citibank, N.A., including certain of its affiliates, Citibank
has agreed, among other things, to increase, and then maintain, the overall
percentage of payment cards issued by Citibank that are MasterCard branded, in
exchange for certain pricing terms. MasterCard and Europay provide
authorization, clearing and settlement services in connection with transactions
for which Citibank or its affiliates act as issuer or acquirer. In addition,
Citibank uses several of MasterCard's fee-for-service products. A portion of
MasterCard International's $1.2 billion dollar credit facility is syndicated to
Citibank, N.A., for which Citibank and its affiliates receive a fee; Citibank is
the administrative agent of that facility and Salomon Smith Barney Inc., an
affiliate of Citibank, is the lead arranger and book manager of that facility.
Additional amounts are paid by MasterCard International for these services.
Another insurance affiliate of Citibank is a creditor of MasterCard
International in connection with a portion of the $149 million lease financing
for our O'Fallon, Missouri operations facility. In addition, Citibank and its
affiliates receive fees from MasterCard for cash management, asset management
and investment banking services. Citibank also acts as issuer of MasterCard's
corporate purchasing cards. For 2000, fees earned from Citibank and its
affiliates, as of the date of this proxy statement-prospectus, net of
contractual obligations under the agreement described above, were approximately
$140 million. Robert B. Willumstad, a member of our board of directors, is the
Chief Executive Officer of Citigroup's Global Consumer Group, an affiliate of
Citibank, N.A. As a result of the conversion and integration, Citibank, N.A.,
and its affiliates are expected to own approximately 6.0% of our class A
redeemable and class B convertible common stock on a combined basis.



     Pursuant to an agreement, dated as of July 1, 1999, between MasterCard and
The Chase Manhattan Bank, The Chase Manhattan Bank has agreed, among other
things, to continue to increase, and then maintain, the annual percentage of
payment cards issued by Chase that are MasterCard branded, in exchange for
certain pricing terms. MasterCard and Europay provide authorization, clearing
and settlement services in connection with transactions for which The Chase
Manhattan Bank or its affiliates act as issuer or acquirer. In addition, The
Chase Manhattan Bank uses several of MasterCard's fee-for-service products. A
portion of MasterCard International's $1.2 billion dollar credit facility is
syndicated to The Chase Manhattan Bank, for which The Chase Manhattan Bank
receives a fee. In addition, The Chase Manhattan Bank and its affiliates receive
amounts from MasterCard for cash management services. The Chase Manhattan Bank
acts as issuer of MasterCard's corporate cards and provides a variety of banking
services for MasterCard employees pursuant to arrangements entered into with
MasterCard. MasterCard provides certain financial and other incentives to The
Chase Manhattan Bank for co-branded and affinity card programs issued by Chase.
For 2000, fees earned from The Chase Manhattan Bank and its affiliates, as of
the date of this proxy statement-prospectus, net of contractual obligations
under the agreement described above, were approximately $110 million. David A.
Coulter, a member of our board of directors, is Vice Chairman of J.P. Morgan
Chase & Co., of which The Chase Manhattan Bank is an affiliate, and Donald L.
Boudreau, our Chairman Emeritus, is a former executive officer of The Chase
Manhattan Bank. As a result of the conversion and integration, The Chase
Manhattan Bank and its affiliates are expected to own approximately 5.4% of our
class A redeemable and class B convertible common stock on a combined basis.



     Under the terms of a licensing agreement with Europay, EURO Kartensysteme
EUROCARD und eurocheque GmbH, or EKS, is the principal licensee for certain
Europay brands and payment products in Germany. EKS owns a 15.3% equity interest
in Europay and is a principal member of MasterCard International. In connection
with the conversion and integration, EKS may enter into one or more agreements
with MasterCard Incorporated, MasterCard International and/or Europay pursuant
to which, among other things, EKS will assign to Europay certain trademarks,
trade names and other intellectual property rights, and MasterCard and Europay
will provide support for marketing initiatives designed to migrate all uses by
German members of the Eurocard-MasterCard brand on cards, acceptance decals,
advertising and other materials to the MasterCard brand mark. For 2000, fees
earned by Europay from EKS were approximately E65 million. Jan A. M. Hendrikx, a
member of our board of directors, is Chief Executive Officer of EKS and a member
of the board of directors of Europay. As a result of the conversion and
integration, EKS is expected to own approximately 5.2% of our class A redeemable
and class B convertible common stock.


