1.

Nature of Business and Organization

     IntercontinentalExchange, Inc. (the “Company”) is a leading operator of global regulated futures exchanges and over-the-counter (“OTC”) markets for commodities and derivative financial products. The Company owns ICE Futures Europe, which operates as a United Kingdom (“U.K.”) Recognized Investment Exchange for the purpose of price discovery, trading and risk management within the energy commodity futures and options markets. The Company owns ICE Futures U.S., Inc. (“ICE Futures U.S.”), which operates as a United States (“U.S.”) Designated Contract Market for the purpose of price discovery, trading and risk management within the soft commodity, index and currency futures and options markets. The Company owns ICE Futures Canada, Inc. (“ICE Futures Canada”), which operates as a Canadian derivatives exchange for the purpose of price discovery, trading and risk management within the agricultural futures and options markets. In addition to operating an Exempt Commercial Market for trading OTC energy commodities and derivatives, the Company owns Creditex Group Inc. (“Creditex”), which operates in the OTC credit default swaps (“CDS”) trade execution markets. In addition, the Company currently owns and operates five central counterparty clearing houses, including ICE Clear U.S., Inc. (“ICE Clear U.S.”), ICE Clear Europe Limited (“ICE Clear Europe”), ICE Clear Canada, Inc. (“ICE Clear Canada”) and ICE Trust U.S. LLC (“ICE Trust”), which began clearing CDS markets in March 2009. Headquartered in Atlanta, Georgia, the Company also has offices in London, New York, Chicago, Houston, Calgary, Winnipeg and Singapore. The Company does not risk its own capital by engaging in any trading activities.

2.

Basis of Presentation

     The accompanying unaudited consolidated financial statements have been prepared by the Company in accordance with U.S. generally accepted accounting principles pursuant to the rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and related notes thereto for the year ended December 31, 2008. The accompanying unaudited consolidated financial statements reflect all adjustments that are, in the opinion of the Company’s management, necessary for a fair presentation of results for the interim periods presented. These adjustments are of a normal recurring nature. Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the consolidated financial statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may be different from the estimates. The results of operations for the six months and three months ended June 30, 2009 are not necessarily indicative of the results to be expected for any future period or the full fiscal year.

     The accompanying unaudited consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany balances and transactions between the Company and its wholly-owned and majority-owned subsidiaries have been eliminated in consolidation. As discussed in Note 10, the Company completed its acquisition of The Clearing Corporation (“TCC”) on March 6, 2009 and has included the financial results of TCC in its consolidated financial statements effective from March 6, 2009.

     On January 1, 2009, the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 141 (revised 2007), Business Combinations, (“SFAS No. 141R”). Under SFAS No. 141R, an acquirer is required to recognize all the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value, with limited exceptions. SFAS No. 141R changes the accounting treatment for certain specific acquisition-related items including expensing acquisition costs as incurred, valuing noncontrolling interests at fair value at the acquisition date and expensing restructuring costs associated with an acquired business. SFAS No. 141R also includes a number of new disclosure requirements. SFAS No. 141R will be applied prospectively to business combinations consummated on or after January 1, 2009, including the Company’s acquisition of TCC on March 6, 2009. As a result of the Company’s adoption of SFAS No. 141R, $5.6 million in transaction costs related to the acquisition of TCC were expensed in the accompanying consolidated statement of income for the six months ended June 30, 2009, of which $2.2 million had been included as deferred acquisition costs and classified in noncurrent assets in the Company’s consolidated balance sheet as of December 31, 2008. The Company expects the adoption of SFAS No. 141R to have an impact on its financial results, but the extent of the impact is dependent on the size, complexity and number of acquisitions made in the future and the related use of external advisory service providers.

     On January 1, 2009, the Company adopted SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of ARB No. 51 (“SFAS No. 160”). SFAS No. 160 amends ARB No. 51 to establish and improve accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No. 160 also changes the way the consolidated income statement is presented, establishes a single method of accounting for changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation, requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated, and expands disclosures in the consolidated financial statements in order to clearly identify and distinguish between the interests of the parent’s owners and the interests of the noncontrolling owners of a subsidiary. The adoption of SFAS No. 160 did not have a material impact on the Company’s consolidated financial statements. The Company’s adoption of SFAS No. 160 resulted in a reclassification of noncontrolling interest from the mezzanine section of the balance sheet to equity of $5.9 million. Increases in noncontrolling interest, including that resulting from the acquisition of TCC, have been recorded within equity, with income attributable to that noncontrolling interest recorded separately in the Company’s consolidated statements of income.

     In April 2009, the FASB issued two Staff Positions (“FSPs”) that are intended to provide additional application guidance and enhance disclosures about fair value measurements and impairment of securities. FSP FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, clarifies the objective and method of fair value measurement in accordance with SFAS No. 157, Fair Value Measurement, when there has been a significant decrease in market activity for the asset or liability being measured. This FSP also provides guidance for identifying circumstances that indicate a transaction is not orderly. FSP FAS 115-2 and FSP FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments, changes existing guidance for determining whether an impairment of a debt security is other than temporary, including establishing criteria for when to recognize a write-down through earnings versus other comprehensive income. Both of these FSPs are effective for the Company’s quarter ending June 30, 2009. The application of these FSPs did not have a material impact on the Company’s consolidated financial statements.

     In April 2009, the FASB issued FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments. This FSP requires that the fair values of all financial instruments within the scope of FASB Statement No. 107, Disclosures about Fair Value of Financial Instruments, be disclosed in interim and annual reporting periods. This FSP is effective for the Company’s quarter ending June 30, 2009, and application of it did not have a material impact on the Company’s consolidated financial statements.

     In May 2009, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 165, Subsequent Events (“SFAS No. 165”). SFAS No. 165 incorporates into authoritative accounting literature certain guidance that already existed within generally accepted auditing standards. SFAS No. 165 prescribes the period after the balance sheet date during which an entity should evaluate transactions for potential recognition, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date and the related disclosure requirements. SFAS No. 165 is effective for the Company as of the quarter ending June 30, 2009. The adoption of SFAS No. 165 did not have a material impact on the Company’s consolidated financial statements.

3.

