caused a reduction in the effective tax rate between periods. The rate was lower in 2009 than in 2008 mainly due to the effect in 2009 of deferred tax benefits and relatively low tax rates on asset sales, both related to an international upstream project. In addition, a greater proportion of before-tax income was earned in 2009 by equity affiliates than in 2008. (Equity affiliate income is reported as a single amount on an after-tax basis on the Consolidated Statement of Income.) Partially offsetting these items was the effect of a greater proportion of income earned in 2009 in tax jurisdictions with higher tax rates. Refer also to the discussion of income taxes in Note 15 beginning on page FS-47.

Liquidity and Capital Resources

Cash, cash equivalents, time deposits and marketable securities Total balances were $17.1 billion and $8.8 billion at December 31, 2010 and 2009, respectively. Cash provided by operating activities in 2010 was $31.4 billion, compared with $19.4 billion in 2009 and $29.6 billion in 2008. Cash provided by operating activities was net of contributions to employee pension plans of approximately $1.4 billion, $1.7 billion and $800 million in 2010, 2009 and 2008, respectively. Cash provided by investing activities included proceeds and deposits related to asset sales of $2.0 billion in 2010, $2.6 billion in 2009 and $1.5 billion in 2008. Cash provided by operating activities during 2010 was more than sufficient to fund the company’s $21.8 billion capital and exploratory program, pay $5.7 billion of dividends to shareholders and repurchase $750 million of common stock.

     Restricted cash of $855 million and $123 million associated with various capital-investment projects at December 31, 2010 and 2009, respectively, was invested in short-term marketable securities and recorded as “Deferred charges and other assets” on the Consolidated Balance Sheet.

     Dividends Dividends paid to common stockholders were approximately $5.7 billion in 2010, $5.3 billion in 2009 and $5.2 billion in 2008. In April 2010, the company increased its quarterly common stock dividend by 5.9 percent, to $0.72 per share.

     Debt and capital lease obligations Total debt and capital lease obligations were $11.5 billion at December 31, 2010, up from $10.5 billion at year-end 2009.

     The $1.0 billion increase in total debt and capital lease obligations during 2010 included issuance of $1.25 billion of tax-exempt bonds, partially offset by a decrease in short-term obligations. The company’s debt and capital lease obligations due within one year, consisting primarily of commercial paper, redeemable long-term obligations and the current portion oflong-term debt, totaled $5.6 billion at December 31, 2010, up from $4.6 billion at year-end 2009. Of this amount, $5.4 billion and $4.2 billion were reclassified to long-term at the end of each period, respectively. At year-end 2010, settlement of these obligations was not expected to require the use of working capital in 2011, as the company had the intent and the ability, as evidenced by committed credit facilities, to refinance them on a long-term basis.

     At December 31, 2010, the company had