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<PAGE>


     MasterCard and Europay provide authorization, clearing and settlement
services in connection with transactions for which Bank One or its affiliates,
including First USA Bank, N.A., act as issuer or acquirer. For 2000, fees earned
from Bank One and its affiliates, as of the date of this proxy
statement-prospectus were approximately $110 million. As a result of the
conversion and integration, Bank One and its affiliates are expected to own
approximately 5.0% of our class A redeemable and class B convertible common
stock on a combined basis.


     Europay France S.A., a company formed by certain French financial
institutions to promote Europay brands and payment products in France, owns a
15.3% equity interest in Europay and is a principal member of MasterCard
International. For 2000, fees earned by Europay from Europay France were
approximately E21 million. Jean-Pierre Ledru, a member of our board of
directors, is Chairman and Chief Executive Officer of Europay France and
Chairman of Europay. As a result of the conversion and integration, Europay
France is expected to own approximately 5.0% of our class A redeemable and class
B convertible common stock.

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<PAGE>

            DESCRIPTION OF CAPITAL STOCK OF MASTERCARD INCORPORATED

     The following summary of MasterCard Incorporated's capital stock describes
the material terms of the stock. For a complete description, we refer you to
MasterCard Incorporated's charter and bylaws, which are attached as Annexes D
and E to this proxy statement-prospectus.

GENERAL

     Capitalization.  The authorized capital stock of MasterCard Incorporated
consists of:

     - 275 million shares of class A redeemable common stock, par value $.01 per
       share;

     - 25 million shares of class B convertible common stock, par value $.01 per
       share; and

     - 75 million shares of class C common stock, par value $.01 per share.

     Immediately following the closing of the conversion and integration, 84
million shares of class A redeemable common stock will be issued and
outstanding, 16 million shares of class B convertible common stock will be
issued and outstanding and no shares of class C common stock will be issued and
outstanding. MasterCard Incorporated may only issue the class B convertible
common stock in connection with the transactions contemplated by the integration
agreement.

     Conversion of Class B convertible common stock.  Each share of class B
convertible common stock, except shares that constitute ec Pictogram shares,
will automatically be converted into one share of class A redeemable common
stock on the third anniversary of the first day of the first fiscal quarter
beginning after the fiscal quarter in which the closing of the conversion and
integration occurs. Shares of class B convertible common stock that are ec
Pictogram shares will automatically be converted into one share of class A
redeemable common stock on the second anniversary of the day on which all of the
other shares of class B convertible common stock were converted and some or all
of these shares will be allocated among the members of MasterCard responsible
for ec Pictogram volumes to the extent such volumes have been previously
converted to Maestro, in accordance with the terms of the integration agreement.
Any remaining shares will be allocated to non-European member-stockholders.

     Reallocation.  At the conclusion of the three year transition period, all
shares of class A redeemable common stock, including class A redeemable common
stock resulting from the conversion of class B convertible common stock, will be
subject to reallocation as described more fully under "Share Allocation and the
Global Proxy -- Reallocation of Shares at the Conclusion of the Transition
Period." In connection with this reallocation, shareholders may be required to
return some or all of their common stock to MasterCard Incorporated for
reallocation. In addition, ec Pictogram shares will be subject to reallocation
at the conclusion of an additional two year period following the transition
period as described more fully under "-- Conversion of Class B Convertible
Common Stock" above.