Short-Term and Long-Term Investments

     Investments consist of available-for-sale securities. Available-for-sale securities are carried at fair value with unrealized gains or losses reported as a component of accumulated other comprehensive income. The cost of securities sold is based on the specific identification method. As of June 30, 2009, available-for-sale securities consisted of the following (in thousands):

						Gross				Gross
						Unrealized				Unrealized				Estimated
		Cost				Gains				Losses				Fair Value
U.S. Treasury securities		$	1,999			$	—			$	—			$	1,999
Equity securities			24,103				8,254				1				32,356
Corporate bonds			22				—				—				22
Municipal bonds			2,760				—				—				2,760
Total		$	28,884			$	8,254			$	1			$	37,137

     The contractual maturities of the debt securities noted above as of June 30, 2009, were as follows (in thousands):

		Estimated Fair
		Value
Maturities:
Due within 1 year		$	1,999
Due within 1 year to 5 years			22
Due within 5 years to 10 years			—
Due after 10 years			2,760
Total		$	4,781

     The Company acquired 2.3 million shares, or approximately 4.8%, of the common stock of Climate Exchange plc (“CLE”) for $24.1 million in cash in June 2009. CLE is listed on the Alternative Investment Market (“AIM”) section of the London Stock Exchange. CLE is principally engaged in owning, operating and developing exchanges to facilitate trading in environmental financial instruments, including emissions reduction credits, which are designed to support and lower the economic costs of achieving environmental objectives. The Company has a preexisting contractual relationship with three subsidiaries of CLE whereby the Company provides hosting and other services for electronic trading and clearing of the CLE subsidiaries’ products. The Company accounts for its investment in CLE as an available-for-sale investment. At June 30, 2009, the fair value of the investment was $32.4 million and the unrealized gain was $8.3 million, or $5.9 million net of taxes, which is included in equity securities in the table above. Investments that the Company intends to hold for more than one year are classified as long-term investments. The investment in CLE is classified as a long-term investment in the accompanying consolidated balance sheet as of June 30, 2009. All other available-for-sale securities are classified as short-term investments as of June 30, 2009 as the Company does not expect to hold these for more than one year.

4.

Cost Method Investments

     The Company has an 8% equity ownership in the National Commodity and Derivatives Exchange, Ltd. (“NCDEX”), a derivatives exchange located in Mumbai, India, which it acquired for $37.0 million in 2006. In 2008, the Company recorded an impairment loss of $15.7 million, reducing the carrying value of the investment to $21.3 million. During the three months ended June 30, 2009, the Company recorded an additional impairment loss of $9.3 million, resulting in the present carrying value of $12.0 million as of June 30, 2009. The Company wrote down its cost method investment in NCDEX due to the significance of the decrease in the estimated fair value of its investment resulting from the suspended trading of certain key NCDEX contracts, foreign investment limits, current market conditions and the uncertainty surrounding the potential for the Company to recover the carrying value of the investment.

     The Company is required to sell a portion of its stake in NCDEX by September 30, 2009 as a result of a change in Indian law that limits the total ownership by foreign entities in Indian commodities exchanges to a maximum of 5%. The Company has identified a buyer of its excess 3% interest and has entered into an agreement to sell the interest by the September 30, 2009 deadline. The sales price represents the fair market value of the investment. Of the $12.0 million present carrying value, $4.5 million is reflected as other current assets in the accompanying consolidated balance sheet to reflect the 3% excess interest that we expect will be sold by September 30, 2009. The Company will continue to monitor the $7.5 million long-term cost method investment and if it is determined that additional other-than-temporary impairment exists, the Company will recognize an impairment loss equal to the difference between the fair value and the adjusted carrying value of the remaining 5% equity stake in NCDEX.

5.

Goodwill and Other Intangible Assets

     The following is a summary of the activity in the goodwill balance for the six months ended June 30, 2009 (in thousands):

Goodwill balance at December 31, 2008		$	1,434,816
Acquisition of TCC			46,989
Other activity			(5,643	)
Goodwill balance at June 30, 2009		$	1,476,162

     The following is a summary of the activity in the other intangible assets balance for the six months ended June 30, 2009 (in thousands):

Other intangible assets balance at December 31, 2008		$	728,855
Acquisition of TCC			35,380
Other activity			1,293
Amortization of intangibles			(32,714	)
Other intangible assets balance at June 30, 2009		$	732,814

     The goodwill and other intangible assets from the acquisition of TCC (Note 10) have been included in the global OTC segment for purposes of segment reporting as this is consistent with how it is reported internally to the Company’s chief operating decision maker. The TCC goodwill amount above was allocated to the CDS reporting unit for purposes of future impairment testing. The Company estimates that none of the goodwill acquired for the TCC acquisition will be deductible for tax purposes as it was a nontaxable transaction. The other activity in the goodwill and other intangible assets balances relates to adjustments to the purchase price, other intangible assets and related goodwill for acquisitions completed in 2008, primarily relating to updated valuations of identified tangible and intangible assets, adjustments for excess tax benefits on share based payments, and foreign currency translation adjustments. The Company did not recognize any impairment losses on goodwill or other intangible assets during the six months ended June 30, 2009.

6.

Credit Facilities

     As of December 31, 2008, the Company had a senior unsecured credit agreement under which a term loan facility in the aggregate principal amount of $184.4 million was outstanding and a revolving credit facility with a total borrowing capacity of $250.0 million (collectively, the “Credit Facilities”). As of December 31, 2008, $195.0 million was outstanding under the revolving credit facility, which was due to be repaid by January 12, 2010. The Company also had a separate senior credit agreement (the “Credit Agreement”) outstanding that provided for an additional 364-day revolving credit facility with a total borrowing capacity of $150.0 million for use by ICE Clear Europe, of which no amounts had been borrowed.

     On April 9, 2009, the Credit Facilities and the Credit Agreement were cancelled, amended and/or replaced with new unsecured senior credit facilities (the “New Credit Facilities”) with aggregate principal amount and borrowing capacity of $775.0 million with Wachovia Bank, National Association (“Wachovia”), as Administrative Agent, Bank of America, N.A., as Syndication Agent, and the lenders named therein. The New Credit Facilities provide for a 364-day senior unsecured revolving credit facility with a total borrowing capacity of $300.0 million, a three-year senior unsecured revolving credit facility with a total borrowing capacity of $100.0 million, a three-year senior unsecured term loan facility in the aggregate principal amount of $200.0 million and an amended senior unsecured term loan facility in the aggregate principal amount of $175.0 million. The full $200.0 million available under the new term loan facility was borrowed on April 9, 2009 and was used to pay off the $195.0 million in principal that was outstanding under the previous revolving credit facility. The original term loan facility was amended and the $175.0 million that was outstanding at that time remained outstanding under the New Credit Facilities. No amounts were borrowed under the new $400.0 million combined revolving credit facilities.

