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-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LwLM/a45Md+AJj2HM9svpoUqbnFxzMjBsLVDVp871q9QLSDs39cCXc7QNgwKZ6Rn LXAB7ZetYZWjlyxi9Qa6NA== 0001193125-10-247899.txt : 20101104 0001193125-10-247899.hdr.sgml : 20101104 20101104150237 ACCESSION NUMBER: 0001193125-10-247899 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 20100930 FILED AS OF DATE: 20101104 DATE AS OF CHANGE: 20101104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BROADRIDGE FINANCIAL SOLUTIONS, INC. CENTRAL INDEX KEY: 0001383312 STANDARD INDUSTRIAL CLASSIFICATION: FINANCE SERVICES [6199] IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-33220 FILM NUMBER: 101164613 BUSINESS ADDRESS: STREET 1: 1981 MARCUS AVENUE CITY: LAKE SUCCESS STATE: NY ZIP: 11042 BUSINESS PHONE: 516-472-5400 MAIL ADDRESS: STREET 1: 1981 MARCUS AVENUE CITY: LAKE SUCCESS STATE: NY ZIP: 11042 FORMER COMPANY: FORMER CONFORMED NAME: BROADRIDGE FINANCIAL SOLUTIONS, LLC DATE OF NAME CHANGE: 20070126 FORMER COMPANY: FORMER CONFORMED NAME: BSG LLC DATE OF NAME CHANGE: 20061212 10-Q 1 d10q.htm FORM 10-Q Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2010

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-33220

BROADRIDGE FINANCIAL SOLUTIONS, INC.

(Exact Name of Registrant as Specified in Its Charter)


Delaware		33-1151291
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

1981 Marcus Avenue Lake Success, NY		11042
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (516) 472-5400

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer” “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one).

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of shares outstanding of the registrant’s common stock, $0.01 par value, as of October 29, 2010 was 125,024,994.

TABLE OF CONTENTS


ITEM		PAGE

PART I. FINANCIAL INFORMATION			3

Item 1.	FINANCIAL STATEMENTS		3

Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		15

Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		23

Item 4.	CONTROLS AND PROCEDURES		23

PART II. OTHER INFORMATION			24

Item 1.	LEGAL PROCEEDINGS		24

Item 1A.	RISK FACTORS		24

Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		24

Item 3.	DEFAULTS UPON SENIOR SECURITIES		24

Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS		24

Item 5.	OTHER INFORMATION		25

Item 6.	EXHIBITS		26

PART I. FINANCIAL INFORMATION

Item 1.

FINANCIAL STATEMENTS

Broadridge Financial Solutions, Inc.

Condensed Consolidated Statements of Earnings

(In millions, except per share amounts)

(Unaudited)


	Three Months Ended September 30,
	2010		2009
Revenues	$	421.4	$	438.2

Cost of revenues		336.6		338.5
Selling, general and administrative expenses		61.5		53.4
Other expenses, net		2.4		3.8

Total expenses		400.5		395.7

Earnings from continuing operations before income taxes		20.9		42.5
Provision for income taxes		7.6		15.9

Net earnings from continuing operations		13.3		26.6
Loss from discontinued operations, net of tax benefit		—		(0.2	)

Net earnings	$	13.3	$	26.4

Basic earnings per share:
Basic earnings per share from continuing operations	$	0.11	$	0.19
Basic earnings per share from discontinued operations		—		—

Basic earnings per share	$	0.11	$	0.19


Diluted earnings per share:
Diluted earnings per share from continuing operations	$	0.10	$	0.19
Diluted earnings per share from discontinued operations		—		—

Diluted earnings per share	$	0.10	$	0.19


Weighted-average shares outstanding:
Basic		126.5		138.1
Diluted		129.6		140.4
Dividends declared per common share	$	0.15	$	0.14

See Notes to Condensed Consolidated Financial Statements.

Broadridge Financial Solutions, Inc.

Condensed Consolidated Balance Sheets

(In millions, except per share amounts)

(Unaudited)


	September 30, 2010			June 30, 2010
Assets
Current assets:
Cash and cash equivalents	$	180.7		$	412.6
Accounts receivable, net of allowance for doubtful accounts of $2.1 and $2.0, respectively		293.7			354.3
Other current assets		110.0			101.7
Assets of discontinued operations		55.9			123.8

Total current assets		640.3			992.4
Property, plant and equipment, net		86.5			87.4
Other non-current assets		162.4			159.0
Goodwill		560.8			509.5
Intangible assets, net		69.3			46.1

Total assets	$	1,519.3		$	1,794.4


Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	70.5		$	91.3
Accrued expenses and other current liabilities		160.3			261.2
Deferred revenues		26.0			34.8
Liabilities of discontinued operations		35.5			99.1

Total current liabilities		292.3			486.4
Long-term debt		324.2			324.1
Deferred taxes		46.1			56.2
Other non-current liabilities		75.7			72.8
Deferred revenues		56.4			47.8

Total liabilities		794.7			987.3

Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock: authorized, 25.0 shares; issued and outstanding, none		—			—
Common stock, $0.01 par value: authorized, 650.0 shares; issued, 146.1 and 145.9 shares, respectively; outstanding, 124.9 and 129.2 shares, respectively		1.5			1.5
Additional paid-in capital		598.2			587.8
Retained earnings		541.4			546.9
Treasury stock—at cost, 21.2 and 16.7 shares, respectively		(421.8	)		(327.7	)
Accumulated other comprehensive income (loss)		5.3			(1.4	)

Total stockholders’ equity		724.6			807.1

Total liabilities and stockholders’ equity	$	1,519.3		$	1,794.4

See Notes to Condensed Consolidated Financial Statements.

Broadridge Financial Solutions, Inc.

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)


	Three Months Ended September 30,
	2010			2009
Cash Flows From Operating Activities
Net earnings	$	13.3		$	26.4
Adjustments to reconcile Net earnings to Net cash flows (used in) provided by operating activities:
Loss from discontinued operations, net of tax		—			0.2
Depreciation and amortization		12.0			9.6
Amortization of other assets		3.6			4.1
Deferred income taxes		(1.1	)		(2.8	)
Stock-based compensation expense		6.2			5.8
Excess tax benefits from the issuance of stock-based compensation awards		—			(0.1	)
Other		1.6			0.7
Changes in operating assets and liabilities:
Current assets and liabilities:
Decrease in Accounts receivable, net		64.5			72.7
Increase in Other current assets		(9.3	)		(23.6	)
(Decrease) increase in Accounts payable		(21.7	)		1.8
Decrease in Accrued expenses and other current liabilities		(83.8	)		(77.8	)
(Decrease) increase in Deferred revenues		(12.0	)		12.1
Non-current assets and liabilities:
Increase in Other non-current assets		(9.2	)		(2.1	)
Increase in Other non-current liabilities		11.4			2.9

Net cash flows (used in) provided by operating activities of continuing operations		(24.5	)		29.9

Cash Flows From Investing Activities
Capital expenditures		(6.3	)		(3.6	)
Purchases of intangibles		(0.8	)		(0.1	)
Acquisitions, net of cash acquired		(77.4	)		—

Net cash flows used in investing activities of continuing operations		(84.5	)		(3.7	)

Cash Flows From Financing Activities
Dividends paid		(18.8	)		(9.8	)
Proceeds from exercise of stock options		4.0			14.1
Purchases of common stock		(115.3	)		(71.9	)
Other financing transactions		(0.1	)		—
Excess tax benefits from the issuance of stock-based compensation awards		—			0.1

Net cash flows used in financing activities of continuing operations		(130.2	)		(67.5	)

Cash flows from discontinued operations:
Cash flows provided by (used in) operating activities		11.5			(31.9	)
Cash flows (used in) provided by financing activities		(7.2	)		22.2

Net cash provided by (used in) discontinued operations		4.3			(9.7	)


Effect of exchange rate changes on Cash and cash equivalents		3.0			1.6

Net change in Cash and cash equivalents		(231.9	)		(49.4	)
Cash and cash equivalents, beginning of period		412.6			173.4
Cash and cash equivalents of discontinued operations, beginning of period		—			107.5

Cash and cash equivalents, end of period		180.7			231.5
Less Cash and cash equivalents from discontinued operations, end of period		—			92.6

Cash and cash equivalents of continuing operations, end of period	$	180.7		$	138.9

Supplemental disclosure of cash flow information:
Cash payments made for interest	$	0.5		$	0.6
Cash payments made for income taxes	$	14.3		$	32.8
Non-cash investing and financing activities:
Property, plant and equipment	$	1.2		$	—

See Notes to Condensed Consolidated Financial Statements.

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements

(Tabular dollars in millions, except per share amounts)

(Unaudited)

NOTE 1. BASIS OF PRESENTATION

A. Description of Business. Broadridge Financial Solutions, Inc. (“Broadridge®” or the “Company”), a Delaware corporation, is a leading global provider of investor communication solutions, and securities processing and operations outsourcing solutions to the financial services industry. The Company classifies its continuing operations into the following two reportable segments:

•

Investor Communication Solutions— A large portion of Broadridge’s Investor Communication Solutions business involves the processing and distribution of proxy materials to investors in equity securities and mutual funds, as well as the facilitation of related vote processing. ProxyEdge®, its innovative electronic proxy delivery and voting solution for institutional investors, helps ensure the participation of the largest stockholders of many companies. Broadridge also provides the distribution of regulatory reports and corporate action/reorganization event information, as well as tax reporting solutions that help its clients meet their regulatory compliance needs. In addition, Broadridge provides financial information distribution and transaction reporting services to both financial institutions and securities issuers. These services include the processing and distribution of account statements and trade confirmations, traditional and personalized document fulfillment and content management services, marketing communications, and imaging, archival and workflow solutions that enable and enhance its clients’ communications with investors. All of these communications are delivered in paper or electronic form. In fiscal year 2009, Broadridge introduced several new investor communication solutions. They are The Investor Network, Shareholder Forum and Virtual Shareholder Meeting solutions, and our data aggregation and data management solutions. In fiscal year 2010, Broadridge entered the transfer agency business through its acquisition of StockTrans, Inc., a leading provider of registrar, stock transfer and record-keeping services. In August 2010, Broadridge acquired NewRiver, Inc., a leader in mutual fund electronic investor disclosure solutions.

•

Securities Processing Solutions— Broadridge offers a suite of advanced computerized real-time transaction processing services that automate the securities transaction lifecycle, from desktop productivity tools, data aggregation, performance reporting, and portfolio management to order capture and execution, trade confirmation, settlement, and accounting. Broadridge’s services help financial institutions efficiently and cost-effectively consolidate their books and records, gather and service assets under management, focus on their core businesses, and manage risk. With multi-currency capabilities, its Global Processing Solution supports real-time global trading of equity, option, mutual fund and fixed income securities in established and emerging markets. In addition, its operations outsourcing solutions allow broker-dealers to outsource certain administrative functions relating to clearing and settlement, from order entry to trade matching and settlement, while maintaining their ability to finance and capitalize their business.

B. Basis of Presentation. The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.”). These financial statements present the condensed consolidated position of the Company. These financial statements include the entities in which the Company directly or indirectly has a controlling financial interest and various entities in which the Company has investments recorded under both the cost and equity methods of accounting. Intercompany balances and transactions have been eliminated. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2010 (the “2010 Annual Report”) filed on August 12, 2010 with the Securities and Exchange Commission (the “SEC”). These Condensed Consolidated Financial Statements include all normal and recurring adjustments necessary for a fair presentation of the Company’s financial position at September 30, 2010 and June 30, 2010, the results of its operations for the three months ended September 30, 2010 and 2009 and its cash flows for the three months ended September 30, 2010 and 2009.

C. Cash and Cash Equivalents. Investment securities with a maturity of 90 days or less at the time of purchase are considered cash equivalents. Cash and cash equivalents also include cash of $6.9 million and $7.6 million as of September 30, 2010 and June 30, 2010, respectively, held on behalf of clients of our transfer agency services. A corresponding liability is also included as a current liability in Accrued expenses and other current liabilities on the accompanying Condensed Consolidated Balance Sheets.

D. Financial Instruments. Substantially all of the financial instruments of the Company other than Long-term debt are carried at fair values, or at carrying amounts that approximate fair values because of the short maturity of the instruments. The carrying value of the Company’s long-term variable-rate term loan facility approximates fair value because these instruments reflect market changes to interest rates. The carrying value of the Company’s long-term fixed-rate senior notes represents the face value of the long-term fixed-rate senior notes net of the unamortized discount. The fair value of the Company’s long-term fixed-rate senior notes is based on quoted market prices.