     Fractional Shares.  No fractional shares of class A redeemable or class B
convertible common stock will be issued or delivered by MasterCard Incorporated.
Any fractional share interests will be rounded to a whole share in such manner
as the management of MasterCard Incorporated may determine in its sole
discretion.

VOTING RIGHTS, DIVIDEND RIGHTS AND LIQUIDATION RIGHTS

     Voting Rights.  Each holder of class A redeemable and class B convertible
common stock has the right to cast one vote for each share of class A redeemable
and class B convertible common stock held of record on all matters submitted to
a vote of stockholders of MasterCard Incorporated. At the end of the transition
period, all shares of class B convertible common stock, except for class B
convertible shares relating to ec Pictogram, will be converted into class A
redeemable common stock. Following this conversion, the remaining class B
convertible common stock will have no voting rights. At all times, each holder
of class A redeemable and class B convertible common stock, together with its
affiliates, will be subject to a 7% voting limitation in the election of
directors regardless of the number of shares owned. This provision may be
altered by a majority vote of the MasterCard Incorporated board of directors or
by a majority of the holders of the class A redeemable common stock and class B
convertible common stock voting together as a single class (so long as
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<PAGE>

the class B convertible stock has voting rights). However, approval of at least
75% of the directors present at a meeting at which a quorum is present is
required to raise the limitation on voting for directors to more than 15% of the
shares that are entitled to vote in the election of directors. The above
provisions may be amended only with the approval of 75% of the directors present
at a meeting at which a quorum is present and the approval of the holders of a
majority of the outstanding class A redeemable and class B convertible common
stock voting together as a single class (so long as the class B convertible
stock has voting rights).

     Dividend Rights.  The holders of shares of class A redeemable and class B
convertible common stock are entitled to share ratably in dividends or
distributions, if, as and when dividends or distributions are declared by the
board of directors of MasterCard Incorporated at its discretion. MasterCard
Incorporated has no current plans to pay cash dividends on the common stock.

     Liquidation Rights.  Upon dissolution, liquidation or winding-up of
MasterCard Incorporated, holders of class A redeemable and class B convertible
common stock are entitled to share ratably in the net assets available for
distribution to stockholders after the payment of debts and other liabilities,
subject to the prior rights of any issued preferred shares.

     Redemption Rights.  If, within three years after the closing of the
conversion, a stockholder of MasterCard Incorporated ceases to be a principal
member of MasterCard International (other than in connection with a permitted
transfer of shares as described under "-- Transfer Restrictions" below),
MasterCard Incorporated will redeem that stockholder at par value. If more than
three years have elapsed since the conversion and a stockholder of MasterCard
Incorporated ceases to be a principal member of MasterCard International,
MasterCard Incorporated may, at its option, redeem the shares of that
stockholder for their book value based on MasterCard Incorporated's financial
statements most recently filed with the Securities and Exchange Commission. If
MasterCard Incorporated does not redeem the stockholder's shares, the
stockholder will be required to offer the unpurchased shares to the other
stockholders in accordance with procedures to be established by the board of
directors.

     Certain Purchase and Sale Obligations.  Beginning three years after the
conversion and integration, no stockholder may own common stock representing
more than 125% or less than 75% of that stockholder's most recent global proxy
calculation. Stockholders may be required to purchase or sell shares of
MasterCard Incorporated in order to satisfy these requirements within 12 months
of receipt of notice from MasterCard Incorporated that such purchase or sale is
required. Any sales of shares would ordinarily constitute taxable transactions.
Stockholders who need to sell shares in order to satisfy the 125% requirement
are obligated under the bylaws of MasterCard Incorporated to accept the highest
price offered to them for the shares that are required to be sold.