     Loans under the New Credit Facilities bear interest on the principal amount outstanding, at the option of the Company, at either (i) LIBOR plus an applicable margin rate or (ii) a “base rate” plus an applicable margin rate. The “base rate” will be equal to the higher of (i) Wachovia’s prime rate, (ii) the federal funds rate plus 0.5%, or (iii) the LIBOR rate for an interest period of one month plus 1.5%. The applicable margin rate ranges from 2.50% to 4.50% on the LIBOR loans and from 1.50% to 3.50% for the base rate loans, in each case based on the Company’s total leverage ratio calculated on a trailing twelve month period. Interest on each outstanding borrowing is payable on at least a quarterly basis. Aggregate principal maturities on the borrowings outstanding under the New Credit Facilities are $45.0 million for the remaining six months in 2009 and $99.0 million, $132.8 million and $75.7 million in 2010, 2011 and 2012, respectively.

     The Company had a one-month LIBOR-rate loan with a stated interest rate of 2.81% per annum, including the applicable margin rate of 2.50% on the LIBOR loan, related to the $175.0 million term loan facility, of which $162.5 million remained outstanding as of June 30, 2009. The Company had a one-month LIBOR-rate loan with a stated interest rate of 2.81% per annum, including the applicable margin rate of 2.50% on the LIBOR loan, related to the $200.0 million term loan facility, of which $190.0 million remained outstanding as of June 30, 2009. The closing of the New Credit Facilities increased the deferred debt issuance costs to $9.8 million as of June 30, 2009. The debt issuance costs will be amortized over the remaining life of the loans, including $1.8 million that was amortized during the three months ended June 30, 2009 and the Company will amortize $3.0 million for the remaining six months in 2009 and $3.8 million, $2.5 million and $541,000 in 2010, 2011 and 2012, respectively.

     The New Credit Facilities include an unutilized revolving credit commitment fee that is equal to the unused maximum revolver amount multiplied by an applicable margin rate and is payable in arrears on a quarterly basis. The applicable margin rate ranges from 0.50% to 0.90% based on the Company’s total leverage ratio calculated on a trailing twelve month period. Based on this calculation, the applicable margin rate was 0.50% as of June 30, 2009.

     Of the $300.0 million available under the 364-day senior unsecured revolving credit facility, (i) up to $150.0 million of such amount has been reserved to provide liquidity for the clearing operations of ICE Clear Europe, (ii) up to $100.0 million of such amount has been reserved to provide liquidity for the clearing operations of ICE Trust, and (iii) up to $50.0 million of such amount has been reserved to provide liquidity for the clearing operations of ICE Clear U.S. The Company has reserved $3.0 million of the $100.0 million available under the three-year senior unsecured revolving credit facility to be used to provide liquidity for certain of the clearing operations of ICE Clear Canada and the remaining balance can be used by the Company for working capital and general corporate purposes.

     With limited exceptions, the Company may prepay the outstanding loans under the New Credit Facilities, in whole or in part, without premium or penalty. The New Credit Facilities contain affirmative and negative covenants, including, but not limited to, leverage and interest coverage ratios, as well as limitations or required notices or approvals for acquisitions, dispositions of assets and certain investments, the incurrence of additional debt or the creation of liens and other fundamental changes to the Company’s business. The Company has been and is currently in compliance with all applicable covenants under the New Credit Facilities.

     In April 2009, the Company entered into interest rate swaps to reduce its exposure to interest rate volatility on the term loan facilities. The interest rate swaps are forward-starting swaps and are effective from December 31, 2009 through the maturity dates of the term loan facilities. The interest rate swaps require the Company to pay a fixed interest rate of 4.26% per annum on the $175.0 million term loan facility, of which $137.5 million will be outstanding as of December 31, 2009, and 4.36% per annum on the $200.0 million term loan facility, of which $170.0 million will be outstanding as of December 31, 2009. In return, the Company will receive the one-month LIBOR-rate plus 250 basis points. These swaps are designated as cash flow hedges. Under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended, the effective portion of unrealized gains or losses on derivatives designated as cash flow hedges are recorded in accumulated other comprehensive income. The unrealized gain or loss is recognized in earnings when the designated interest expense under the term loans is recognized in earnings. Any portion of the hedge that is ineffective is recognized in earnings immediately. The amounts received under the variable component of the swaps will fully offset the variable interest payments under the term loan facilities. With the two variable components offsetting, the net interest expense will equal the fixed interest component. The fair value of the interest rate swaps as of June 30, 2009 is $587,000 and is included in the accompanying balance sheet as non-current assets with the unrealized gain included under the shareholders’ equity section as accumulated other comprehensive income from cash flow hedges. The portion of the unrealized gain expected to be reclassified into earnings within the next twelve months is not expected to be significant.

7.

Stock-Based Compensation

     The Company currently sponsors employee stock option and restricted stock plans. All stock options are granted at an exercise price equal to the fair value of the common stock on the date of grant. The grant date fair value is based on the closing stock price on the date of grant. The fair value of the stock options and restricted stock on the date of the grant is recognized as expense over the vesting period, net of estimated forfeitures. The non-cash compensation expenses recognized in the Company’s consolidated statements of income for the stock options and restricted stock were $21.8 million and $17.8 million for the six months ended June 30, 2009 and 2008, respectively, and $12.0 million and $9.9 million for the three months ended June 30, 2009 and 2008, respectively.