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

E. Subsequent Events. In preparing the accompanying Condensed Consolidated Financial Statements, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 855, “Subsequent Events,” the Company has reviewed events that have occurred after September 30, 2010, through the date of issuance of the financial statements. During this period, the Company did not have any material subsequent events.

NOTE 2. NEW ACCOUNTING PRONOUNCEMENTS

In October 2009, the FASB issued Accounting Standards Update (“ASU”) No. 2009-13, “Multiple-Deliverable Revenue Arrangements a consensus of the FASB Emerging Issues Task Force,” an amendment of ASC No. 605-25, “Revenue Recognition” (formerly EITF Issue No. 08-01, “Revenue Arrangements with Multiple Deliverables”). This standard provides principles for allocation of consideration among its multiple-elements, allowing more flexibility in identifying and accounting for separate deliverables under an arrangement. The ASU introduces an estimated selling price method for valuing the elements of a bundled arrangement if vendor-specific objective evidence or third-party evidence of selling price is not available, and significantly expands related disclosure requirements. It is effective on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. ASU No. 2009-13 became effective for the Company in the first fiscal quarter of fiscal year 2011 and did not have an impact on the Company’s results of operations, cash flows or financial condition.

NOTE 3. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is calculated by dividing the Company’s Net earnings by the basic Weighted-average shares outstanding for the periods presented.

Diluted EPS reflects the potential dilution that could occur if outstanding stock options at the presented date are exercised and shares of restricted stock units have vested.

For the three months ended September 30, 2010 and 2009, the computation of diluted EPS did not include 4.8 million and 8.1 million options to purchase Broadridge common stock, respectively, as the effect of their inclusion would have been anti-dilutive.

The following table sets forth the denominators of the basic and diluted EPS computations:


	Three Months Ended September 30,
	2010		2009
	(in millions)
Weighted-average shares outstanding:
Basic		126.5		138.1
Common stock equivalents		3.1		2.3

Diluted		129.6		140.4

NOTE 4. OTHER EXPENSES, NET

Other (income) expenses, net consisted of the following:


	Three Months Ended September 30,
	2010			2009
	($ in millions)
Interest expense on borrowings	$	2.4		$	2.6
Interest income		(0.4	)		—
Foreign currency exchange loss		0.3			1.0
Other, net		0.1			0.2

Other expenses, net	$	2.4		$	3.8

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

NOTE 5. ACQUISITIONS

Assets acquired and liabilities assumed in business combinations were recorded on the Company’s Consolidated Balance Sheets as of the respective acquisition dates based upon their estimated fair values at such dates. The results of operations of businesses acquired by the Company were included in the Company’s Consolidated Statements of Earnings since their respective dates of acquisition. The excess of the purchase price over the estimated fair values of the underlying assets acquired and liabilities assumed was allocated to goodwill.

In August 2010, the Company acquired one business in the Investor Communication Solutions segment, NewRiver, Inc., a leader in mutual fund electronic investor disclosure solutions. The purchase price was $77.4 million, net of cash acquired. This acquisition resulted in $43.7 million of goodwill. Intangible assets acquired, which totaled $27.3 million, consist primarily of customer relationships and acquired software technology, which are being amortized over an eight-year life and seven-year life, respectively. This acquisition was not material to the Company’s operations, financial position, or cash flows.

NOTE 6. FAIR VALUE OF FINANCIAL INSTRUMENTS

Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:


Level 1		Inputs that are based upon unadjusted quoted prices for identical instruments traded in active markets.

Level 2		Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly;

Level 3		Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

In valuing assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculates the fair value of our Level 1 and Level 2 instruments based on the exchange traded price of similar or identical instruments where available or based on other observable instruments. These calculations take into consideration the credit risk of both the Company and our counterparties. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period.

The following table sets forth the Company’s financial assets and liabilities at September 30, 2010 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:


	Level 1		Level 2		Level 3		Total
	($ in millions)
Assets
Cash and cash equivalents:
Money market funds	$	107.0	$	—	$	—	$	107.0
Other current assets:
Available-for-sale equity securities		—		1.5		—		1.5
Other non-current assets:
Available-for-sale equity securities		—		10.9		—		10.9

Total	$	107.0	$	12.4	$	—	$	119.4

A note receivable of $20.6 million from Penson Worldwide, Inc. (“PWI”) was included as a financial asset measured at fair value on a recurring basis as of June 30, 2010; however, this financial asset is not being measured at fair value on a recurring basis. Therefore, this note receivable has been removed from the table during the fiscal quarter ended September 30, 2010.

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

The following table sets forth the Company’s financial assets and liabilities at June 30, 2010 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:


	Level 1		Level 2		Level 3		Total
	($ in millions)
Assets
Cash and cash equivalents:
Money market funds	$	177.0	$	—	$	—	$	177.0
Other non-current assets:
Note receivable		—		—		20.6		20.6

Total	$	177.0	$	—	$	20.6	$	197.6

The note receivable in Level 3 assets represents the present value of a five-year subordinated note from PWI. There was no financial impact to the Company’s statement of operations as of June 30, 2010.

NOTE 7. DISCONTINUED OPERATIONS

In November 2009, the Company and Ridge Clearing & Outsourcing Solutions, Inc. (“Ridge”) entered into an asset purchase agreement (the “Asset Purchase Agreement”) with PWI and Penson Financial Services, Inc., a wholly owned subsidiary of PWI (“PFSI”), to sell substantially all contracts of the securities clearing clients of Ridge to PFSI.

On June 25, 2010, the Company completed the sale of the contracts of substantially all of the securities clearing clients of Ridge to PFSI, for an aggregate purchase price of $35.2 million. The purchase price paid to Broadridge consists of (i) a five-year subordinated note from PWI in the principal amount of $20.6 million bearing interest at an annual rate equal to the London Inter-Bank Offer Rate (“LIBOR”) plus 550 basis points, and (ii) 2,455,627 shares of PWI’s common stock (representing 9.5% of PWI’s outstanding common stock as of May 31, 2010), at the June 25, 2010 closing price of PWI’s common stock of $5.95 per share. The purchase price is subject to certain adjustments post-closing including adjustments to reflect certain recently signed correspondent clearing contracts. The Company will discontinue its securities clearing services business but will continue to provide operations outsourcing solutions aligned with the Securities Processing Solutions business.

The results of the securities clearing business are included in Loss from discontinued operations, net of taxes, for all periods presented. The net assets associated with the securities clearing business, totaling $20.4 million and $24.7 million, have been reclassified to Assets of discontinued operations and Liabilities of discontinued operations as of September 30, 2010 and June 30, 2010, respectively.

For a period of time, the Company will continue to generate cash flows and to report income statement activity in Loss from discontinued operations, net of taxes, associated with the securities clearing business. The activities that give rise to these cash flows and income statement activities are transitional in nature.

The following summarized financial information related to the securities clearing business has been segregated from continuing operations and reported as discontinued operations:


	Three Months Ended September 30,
	2010		2009
	($ in millions)
Revenues	$	0.6	$	19.7


Loss from discontinued operations, before net loss on disposal	$	—	$	(0.2	)
Income tax benefit		—		—

Net loss from discontinued operations, before loss on disposal		—		(0.2	)
Net loss on disposal of assets of discontinued operations		—		—

Loss from discontinued operations, net of tax benefit	$	—	$	(0.2	)

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

The following assets and liabilities have been segregated and classified as Assets of discontinued operations and Liabilities of discontinued operations, as appropriate, in the Condensed Consolidated Balance Sheets as of September 30, 2010 and June 30, 2010, respectively. These assets and liabilities related to the securities clearing business described above, net to $20.4 million and $24.7 million at September 30, 2010 and June 30, 2010, respectively. The amounts presented below were adjusted to exclude intercompany receivables and payables between the business held for sale and the Company, which were excluded from the disposition.


	September 30, 2010		June 30, 2010
	($ in millions)
Assets
Cash and securities segregated for regulatory purposes and securities deposited with clearing organizations	$	24.3	$	67.0
Securities clearing receivables		30.3		52.5
Other assets		1.3		4.3

Total assets of discontinued operations		55.9		123.8


Liabilities
Accrued expenses and other current liabilities		6.7		21.7
Securities clearing payables		28.8		77.4

Total liabilities of discontinued operations		35.5		99.1

Net assets of discontinued operations	$	20.4	$	24.7

Securities clearing receivables/payables and segregated cash are in the process of being converted to cash since the close of the transaction. Upon final conversion, any excess cash will remain with the Company.

Regulatory Requirements

As a registered broker-dealer and member of the New York Stock Exchange (“NYSE”) and the Financial Industry Regulatory Authority (“FINRA”), Ridge is subject to the Uniform Net Capital Rule 15c3-1 of the Securities Exchange Act of 1934, as amended (“Rule 15c3-1”). Ridge computes its net capital under the alternative method permitted by Rule 15c3-1, which requires Ridge to maintain minimum net capital equal to the greater of $250,000 or 2% of aggregate debit items arising from customer transactions. The NYSE and FINRA may require a member firm to reduce its business if its net capital is less than 4% of aggregate debit items, or may prohibit a member firm from expanding its business or paying cash dividends if resulting net capital would be less than 5% of aggregate debit items. At September 30, 2010, Ridge had net capital of $41.5 million, which was approximately 196.0% of aggregate debit items and exceeded the minimum requirements by $41.1 million.

NOTE 8. OTHER NON-CURRENT ASSETS

Other non-current assets consisted of the following:


	September 30, 2010		June 30, 2010
	($ in millions)

Deferred client conversion and start-up costs	$	108.6	$	106.6
Note receivable		20.6		20.6
Long-term investments		14.0		15.4
Long-term broker fees		9.4		9.8
Other		9.8		6.6

Total	$	162.4	$	159.0

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

NOTE 9. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following:


	September 30, 2010		June 30, 2010
	($ in millions)

Employee compensation and benefits	$	63.5	$	101.9
Accrued broker fees		25.9		56.3
Accrued dividend payable		18.7		18.6
Accrued income taxes and other		52.2		84.4

Total	$	160.3	$	261.2

NOTE 10. BORROWINGS

The Company’s outstanding borrowings consisted of the following:


	Expiration Date		September 30, 2010		June 30, 2010
			($ in millions)
Long-term debt
Term loan facility		March 2012	$	200.0	$	200.0
Senior notes		June 2017		124.2		124.1

			$	324.2	$	324.1

In addition, the Company has a five-year revolving credit facility that expires in March 2012 that has an available capacity of $500.0 million. No amount was outstanding under this credit facility at September 30, 2010.

At September 30, 2010 and June 30, 2010, the Company was not aware of any instances of non-compliance with the financial covenants of its borrowings’ obligations.

The fair value of the fixed-rate senior notes at September 30, 2010 was $132.6 million based on quoted market prices. The carrying value of the variable-rate term loan facility approximates fair value. Amounts are due on the expiration dates listed above.

NOTE 11. STOCK-BASED COMPENSATION

The activity related to the Company’s incentive equity awards for the three months ended September 30, 2010 consisted of the following:


	Stock Options					Time-based Restricted Stock Units					Performance-based Restricted Stock Units
	Number of Options (d)			Weighted- Average Exercise Price		Number of Shares			Weighted- Average Grant Date Fair Value		Number of Shares		Weighted- Average Grant Date Fair Value
Balances at June 30, 2010		17,369,212		$	19.33		1,884,170		$	16.52		670,859	$	16.45
Granted		—			—		8,548			18.59		—		—
Exercise of stock options (a)		(231,384	)		17.90		—			—		—		—
Vesting of restricted stock units		—			—		(2,713	)		16.93		—		—
Expired/forfeited		(14,693	)		18.54		(19,390	)		23.16		—		—

Balances at September 30, 2010 (b)(c)		17,123,135		$	19.35		1,870,615		$	16.46		670,859	$	16.45

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

(a)	Stock options exercised during the period of July 1, 2010 through September 30, 2010 had an intrinsic value of $0.8 million.

(b)	As of September 30, 2010, the Company’s outstanding “in the money” stock options using the September 30, 2010 closing share price of $22.87 (approximately 15.1 million shares) had an aggregate intrinsic value of $63.6 million.

(c)	As of September 30, 2010, the Company’s outstanding stock options included 1,286,409 options with an exercise price of $24.39 per share that expired on October 15, 2010.

(d)	Options outstanding as of September 30, 2010 have a weighted-average remaining contractual life of 3.8 years and 13.5 million options are exercisable.

The Company has stock-based compensation plans under which we annually grant stock option and restricted stock unit awards. Exercise prices on options granted have been and continue to be set equal to the market price of the underlying shares on the date of the grant (except the special stock option grants, some of which have a premium exercise price), with the measurement of stock-based compensation expense recognized in Net earnings based on the fair value of the award on the date of grant. Stock-based compensation expense of $6.2 million and $5.8 million, respectively, as well as related tax benefits of $2.4 million and $2.1 million, respectively, were recognized in Earnings from continuing operations for the three months ended September 30, 2010 and 2009, respectively.