     To the extent that member-stockholders are required to purchase shares in
order to satisfy the 75% minimum ownership requirement, shares will be available
either directly from MasterCard Incorporated or from other member-stockholders
that either are required to sell shares in order to satisfy the 125% maximum
ownership requirement or otherwise desire to sell shares. The board of directors
of MasterCard Incorporated is authorized to establish procedures by which shares
of MasterCard Incorporated common stock will be traded among member-stockholders
or purchased or sold by MasterCard. Methods for the purchase and disposition of
shares may include some or all of the following: an on-line bulletin board that
matches buyers and sellers of shares; a periodic auction conducted on behalf of
MasterCard Incorporated for buyers and sellers of shares; and directly
negotiated purchases and sales of shares. The price at which shares may be
purchased or sold will be determined through these methods. MasterCard
Incorporated will not charge member-stockholders any commissions for
facilitating trading in its shares.

     MasterCard Incorporated will purchase or sell its common stock subject to
its having sufficient capital available to effect each purchase transaction, and
only if each purchase or sale transaction is permitted under the laws, rules and
regulations applicable to MasterCard Incorporated at the time (including
securities laws). In particular, to the extent any offer by MasterCard
Incorporated to purchase its shares constitutes a tender offer under the
Exchange Act, MasterCard Incorporated will comply with the applicable tender
offer rules and regulations. In addition, MasterCard Incorporated will undertake
activities to facilitate trading of its common stock among member-stockholders
only to the extent such activities are permitted under the federal and state
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<PAGE>

securities laws of the United States and related rules and regulations. Any
shares subsequently sold by MasterCard Incorporated may not be registered under
the Securities Act of 1933, as amended, and accordingly may be subject to resale
restrictions under the Securities Act.

     Rights.  Holders of class A redeemable and class B convertible common stock
have the right under the terms of the integration agreement and as provided for
in the bylaws of MasterCard Incorporated to receive additional shares at the end
of the three-year transition period to the extent that their new global proxy
calculation for the third year of the transition period (calculated on a
European or non-European basis, as the case may be) exceeds their initial
allocation of shares. See "Share Allocation and the Global Proxy -- Reallocation
of Shares at the Conclusion of the Transition Period." Similarly, holders of
class A redeemable and class B convertible common stock have the right to
receive additional shares in certain circumstances in connection with the
reallocation of ec Pictogram shares. See "Share Allocation and the Global
Proxy -- Conversion and Reallocation of ec Pictogram Shares." Members receiving
additional shares at the end of the three-year transition period and/or in
connection with the reallocation of ec Pictogram shares will do so pursuant to
rights initially granted with all shares of class A redeemable and class B
convertible common stock of MasterCard Incorporated. Each right is transferable
only with the applicable shares of class A redeemable and class B convertible
common stock, expires or terminates upon completion of the final reallocation
and is not redeemable except together with the redemption of a share of class A
redeemable or class B convertible common stock. Other than the right and as
otherwise described herein, holders of class A redeemable and class B
convertible common stock do not have any rights to purchase additional shares of
stock from MasterCard Incorporated, to have their common stock converted into or
exchanged for other securities (except for the conversion of class B convertible
shares into class A redeemable shares as described above), to have their common
stock repurchased by MasterCard Incorporated or to receive a preferred return on
their shares of common stock.

     Class C Common Stock.  Shares of class C common stock may be issued from
time to time with voting powers, designations, preferences and other rights to
be determined by the MasterCard Incorporated board of directors, provided that
no shares of class C common stock may be entitled to voting rights, dividends or
rights to participate in the proceeds of a liquidation that are greater than the
corresponding rights of the class A redeemable common stock. The MasterCard
Incorporated certificate of incorporation provides that any issuance of class C
common stock requires the approval of two-thirds of the board of directors, and
that any issuance of voting class C common stock or class C common stock that,
together with all other issuances of class C common stock made during the
immediately preceding two years, represents greater than 5% of the total number
of class A redeemable shares and class B convertible shares outstanding prior to
the issuance requires the approval of 75% of the board of directors. These
provisions may be amended only with the approval of 75% of the directors present
at a meeting at which a quorum is present and the approval of the holders of a
majority of the outstanding class A redeemable and class B convertible common
stock voting together as a single class (so long as the class B convertible
stock has voting rights).