     The following is a summary of stock options for the six months ended June 30, 2009:

						Weighted Average
						Exercise Price
		Number of Options				Per Option
Outstanding at December 31, 2008			2,463,415			$	36.83
Exercised			(435,686	)			17.25
Forfeited or expired			(21,299	)			106.56
Outstanding at June 30, 2009			2,006,430				40.35

     Details of stock options outstanding as of June 30, 2009 are as follows:

										Weighted Average				Aggregate
						Weighted Average				Remaining				Intrinsic
						Exercise				Contractual Life				Value
		Number of Options				Price				(years)				(In thousands)
Vested or expected to vest			1,899,119			$	39.46				6.65			$	148,068
Exercisable			1,418,841			$	30.23				6.04			$	122,663

     The total intrinsic value of stock options exercised during the six months ended June 30, 2009 and 2008 was $34.0 million and $37.7 million, respectively, and was $31.3 million and $14.5 million during the three months ended June 30, 2009 and 2008, respectively. As of June 30, 2009, there were $21.2 million in total unrecognized compensation costs related to stock options. These costs are expected to be recognized over a weighted average period of 2.1 years as the stock options vest.

     In December 2008, the Company reserved a maximum of 465,895 restricted shares for potential issuance as performance-based restricted shares for certain Company employees. These restricted shares are also subject to a market condition that may reduce the number of shares that are issued if the 2009 Company total shareholder return falls below that of the 2009 return of the Dow Jones Global Exchange Index. The number of shares issued will be reduced by either 10% or 20% if the 2009 Company total shareholder return is below certain threshold levels as compared to the 2009 return of the Dow Jones Global Exchange Index. The Company used a Monte Carlo simulation model to determine the grant date fair value of these awards. The grant date was December 16, 2008, which was the date when the Company and the employees reached a mutual understanding of award terms, and it is also the service inception date, which is the date when the requisite service period began. These shares vest over a three-year period based on the Company’s financial performance targets set by the Company’s compensation committee for the year ending December 31, 2009. The compensation expense to be recognized under these performance-based restricted shares is expected to be $6.0 million if the Threshold Performance Target is met and 93,179 shares vest, $12.0 million if the Target Performance Target is met and 186,358 shares vest, $20.9 million if the Above Target Performance Target is met and 326,127 shares vest, and $29.9 million if the Maximum Performance Target is met and 465,895 shares vest. Shares to be issued will be prorated on a straight-line basis between performance level targets. The Company will recognize expense on an accelerated basis over the three-year vesting period based on the Company’s quarterly assessment of the probable 2009 actual performance as compared to the 2009 financial performance targets. If the market condition is not achieved, compensation cost will not be affected since the grant date fair value of the award gave consideration to the probability of market condition achievement. The Company utilized a Monte Carlo model to determine the fair value of these awards based on the following assumptions:

Assumptions
Risk-free interest rate:			0.48	%
Expected volatility:			100.41	%
Performance measurement period in years:			1.04
Expected dividend yield:			0.0	%

     The risk free interest rate is based on the one-year U.S. Treasury yield curve in effect at the time of grant. Expected volatility is based on one-year historical volatility of the Company’s stock. The performance measurement period of the award is based on the length of time between the grant date and the end of the market condition determination date.

     The following is a summary of the nonvested restricted shares for the six months ended June 30, 2009:

						Weighted Average
		Number of				Grant-Date Fair
		Restricted Stock Shares				Value per Share
Nonvested at December 31, 2008			1,142,332			$	92.33
Granted			111,144				81.18
Vested			(222,348	)			101.71
Forfeited			(24,299	)			104.39
Nonvested at June 30, 2009			1,006,829				88.74

     Restricted stock shares granted in the table above include both time-based and performance-based grants. Unvested performance-based restricted shares granted are presented in the table above at the maximum number of restricted shares that would vest if the maximum performance targets are met. Performance-based shares awarded in prior years have been adjusted to reflect the actual shares to be issued based on the achievement of past performance targets. As of June 30, 2009, there were $39.3 million in total unrecognized compensation costs related to the time-based restricted stock and the performance-based restricted stock. These costs are expected to be recognized over a weighted average period of 1.9 years as the restricted stock vests. These unrecognized compensation costs assume that the target performance level will be met on the performance-based restricted shares granted in December 2008. During the six months ended June 30, 2009 and 2008, the total fair value of restricted stock vested under all restricted stock plans was $15.7 million and $127.4 million, respectively.

8.

Income Taxes

     The Company’s effective tax rate increased to 36.4% for the six months ended June 30, 2009 from 35.4% for the six months ended June 30, 2008 and to 38.8% for the three months ended June 30, 2009 from 35.5% for the three months ended June 30, 2008. The effective tax rate for the six months and three months ended June 30, 2009 is higher than the federal statutory rate primarily due to the tax impact of an impairment loss related to the Company’s investment in NCDEX (Note 4), state taxes and non-deductible expenses, which are partially offset by favorable foreign income tax rates, tax exempt interest income and tax credits. The effective tax rate for the six months and three months ended June 30, 2008 is higher than the federal statutory rate primarily due to state taxes and non-deductible expenses, which are partially offset by favorable foreign income tax rates, tax exempt interest income and tax credits.

     The undistributed earnings of the Company’s foreign subsidiaries that have not been remitted to the United States totaled $471.1 million and $363.4 million as of June 30, 2009 and December 31, 2008, respectively. These earnings are not subject to U.S. income tax until they are distributed to the United States.

9.

Clearing Organizations

     ICE Clear U.S. performs the clearing and settlement of every futures and options contract traded through ICE Futures U.S., ICE Clear Canada performs the same function for every futures and options contract traded through ICE Futures Canada and ICE Clear Europe performs the same function for every futures and options contract traded through ICE Futures Europe, as well as for all of the Company’s cleared OTC energy products. TCC performs clearing and settlement services to its participants for trades in futures contracts, options contracts and OTC transactions executed on various exchanges and marketplaces. ICE Trust performs the clearing and settlement of U.S.-based CDS contracts and began clearing these contracts in March 2009. ICE Clear U.S., ICE Clear Europe, ICE Clear Canada, TCC and ICE Trust are referred to herein collectively as the “ICE Clearing Houses”.

