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Visa Inc. (V)
10-K
Annual report pursuant to section 13 and 15(d)
Filed on 11/18/2011
Filed Period 09/30/2011

Table of contents

  • Page 1
    Visa Inc. (V) 10-K Annual report pursuant to section 13 and 15(d) Filed on 11/18/2011 Filed Period 09/30/2011

  • Page 2
    ...Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ The aggregate market value of the registrant's class A common stock, par value $.0001 per share, held by non-affiliates (using the New York Stock Exchange closing price as of...

  • Page 3
    ... About Market Risk Item 8 Financial Statements and Supplementary Data Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosures Item 9A Controls and Procedures Item 9B Other Information PART III Item 10 Directors, Executive Officers and Corporate Governance Item...

  • Page 4
    ... our systems; costs arising if Visa Europe were to exercise its right to require us to acquire all of its outstanding stock; loss of organizational effectiveness or key employees; failure to integrate recent acquisitions successfully or to effectively launch new products and businesses changes...

  • Page 5
    ...of our network and our payments services to enhance the reliability of our global processing infrastructure and protect the security of cardholder information. We operate an open-loop payments network, a multi-party system in which Visa connects financial institutions-issuing financial institutions...

  • Page 6
    ... brand or to another card product, such as a "non-reward" Visa credit card. Our rules always have allowed U.S. merchants to steer customers to other forms of payment and offer discounts to customers who choose to pay with cash, check or debit when authorized by a personal identification number...

  • Page 7
    ... major international markets, we and others have, over time, broadened our offerings to include debit, ATM, prepaid and commercial payment products. Our Core Operations We derive revenues primarily from fees paid by our clients based on payments volume, transactions that we process and other related...

  • Page 8
    ... routing of payment information and related data to facilitate the authorization, clearing and settlement of transactions between Visa issuers and acquirers. In addition, we offer a range of value-added processing services to support our clients' Visa programs and to promote the growth and security...

  • Page 9
    Table of Contents products. In addition to core issuer authorization processing, DPS offers card management services, exception processing, PIN and ATM network gateways, call center services, fraud detection services and ATM terminal driving. Visa Processing Service, or VPS, provides credit, debit ...

  • Page 10
    ...travel, youth, payroll, money transfer, corporate incentive, insurance reimbursement and government benefits cards. Cash Access. Our clients can provide global cash access to their cardholders by issuing products accepted at Visa and PLUS branded ATMs. Most Visa and Visa Electron branded cards offer...

  • Page 11
    ..., promotions, public relations and, increasingly, social media to create programs that build active preference for products carrying our brand, promote product usage, increase product acceptance and support cardholder acquisition and retention. For merchants, we work to ensure that the Visa brand...

  • Page 12
    ... rules and standards relate to such matters as the use of our brands and trademarks; the standards, design and features of payment cards, devices and programs; processing; merchant acquiring activities, including use of agents; disputes between members; risk management; guaranteed settlement; client...

  • Page 13
    ..., the issuer may return the transaction to the acquirer, an action termed a "chargeback." We enforce rules relating to chargebacks and maintain a dispute resolution process with respect to chargeback disputes. Credit Risk Management. We indemnify our clients for any settlement loss suffered due to...

  • Page 14
    ... established new rules under the Reform Act affecting interchange reimbursement fees, network exclusivity and transaction routing. We expect these rules to have an adverse impact on our pricing, reduce the number and volume of U.S. debit payments we process and decrease associated revenues. See...

  • Page 15
    ... options of merchants when multiple debit networks co-reside on Visa debit cards. For example, Visa's rules require that an acquirer must process authorizations for all international transactions through VisaNet and that a member must clear international transactions through VisaNet. Issues relating...

  • Page 16
    ... credit by using payment cards, which could decrease our transaction volumes. In some circumstances, new regulations could have the effect of limiting our clients' ability to offer new types of payment programs or restricting their ability to offer our existing programs such as stored value cards...

  • Page 17
    ... our payments network. Competition We compete in the global payment marketplace against all forms of payment, including paper-based forms, principally cash and checks; card-based payments, including credit, charge, debit, ATM, prepaid, private-label and other types of general purpose and limited-use...