Stock-based compensation expense of $0.2 million and related tax benefits of $0.1 million, were recognized in Earnings from discontinued operations for the three months ended September 30, 2009.

As of September 30, 2010, the total remaining unrecognized compensation cost related to non-vested stock options and restricted stock unit awards amounted to $8.3 million and $18.4 million, respectively, which will be amortized over the weighted-average remaining requisite service periods of 2.6 years and 1.3 years, respectively.

For stock options issued, the fair value of each stock option was estimated on the date of grant using a binomial option pricing model. The binomial model considers a range of assumptions related to volatility, risk-free interest rate and employee exercise behavior. Expected volatilities utilized in the binomial model are based on a combination of implied market volatilities, historical volatility of the Company’s stock price and other factors. Similarly, the dividend yield is based on historical experience and expected future changes. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The binomial model also incorporates exercise and forfeiture assumptions based on an analysis of historical data. The expected life of the stock option grants is derived from the output of the binomial model and represents the period of time that options granted are expected to be outstanding.

NOTE 12. INCOME TAXES

The Company’s effective tax rates from continuing operations for the fiscal quarter ended September 30, 2010 and 2009 were 36.4% and 37.4%, respectively. The decrease in our effective tax rate is primarily attributable to an increase in favorable geographic mix of income in certain non-U.S. tax jurisdictions with lower enacted tax rates.

NOTE 13. CONTRACTUAL COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS

The Company entered into a data center outsourcing services agreement with ADP before our spin-off from ADP in March 2007 under which ADP provides the Company with data center services consistent with the services provided to the Company immediately before the spin-off, provided that the operation of the data center is the sole responsibility of ADP. Among the principal services provided by the data center are information technology services and service delivery network services. The agreement with ADP provides for increasing volumes and the addition of new services over the term. Under the agreement, ADP is responsible for hosting the mainframe, midrange, open systems, and networks. Additionally, systems engineering, network engineering, hardware engineering, network operations, data center operations, application change management, and data center disaster recovery services are managed by ADP. The agreement will expire on June 30, 2012. For the three months ended September 30, 2010 and 2009, the Company recorded $27.2 million and $25.9 million, respectively, of expenses in the Condensed Consolidated Statements of Earnings related to these services.

In March 2010, the Company and International Business Machines Corporation (“IBM”) entered into an Information Technology Services Agreement (the “IT Services Agreement”), under which IBM will provide certain aspects of the Company’s information technology infrastructure that are currently provided under a data center outsourcing services agreement with ADP. Under the IT Services Agreement, IBM will provide a broad range of technology services to the Company including supporting its mainframe, server, network and data center operations, as well as providing disaster recovery services. The Company has the option of incorporating additional services into the agreement over time. The Company expects that the migration of its data center processing from ADP to IBM will be completed by June 2012. The IT Services Agreement has an initial term of 11 years and seven months, expiring on October 31, 2021. The Company has the right to renew the initial term of the IT Services Agreement for up to one

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

additional 12-month term. Commitments under this agreement are $561.5 million through fiscal year 2022, the final year of the contract. For the three months ended September 30, 2010, the Company did not record any expenses in the Condensed Consolidated Statements of Earnings related to these services.

In the normal course of business, the Company is subject to various claims and litigation. While the outcome of any claim or litigation is inherently unpredictable, the Company believes that the ultimate resolution of these matters will not, individually or in the aggregate, result in a material adverse impact on its financial condition, results of operations or cash flows.

On January 28, 2010, the Company filed a declaratory action in the U.S. District Court for the District of Delaware (the “Delaware District Court”) against Inveshare, Inc. (the “Defendant”) seeking a declaration by the court that Broadridge does not infringe two U.S. patents owned by the Defendant that included claims related to the delivery and distribution of an electronic solicitation. The Company’s complaint also alleged that the Defendant’s patents are invalid and/or are unenforceable due to inequitable conduct. On March 22, 2010, the Defendant answered the Company’s complaint and filed a counterclaim against the Company alleging that Broadridge uses a process that infringes one of the patents in the action. In its counterclaim, Defendant is seeking injunctive relief and unspecified damages. This lawsuit is in an early procedural stage and the Company cannot predict with assurance what impact, if any, the outcome of this litigation may have on its financial condition, results of operations, or cash flows.

It is not the Company’s business practice to enter into off-balance sheet arrangements. However, the Company is exposed to market risk from changes in foreign currency exchange rates that could impact its financial position, results of operations, and cash flows. The Company manages its exposure to these market risks through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. The Company uses derivative financial instruments as risk management tools and not for trading purposes. The Company was not a party to any derivative financial instruments as of September 30, 2010 and 2009. In the normal course of business, the Company also enters into contracts in which it makes representations and warranties that relate to the performance of the Company’s products and services. The Company does not expect any material losses related to such representations and warranties, or collateral arrangements.

As a registered broker-dealer, our subsidiary Ridge is subject to regulations concerning many aspects of its business, including trade practices, capital structure, record retention, money laundering prevention, and the supervision of the conduct of directors, officers and employees. A failure by Ridge to comply with any of these laws, rules or regulations could result in censure, fine, the issuance of cease-and-desist orders, or the suspension or revocation of SEC authorization granted to allow the operation of its business or disqualification of the directors, officers or employees of such business. In addition, as a registered broker-dealer, Ridge is required to participate in the Securities Investor Protection Corporation (“SIPC”) for the benefit of the customers of our introducing broker-dealer clients in connection with our securities clearing services. On June 25, 2010, we completed the sale of the contracts of substantially all of Ridge’s securities clearing clients and are in the process of winding down the securities clearing business, which we expect to complete in fiscal year 2011. As we wind down that business, Ridge continues to perform securities clearing services on a limited basis. Until such wind down is complete, Ridge will continue to be subject to the regulatory requirements of a broker-dealer performing those functions. These regulations include the SEC’s customer protection rule, which protects both the customer funds and customer securities; the SEC’s hypothecation Rules 8c-1 and 15c2-1 regarding the borrowing and lending of our correspondents’ customers’ securities; Regulation T, which regulates the borrowing and lending of securities by broker-dealers; and Regulation SHO, which prohibits short sales in certain instances.

NOTE 14. COMPREHENSIVE INCOME

Comprehensive income consisted of the following:


	Three Months Ended September 30,
	2010			2009
	($ in millions)
Net earnings	$	13.3		$	26.4
Foreign currency translation adjustments		8.2			(3.9	)
Net unrealized losses on available-for-sale securities, net of taxes of $0.9 and zero at September 30, 2010 and 2009, respectively		(1.5	)		—

Comprehensive income	$	20.0		$	22.5

Broadridge Financial Solutions, Inc.

Notes to Condensed Consolidated Financial Statements—(Continued)

(Tabular dollars in millions, except per share amounts)

(Unaudited)

NOTE 15. INTERIM FINANCIAL DATA BY SEGMENT

The Company classifies its operations into the following two reportable segments: Investor Communication Solutions and Securities Processing Solutions.

The primary components of “Other” are the elimination of intersegment revenues and profits as well as certain unallocated expenses. Foreign currency exchange is a reconciling item between the actual foreign currency exchange rates and fiscal year 2011 budgeted foreign currency exchange rates.

Certain corporate expenses, as well as certain centrally managed expenses, are allocated based upon budgeted amounts. Because the Company compensates the management of its various businesses on, among other factors, segment earnings, the Company records certain segment-related expense items of an unusual or non-recurring nature in Other rather than reflect such items in segment profit.

Segment results:


	Revenues
	Three Months Ended September 30,
	2010			2009
	($ in millions)
Investor Communication Solutions	$	279.5		$	309.9
Securities Processing Solutions		141.7			130.1
Other		—			0.1
Foreign currency exchange		0.2			(1.9	)

Total	$	421.4		$	438.2


	Earnings (Loss) from Continuing Operations before Income Taxes
	Three Months Ended September 30,
	2010			2009
	($ in millions)
Investor Communication Solutions	$	6.4		$	23.4
Securities Processing Solutions		20.9			25.6
Other		(8.0	)		(6.6	)
Foreign currency exchange		1.6			0.1

Total	$	20.9		$	42.5

* * * * * * *

Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our Condensed Consolidated Financial Statements (the “Financial Statements”) and accompanying Notes thereto included elsewhere herein.

Forward-Looking Statements

This Quarterly Report on Form 10-Q may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical in nature and which may be identified by the use of words like “expects,” “assumes,” “projects,” “anticipates,” “estimates,” “we believe,” “could be” and other words of similar meaning, are forward-looking statements. These statements are based on management’s expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed. These risks and uncertainties include those risk factors discussed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2010 (the “2010 Annual Report”). Any forward-looking statements are qualified in their entirety by reference to the factors discussed in this Quarterly Report on Form 10-Q and our 2010 Annual Report. These risks include:

•

the success of Broadridge Financial Solutions, Inc. (“Broadridge®” or the “Company”) in retaining and selling additional services to its existing clients and in obtaining new clients;

•

the pricing of Broadridge’s products and services;

•

changes in laws and regulations affecting the investor communication services provided by Broadridge;

•

declines in participation and activity in the securities markets;

•

overall market and economic conditions and their impact on the securities markets;

•

any material breach of Broadridge security affecting its clients’ customer information;

•

the failure of our outsourced data center services provider to provide the anticipated levels of service

•

any significant slowdown or failure of Broadridge’s systems or error in the performance of Broadridge’s services;

•

Broadridge’s failure to keep pace with changes in technology and demands of its clients;

•

the ability to attract and retain key personnel;

•

the impact of new acquisitions and divestitures; and

•

competitive conditions.

Broadridge disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

We are a leading global provider of technology solutions to the financial services industry. Our systems and services include investor communication solutions, and securities processing and operations outsourcing solutions. In short, we provide the infrastructure that helps make the financial services industry work. With more than 40 years of experience, we provide financial services firms with advanced, dependable, scalable and cost-effective integrated systems. Our systems help reduce the need for clients to make significant capital investments in operations infrastructure, thereby allowing them to increase their focus on core business activities.

We serve a large and diverse client base in the financial services industry, including retail and institutional brokerage firms, global banks, mutual funds, annuity companies, institutional investors, specialty trading firms, and clearing firms. We also provide services to corporate issuers.

We deliver a broad range of solutions that help our clients better serve their retail and institutional customers across the entire investment lifecycle, including pre-trade, trade, and post-trade processing. Our securities processing systems enable our clients to process securities transactions in more than 50 countries. In fiscal year 2010, we: (i) distributed over one billion investor communications, including proxy materials, investor account statements, trade confirmations, tax statements and prospectuses; and (ii) on average processed over 1.5 million equity trades and over $3.5 trillion in fixed income trades per day of United States (“U.S.”) and Canadian securities. Our operations are classified into two business segments:

Investor Communication Solutions

A large portion of our Investor Communication Solutions business involves the processing and distribution of proxy materials to investors in equity securities and mutual funds, as well as the facilitation of related vote processing. ProxyEdge, our innovative electronic proxy delivery and voting solution for institutional investors, helps ensure the participation of the largest stockholders of many companies. We also provide the distribution of regulatory reports and corporate action/reorganization event information, as well as tax reporting solutions that help our clients meet their regulatory compliance needs. In addition, we provide financial information distribution and transaction reporting services to both financial institutions and securities issuers. These services include the processing and distribution of account statements and trade confirmations, traditional and personalized document fulfillment and content management services, marketing communications, and imaging, archival and workflow solutions that enable and enhance our clients’ communications with investors. All of these communications are delivered in paper or electronic form. In fiscal year 2009, Broadridge introduced several new investor communication solutions. They are The Investor Network, Shareholder Forum and Virtual Shareholder Meeting solutions, and our data aggregation and data management solutions. In fiscal year 2010, Broadridge entered the transfer agency business through its acquisition of StockTrans, Inc., a leading provider of registrar, stock transfer and record-keeping services. In August 2010, Broadridge acquired NewRiver, Inc., a leader in mutual fund electronic investor disclosure solutions.

Securities Processing Solutions

We offer a suite of advanced computerized real-time transaction processing services that automate the securities transaction lifecycle, from desktop productivity tools, data aggregation, performance reporting, and portfolio management to order capture and execution, trade confirmation, settlement, and accounting. Our services help financial institutions efficiently and cost-effectively consolidate their books and records, gather and service assets under management, focus on their core businesses, and manage risk. With multi-currency capabilities, our Global Processing Solution supports real-time global trading of equity, option, mutual fund, and fixed income securities in established and emerging markets. In addition, our operations outsourcing solutions allow broker-dealers to outsource certain administrative functions relating to clearing and settlement, from order entry to trade matching and settlement, while maintaining their ability to finance and capitalize their business.