     Each of the ICE Clearing Houses has equal and offsetting claims to and from their respective clearing members on opposite sides of each contract, standing as the central financial counterparty on every contract cleared. To the extent that funds are not otherwise available to satisfy an obligation under an applicable contract, each ICE Clearing House bears financial counterparty credit risk in the event that future market movements create conditions that could lead to its clearing members failing to meet their obligations to that ICE Clearing House. Accordingly, the ICE Clearing Houses account for this central counterparty guarantee as a performance guarantee under FIN 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, an interpretation of FASB Statements No. 5, 57, and 107 and rescission of FASB interpretation No. 34. Given that each contract is settled on at least a daily basis for each clearing member, the ICE Clearing Houses’ maximum exposure for this guarantee is approximately $25.2 billion as of June 30, 2009, which represents the maximum estimated value by the ICE Clearing Houses of a hypothetical one to five day movement in pricing of the underlying unsettled contracts. This amount is based on calculations determined using proprietary software that simulates gains and losses based on historical market prices, volatility and other factors present at that point in time for those particular unsettled contracts. Future actual market price volatility could result in the exposure being significantly different than the amount estimated by the ICE Clearing Houses. The net notional value of the unsettled contracts was approximately $249.8 billion as of June 30, 2009.

     The ICE Clearing Houses seek to reduce their exposure through a risk management program that includes initial and ongoing financial standards for clearing firm admission and ongoing membership, original and variation margin requirements, and mandatory deposits to a guaranty fund. The amounts that the clearing members are required to maintain in the original margin and guaranty fund accounts are determined by standardized parameters established by the margin or risk committees, risk management departments and the boards of directors of each of the ICE Clearing Houses and may fluctuate over time. The Company’s audit committee is not responsible for determining these parameters. As of June 30, 2009, the ICE Clearing Houses have received or have been pledged $32.0 billion in original margin and guaranty fund deposits to cover movements in the pricing of the underlying contracts. The ICE Clearing Houses also have powers of assessment that provide the ability to collect additional funds from their clearing members to cover a defaulting member’s remaining obligations. ICE Clear Europe also has $100 million of insurance which, in the event of a clearing member default, would be called upon prior to any member assessment.

     Each of the ICE Clearing Houses requires all clearing members to maintain on deposit or pledge certain assets, which may include cash, government obligations, money market mutual fund shares, certificates of deposit or letters of credit to secure payment of risk-based margin as may become due and such amounts in total are known as original margin. The daily payment of profits and losses from and to the ICE Clearing Houses in respect of relevant contracts is known as variation margin. ICE Clear U.S. marks all outstanding futures contracts to market, and therefore pays and collects variation margin at least twice daily, and pays and collects option premiums daily. ICE Clear Europe, ICE Clear Canada, TCC and ICE Trust mark all outstanding positions to market at least once per day. Each of the ICE Clearing Houses requires that each clearing member make deposits into a fund known as a guaranty or clearing fund (“Guaranty Fund”), which is maintained by the relevant ICE Clearing House. These amounts serve to secure the obligations of a clearing member to the ICE Clearing House to which it has made the Guaranty Fund deposits and may be used to cover losses sustained by the respective ICE Clearing House in the event of a default of a clearing member.

     Should a particular clearing member fail to deposit original margin, or to make a variation margin payment, when and as required, the relevant ICE Clearing House may liquidate or hedge the clearing member’s open positions and use the clearing member’s original margin and Guaranty Fund deposits to make up the amount owed. In the event that those deposits are not sufficient to pay that owed amount in full, ICE Clear U.S., ICE Clear Canada and TCC may utilize the respective Guaranty Fund deposits of all clearing members pro rata for that purpose. For ICE Clear Europe, once an energy clearing member’s deposits are depleted and a default occurs, a $100.0 million contribution made by the Company to ICE Clear Europe would be utilized. The $100.0 million is solely available in the event of an ICE Clear Europe energy clearing member default, and $50.0 million of the $100.0 million will be utilized after the available funds of the defaulting member but before all other amounts within the ICE Clear Europe energy Guaranty Fund. If additional cash is required to settle positions, the remaining $50.0 million will be called pro rata along with other non-defaulting ICE Clear Europe energy clearing members’ deposits in the ICE Clear Europe energy Guaranty Fund.

     The Company has also contributed $10.0 million to the ICE Trust Guaranty Fund as of June 30, 2009, another $10.0 million to the ICE Clear Europe CDS Guaranty Fund subsequent to June 30, 2009, and it is obligated to increase the contribution up to $100.0 million in total to the ICE Trust Guaranty Fund and the ICE Clear Europe CDS Guaranty Fund over a two-year period. The $100.0 million contribution will be split evenly between the U.S.

and European CDS clearing houses with $50.0 million to the ICE Trust Guaranty Fund and $50.0 million to the ICE Clear Europe CDS Guaranty Fund, using profits and cash flows of the CDS clearing businesses (Note 10). As amounts are required to be funded by the Company to the two Guaranty Funds, those amounts will be available in the event of a CDS clearing member default. The first $25.0 million contributed to the ICE Trust Guaranty Fund and ICE Clear Europe CDS Guaranty Fund, respectively, will be utilized after the available funds of the defaulting CDS clearing member but before all other amounts within the Guaranty Funds. The additional $25.0 million contributed to the ICE Trust Guaranty Fund and ICE Clear Europe CDS Guaranty Funds, respectively, will be utilized pro-rata along with other non-defaulting CDS clearing members’ deposits in the respective Guaranty Funds.

     Additionally, for ICE Clear Europe, if all Guaranty Fund amounts are depleted, proceeds from the Company’s $100.0 million insurance policy would be utilized. If there is any remaining shortfall after the Guaranty Fund deposits are depleted and, in the case of ICE Clear Europe, after the applicable insurance policy is also fully utilized, the relevant ICE Clearing House may then assess its clearing members to meet the shortfall.

     As of June 30, 2009, original margin, unsettled variation margin, Guaranty Fund cash deposits and performance collateral for delivery are as follows for ICE Clear U.S., ICE Clear Europe, ICE Clear Canada, TCC and ICE Trust (in thousands):

		ICE Clear U.S.				ICE Clear Europe				ICE Clear Canada				TCC				ICE Trust				Total
Original margin		$	547,055			$	9,447,702			$	10,480			$	49,837			$	5,337,338			$	15,392,412
Variation margin			7,800				—				—				763				—				8,563
Guaranty Fund			19,833				382,331				5,024				8,286				2,026,419				2,441,893
Performance collateral for delivery			—				26				1,405				—				—				1,431
Total		$	574,688			$	9,830,059			$	16,909			$	58,886			$	7,363,757			$	17,844,299