TRANSFER RESTRICTIONS

     For three years following the closing of the conversion, no transfer of
shares of common stock and no assignment of the right to receive shares will be
permitted except:

     - in connection with a transfer of all or substantially all of a
       stockholder's card portfolio;

     - in the event that a stockholder that was a principal member becomes an
       affiliate member of another principal member, in which case the
       stockholder may transfer its common stock to the principal member with
       which it becomes affiliated;

     - in the event that a stockholder that was a principal member with one or
       more affiliate members ceases to be a principal member and one or more of
       its affiliate members thereupon become principal members, in which case
       the stockholder may transfer its common stock to the former affiliate
       members;

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<PAGE>

     - if a stockholder is prohibited from holding the common stock of
       MasterCard Incorporated by applicable regulatory requirements, in which
       case the stockholder may transfer its common stock to an affiliate that
       is permitted to hold the stock, with the prior approval of the board of
       directors of MasterCard Incorporated; and

     - a stockholder may transfer shares to a class A member of MasterCard
       International that is an affiliate of such stockholder with the approval
       of the board of directors of MasterCard Incorporated. For these purposes,
       an affiliate is any parent company that directly or indirectly owns 80%
       or more of the voting power and economic interests in the stockholder,
       and any entity of which the stockholder or any of such parents owns 80%
       or more of the voting power and economic interests.

The permissible transfers described above apply only to transfers of all, but
not less than all, of a stockholder's shares in MasterCard Incorporated.

     After three years, each stockholder must maintain an ownership percentage
of MasterCard Incorporated common stock that is no less than 75% and no more
than 125% of the stockholder's most recent global proxy calculation.
Stockholders may be required to purchase or sell shares of MasterCard
Incorporated in order to satisfy these requirements within 12 months of receipt
of notice from MasterCard Incorporated that such purchase or sale is required.
Any sales of shares would ordinarily constitute taxable transactions.
Stockholders who need to sell shares in order to satisfy the 125% requirement
are obligated under the bylaws of MasterCard Incorporated to accept the highest
price offered to them for the shares that are required to be sold. In addition:

     - only class A members of MasterCard International may own shares of class
       A redeemable and class B convertible common stock of MasterCard
       Incorporated; and

     - unless otherwise approved by a two-thirds vote of the MasterCard
       Incorporated board of directors, no stockholder together with its
       affiliates may own more than 15% of the outstanding shares of voting
       stock of MasterCard Incorporated.

     Following the three year transition period, MasterCard Incorporated intends
to facilitate trading of its common stock among class A members of MasterCard
International according to procedures to be established by the board of
directors of MasterCard Incorporated. See "-- Certain Purchase or Sale
Obligations."

     The shares of MasterCard Incorporated common stock that MasterCard
International members will own following the conversion and integration have
been registered under the Securities Act of 1933. They may be traded in
accordance with the transfer restrictions contained in this section by you if
you are not an affiliate of MasterCard International under the Securities Act.
An "affiliate" as defined by the rules under the Securities Act is a person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, MasterCard International.
Persons who are affiliates of MasterCard International may not sell their shares
of MasterCard Incorporated common stock acquired in the merger except pursuant
to an effective registration statement under the Securities Act or an applicable
exemption from the requirements of the Securities Act, including Rules 144 and
145 issued by the SEC under the Securities Act. Affiliates generally include
directors, executive officers and beneficial owners of 10% or more of any class
of capital stock.

TRANSFER AGENT

     Initially, MasterCard Incorporated will be the transfer agent and registrar
of the common stock.

LIMITATIONS ON A CHANGE OF CONTROL

     We summarize below several provisions of our certificate of incorporation
and bylaws and the Delaware General Corporation Law. These provisions could have
the effect of delaying, deferring or preventing a change in control of
MasterCard Incorporated or deterring potential acquirers from making an offer to
our stockholders. This could be the case even though a majority of our
stockholders might benefit from such a change in control or offer. These
descriptions are not complete and we refer you to the documents that we have
filed as exhibits to this proxy statement-prospectus and to the Delaware General
Corporation Law.