Basis of Presentation

The Financial Statements have been prepared in accordance with accounting principles generally accepted in the U.S. These Financial Statements present the consolidated position of the Company. These Financial Statements include the entities in which the Company directly or indirectly has a controlling financial interest and various entities in which the Company has investments recorded under the cost and equity methods of accounting. Intercompany balances and transactions have been eliminated. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These Financial Statements should be read in conjunction with the Company’s financial statements for the fiscal year ended June 30, 2010 in the Company’s 2010 Annual Report filed with the Securities and Exchange Commission (the “SEC”) on August 12, 2010.

As a result of Broadridge’s sale of substantially all of the contracts of the securities clearing clients of Ridge Clearing & Outsourcing Solutions, Inc. (“Ridge”) to Penson Financial Services, Inc. (“PFSI”), a wholly owned subsidiary of Penson Worldwide,

Inc. (“PWI,” referred to herein together with PFSI as “Penson”), the Company has two reportable operating business segments: Investor Communication Solutions and Securities Processing Solutions. The securities clearing business is reflected in discontinued operations and the operations outsourcing solutions business retained by Broadridge is now reported as part of the Securities Processing Solutions business segment. This change is reflected in all prior periods presented in this report on Form 10-Q.

Critical Accounting Policies

In presenting the Financial Statements, management makes estimates and assumptions that affect the amounts reported and related disclosures. Management continually evaluates the accounting policies and estimates used to prepare the Financial Statements. The estimates, by their nature, are based on judgment, available information, and historical experience and are believed to be reasonable. However, actual amounts and results could differ from these estimates made by management. In management’s opinion, the Financial Statements contain all normal recurring adjustments necessary for a fair presentation of results reported. Certain accounting policies that require significant management estimates and are deemed critical to our results of operations or financial position are discussed in the “Critical Accounting Policies” section of Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2010 Annual Report.

Results of Continuing Operations

The following discussions of Analysis of Condensed Consolidated Continuing Operations and Analysis of Reportable Segments refer to the three months ended September 30, 2010 compared to the three months ended September 30, 2009. The following discussions of the Company’s results of continuing operations exclude the results related to the securities clearing business. This business is segregated from continuing operations and included in discontinued operations for all periods presented. The Analysis of Condensed Consolidated Continuing Operations should be read in conjunction with the Analysis of Reportable Segments, which provides more detailed discussions concerning certain components of the Condensed Consolidated Statements of Earnings.

Analysis of Condensed Consolidated Continuing Operations


	Three Months Ended September 30,
							Change
	2010			2009			$			%
	($ in millions)
Revenues	$	421.4		$	438.2		$	(16.8	)		(4	)

Cost of revenues		336.6			338.5			(1.9	)		(1	)
Selling, general and administrative expenses		61.5			53.4			8.1			15
Other expenses, net		2.4			3.8			(1.4	)		(37	)

Total expenses		400.5			395.7			4.8			1

Earnings from continuing operations before income taxes		20.9			42.5			(21.6	)		(51	)
Margin		5.0	%		9.7	%					(4.7	) pts

Provision for income taxes		7.6			15.9			8.3			(52	)
Effective tax rate		36.4	%		37.4	%					(1.0	) pt

Net earnings from continuing operations	$	13.3		$	26.6		$	(13.3	)		(50	)

Basic Earnings per share from continuing operations	$	0.11		$	0.19		$	(0.08	)		(42	)
Diluted Earnings per share from continuing operations	$	0.10		$	0.19		$	(0.09	)		(47	)

*	Not Meaningful

Three Months Ended September 30, 2010 versus Three Months Ended September 30, 2009

Revenues. Revenues for the three months ended September 30, 2010 were $421.4 million, a decrease of $16.8 million or 4%, compared to $438.2 million for the three months ended September 30, 2009. The 4% decrease was driven by higher fee revenue of $3.1 million, offset by lower distribution revenue of $19.9 million. The increase in fee revenue of $3.1 million consisted of a positive contribution from recurring revenues of $20.7 million reflecting gains from acquisitions and the Penson transaction, sales less losses (referred to as “Net New Business”), and the favorable impact of foreign currency exchange rates of $2.1 million, all of which was mostly offset by lower event-driven fee revenue of $19.7 million mainly from mutual fund proxy activity of $14.6 million. Total distribution revenues declined by $19.9 million primarily due to event-driven activity of $10.3 million, with the remaining decline driven by business mix.

Total Expenses. Total expenses for the three months ended September 30, 2010 were $400.5 million, an increase of $4.8 million, or 1%, compared to $395.7 million for the three months ended September 30, 2009. The increase reflects an $8.1 million, or 15% increase in Selling, general and administrative expenses, partially offset by a decline in Cost of revenues of $1.9 million, or 1%, and a $1.4 million decrease in Other expenses, net.

Cost of revenues for the three months ended September 30, 2010 were $336.6 million, a decrease of $1.9 million, or 1%, compared to $338.5 million for the three months ended September 30, 2009. The decrease reflects lower distribution costs related to lower distribution revenues, mostly offset by the integration of the MSSB business and acquisitions. Distribution cost of revenues for the three months ended September 30, 2010 were $116.9 million, a decrease of $19.1 million, or 14%, compared to $136.0 million for the three months ended September 30, 2009. Distribution cost of revenues consist primarily of postage related expenses. Fluctuations in foreign currency exchange rates increased Cost of revenues by $0.8 million.

Selling, general and administrative expenses for the three months ended June 30, 2010 were $61.5 million, an increase of $8.1 million, or 15%, compared to $53.4 million for the three months ended September 30, 2009. The 15% increase is primarily due to increased costs related to acquisitions of $4.4 million and strategic initiatives and investments.

Other expenses, net for the three months ended September 30, 2010 were $2.4 million, a decrease of $1.4 million, compared to $3.8 million for the three months ended September 30, 2009. The decrease reflects a lower foreign currency exchange loss of $0.7 million and lower interest expense on our Long-term debt due to the decline in the weighted-average interest rate on our five-year term loan facility.

Earnings from Continuing Operations before Income Taxes. Earnings from continuing operations before income taxes for the three months ended September 30, 2010 were $20.9 million, a decrease of $21.6 million, or 51%, compared to $42.5 million for the three months ended September 30, 2009. The decrease is mainly due to the decline in event-driven fee revenues, coupled with the previously discussed dilutive impact of the strategic initiatives and acquisitions. Overall margin decreased from 9.7% to 5.0% for the three months ended September 30, 2009 compared to the three months ended September 30, 2010, respectively.

Provision for Income Taxes. Our Provision for income taxes and Effective tax rates for the three months ended September 30, 2010 were $7.6 million and 36.4%, respectively, compared to $15.9 million and 37.4%, for the three months ended September 30, 2009, respectively. The decreases in our Provision for income taxes and the Effective tax rates for the three months ended September 30, 2010 compared to the three months ended September 30, 2009 were primarily attributable to an increase in favorable geographic mix of income in certain non-U.S. tax jurisdictions with lower enacted tax rates.

Net Earnings from Continuing Operations and Basic and Diluted Earnings per Share from Continuing Operations. Net earnings from continuing operations for the three months ended September 30, 2010 were $13.3 million, a decrease of $13.3 million, or 50%, compared to $26.6 million for the three months ended September 30, 2009. The decrease in Net earnings from continuing operations reflects lower Earnings from continuing operations before income taxes, partially offset by a lower Effective tax rate and lower Weighted-Average shares outstanding.

Basic and diluted earnings per share from continuing operations for the three months ended September 30, 2010 were $0.11, a decrease of $0.08, or 42%, and $0.10, a decrease of $0.09, or 47%, respectively, compared to $0.19 and $0.19 for the three months ended September 30, 2009, respectively.

Analysis of Reportable Segments

The Company classifies its operations into the following two reportable segments: Investor Communication Solutions and Securities Processing Solutions.

The primary components of “Other” are the elimination of intersegment revenues and profits and certain unallocated expenses. Foreign currency exchange is a reconciling item between the actual foreign currency exchange rates and the fiscal year 2011 budgeted foreign currency exchange rates.

Certain corporate expenses, as well as certain centrally managed expenses, are allocated based upon budgeted amounts in a reasonable manner. Because the Company compensates the management of its various businesses on, among other factors, segment profit, the Company may elect to record certain segment-related expense items of an unusual or non-recurring nature in consolidation rather than reflect such items in segment profit.

Revenues


	Three Months Ended September 30,
						Change
	2010		2009			$			%
	($ in millions)
Investor Communication Solutions	$	279.5	$	309.9		$	(30.4	)		(10	)
Securities Processing Solutions		141.7		130.1			11.6			9
Other		—		0.1			(0.1	)		NM	*
Foreign currency exchange		0.2		(1.9	)		2.1			NM	*

Total	$	421.4	$	438.2		$	(16.8	)		(4	)

*	Not Meaningful

Earnings (Loss) from Continuing Operations Before Income Taxes


	Three Months Ended September 30,
							Change
	2010			2009			$			%
	($ in millions)
Investor Communication Solutions	$	6.4		$	23.4		$	(17.0	)		(73	)
Securities Processing Solutions		20.9			25.6			(4.7	)		(18	)
Other		(8.0	)		(6.6	)		(1.4	)		(21	)
Foreign currency exchange		1.6			0.1			1.5			NM	*

Total	$	20.9		$	42.5		$	(21.6	)		(51	)

*	Not Meaningful

Investor Communication Solutions

Revenues. Investor Communication Solutions segment’s Revenues for the three months ended September 30, 2010 were $279.5 million, a decrease of $30.4 million, or 10%, compared to $309.9 million for the three months ended September 30, 2009. The 10% decrease was primarily driven by lower event-driven mutual fund proxy revenues and related distribution revenues. These declines were partially offset by a positive contribution from recurring revenues from Net New Business in transaction reporting mainly as a result of the MSSB transaction and revenue gains from acquisitions. Distribution revenues for the three months ended September 30, 2010 were $132.4 million, a decrease of $19.9 million, or 13%, compared to $152.3 million for the three months ended September 30, 2009. Position growth, a key measure in the number of pieces processed, was unchanged for annual equity proxy and a positive 11% for mutual fund interim communications. Equity proxy position growth in the first quarter historically has not been an accurate measure of the full year trend due to the seasonality of the business. The number of pieces processed decreased 8% from 240.8 million pieces to 222.6 million pieces driven primarily by the decline in event-driven mutual fund proxy activity.

Earnings from Continuing Operations before Income Taxes. Earnings from Continuing Operations before income taxes for the three months ended September 30, 2010 were $6.4 million, a decrease of $17.0 million, compared to $23.4 million for the three months ended September 30, 2009. Margin decreased by 5.3 percentage points to 2.3% as a result of the decline in event-driven fee revenues, coupled with costs related to strategic initiatives including MSSB and increased investment spend on acquisitions.

Securities Processing Solutions

Revenues. Securities Processing Solutions segment’s Revenues for the three months ended September 30, 2010 were $141.7 million, an increase of $11.6 million, or 9%, compared to $130.1 million for the three months ended September 30, 2009. Excluding the Penson transaction and the City Networks, Ltd acquisition, Revenues were essentially unchanged for the three months ended September 30, 2010 compared to the three months ended September 30, 2009. Revenue from Net New Business and internal growth were offset by the carryover impact of prior fiscal year’s client losses and concessions. Internal growth was driven by non-trade revenues and higher fixed income trade volumes, offset by lower equity trade volumes.

Earnings from Continuing Operations before Income Taxes. Earnings from Continuing Operations before income taxes for the three months ended September 30, 2010 were $20.9 million, a decrease of $4.7 million, or 18%, compared to $25.6 million for the three months ended September 30, 2009. Margin decreased by 5.0 percentage points to 14.7% for the three months ended September 30, 2010. Excluding the Penson transaction and the City Networks, Ltd acquisition, Earnings from continuing operations and margin were essentially unchanged for the three months ended September 30, 2010 compared to the three months ended September 30, 2009.

Other

Revenues. Other segment Revenues for the three months ended September 30, 2010 were essentially unchanged compared to the three months ended September 30, 2009.

Loss from Continuing Operations before Income Taxes. Loss from Continuing Operations before income taxes was $8.0 million for the three months ended September 30, 2010, an increase of $1.4 million, compared to a $6.6 million loss from continuing operations before income taxes for the three months ended September 30, 2009. The increased loss was primarily due to increased costs related to strategic initiatives and investments.