     The Company has recorded these cash deposits in the accompanying consolidated balance sheets as current assets with corresponding current liabilities to the clearing members of the relevant ICE Clearing House. All cash, securities and letters of credit are only available to meet the financial obligations of that clearing firm to the relevant ICE Clearing House. ICE Clear U.S., ICE Clear Europe, ICE Clear Canada, TCC and ICE Trust are separate legal entities and are not subject to the liabilities of the other ICE Clearing Houses or the obligations of the members of the other ICE Clearing Houses. The amount of these cash deposits may fluctuate due to the types of margin collateral choices available to clearing members and the change in the amount of deposits required. As a result, these assets and corresponding liabilities may vary significantly over time. The total ICE Clear Europe Guaranty Fund balance as of June 30, 2009 is $482.3 million, which includes the $382.3 million in Guaranty Fund deposits from clearing members as well as $100.0 million that ICE Clear Europe has committed of its own cash and which is included in restricted cash in the accompanying consolidated balance sheets. The total ICE Trust Guaranty Fund balance as of June 30, 2009 is $2,036.4 million, which includes the $2,026.4 million in Guaranty Fund deposits from clearing members as well as $10.0 million that ICE Trust has committed of its own cash.

     The ICE Trust original margin balance above and the ICE Trust Guaranty Fund balance above includes $5.3 billion and $800.0 million, respectively, under a tri-party reverse repurchase agreement with Bank of Montreal as the counterparty bank and Bank of New York Mellon as the custodian bank. Under this arrangement, ICE Trust purchases U.S. Treasury instruments overnight and holds margin value of 100.5% of the purchase price. Under the agreement, Bank of Montreal agrees to purchase back the instruments on the set repurchase date at the repurchase price.

     At the expiration of certain contracts that require physical deliveries, ICE Clear Europe collects cash from a clearing member until the physical delivery has been made to the other clearing member. These cash deposits are referred to as performance collateral for delivery and vary from month to month depending on when the physical contracts expire. ICE Futures Canada collects cash from merchant participants that have made delivery as indemnification, and holds this cash in trust until the shipment process has been completed. These cash deposits are also referred to as performance collateral for delivery and the amounts vary from month to month.

     In addition to the cash deposits for original margin, variation margin, and Guaranty Fund made to the relevant ICE Clearing House, clearing members also pledge assets, including government obligations, money market mutual funds, certificates of deposit or letters of credit to the relevant ICE Clearing House to mitigate its credit risk. These assets are not reflected in the accompanying consolidated balance sheet as the ICE Clearing Houses do not take legal ownership of the assets as the risks and rewards remain with the clearing members. The ICE Clearing Houses have the ability to access the accounts where these assets are held at the financial institutions and depositories in the event of a clearing member default. As of June 30, 2009, there were only cash deposits for the original margin, variation margin and Guaranty Fund, and no assets were pledged, for ICE Trust.

     As of June 30, 2009, the U.S. Government obligations, money market mutual funds and letters of credit pledged by the clearing members as original margin and Guaranty Fund deposits for ICE Clear U.S. are detailed below (in thousands):

		U.S.
		Government				Money
		Securities at				Market				Letters
		Face Value				Mutual Fund				Of Credit
Original margin		$	5,873,969			$	841,241			$	200,000
Guaranty Fund			123,225				35,857				—
Total		$	5,997,194			$	877,098			$	200,000

     As of June 30, 2009, the government obligations and letters of credit pledged by the clearing members as original margin and Guaranty Fund deposits for ICE Clear Europe are detailed below (in thousands):

		Government
		Securities at				Letters
		Face Value				Of Credit
Original margin		$	4,840,798			$	2,020,000
Guaranty Fund			2,300				—
Total		$	4,843,098			$	2,020,000

     As of June 30, 2009, the Canadian Government obligations and letters of credit pledged by the clearing members as original margin and Guaranty Fund deposits for ICE Clear Canada are detailed below (in thousands):

		Canadian
		Government
		Securities at				Letters
		Face Value				Of Credit
Original margin		$	33,782			$	4,776
Guaranty Fund			10,921				—
Total		$	44,703			$	4,776

     As of June 30, 2009, the government obligations pledged by the clearing members as original margin and Guaranty Fund deposits for TCC are detailed below (in thousands):

		Government
		Securities at
		Face Value
Original margin		$	148,040
Guaranty Fund			4,605
Total		$	152,645

10.   Acquisitions

TCC Acquisition

     The Company completed its acquisition of TCC on March 6, 2009. TCC is a U.S. clearing house that provides clearing and settlement services to its participants for trades in futures contracts, options on futures contracts and OTC transactions executed on various exchanges and marketplaces. TCC also developed the CDS risk management framework, operational processes and infrastructure for ICE Trust’s clearing operations. The Company acquired 100% of TCC for cash and a 50% equity interest in the parent company of ICE Trust. The 50% equity interest in the parent company of ICE Trust entitles the holders to 50% of the net profits of ICE Trust. The majority of the former stockholders of TCC have waived their participation in the profits through December 31, 2009.

     The acquisition facilitated the Company’s expansion into clearing within the global CDS markets. Assets acquired and liabilities assumed were recorded at their estimated fair values as of March 6, 2009. The total preliminary purchase price was $106.7 million, and was comprised of $39.0 million in cash, $37.9 million in excess working capital paid to the TCC shareholders and a 50% equity interest in the parent company of ICE Trust with an estimated fair value of $29.8 million. The preliminary fair value of the noncontrolling net profit sharing interest was based on a discounted cash flow approach.

     Under the acquisition method of SFAS No. 141R, the total preliminary purchase price was allocated to TCC’s net tangible and identifiable intangible assets based on the estimated fair values of those assets as of March 6, 2009. The preliminary net tangible and identifiable intangible assets acquired from TCC were $59.6 million, including $6.0 million of regulatory capital that is reflected as restricted cash in the accompanying consolidated balance sheet as of June 30, 2009. The primary areas of the preliminary purchase price allocation that are not yet finalized relate to identifiable intangible assets, certain tangible assets and liabilities and valuation of certain noncontrolling interest consideration given to the former TCC stockholders. In performing the preliminary purchase price allocation, the Company considered, among other factors, analyses of historical financial performance, estimates of future financial performance and anticipated merger synergies. The Company has recorded preliminary intangible assets associated with the TCC acquisition of $19.6 million for customer relationships, which has been assigned a nine year useful life, $14.2 million for developed technology, which has been assigned a three to five year useful life, and $1.6 million in other intangible assets. The excess of the purchase price over the preliminary net tangible and identifiable intangible assets was $47.0 million and was recorded as goodwill. The allocation of the purchase price will be finalized upon completion of the fair value analysis of the acquired assets and liabilities.