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     Supermajority Vote of the Board of Directors.  Our certificate of
incorporation requires the approval of 75% of the directors present at a meeting
at which a quorum is present and the approval of the holders of a majority of
the outstanding class A redeemable and class B convertible common stock voting
together as a single class (so long as the class B convertible common stock has
voting rights) to: alter our status as a stock corporation; amend our
certificate of incorporation to authorize MasterCard Incorporated to issue stock
other than class A redeemable, B convertible or C common stock; sell, lease or
exchange all or substantially all of MasterCard Incorporated's assets; approve
the sale, lease or exchange of all or substantial all of the assets of
MasterCard International; engage in a business combination (merger or
consolidation) involving either MasterCard Incorporated or MasterCard
International; undertake an initial public offering; amend the MasterCard
International certificate of incorporation to allow MasterCard International to
issue capital stock, to create additional classes of membership interests in
MasterCard International, to subject the property of the members of MasterCard
International to the obligations of MasterCard International or to subject
non-U.S. programs to the satisfaction of any liabilities arising from the
current DOJ and merchant antitrust litigations in the United States; or amend
the provisions of the MasterCard International bylaws relating to special
assessments that may be imposed upon the members of MasterCard International.
Other provisions of the certificates of incorporation and by-laws of MasterCard
Incorporated and MasterCard International may be modified only if certain
supermajorities are achieved, and these provisions may have the effect of
deterring potential acquirors. See "Comparison of Rights of MasterCard
International Members Before and After the Conversion and Integration."

     Ability to Call Special Meetings.  Special meetings of MasterCard
Incorporated stockholders may be called at any time for any purpose by written
request of the chairman of the board of directors or the President and Chief
Executive Officer of MasterCard Incorporated. Special meetings may also be
called by the Secretary upon the written request of at least 33 1/3% of the
board of directors or the holders of at least 25% of the outstanding shares
entitled to vote on the action being proposed. Notice of a special meeting must
state the time, place and date of the meeting, the name of the person or persons
calling the meeting, the purpose for which the meeting is called and the means
of acceptable remote participation. The business transacted at the special
meeting is limited to the purpose described in the notice.

     15% Share Ownership Limitation.  Unless otherwise approved by a two-thirds
vote of the MasterCard board of directors, no stockholder together with its
affiliates may own more than 15% of the outstanding shares of voting stock of
MasterCard Incorporated.

     7% Voting Power Limitation.  Each holder of class A redeemable and class B
convertible common stock, together with its affiliates, will be subject to a 7%
voting limitation in the election of directors regardless of the number of
shares owned.

     Only Class A Members of MasterCard International may be Stockholders of
MasterCard Incorporated. Only class A members of MasterCard International may
own shares of class A redeemable and class B convertible common stock of
MasterCard Incorporated.

     Authorized but Unissued Shares of Class C Common Stock.  Since the board of
directors of MasterCard Incorporated may issue shares of class C common stock
and set the voting powers, designations, preferences and other rights related to
that stock, any issuance of class C shares may delay or prevent a change of
control.

DELAWARE ANTI-TAKEOVER STATUTE

     Under Section 203 of the business combination statute of Delaware law, a
corporation is prohibited from engaging in any business combination with an
interested stockholder who, together with its affiliates or associates, owns 15%
or more of the corporation's voting stock for a three year period following the
time the stockholder became an interested stockholder, unless:

     - prior to the time the stockholder became an interested stockholder, the
       board of directors of the corporation approved either the business
       combination or the transaction which resulted in the stockholder becoming
       an interested stockholder;

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<PAGE>

     - the interested stockholder owned at least 85% of the voting stock of the
       corporation, excluding specified shares, upon completion of the
       transaction which resulted in the stockholder becoming an interested
       stockholder; or

     - at or subsequent to the time the stockholder became an interested
       stockholder, the business combination is approved by the board of
       directors of the corporation and authorized by the affirmative vote, at
       an annual or special meeting and not by written consent, of at least
       66 2/3% of the outstanding voting shares of the corporation, excluding
       shares held by that interested stockholder.