Financial Condition, Liquidity and Capital Resources

At September 30, 2010, Cash and cash equivalents were $180.7 million and Total stockholders’ equity was $724.6 million. At September 30, 2010, working capital was $348.0 million, compared to $506.0 million at June 30, 2010.

At September 30, 2010, the Company had $324.2 million outstanding Long-term debt, consisting of a $200.0 million five-year term loan facility and unsecured senior notes of $124.2 million principal amount. The senior notes are unsecured obligations of Broadridge and rank equally in right of payment with other unsecured and unsubordinated obligations of Broadridge. Interest is payable semiannually on June 1^st and December 1^st each year based on a fixed per annum rate equal to 6.125%.

Borrowings under the term loan facility bear interest at LIBOR plus 40 to 90 basis points based on debt ratings at the time of borrowing. The term loan facility was subject to interest at LIBOR plus 40 basis points as of September 30, 2010. The weighted-average interest rate on the five-year term loan facility was 0.94% during the three months ended September 30, 2010.

current and anticipated cash operating requirements, capital expenditures and working capital needs. Please refer to the discussion of net cash flows used in financing activities in the following section for further discussion of the Company’s financing activities.

Cash Flows

Net cash flows used in operating activities from continuing operations were $24.5 million for the three months ended September 30, 2010 compared to $29.9 million net cash flows provided by operating activities during the three months ended September 30, 2009. The increase in cash used is primarily due to a reduction in working capital as the decrease in accounts receivable was more than offset by the payment of liabilities accrued for at fiscal year end.

Net cash flows used in investing activities for the three months ended September 30, 2010 were $84.5 million, an increase of $80.8 million compared to $3.7 million net cash flows used in investing activities for the three months ended September 30, 2009. The increase reflects higher spending of $77.4 million on acquisitions during the three months ended September 30, 2010, compared to the three months ended September 30, 2009, and higher capital expenditures of $2.7 million.

Net cash flows used in financing activities for the three months ended September 30, 2010 were $130.2 million, an increase of $62.7 million compared to $67.5 million net cash flows used in financing activities for the three months ended September 30, 2009. The increased use of cash in the three months ended September 30, 2010 reflects an increase in the purchases of common stock of $43.4 million, a decrease in proceeds from the exercise of stock options of $10.1 million in the current period and an increase in dividends paid of $9.0 million in the current period.

Liquidity Risk

Our liquidity position may be negatively affected by changes in general economic conditions, regulatory requirements and access to the capital markets, which may be limited if we were to fail to renew any of the credit facilities on their renewal dates or if we were to fail to meet certain ratios.

Based upon current and anticipated levels of operation, management believes that the Company’s cash on hand and cash flows from operations, combined with borrowings available under credit facilities, will be sufficient to enable the Company to meet its current and anticipated cash operating requirements, capital expenditures and working capital needs. Please refer to the discussion of net cash flows used in financing activities in the preceding section for further discussion of the Company’s financing activities.

Seasonality

Processing and distributing proxy materials and annual reports to investors in equity securities and mutual funds comprises a large portion of our Investor Communication Solutions business. We process and distribute the greatest number of proxy materials and annual reports during our fourth fiscal quarter (the second quarter of the calendar year). The recurring periodic activity of this business is linked to significant filing deadlines imposed by law on public reporting companies and mutual funds. Historically this has caused our revenues, operating income, net earnings, and cash flows from operating activities to be higher in our fourth fiscal quarter than in any other fiscal quarter. The seasonality of our revenues makes it difficult to estimate future operating results based on the results of any specific fiscal quarter and could affect an investor’s ability to compare our financial condition, results of operations, and cash flows on a fiscal quarter-by-quarter basis.

Income Taxes

The Company’s effective tax rates for the fiscal quarters ended September 30, 2010 and 2009 were 36.4% and 37.4%, respectively. The decrease in our effective tax rate is primarily attributable to an increase in favorable geographic mix of income in certain non-U.S. tax jurisdictions with lower enacted tax rates.

Contractual Obligations

Company recorded $27.2 million and $25.9 million, respectively, of expenses in the Condensed Consolidated Statements of Earnings related to these services.

Other Commercial Agreements

The Company has a five-year revolving credit facility that expires in March 2012 that has an available capacity of $500.0 million. No amounts were outstanding under this credit facility at September 30, 2010.

In addition, immediately prior to the separation from ADP, certain of the Company’s foreign subsidiaries established unsecured, uncommitted lines of credit with banks. These lines of credit bear interest at LIBOR plus 250 basis points. There were no outstanding borrowings under these lines of credit at September 30, 2010.

Off-balance Sheet Arrangements

It is not the Company’s business practice to enter into off-balance sheet arrangements. However, the Company is exposed to market risk from changes in foreign currency exchange rates that could impact its financial position, results of operations and cash flows. The Company manages its exposure to these market risks through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. The Company uses derivative financial instruments as risk management tools and not for trading purposes. The Company was not a party to any derivative financial instruments at September 30, 2010 or at June 30, 2010. In the normal course of business, the Company also enters into contracts in which it makes representations and warranties that relate to the performance of the Company’s products and services. The Company does not expect any material losses related to such representations and warranties or collateral arrangements.

Recently-issued Accounting Pronouncements

Please refer to Note 2. “New Accounting Pronouncements” to our Financial Statements under Item 1. of Part I of this Quarterly Report on Form 10-Q for a discussion on the impact of new accounting pronouncements.

Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company provides guarantees to securities clearinghouses and exchanges. Under the standard membership agreement, members are required to guarantee the performance of the other members. Under the agreements, if another member becomes unable to satisfy its obligations to the clearinghouse, the other members would be required to meet any shortfalls. The Company’s liability under these arrangements is not quantifiable and could exceed the cash and securities it has posted as collateral. However, the potential for the Company to be required to make payments under these arrangements is remote. Accordingly, no contingent liability is carried on the Condensed Consolidated Balance Sheets for these transactions.

In the normal course of business, the securities activities of the Clearing and Outsourcing Solutions business primarily involve executions, settlement and financing of various securities transactions for a nationwide retail and institutional, customer and non-customer client base, introduced by its correspondent broker-dealers. These activities may expose the Company to risk in the event customers, other broker-dealers, banks, clearing organizations or depositories are unable to fulfill contractual obligations.

The Company may be exposed to a risk of loss not reflected in the Condensed Consolidated Balance Sheets for securities sold, not yet purchased, should the value of such securities rise. The securities lending activities of the Company’s Clearing and Outsourcing Solutions segment require the Company to pledge securities as collateral. In the event the counterparty is unable to meet its contractual obligation, the Company may be exposed to off-balance sheet risk of acquiring securities at prevailing market prices. The Company monitors the credit standing of counterparties with whom it conducts business. Risk is further controlled by monitoring the market value of securities pledged on a daily basis and by requiring adjustments of collateral level in the event of excess market exposure or instituting securities buy-in procedures when required.

At September 30, 2010, $200.0 million of our total $324.2 million outstanding Long-term debt is based on floating interest rates. Our term loan facility had $200.0 million outstanding at September 30, 2010. The interest rate is based on LIBOR plus 40 to 90 basis points based on our debt rating at the time of borrowing. The term loan facility was subject to interest at LIBOR plus 40 basis points as of September 30, 2010. The weighted-average interest rate was 0.94% during the three months ended September 30, 2010.

Item 4.

CONTROLS AND PROCEDURES

Management’s Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2010. The Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of September 30, 2010 were effective to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding disclosure.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the three months ended September 30, 2010 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.

LEGAL PROCEEDINGS

In the normal course of business, the Company is subject to claims and litigation. While the outcome of any claim or litigation is inherently unpredictable, the Company believes that the ultimate resolution of these matters will not, individually or in the aggregate, result in a material adverse impact on its financial condition, results of operations or cash flows.

Item 1A.

RISK FACTORS

In addition to the information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the “Risk Factors” disclosed under Item 1A. to Part I in our Annual Report on Form 10-K for the fiscal year ended June 30, 2010, filed on August 12, 2010. You should be aware that these risk factors and other information may not describe every risk facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. Other than as set forth below, there have been no material changes to the risk factors we have disclosed in the “Risk Factors” section of our 2010 Annual Report on Form 10-K.

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

The following table contains information about our purchases of our equity securities for each of the three months during our first fiscal quarter ended September 30, 2010:


Period	Total Number of Shares Purchased			Average Price Paid per Share			Total Number of Shares Purchased as Part of a Publicly Announced Plan(2)		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans (2)
July 1, 2010 – July 31, 2010		2,536,600		$	19.85			2,536,600		3,774,922
August 1, 2010 – August 31, 2010		192,027			21.31			192,027		13,582,895
September 1, 2010 – September 30, 2010		1,768,748	⁽¹⁾		22.39	⁽¹⁾		1,767,973		11,814,922

Total		4,497,375		$	20.91			4,496,600		11,814,922

(1)	Includes 775 shares purchased from employees to pay taxes related to the vesting of restricted shares.

(2)

On June 7, 2010, the Board of Directors authorized a stock repurchase plan for the repurchase of up to 10 million shares of the Company’s common stock to offset share dilution created by the Company’s equity compensation plans. During the fiscal quarter ended September 30, 2010, the Company purchased approximately 4.5 million shares of common stock under this plan at an average price per share of $20.91.

On August 12, 2010, the Board of Directors authorized a stock repurchase plan for the repurchase of up to 10 million shares of the Company’s common stock.

There are approximately 11.8 million shares remaining for repurchase under these stock repurchase plans at September 30, 2010.

Item 3.

DEFAULTS UPON SENIOR SECURITIES

None.

Item 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

Item 5.

OTHER INFORMATION

None.

Item 6.

EXHIBITS

The following exhibits are being filed as part of this Quarterly Report on Form 10-Q:



10.1		Amendment No. 1, dated as of September 13, 2010, to the Offer Letter by and between Broadridge Financial Solutions, Inc. and Timothy Gokey, dated as of March 15, 2010.

31.1		Certification of the Chief Executive Officer of Broadridge Financial Solutions, Inc., pursuant to Rule 13a-14 of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the Chief Financial Officer of Broadridge Financial Solutions, Inc., pursuant to Rule 13a-14 of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial statements from the Broadridge Financial Solutions, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2010, formatted in eXtensible Business Reporting Language (XBRL): (i) condensed consolidated statements of earnings for the three months ended September 30, 2010 and 2009, (ii) condensed consolidated balance sheets as of September 30, 2010 and June 30, 2010, (iii) condensed consolidated statements of cash flows for the three months ended September 30, 2010 and 2009, and (iv) the notes to the condensed consolidated financial statements.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned hereunto duly authorized.


	BROADRIDGE FINANCIAL SOLUTIONS, INC.

Date: November 4, 2010	By:	/S/ DAN SHELDON
		Dan Sheldon
		Vice President, Chief Financial Officer (Principal Financial and Accounting Officer)


		INDEX TO EXHIBITS
Exhibit Number		Description of Exhibit

10.1		Amendment No. 1, dated as of September 13, 2010, to the Offer Letter by and between Broadridge Financial Solutions, Inc. and Timothy Gokey, dated as of March 15, 2010.

31.1		Certification of the Chief Executive Officer of Broadridge Financial Solutions, Inc., pursuant to Rule 13a-14 of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the Chief Financial Officer of Broadridge Financial Solutions, Inc., pursuant to Rule 13a-14 of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial statements from the Broadridge Financial Solutions, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2010, formatted in eXtensible Business Reporting Language (XBRL): (i) condensed consolidated statements of earnings for the three months ended September 30, 2010 and 2009, (ii) condensed consolidated balance sheets as of September 30, 2010 and June 30, 2010, (iii) condensed consolidated statements of cash flows for the three months ended September 30, 2010 and 2009, and (iv) the notes to the condensed consolidated financial statements.

EX-10.1 2 dex101.htm AMENDMENT NO. 1, DTD AS OF SEPT. 13 2010, TO THE OFFER LETTER Amendment No. 1, dtd as of Sept. 13 2010, to the Offer Letter

Exhibit 10.1

LOGO

Broadridge Financial Solutions, Inc.
1981 Marcus Avenue

Lake Success, NY 11046

516 472 5454 Phone
Richdaly@broadridge.com

September 13, 2010

Timothy Gokey

600 East 45th Street

Kansas City, MO 64110

AMENDMENT NO. 1 TO OFFER LETTER DATED AS OF MARCH 15, 2010

Dear Tim:

This letter amendment (“Amendment”) amends certain provisions of the offer letter between you and Broadridge Financial Solutions, Inc. (“Broadridge”) dated as of March 15, 2010 (“Offer Letter”). Unless specifically amended or modified by the terms of this Amendment, the terms and conditions set forth in the Offer Letter remain unchanged.