  • Page 18
    ... payments volume plus cash volume. The data presented is reported quarterly by Visa's clients on their operating certificates and is subject to verification by Visa. On occasion, clients may update previously submitted information. Sources: MasterCard, American Express, JCB and Diners Club data...

  • Page 19
    ... financial institutions that issue Visa cards to cardholders. The fees are typically paid by acquirers: the financial institutions that offer Visa network connectivity and payments acceptance services to merchants. We refer to a system like ours, in which a payment network intermediates between the...

  • Page 20
    ... as limiting the routing options of merchants when multiple debit networks co-reside on Visa debit cards. For example, Visa's rules require that an acquirer must process authorizations for all international transactions through VisaNet and that a member must clear international transactions through...

  • Page 21
    ... affecting our ability to maintain or increase our revenues. Governments in some countries provide resources or protection to selected domestic payment card networks, brands and processing providers. These governments may take this action in order to support these providers. They may also take...

  • Page 22
    ... of such regulations on our clients may reduce the volume of payments we process. Moreover, such regulations could limit the types of products and services that we offer, the countries in which our cards are used and the types of cardholders and merchants who can obtain or accept our cards. Any of...

  • Page 23
    ... additional regulations. These could include new settlement procedures or other operational rules to address credit and operational risks. They could also include new criteria for member participation and merchant access to our payments system. Safety and Soundness Regulation. Recent federal banking...

  • Page 24
    ... to change our business practices, including by limiting interchange reimbursement fees and by revising our rules about fees charged to consumers who choose to pay with Visa. This could limit our payments volume and result in a material and adverse effect on our revenues, results of operations, cash...

  • Page 25
    ... client pricing may materially and adversely affect our revenues and profits. We offer incentives to clients in order to increase payments volume, enter new market segments and expand our card base. These include up-front cash payments, fee discounts, credits, performance-based incentives, marketing...

  • Page 26
    ... against all forms of payment. These include cash, checks and electronic transactions, such as wire transfers and automatic clearinghouse payments. In addition, our payment programs compete against the card-based payments systems of our competitors and private-label cards issued by merchants. The...

  • Page 27
    ...there to be changes in the competitive landscape in the future. For example Competitors, clients and others may develop products that compete with or replace the value-added services we provide to support our transaction processing; Parties that process our transactions in certain countries may try...

  • Page 28
    ... services. We do not have direct relationships with cardholders. We do not issue cards, extend credit to cardholders or determine the interest rates, if any, or other fees charged to cardholders using cards that carry our brands. Each issuer determines these and most other competitive card features...

  • Page 29
    ...only limited control over the operation of the Visa business. Visa Europe is not required to spend any minimum amount of money promoting or building the Visa brands in its region, and the strength of the Visa global brands depends in part on the efforts of Visa Europe to maintain product and service...

  • Page 30
    ...eliminate payment card marketing or increase requests for greater incentives or additional expense reductions, which may reduce our revenues. Our clients may decrease spending for optional or enhanced services, affecting our revenue and reducing cardholders' desire to use these products. Our clients...

  • Page 31
    ... its daily settlement obligations. In certain instances, we may indemnify issuers or acquirers even in situations in which a transaction is not processed by our system. This indemnification creates settlement risk for us due to the difference in timing between the date of a payment transaction and...

  • Page 32
    ... and revenues. Our clients, merchants, others and we store, process and transmit cardholder account information in connection with our payment cards. In addition, our clients may use third-party processors to process transactions generated by cards carrying our brands. Breach of the systems storing...

  • Page 33
    ...respective systems as they diverge over time. Failure to authorize or clear and settle inter-territory transactions quickly and accurately could impair the global perception of the Visa brands. Risks Related to our Structure and Organization We have little ability to control Visa Europe's operations...

  • Page 34
    ... rights in Europe may hinder our ability to acquire new entities or to operate them effectively. Any inconsistency in the payment processing services and products that we can provide could negatively affect cardholders from Visa Europe using cards in the countries we serve or our cardholders using...

  • Page 35
    ... our operations and results. Future sales of our class A common stock, or the expiration or waiver of transfer restrictions on our class B stock, could result in dilution to holders of shares of our existing class A common stock, adversely affecting their rights and depressing the market price of...