Creditex Acquisition

     The Company completed its acquisition of Creditex on August 29, 2008. The primary areas of the preliminary purchase price allocation that are not yet finalized relate to identifiable intangible assets and certain tangible assets and liabilities.

Formation of ICE Trust

     The Company has assembled a comprehensive CDS infrastructure with its acquisition of Creditex and its subsidiaries, which included ICE Processing (formerly known as T-Zero), which operates a CDS post-trade processing platform known as ICE Link, as well as its acquisition of TCC. The Company utilized infrastructure, domain knowledge and personnel from each entity to establish ICE Trust, which serves as the Company’s North American CDS clearing house. A distinct pricing structure applies to the initial clearing members of ICE Trust, which may limit the revenue potential from the initial clearing members. These commercial terms were reviewed by U.S. regulators prior to receiving approval for the launch of ICE Trust. As a New York trust company and a member of the Federal Reserve System, ICE Trust is subject to direct regulation and supervision by the Federal Reserve and the New York State Banking Department. Subject to compliance with certain conditions, ICE Trust operates under a temporary exemption from the Securities and Exchange Commission (“SEC”) and the U.S. Treasury Department. The Company began processing and clearing North American CDS indexes on March 9, 2009 through ICE Trust.

     Pursuant to bank capitalization requirements, the Company funded ICE Trust with $35.0 million in operating cash and it contributed an initial $10.0 million to the ICE Trust Guaranty Fund (Note 9), along with the contribution by clearing members. The Company’s contribution of $45.0 million in cash has been reflected as restricted cash in the accompanying consolidated balance sheet as of June 30, 2009. Over a two-year period, the Company is obligated to increase its contribution to the ICE Trust Guaranty Fund and ICE Clear Europe CDS Guaranty Funds to a total of $100.0 million.

11.

Russell Licensing Agreement

     In 2007, the Company entered into an exclusive licensing agreement (the “Licensing Agreement”) with the Russell Investment Group (“Russell”) to offer futures and options on futures contracts based on the full range of Russell’s benchmark U.S. equity indexes. Due to the wind-down provisions of other Russell licensing contracts, during the first year of the Licensing Agreement, the Company offered the Russell contracts on a non-exclusive basis. These rights became exclusive on September 19, 2008, and subject to achieving specified trading volume beginning in June 2010, will remain exclusive throughout the remainder of the Licensing Agreement through June 2014.

     In exchange for the license rights, the Company paid Russell $50.0 million in July 2007 and will also make annual cash payments based on the annual contract volume, subject to certain minimum annual royalty payments. The Company has recorded the license rights as intangible assets, which were valued based on the net present value of all minimum annual royalty payments that the Company is required to make to Russell throughout the term of the agreement. As of June 30, 2009, the net assets related to the Licensing Agreement are $129.5 million and are included in other intangible assets in the accompanying consolidated balance sheets. The intangible assets are being amortized based on the Company’s valuations of the non-exclusive and the exclusive elements of the Licensing Agreement. For the six months ended June 30, 2009 and 2008, amortization expense related to the Licensing Agreement was $13.0 million and $83,000, respectively, and was $6.5 million and $42,000 for the three months ended June 30, 2009 and 2008, respectively, which reflects amortization on the exclusive and non-exclusive portions of the intangible assets.

     Because the Company is required to make minimum annual royalty payments to maintain the Russell license rights, the Company has recorded a liability based on the net present value of the total required minimum royalty payments as of the effective date of the Licensing Agreement. As of June 30, 2009, the current and noncurrent liabilities relating to the minimum annual royalty payments under the Licensing Agreement are $13.9 million and $78.7 million, respectively, and are reflected as licensing agreement liabilities in the accompanying consolidated balance sheet. The difference between the present value of the payments and the actual payments is recorded as interest expense using the effective interest method over the term of the Licensing Agreement. For the six months ended June 30, 2009 and 2008, interest expense related to the Licensing Agreement was $2.8 million and $3.0 million, respectively and was $1.4 million and $1.5 million for the three months ended June 30, 2009 and 2008, respectively.

12.

Fair Value Measurements

     SFAS No. 157, Fair Value Measurements, provides guidance for using fair value to measure assets and liabilities by defining fair value and establishes a framework for measuring fair value. SFAS No. 157 defines a three-level hierarchy for classification of fair value for disclosure purposes:

	•		Level 1 inputs — quoted prices for identical assets or liabilities in active markets.
	•		Level 2 inputs — observable inputs other than Level 1 inputs such as quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are directly observable.
	•		Level 3 inputs — unobservable inputs supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

     The Company’s financial instruments consist primarily of cash and cash equivalents, short-term and long-term restricted cash, short-term and long-term investments, customer accounts receivable, margin deposits and guaranty funds, cost method investments, short-term and long-term debt and other short-term assets and liabilities. In general, the Company uses Level 1 and 2 inputs to determine the fair value of investments (Note 3). The Level 1 investments include U.S. Treasury securities and equity securities. If quoted prices are not available to determine fair value, the Company uses other inputs that are observable either directly or indirectly. Investments included in Level 2 consist primarily of corporate and municipal bonds. Municipal bonds include auction rate securities, which were historically valued using level 3 inputs since there was little or no market activity. Since market activity has increased in these markets, there were observable inputs available as of June 30, 2009, so level 2 inputs were used. The fair value of cost method investments (Note 4) was determined based on observable market data resulting from sales agreements executed during the quarter ending June 30, 2009. The Company determined the fair value of the interest rate swap contracts using Level 2 inputs, consisting of standard valuation models that are based on market-based observable inputs including interest rate curves. The fair value of interest rate swap contracts is included in other noncurrent assets in the accompanying consolidated balance sheet as of June 30, 2009. The fair value of short-term and long-term debt approximates carrying value since the rate of interest on the debt adjusts to market rates on a periodic basis. All other financial instruments are determined to approximate carrying value due to the short period of time to their maturities.