The “Severance” section of the Offer Letter is hereby deleted in its entirety and is replaced with the following modified section:

Severance

Your employment is “at will”. This means that your employment is for no definite period of time, and either you or Broadridge may terminate your employment at any time, with or without cause or notice. For the purposes of this offer letter, a termination of employment by you for good reason will mean a termination of employment by you within 90 days following the occurrence of any of the following events and the failure of Broadridge to rectify such occurrence within 30 days of written notice from you of your intent to invoke a good reason termination:

(i)

A reduction in the compensation set forth in the base salary section of this offer letter, unless such a reduction in base salary is 10% or less and is applicable to other Corporate Officers;

(ii)

The relocation of your office greater than fifty (50) miles from Lake Success, New York, if such relocation increases your commute;

(iii)

You no longer report directly to the Chief Executive Officer;

(iv)

Your duties and responsibilities are materially diminished at any point during the duration of the terms of this letter; and

(v)

Your role and primary responsibilities at Broadridge have not been materially enhanced by me, or any successor to me, by December 31, 2012.

If your employment is terminated by Broadridge without cause or you terminate employment for good reason as defined above, you will be eligible for severance pay via compensation continuation as follows (so long as you execute and deliver to Broadridge a general release of claims reasonably satisfactory to Broadridge on or before the date that is 50 days following the date of termination and you do not revoke such release prior to the end of the statutory seven-day revocation period):

(A)

Two years’ payment of your then-current annual base salary, to be paid over twenty-four (24) months in equal monthly installments in arrears, provided that the first and second monthly installments shall be paid on the date that is sixty days after the date of termination;

(B)

One year’s payment of your then-current annual target cash incentive payment, to be paid over twelve (12) months in equal monthly installments in arrears, provided that the first and second monthly installments shall be paid on the date that is sixty days after the date of termination; and

(C)

RSUs and stock options granted prior to termination shall continue to vest during the twenty-four months that you receive severance payments. Vested stock options will be exercisable until the earlier to occur of (I) the regular stock option expiration date and (II) 180 days after the last date of severance payments.

All such payments will be subject to your continued compliance for the duration of the severance period with the restrictive covenants attached to the original offer letter dated as of March 15, 2010 as Annex A, which you separately executed on March 15, 2010.

If you are discharged for cause or you terminate employment without good reason, you will not be eligible for severance pay. As used in this offer letter, the term “for cause” shall cover circumstances where Broadridge elects to terminate your employment because you have:

(i)

Been convicted of or pled nolo contendere to a criminal act for which the punishment under applicable law may be death or imprisonment for more than one year;

(ii)

Willful failure or refusal to perform your material obligations as an employee of Broadridge and such failure or refusal shall continue during the 30 day period following the receipt by you of written notice from Broadridge of such failure or refusal;

(iii)

Committed any act or omission of gross negligence in the performance of your material duties hereunder and failed to take appropriate corrective action, if such act or omission is susceptible of correction, during the 30 day period following the receipt by you of written notice from Broadridge of such act or omission of gross negligence;

(iv)

Committed any act of willful or reckless misconduct; or

(v)

Violated Broadridge’s Code of Business Conduct and Ethics.

-2-

Notwithstanding anything in this paragraph, if you are discharged “for cause,” Broadridge will pay all vested or accrued wages, vacation, and expense reimbursement owed to you on the date of such discharge.

In accordance with the terms of the Broadridge Change in Control Severance Plan for Corporate Officers (the “CIC Plan”), so long as you are a corporate officer of Broadridge on the date of a Change in Control (as defined in the CIC Plan) or otherwise qualify as a participant under the terms of the CIC Plan, you will participate in the CIC Plan. Subject to the next sentence in this paragraph, as provided in Section 6.7(b) of the CIC Plan, if you are due benefits or payments under both this letter agreement and the CIC Plan and/or where the CIC Plan and this letter agreement have inconsistent or conflicting terms and conditions, you shall receive the greater of the benefits and payments, and the more favorable terms and conditions to you, under this letter agreement and the CIC Plan, determined on an item-by-item basis. Notwithstanding any provision in the CIC Plan or this letter agreement to the contrary, if your employment terminates (i) following a Change in Control but prior to a “change in control event” (within the meaning of Treas. Reg. § 1.409A-3(i)(5)) with respect to Broadridge, (ii) during the third year following a Change in Control, or (iii) prior to a Change in Control under the circumstances described in the second sentence of Section 7.5 of the CIC Plan, to the extent required to avoid accelerated taxation and/or additional taxes under Section 409A of the Internal Revenue Code of 1986, as amended, amounts payable to you under the CIC Plan, to the extent not in excess of the amount that you would have received as severance pay under this letter agreement had this letter agreement (and not the CIC Plan) been applicable, shall be paid at the time and in the manner provided in clause (A) or (B) (as applicable) on page 2 of this letter agreement and the remainder, if any, shall be paid to you in accordance with Section 1.1(b) of the CIC Plan.

* * * * *

This letter agreement is effective as of September 13, 2010 and it supercedes and replaces the letter agreement between Broadridge and you previously signed and dated September 13, 2010.

Sincerely,

[signature required for the official document]

/s/ Rich Daly

Rich Daly

CEO

-3-

I hereby accept and agree to the terms and conditions of Amendment No. 1 to the Offer Letter set forth above as of September 13, 2010:

/s/ Timothy Gokey

Timothy Gokey

cc:	Maryjo Charbonnier, Chief Human Resources Officer

Scott Oberstaedt, VP Compensation

-4-

EX-31.1 3 dex311.htm CEO CERTIFICATION PURSUANT TO SECTION 302 CEO Certification Pursuant to Section 302

Exhibit 31.1

SECTION 302 CERTIFICATION

I, Richard J. Daly, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Broadridge Financial Solutions, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 4, 2010

/s/ Richard J. Daly

Richard J. Daly

Chief Executive Officer

EX-31.2 4 dex312.htm CFO CERTIFICATION PURSUANT TO SECTION 302 CFO Certification Pursuant to Section 302

Exhibit 31.2

SECTION 302 CERTIFICATION

I, Dan Sheldon, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Broadridge Financial Solutions, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 4, 2010

/s/ Dan Sheldon

Dan Sheldon

Vice President, Chief Financial Officer

EX-32.1 5 dex321.htm CEO CERTIFICATION PURSUANT TO SECTION 906 CEO Certification Pursuant to Section 906

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Broadridge Financial Solutions, Inc. (the “Company”) on Form 10-Q for the three months ended September 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard J. Daly, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(a)

the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Richard J. Daly

Richard J. Daly

Chief Executive Officer

November 4, 2010

Pursuant to Securities and Exchange Commission Release 33-8238, dated June 5, 2003, this certification is being furnished and shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2 6 dex322.htm CFO CERTIFICATION PURSUANT TO SECTION 906 CFO Certification Pursuant to Section 906

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Broadridge Financial Solutions, Inc. (the “Company”) on Form 10-Q for the three months ended September 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dan Sheldon, Vice President, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(a)

the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Dan Sheldon

Dan Sheldon

Vice President, Chief Financial Officer

November 4, 2010

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<div> <div> NOTE 5. ACQUISITIONS Assets acquired and liabilities assumed in business combinations were recorded on the Company's Consolidated Balance Sheets as of the respective acquisition dates based upon their estimated fair values at such dates. The results of operations of businesses acquired by the Company were included in the Company's Consolidated Statements of Earnings since their respective dates of acquisition. The excess of the purchase price over the estimated fair values of the underlying assets acquired and liabilities assumed was allocated to goodwill. In August 2010, the Company acquired one business in the Investor Communication Solutions segment, NewRiver, Inc., a leader in mutual fund electronic investor disclosure solutions. The purchase price was $77.4 million, net of cash acquired. This acquisition resulted in $43.7 million of goodwill. Intangible assets acquired, which totaled $27.3 million, consist primarily of customer relationships and acquired software technology, which are being amortized over an eight-year life and seven-year life, respectively. This acquisition was not material to the Company's operations, financial position, or cash flows. </div> </div>

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-7200000

-31900000

11500000

<div> NOTE 13. CONTRACTUAL COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS The Company entered into a data center outsourcing services agreement with ADP before our spin-off from ADP in March 2007 under which ADP provides the Company with data center services consistent with the services provided to the Company immediately before the spin-off, provided that the operation of the data center is the sole responsibility of ADP. Among the principal services provided by the data center are information technology services and service delivery network services. The agreement with ADP provides for increasing volumes and the addition of new services over the term. Under the agreement, ADP is responsible for hosting the mainframe, midrange, open systems, and networks. Additionally, systems engineering, network engineering, hardware engineering, network operations, data center operations, application change management, and data center disaster recovery s ervices are managed by ADP. The agreement will expire on June 30, 2012. For the three months ended September 30, 2010 and 2009, the Company recorded $27.2 million and $25.9 million, respectively, of expenses in the Condensed Consolidated Statements of Earnings related to these services. In March 2010, the Company and International Business Machines Corporation ("IBM") entered into an Information Technology Services Agreement (the "IT Services Agreement"), under which IBM will provide certain aspects of the Company's information technology infrastructure that are currently provided under a data center outsourcing services agreement with ADP. Under the IT Services Agreement, IBM will provide a broad range of technology services to the Company including supporting its mainframe, server, network and data center operations, as well as providing disaster recovery services. The Company has the option of incorporating additional services into the agreement over time. The Company expects that the migration of its data center processing from ADP to IBM will be completed by June 2012. The IT Services Agreement has an initial term of 11 years and seven months, e xpiring on October 31, 2021. The Company has the right to renew the initial term of the IT Services Agreement for up to one additional 12-month term. Commitments under this agreement are $561.5 million through fiscal year 2022, the final year of the contract. For the three months ended September 30, 2010, the Company did not record any expenses in the Condensed Consolidated Statements of Earnings related to these services. In the normal course of business, the Company is subject to various claims and litigation. While the outcome of any claim or litigation is inherently unpredictable, the Company believes that the ultimate resolution of these matters will not, individually or in the aggregate, result in a material adverse impact on its financial condition, results of operations or cash flows. On January 28, 2010, the Company filed a declaratory action in the U.S. District Court for the District of Delaware (the "Delaware District Court") against Inveshare, Inc. (the "Defendant") seeking a declaration by the court that Broadridge does not infringe two U.S. patents owned by the Defendant that included claims related to the delivery and distribution of an electronic solicitation. The Company's complaint also alleged that the Defendant's patents are invalid and/or are unenforceable due to inequitable conduct. On March 22, 2010, the Defendant answered the Company's complaint and filed a counterclaim against the Company alleging that Broadridge uses a process that infringes one of the patents in the action. In its counterclaim, Defendant is seeking injunctive relief and unspecified damages. This lawsuit is in an earl y procedural stage and the Company cannot predict with assurance what impact, if any, the outcome of this litigation may have on its financial condition, results of operations, or cash flows. It is not the Company's business practice to enter into off-balance sheet arrangements. However, the Company is exposed to market risk from changes in foreign currency exchange rates that could impact its financial position, results of operations, and cash flows. The Company manages its exposure to these market risks through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. The Company uses derivative financial instruments as risk management tools and not for trading purposes. The Company was not a party to any derivative financial instruments as of September 30, 2010 and 2009. In the normal course of business, the Company also enters into contracts in which it makes representations and warranties that relate to the performance of the Company's products and services. The Company d oes not expect any material losses related to such representations and warranties, or collateral arrangements. As a registered broker-dealer, our subsidiary Ridge is subject to regulations concerning many aspects of its business, including trade practices, capital structure, record retention, money laundering prevention, and the supervision of the conduct of directors, officers and employees. A failure by Ridge to comply with any of these laws, rules or regulations could result in censure, fine, the issuance of cease-and-desist orders, or the suspension or revocation of SEC authorization granted to allow the operation of its business or disqualification of the directors, officers or employees of such business. In addition, as a registered broker-dealer, Ridge is required to participate in the Securities Investor Protection Corporation ("SIPC") for the benefit of the customers of our introducing broker-dealer clients in connection with our securities clearing services. On June& amp;nbsp;25, 2010, we completed the sale of the contracts of substantially all of Ridge's securities clearing clients and are in the process of winding down the securities clearing business, which we expect to complete in fiscal year 2011. As we wind down that business, Ridge continues to perform securities clearing services on a limited basis. Until such wind down is complete, Ridge will continue to be subject to the regulatory requirements of a broker-dealer performing those functions. These regulations include the SEC's customer protection rule, which protects both the customer funds and customer securities; the SEC's hypothecation Rules 8c-1 and 15c2-1 regarding the borrowing and lending of our correspondents' customers' securities; Regulation T, which regulates the borrowing and lending of securities by broker-dealers; and Regulation SHO, which prohibits short sales in certain instances. </div>