  • Page 36
    ... own more than 15% of our class A common stock (or 15% of our total outstanding common stock on an as-converted basis), unless our board of directors approves the acquisition of such shares in advance. In addition, except for common stock issued to a member in connection with our reorganization or...

  • Page 37
    Table of Contents We believe that these facilities are suitable and adequate to support our business needs. ITEM 3. Legal Proceedings Refer to Note 21-Legal Matters to our consolidated financial statements included in Item 8 in this report. ITEM 4. (Removed and Reserved). 36

  • Page 38
    ... ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Price Range of Common Stock Our class A common stock has been listed on the New York Stock Exchange under the symbol "V" since March 19, 2008. At September 30, 2011, the Company had...

  • Page 39
    ...of class A common stock withheld at an average price of $86.99 per share (under the terms of grants under the Company's equity incentive compensation plan) to offset tax withholding obligations that occur upon vesting and release of restricted shares. During the three months ended September 30, 2011...

  • Page 40
    ... the table below. For a description of the awards issued under the EIP, see Note 17-Share-based Compensation to our consolidated financial statements included in Item 8 of this report. (a) Number of shares of class A common stock issuable upon exercise of outstanding options, warrants Plan Category...

  • Page 41
    ...for the consolidated statement of operations and consolidated balance sheet data prior to October 1, 2007, represent balances for Visa U.S.A. Inc., the accounting acquirer in the reorganization. Visa U.S.A. Inc. was a non-stock corporation and therefore no comparable metric for earnings per share is...

  • Page 42
    ...with Visa-affiliated networks. We expect many merchants to use the routing regulations to redirect transactions or steer cardholders to other networks based on lowest cost or other factors. We expect operating revenue to grow in the high single to low double digit range for the full 2012 fiscal year...

  • Page 43
    ... and globally accepted form of payment. The Fundamo acquisition had a dilutive impact to earnings per share of $0.02 for the full 2011 fiscal year. See Note 5-Acquisitions to our consolidated financial statements. PlaySpan acquisition. On March 1, 2011, we acquired PlaySpan, a privately held company...

  • Page 44
    ... and mCommerce in order to expand the scope of payment services available to clients and consumers. See Note 5-Acquisitions to our consolidated financial statements. The PlaySpan acquisition had a dilutive impact to earnings per share of $0.03 for the full 2011 fiscal year. Sale of investment in...

  • Page 45
    ...operating revenues are primarily generated from payments volume on Visa-branded cards for goods and services, as well as the number, size and type of transactions processed on our VisaNet system. We do not earn revenues from, or bear credit risk with respect to, interest and fees paid by cardholders...

  • Page 46
    ...to build payments volume, increase product acceptance and win merchant preference to route transactions over our network. These incentives are primarily accounted for as reductions to operating revenues. Operating Expenses Personnel includes salaries, incentive compensation, stock-based compensation...

  • Page 47
    ... primarily relates to the change in the fair value of the Visa Europe put option. Visa Inc. Fiscal 2011, 2010 and 2009 Operating Revenues The following table sets forth our operating revenues earned in the United States, in the rest of the world and from Visa Europe. Revenues earned from Visa Europe...

  • Page 48
    ...14% 26% 17% Percentage change calculated based on whole numbers, not rounded numbers. • Service revenues increased in fiscal 2011 primarily due to 16% growth in nominal payments volume. Service revenues also benefited from competitive pricing actions which became effective in the first quarter of...

  • Page 49
    ... our total operating expenses for the periods presented. Fiscal Year ended September 30, (1) $ Change 2011 2010 vs. vs. 2009 2010 2009 (in millions, except percentages) 2011 vs. 2010 % Change 2011 2010 2010 vs. 2009 Personnel Network and processing Marketing Professional fees Depreciation and...

  • Page 50
    ... was offset by additional salary and stock compensation expense as a result of our acquisition of CyberSource in July 2010. • Network and processing decreased in fiscal 2011 primarily due to the previously announced change in the presentation of revenue and operating expense associated with...

  • Page 51
    ...intangible assets acquired in the CyberSource acquisition, as well as charges related to the east coast data center and office building that were placed in service during the second half of fiscal 2009. • General and administrative increased in fiscal 2011 primarily due to increased travel and the...