     A business combination generally includes:

     - mergers, consolidations and sales or other dispositions of 10% or more of
       the assets of a corporation to or with an interested stockholder;

     - specified transactions resulting in the issuance or transfer to an
       interested stockholder of any capital stock of the corporation or its
       subsidiaries; and

     - other transactions resulting in a disproportionate financial benefit to
       an interested stockholder.

     The provisions of the Delaware business combination statute do not apply to
a corporation if, subject to certain requirements, the certificate of
incorporation or by-laws of the corporation contain a provision expressly
electing not to be governed by the provisions of the statute or the corporation
does not have voting stock listed on a national securities exchange, authorized
for quotation on an inter-dealer quotation system of a registered national
securities association or held of record by more than 2,000 stockholders.

     Although MasterCard Incorporated does not plan to "opt out" of this
provision, Section 203 will not apply as long as we have fewer than 2,000
stockholders. In addition, the provision may not be meaningful as a result of
certain provisions of our certificate of incorporation and bylaws, including the
provision prohibiting stockholders from holding more than 15% of our outstanding
common stock.

LIMITATION OF PERSONAL LIABILITY OF DIRECTORS AND OFFICERS

     Delaware law provides that a corporation may include in its certificate of
incorporation a provision limiting or eliminating the liability of its directors
to the corporation and its stockholders for monetary damages arising from a
breach of fiduciary duty, except for:

     - a breach of the duty of loyalty to the corporation or its stockholders;

     - acts or omissions not in good faith or which involve intentional
       misconduct or a knowing violation of law;

     - payment of a dividend or the repurchase or redemption of stock in
       violation of Delaware law; or

     - any transaction from which the director derived an improper personal
       benefit.

     Our certificate of incorporation provides that, to the fullest extent
Delaware law permits the limitation or elimination of the liability of
directors, none of our directors will be liable to us or our stockholders for
monetary damages for breach of fiduciary duty as a director.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Our bylaws require, among other things, that we indemnify our officers and
directors against all expenses, including attorney's fees, incurred in any
action, suit or proceeding by reason of the fact that the person is or was a
director, officer, employee or agent of MasterCard Incorporated. We are also
permitted to advance to the officers and directors all related expenses, subject
to reimbursement if it is determined subsequently that indemnification is not
permitted.

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                     MATERIAL CONTRACTS BETWEEN MASTERCARD
                           INTERNATIONAL AND EUROPAY

     We summarize below the material contracts between MasterCard International
and Europay before the conversion and integration. If the conversion and
integration are completed, these agreements will be terminated.

ALLIANCE AGREEMENT

     MasterCard International and Europay are parties to an Alliance Agreement,
dated as of November 14, 1996, that provides for a broad alliance between the
two companies and sets forth the terms and conditions under which MasterCard
International and Europay agreed to improve the acceptance, visibility, brand
awareness and technological support of the MasterCard brand in Europe.

     Under the Alliance Agreement, MasterCard International agreed to grant
Europay the exclusive right to elect new European members for the non-exclusive
use of the MasterCard brand marks in Europe and agreed to approve and execute
new member agreements and/or licenses on a non-exclusive basis for newly elected
European members and/or licensees for use of the MasterCard brand marks in
Europe.

MAESTRO AGREEMENT

     MasterCard International and Europay are also parties to a Maestro
Agreement, dated as of June 19, 1997, that provides for the joint development,
promotion and management by MasterCard International and Europay of Maestro
International Incorporated. Maestro International Incorporated is 50% owned by
MasterCard International and 50% owned by Europay. Maestro International grants
licenses to use and to grant sublicenses for the Maestro brands to MasterCard
and Europay for each of the regions of the world.

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