0.14

0.15

0.01

650000000

145900000

146100000

129200000

124900000

1500000

<div> <div> <div> NOTE 14. COMPREHENSIVE INCOME Comprehensive income consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="84%"> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Net earnings</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">13.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">26.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Foreign currency translation adjustments</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">8.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(3.9</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Net unrealized losses on available-for-sale securities, net of taxes of $0.9 and zero at September 30, 2010 and 2009, respectively</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(1.5</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Comprehensive income</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">20.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">22.5</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>  </div></div> </div>

338500000

336600000

395700000

400500000

<div> NOTE 10. BORROWINGS The Company's outstanding borrowings consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="84%" align="center"> <tr><td width="67%"> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">Expiration Date</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">September 30, 2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">June 30, 2010</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="2"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Long-term debt</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Term loan facility</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom">March 2012</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">200.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">200.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Senior notes</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom">June 2017</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">124.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">124.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">324.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">324.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table> In addition, the Company has a five-year revolving credit facility that expires in March 2012 that has an available capacity of $500.0 million. No amount was outstanding under this credit facility at September 30, 2010. At September 30, 2010 and June 30, 2010, the Company was not aware of any instances of non-compliance with the financial covenants of its borrowings' obligations. The fair value of the fixed-rate senior notes at September 30, 2010 was $132.6 million based on quoted market prices. The carrying value of the variable-rate term loan facility approximates fair value. Amounts are due on the expiration dates listed above. </div>

-2800000

-1100000

56200000

46100000

34800000

26000000

47800000

56400000

9600000

12000000

<div> <div> NOTE 11. STOCK-BASED COMPENSATION The activity related to the Company's incentive equity awards for the three months ended September 30, 2010 consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr><td width="55%"> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="2%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Stock Options</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Time-based Restricted Stock Units</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Performance-based Restricted Stock Units</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Number of Options (d)</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Weighted- Average Exercise Price</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Number of Shares</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Weighted- Average Grant Date Fair Value</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Number of Shares</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Weighted- Average Grant Date Fair Value</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Balances at June 30, 2010</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">17,369,212</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">19.33</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1,884,170</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">16.52</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">670,859</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">16.45</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Granted</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">8,548</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">18.59</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Exercise of stock options (a)</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(231,384</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">17.90</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Vesting of restricted stock units</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(2,713</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">16.93</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Expired/forfeited</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(14,693</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">18.54</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(19,390</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">23.16</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Balances at September 30, 2010 (b)(c)</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">17,123,135</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">19.35</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1,870,615</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">16.46</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">670,859</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">16.45</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td valign="top" width="4%" align="left">(a)</td> <td valign="top" align="left">Stock options exercised during the period of July 1, 2010 through September 30, 2010 had an intrinsic value of $0.8 million. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td valign="top" width="4%" align="left">(b)</td> <td valign="top" align="left">As of September 30, 2010, the Company's outstanding "in the money" stock options using the September 30, 2010 closing share price of $22.87 (approximately 15.1 million shares) had an aggregate intrinsic value of $63.6 million. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td valign="top" width="4%" align="left">(c)</td> <td valign="top" align="left">As of September 30, 2010, the Company's outstanding stock options included 1,286,409 options with an exercise price of $24.39 per share that expired on October 15, 2010. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td valign="top" width="4%" align="left">(d)</td> <td valign="top" align="left">Options outstanding as of September 30, 2010 have a weighted-average remaining contractual life of 3.8 years and 13.5 million options are exercisable. </td></tr></table> The Company has stock-based compensation plans under which we annually grant stock option and restricted stock unit awards. Exercise prices on options granted have been and continue to be set equal to the market price of the underlying shares on the date of the grant (except the special stock option grants, some of which have a premium exercise price), with the measurement of stock-based compensation expense recognized in Net earnings based on the fair value of the award on the date of grant. Stock-based compensation expense of $6.2 million and $5.8 million, respectively, as well as related tax benefits of $2.4 million and $2.1 million, respectively, were recognized in Earnings from continuing operations for the three months ended September 30, 2010 and 2009, respectively. Stock-based compensation expense of $0.2 million and related tax benefits of $0.1 million, were recognized in Earnings from discontinued operations for the three months ended September 30, 2009. As of September 30, 2010, the total remaining unrecognized compensation cost related to non-vested stock options and restricted stock unit awards amounted to $8.3 million and $18.4 million, respectively, which will be amortized over the weighted-average remaining requisite service periods of 2.6 years and 1.3 years, respectively. For stock options issued, the fair value of each stock option was estimated on the date of grant using a binomial option pricing model. The binomial model considers a range of assumptions related to volatility, risk-free interest rate and employee exercise behavior. Expected volatilities utilized in the binomial model are based on a combination of implied market volatilities, historical volatility of the Company's stock price and other factors. Similarly, the dividend yield is based on historical experience and expected future changes. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The binomial model also incorporates exercise and forfeiture assumptions based on an analysis of historical data. The expected life of the stock option grants is derived from the output of the binomial model and represents the period of time that options granted are expected to be outstanding. </div> </div>

<div> <div> NOTE 7. DISCONTINUED OPERATIONS In November 2009, the Company and Ridge Clearing & Outsourcing Solutions, Inc. ("Ridge") entered into an asset purchase agreement (the "Asset Purchase Agreement") with PWI and Penson Financial Services, Inc., a wholly owned subsidiary of PWI ("PFSI"), to sell substantially all contracts of the securities clearing clients of Ridge to PFSI. On June 25, 2010, the Company completed the sale of the contracts of substantially all of the securities clearing clients of Ridge to PFSI, for an aggregate purchase price of $35.2 million. The purchase price paid to Broadridge consists of (i) a five-year subordinated note from PWI in the principal amount of $20.6 million bearing interest at an annual rate equal to the London Inter-Bank Offer Rate ("LIBOR") plus 550 basis points, and (ii) 2,455,627 shares of PWI's common stock (representing 9.5% of PWI's outstanding common stock as of May 31, 2010), at the June 25, 2010 closing price of PWI's common stock of $5.95 per share. The purchase price is subject to certain adjustments post-closing including adjustments to reflect certain recently signed correspondent clearing contracts. The Company will discontinue its securities c learing services business but will continue to provide operations outsourcing solutions aligned with the Securities Processing Solutions business. The results of the securities clearing business are included in Loss from discontinued operations, net of taxes, for all periods presented. The net assets associated with the securities clearing business, totaling $20.4 million and $24.7 million, have been reclassified to Assets of discontinued operations and Liabilities of discontinued operations as of September 30, 2010 and June 30, 2010, respectively. For a period of time, the Company will continue to generate cash flows and to report income statement activity in Loss from discontinued operations, net of taxes, associated with the securities clearing business. The activities that give rise to these cash flows and income statement activities are transitional in nature. The following summarized financial information related to the securities clearing business has been segregated from continuing operations and reported as discontinued operations:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="84%"> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Revenues</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">0.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">19.7</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td height="8"> </td> <td height="8" colspan="4"> </td> <td height="8" colspan="4"> </td></tr> <tr><td valign="top"> Loss from discontinued operations, before net loss on disposal</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">(0.2</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Income tax benefit</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Net loss from discontinued operations, before loss on disposal</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">(0.2</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Net loss on disposal of assets of discontinued operations</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Loss from discontinued operations, net of tax benefit</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">(0.2</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table> The following assets and liabilities have been segregated and classified as Assets of discontinued operations and Liabilities of discontinued operations, as appropriate, in the Condensed Consolidated Balance Sheets as of September 30, 2010 and June 30, 2010, respectively. These assets and liabilities related to the securities clearing business described above, net to $20.4 million and $24.7 million at September 30, 2010 and June 30, 2010, respectively. The amounts presented below were adjusted to exclude intercompany receivables and payables between the business held for sale and the Company, which were excluded from the disposition.   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="68%"> </td> <td valign="bottom" width="13%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="13%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">September 30, 2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">June 30, 2010</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Assets</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Cash and securities segregated for regulatory purposes and securities deposited with clearing organizations</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">24.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">67.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Securities clearing receivables</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">30.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">52.5</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Other assets</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">4.3</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Total assets of discontinued operations</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">55.9</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">123.8</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td height="8"> </td> <td height="8" colspan="4"> </td> <td height="8" colspan="4"> </td></tr> <tr><td valign="top"> Liabilities</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Accrued expenses and other current liabilities</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">6.7</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">21.7</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Securities clearing payables</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">28.8</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">77.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Total liabilities of discontinued operations</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">35.5</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">99.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Net assets of discontinued operations</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">20.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">24.7</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table> Securities clearing receivables/payables and segregated cash are in the process of being converted to cash since the close of the transaction. Upon final conversion, any excess cash will remain with the Company. Regulatory Requirements As a registered broker-dealer and member of the New York Stock Exchange ("NYSE") and the Financial Industry Regulatory Authority ("FINRA"), Ridge is subject to the Uniform Net Capital Rule 15c3-1 of the Securities Exchange Act of 1934, as amended ("Rule 15c3-1"). Ridge computes its net capital under the alternative method permitted by Rule 15c3-1, which requires Ridge to maintain minimum net capital equal to the greater of $250,000 or 2% of aggregate debit items arising from customer transactions. The NYSE and FINRA may require a member firm to reduce its business if its net capital is less than 4% of aggregate debit items, or may prohibit a member firm from expanding its business or paying cash dividends if resulting net capital would be less than 5% of aggregate debit items. At September 30, 2010, Ridge had net ca pital of $41.5 million, which was approximately 196.0% of aggregate debit items and exceeded the minimum requirements by $41.1 million. </div> </div>

0.19

0.11

0.19

0.10

<div> NOTE 3. EARNINGS PER SHARE Basic earnings per share ("EPS") is calculated by dividing the Company's Net earnings by the basic Weighted-average shares outstanding for the periods presented. Diluted EPS reflects the potential dilution that could occur if outstanding stock options at the presented date are exercised and shares of restricted stock units have vested. For the three months ended September 30, 2010 and 2009, the computation of diluted EPS did not include 4.8 million and 8.1 million options to purchase Broadridge common stock, respectively, as the effect of their inclusion would have been anti-dilutive. The following table sets forth the denominators of the basic and diluted EPS computations:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="84%"> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">(in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Weighted-average shares outstanding:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Basic</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">126.5</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">138.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Common stock equivalents</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">3.1</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">2.3</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Diluted</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">129.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">140.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>   </div>

1600000

3000000

100000

<div> <div> NOTE 6. FAIR VALUE OF FINANCIAL INSTRUMENTS Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:   <table border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr><td> </td> <td valign="bottom" width="2%"> </td> <td width="93%"> </td></tr> <tr><td valign="top" nowrap="nowrap">Level 1</td> <td valign="bottom"> </td> <td valign="bottom">Inputs that are based upon unadjusted quoted prices for identical instruments traded in active markets.</td></tr> <tr><td height="8"> </td> <td height="8" colspan="2"> </td></tr> <tr><td valign="top" nowrap="nowrap">Level 2</td> <td valign="bottom"> </td> <td valign="bottom">Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly;</td></tr> <tr><td height="8"> </td> <td height="8" colspan="2"> </td></tr> <tr><td valign="top" nowrap="nowrap">Level 3</td> <td valign="bottom"> </td> <td valign="bottom">Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.</td></tr></table> In valuing assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculates the fair value of our Level 1 and Level 2 instruments based on the exchange traded price of similar or identical instruments where available or based on other observable instruments. These calculations take into consideration the credit risk of both the Company and our counterparties. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period. The following table sets forth the Company's financial assets and liabilities at September 30, 2010 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:   <table border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr><td width="74%"> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 1</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 2</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 3</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Total</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="14" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Assets</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Cash and cash equivalents:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Money market funds</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">107.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">107.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Other current assets:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Available-for-sale equity securities</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">1.5</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1.5</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Other non-current assets:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Available-for-sale equity securities</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">10.9</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">10.9</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">107.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">12.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">119.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table> A note receivable of $20.6 million from Penson Worldwide, Inc. ("PWI") was included as a financial asset measured at fair value on a recurring basis as of June 30, 2010; however, this financial asset is not being measured at fair value on a recurring basis. Therefore, this note receivable has been removed from the table during the fiscal quarter ended September 30, 2010. The following table sets forth the Company's financial assets and liabilities at June 30, 2010 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:   <table border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr><td width="74%"> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="3%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 1</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 2</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Level 3</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center">Total</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="14" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Assets</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Cash and cash equivalents:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Money market funds</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">177.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">177.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Other non-current assets:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Note receivable</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom" nowrap="nowrap" align="right">20.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">20.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">177.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">$</td> <td valign="bottom" nowrap="nowrap" align="right">20.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">197.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table> The note receivable in Level 3 assets represents the present value of a five-year subordinated note from PWI. There was no financial impact to the Company's statement of operations as of June 30, 2010. </div> </div>