     Financial assets and liabilities recorded in the accompanying consolidated balance sheet as of June 30, 2009 are classified in their entirety based on the lowest level of input that is significant to the asset or liability’s fair value measurement. Financial instruments measured at fair value on a recurring basis as of June 30, 2009 are as follows (in thousands):

		Level 1				Level 2				Level 3				Total
Assets at fair value:
Short-term investments:
U.S. Treasury securities		$	1,999			$	—			$	—			$	1,999
Corporate bonds			—				22				—				22
Municipal bonds			—				2,760				—				2,760
Equity securities			7				—				—				7
Total short-term investments			2,006				2,782				—				4,788
Long-term investments in equity securities			32,349				—				—				32,349
Interest rate swap contracts			—				587				—				587
Cost method investments			—				19,885				—				19,885
Total assets at fair value		$	34,355			$	23,254			$	—			$	57,609

13.

Segment Reporting

     The Company’s principal business segments consist of its global OTC segment, its futures segment and its market data segment. The operations of ICE Futures Europe, ICE Futures U.S. and ICE Futures Canada, and the respective clearing of the futures contracts that trade at each of these exchanges, make up the futures segment and the operations of ICE Data make up the market data segment. The remaining companies and operations have been included in the global OTC segment as they primarily support the Company’s OTC business operations. Intersegment revenues and transactions attributable to the performance of services are recorded at cost plus an agreed market percentage intercompany profit. Intersegment revenues attributable to licensing transactions have been priced in accordance with comparable third party agreements. Financial data for the Company’s business segments are as follows:

		Global								Market
		OTC				Futures				Data
		Segment				Segment				Segment				Total
		(In thousands)
Six Months Ended June 30, 2009:
Revenues from external customers			$251,303				$203,017				$27,650				$481,970
Intersegment revenues			24,592				14,979				16,758				56,329
Depreciation and amortization			37,270				17,541				71				54,882
Interest and investment income			182				742				30				954
Interest expense			8,095				4,065				—				12,160
Income tax expense			25,789				48,682				8,147				82,618
Net income			43,672				81,730				18,878				144,280
Total assets			9,830,742				11,002,116				31,163				20,864,021

     Revenues from four clearing members of the futures segment comprised 15.9%, 15.6%, 13.6% and 11.9% of the Company’s futures revenues for the six months ended June 30, 2009. These clearing members are primarily intermediaries and represent a broad range of principal trading firms. If a clearing member ceased its operations, the Company believes that the trading firms would continue to conduct transactions and would clear those transactions through another clearing member firm. No additional members or customers accounted for more than 10% of the Company’s segment revenues or consolidated revenues for the six months ended June 30, 2009.

		Global								Market
		OTC				Futures				Data
		Segment				Segment				Segment				Total
		(In thousands)
Six Months Ended June 30, 2008:
Revenues from external customers		$	186,255			$	191,024			$	27,095			$	404,374
Intersegment revenues			15,596				2,379				16,129				34,104
Depreciation and amortization			18,387				3,353				50				21,790
Interest and investment income			2,099				3,425				320				5,844
Interest expense			6,004				3,172				—				9,176
Income tax expense			34,284				49,699				12,921				96,904
Net income			67,493				83,229				26,432				177,154

     Revenues from three clearing members of the futures segment comprised 15.6%, 13.3% and 12.2% of the Company’s futures revenues for the six months ended June 30, 2008. No additional members or customers accounted for more than 10% of the Company’s segment revenues or consolidated revenues for the six months ended June 30, 2008.

		Global								Market
		OTC				Futures				Data
		Segment				Segment				Segment				Total
		(In thousands)
Three Months Ended June 30, 2009:
Revenues from external customers		$	131,722			$	105,039			$	13,656			$	250,417
Intersegment revenues			12,939				7,327				8,320				28,586
Depreciation and amortization			19,111				8,432				36				27,579
Interest and investment income			104				223				17				344
Interest expense			4,719				2,187				—				6,906
Income tax expense			13,604				28,563				3,597				45,764
Net income			23,367				38,808				9,883				72,058

     Revenues from two clearing members of the futures segment comprised 17.6% and 15.0% of the Company’s futures revenues for the three months ended June 30, 2009. No additional members or customers accounted for more than 10% of the Company’s segment revenues or consolidated revenues for the three months ended June 30, 2009.

		Global								Market
		OTC				Futures				Data
		Segment				Segment				Segment				Total
		(In thousands)
Three Months Ended June 30, 2008:
Revenues from external customers		$	92,907			$	90,374			$	13,879			$	197,160
Intersegment revenues			7,776				1,268				8,068				17,112
Depreciation and amortization			9,380				1,435				29				10,844
Interest and investment income			1,045				1,743				137				2,925
Interest expense			2,464				1,577				—				4,041
Income tax expense			18,067				22,332				6,376				46,775
Net income			32,151				39,196				13,517				84,864

     Revenues from three clearing members of the futures segment comprised 16.0%, 13.6% and 13.3% of the Company’s futures revenues for the three months ended June 30, 2008. No additional members or customers accounted for more than 10% of the Company’s segment revenues or consolidated revenues for the three months ended June 30, 2008.

14.

Earnings Per Common Share

     The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per common share computations for the six months and three months ended June 30, 2009 and 2008:

		Six Months Ended								Three Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
		(In thousands, except per share amounts)
Basic:
Net income		$	144,280			$	177,154			$	72,058			$	84,864
Weighted average common shares outstanding			72,759				70,479				72,892				70,596
Basic earnings per common share		$	1.98			$	2.51			$	0.99			$	1.20
Diluted:
Weighted average common shares outstanding			72,759				70,479				72,892				70,596
Effect of dilutive securities:
Stock options and restricted shares			1,059				897				1,182				807
Diluted weighted average common shares outstanding			73,818				71,376				74,074				71,403
Diluted earnings per common share		$	1.95			$	2.48			$	0.97			$	1.19

     Basic earnings per common share is calculated using the weighted average common shares outstanding during the period. Common equivalent shares from stock options and restricted stock awards, using the treasury stock method, are also included in the diluted per share calculations unless their effect of inclusion would be antidilutive. During the six months ended June 30, 2009 and 2008, 151,000 and 108,000 outstanding stock options, respectively, were not included in the computation of diluted earnings per common share, because to do so would have had an antidilutive effect.

15.

Subsequent Events

     The Company has evaluated subsequent events through August 5, 2009, the date of issuance of the accompanying consolidated financial statements. The Company does not have any unrecognized subsequent events as of that date.