509500000

560800000

26600000

13300000

42500000

20900000

0.19

0.11

0.19

0.10

-200000

<div> NOTE 12. INCOME TAXES The Company's effective tax rates from continuing operations for the fiscal quarter ended September 30, 2010 and 2009 were 36.4% and 37.4%, respectively. The decrease in our effective tax rate is primarily attributable to an increase in favorable geographic mix of income in certain non-U.S. tax jurisdictions with lower enacted tax rates. </div>

32800000

14300000

15900000

7600000

1800000

-21700000

72700000

64500000

12100000

-12000000

-77800000

-83800000

-2100000

-9200000

2900000

11400000

46100000

69300000

600000

500000

987300000

794700000

1794400000

1519300000

486400000

292300000

99100000

35500000

324100000

324200000

-9700000

4300000

-67500000

-130200000

-3700000

-84500000

29900000

-24500000

26400000

13300000

<div> <div> NOTE 1. BASIS OF PRESENTATION A. Description of Business. Broadridge Financial Solutions, Inc. ("Broadridge®" or the "Company"), a Delaware corporation, is a leading global provider of investor communication solutions, and securities processing and operations outsourcing solutions to the financial services industry. The Company classifies its continuing operations into the following two reportable segments:   <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="5%"> </td> <td valign="top" width="2%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Investor Communication Solutions— A large portion of Broadridge's Investor Communication Solutions business involves the processing and distribution of proxy materials to investors in equity securities and mutual funds, as well as the facilitation of related vote processing. ProxyEdge®, its innovative electronic proxy delivery and voting solution for institutional investors, helps ensure the participation of the largest stockholders of many companies. Broadridge also provides the distribution of regulatory reports and corporate action/reorganization event information, as well as tax reporting solutions that help its clients meet their regulatory compliance needs. In addition, Broadridge provides financial information distribution and transaction reporting services to both financial institutions and securities issuers. These services include the processing and distribution of acco unt statements and trade confirmations, traditional and personalized document fulfillment and content management services, marketing communications, and imaging, archival and workflow solutions that enable and enhance its clients' communications with investors. All of these communications are delivered in paper or electronic form. In fiscal year 2009, Broadridge introduced several new investor communication solutions. They are The Investor Network, Shareholder Forum and Virtual Shareholder Meeting solutions, and our data aggregation and data management solutions. In fiscal year 2010, Broadridge entered the transfer agency business through its acquisition of StockTrans, Inc., a leading provider of registrar, stock transfer and record-keeping services. In August 2010, Broadridge acquired NewRiver, Inc., a leader in mutual fund electronic investor disclosure solutions. </td></tr></table>   <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="5%"> </td> <td valign="top" width="2%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Securities Processing Solutions— Broadridge offers a suite of advanced computerized real-time transaction processing services that automate the securities transaction lifecycle, from desktop productivity tools, data aggregation, performance reporting, and portfolio management to order capture and execution, trade confirmation, settlement, and accounting. Broadridge's services help financial institutions efficiently and cost-effectively consolidate their books and records, gather and service assets under management, focus on their core businesses, and manage risk. With multi-currency capabilities, its Global Processing Solution supports real-time global trading of equity, option, mutual fund and fixed income securities in established and emerging markets. In addition, its operations outsourcing solutions allow broker-dealers to outsource certain administrative functions relating to clearin g and settlement, from order entry to trade matching and settlement, while maintaining their ability to finance and capitalize their business. </td></tr></table> B. Basis of Presentation. The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S."). These financial statements present the condensed consolidated position of the Company. These financial statements include the entities in which the Company directly or indirectly has a controlling financial interest and various entities in which the Company has investments recorded under both the cost and equity methods of accounting. Intercompany balances and transactions have been eliminated. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2010 (the "2010 Annual Report") filed on August 12, 2010 with the Securities and Exchange Commission (the "SEC"). These Condensed Consolidated Financial Statements include all normal and recurring adjustments necessary for a fair presentation of the Company's financial position at September 30, 2010 and June 30, 2010, the results of its operations for the three months ended September 30, 2010 and 2009 and its cash flows for the three months ended September 30, 2010 and 2009. C. Cash and Cash Equivalents. Investment securities with a maturity of 90 days or less at the time of purchase are considered cash equivalents. Cash and cash equivalents also include cash of $6.9 million and $7.6 million as of September 30, 2010 and June 30, 2010, respectively, held on behalf of clients of our transfer agency services. A corresponding liability is also included as a current liability in Accrued expenses and other current liabilities on the accompanying Condensed Consolidated Balance Sheets. D. Financial Instruments. Substantially all of the financial instruments of the Company other than Long-term debt are carried at fair values, or at carrying amounts that approximate fair values because of the short maturity of the instruments. The carrying value of the Company's long-term variable-rate term loan facility approximates fair value because these instruments reflect market changes to interest rates. The carrying value of the Company's long-term fixed-rate senior notes represents the face value of the long-term fixed-rate senior notes net of the unamortized discount. The fair value of the Company's long-term fixed-rate senior notes is based on quoted market prices. E. Subsequent Events. In preparing the accompanying Condensed Consolidated Financial Statements, in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") No. 855, "Subsequent Events," the Company has reviewed events that have occurred after September 30, 2010, through the date of issuance of the financial statements. During this period, the Company did not have any material subsequent events. </div> </div>

101700000

110000000

159000000

162400000

<div> NOTE 4. OTHER EXPENSES, NET Other (income) expenses, net consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="84%"> </td> <td valign="bottom" width="6%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="6%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Interest expense on borrowings</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">2.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">2.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Interest income</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(0.4</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Foreign currency exchange loss</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Other, net</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.1</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.2</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Other expenses, net</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">2.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">3.8</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>   </div>

<div> NOTE 9. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="76%"> </td> <td valign="bottom" width="7%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="7%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">September 30, 2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">June 30, 2010</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr><td height="8"> </td> <td height="8" colspan="4"> </td> <td height="8" colspan="4"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Employee compensation and benefits</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">63.5</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">101.9</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Accrued broker fees</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">25.9</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">56.3</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Accrued dividend payable</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">18.7</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">18.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Accrued income taxes and other</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">52.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">84.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">160.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">261.2</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>   </div>

72800000

75700000

-3800000

-2400000

71900000

115300000

9800000

18800000

77400000

100000

800000

3600000

6300000

25000000

-100000

14100000

4000000

87400000

86500000

1200000

546900000

541400000

438200000

421400000

<div> NOTE 2. NEW ACCOUNTING PRONOUNCEMENTS In October 2009, the FASB issued Accounting Standards Update ("ASU") No. 2009-13, "Multiple-Deliverable Revenue Arrangements a consensus of the FASB Emerging Issues Task Force," an amendment of ASC No. 605-25, "Revenue Recognition" (formerly EITF Issue No. 08-01, "Revenue Arrangements with Multiple Deliverables"). This standard provides principles for allocation of consideration among its multiple-elements, allowing more flexibility in identifying and accounting for separate deliverables under an arrangement. The ASU introduces an estimated selling price method for valuing the elements of a bundled arrangement if vendor-specific objective evidence or third-party evidence of selling price is not available, and significantly expands related disclosure requirements. It is effective on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. ASU No. 2009-13 became effective for the Company in the first fiscal quarter of fiscal year 2011 and did not have an impact on the Company's results of operations, cash flows or financial condition. </div>

<div> NOTE 8. OTHER NON-CURRENT ASSETS Other non-current assets consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="76%"> </td> <td valign="bottom" width="7%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="7%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">September 30, 2010</td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">June 30, 2010</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr><td height="8"> </td> <td height="8" colspan="4"> </td> <td height="8" colspan="4"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Deferred client conversion and start-up costs</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">108.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">106.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Note receivable</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">20.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">20.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Long-term investments</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">14.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">15.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Long-term broker fees</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">9.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">9.8</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Other</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">9.8</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">6.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">162.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">159.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>   </div>

<div> NOTE 15. INTERIM FINANCIAL DATA BY SEGMENT The Company classifies its operations into the following two reportable segments: Investor Communication Solutions and Securities Processing Solutions. The primary components of "Other" are the elimination of intersegment revenues and profits as well as certain unallocated expenses. Foreign currency exchange is a reconciling item between the actual foreign currency exchange rates and fiscal year 2011 budgeted foreign currency exchange rates. Certain corporate expenses, as well as certain centrally managed expenses, are allocated based upon budgeted amounts. Because the Company compensates the management of its various businesses on, among other factors, segment earnings, the Company records certain segment-related expense items of an unusual or non-recurring nature in Other rather than reflect such items in segment profit. Segment results:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="76%"> </td> <td valign="bottom" width="8%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="8%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Revenues</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Investor Communication Solutions</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">279.5</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">309.9</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Securities Processing Solutions</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">141.7</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">130.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Other</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Foreign currency exchange</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(1.9</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">421.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">438.2</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr> <tr><td height="16"> </td> <td height="16" colspan="8"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center">Earnings (Loss) from Continuing Operations before Income  Taxes</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Investor Communication Solutions</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">6.4</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">23.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Securities Processing Solutions</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">20.9</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">25.6</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Other</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(8.0</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(6.6</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr><td valign="top"> Foreign currency exchange</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">1.6</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">0.1</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Total</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">20.9</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">42.5</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>   <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td valign="top" width="9%" align="left"><a name="tx110192_3"> </a></td> <td valign="top" align="left"> </td></tr></table> </div>

53400000

61500000

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discontinued operations Assets of Disposal Group, Including Discontinued Operation, Total Assets, Current Total current assets Property, plant and equipment, net Property, Plant and Equipment, Net, Ending Balance Property, Plant and Equipment, Net, Beginning Balance Property, Plant and Equipment, Net, Total Other Assets Noncurrent Other non-current assets Other Assets, Noncurrent, Total Property, Plant and Equipment, Net [Abstract] Property, Plant and Equipment, Gross [Abstract] Property, plant and equipment Goodwill Goodwill, Ending Balance Goodwill, Beginning Balance Intangible assets, net Intangible Assets, Net (Excluding Goodwill), Total Assets, Total assets Liabilities and Stockholders' Equity Accounts Payable Current Accounts payable Accounts Payable, Current, Total Accrued Liabilities Current Accrued expenses and other current liabilities Accrued Liabilities, Current, Total Deferred Revenue Current Deferred revenues Deferred Revenue, Current, Total Liabilities of discontinued 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Stock, Shares, Outstanding, Beginning Balance Common stock, shares outstanding Treasury Stock, Shares Treasury Stock, Shares, Ending Balance Treasury Stock, Shares, Beginning Balance Treasury stock, shares Condensed Consolidated Statements of Cash Flows Cash Flows From Operating Activities Adjustments to reconcile Net earnings to net cash flows (used in) provided by operating activities: Adjustments to reconcile Net earnings to Net cash flows (used in) provided by operating activities: Depreciation and amortization Depreciation and amortization Amortization of other assets Amortization of Intangible Assets, Total Deferred income taxes Deferred Income Tax Expense (Benefit), Total Stock-based compensation expense Stock-based compensation expense Excess Tax Benefit From Share Based Compensation Operating Activities Excess tax benefits from the issuance of stock-based compensation awards Excess tax benefits from the issuance of stock-based compensation awards Other Changes in operating 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COMPREHENSIVE INCOME Comprehensive income consisted of the following:   <table border="0" cellspacing="0" cellpadding="0" width="76%" align="center"> <tr><td width="84%"> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="5%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="6" align="center">Three Months Ended September 30,</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">2009</td> <td valign="bottom"> </td></tr> <tr><td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom" colspan="6" align="center">($ in millions)</td> <td valign="bottom"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Net earnings</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">13.3</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">26.4</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr><td valign="top"> Foreign currency translation adjustments</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">8.2</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(3.9</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Net unrealized losses on available-for-sale securities, net of taxes of $0.9 and zero at September 30, 2010 and 2009, respectively</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(1.5</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">—  </td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td style="border-top: #000000 1px solid;" valign="bottom"> </td> <td> </td></tr> <tr><td valign="top"> Comprehensive income</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">20.0</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">22.5</td> <td valign="bottom" nowrap="nowrap">  </td></tr> <tr style="font-size: 1px;"><td valign="bottom"> </td> <td valign="bottom">  </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td style="border-top: #000000 3px double;" valign="bottom"> </td> <td> </td></tr></table>  </div></div> </div> NOTE 14. COMPREHENSIVE INCOME Comprehensive income consisted of the following:   false false false us-types:textBlockItemType textblock This label may include the following: 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income. 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