  • Page 52
    ... make planned capital investments in our business, to pay dividends and repurchase our shares at the discretion of our board of directors and to optimize income earned by investing excess cash in securities that we believe are high-quality and marketable in the short term. Based on our current cash...

  • Page 53
    ... of our class A common stock in the open market, deposits of $1.2 billion into the litigation escrow account and dividend payments of $423 million. The Company prepaid all of its outstanding debt in September 2011. See Note 10-Debt to our consolidated financial statements. Cash used in financing...

  • Page 54
    ... of shares of our class B and class C common stock and certain of our clients and affiliates of our clients. Loans under the five-year facility may be in the form of: (1) Base Rate Advance, which will bear interest at a rate equal to the higher of the Federal Funds Rate plus 0.5% and the Bank of...

  • Page 55
    ...credit ratings. The commercial paper program is a source of short-term borrowed funds that may be used from time to time to cover short-term cash needs. We had no obligations outstanding under this program during and at the end of fiscal 2011. There are no financial covenants related to this program...

  • Page 56
    ...our board of directors. Class B and class C common stock will share ratably on an as-converted basis in such future dividends. Visa Europe put option. We have granted Visa Europe a perpetual put option which, if exercised, will require us to purchase all of the outstanding shares of capital stock of...

  • Page 57
    ... service, age and eligible compensation. Employees hired before January 1, 2008, earn benefits based on their pay during their last five years of employment. Employees hired or rehired on or after January 1, 2008 earn benefits based on a cash balance formula. Effective January 1, 2011, all employees...

  • Page 58
    ... to honor Visa cards, traveler's cheques, or other instruments processed in accordance with our operating regulations. The amount of the indemnification is limited to the amount of unsettled Visa payment transactions at any point in time. We maintain global credit settlement risk policies and...

  • Page 59
    ... to build payments volume, increase payment product acceptance and win merchant preference to route transactions over our network. These agreements, which range in terms from one to thirteen years, can provide card issuance and/or conversion support, volume / growth targets and marketing and program...

  • Page 60
    ... partners designed to build payments volume, increase product acceptance and win merchant preference to route transactions over our network. These incentives are primarily accounted for as reductions to operating revenues or as operating expenses if a separate identifiable benefit can be established...

  • Page 61
    ... the year ended September 30, 2011, client incentives represented 17% of gross operating revenues. Fair Value-Visa Europe Put Option Critical Estimates. We have granted Visa Europe a perpetual put option which, if exercised, will require us to purchase all of the outstanding shares of capital stock...

  • Page 62
    ...-term growth rates or new product innovation. A consistent methodology is applied to a group of comparable public companies used to estimate the forward price-to-earnings multiple applicable to Visa Europe. These estimates, therefore, are impacted by changes in stock prices and the financial market...

  • Page 63
    ... and Visa Europe franchise right are intangible assets with indefinite lives, based on our significant market share, history of strong revenue and cash flow performance, and historical retention rates. As a result of acquiring Fundamo in June 2011, PlaySpan in March 2011 and CyberSource in...

  • Page 64
    ... We allocate goodwill to reporting units based on the reporting unit expected to benefit from the acquisition. We rely on a number of factors when completing impairment assessment including a review of discounted future cash flows, business plans and use of present value techniques. We evaluated our...

  • Page 65
    ...activities. This risk arises from the timing of rate setting for settlement with clients relative to the timing of market trades for balancing currency positions. Risk in settlement activities is limited through daily operating procedures, including the utilization of Visa settlement systems and our...

  • Page 66
    ... 30, 2011. The fair value balances of our adjustable-rate debt securities were $764 million and $13 million at September 30, 2011 and 2010, respectively. Equity Price Risk Visa Europe Put Option. We have a liability related to the put option with Visa Europe which is recorded at fair market value at...

  • Page 67
    ... Data VISA INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page As of September 30, 2011 and 2010 and for the years ended September 30, 2011, 2010 and 2009 Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated...

  • Page 68
    ... the related consolidated statements of operations, changes in equity, comprehensive income, and cash flows for each of the years in the three-year period ended September 30, 2011. We also have audited Visa Inc.'s internal control over financial reporting as of September 30, 2011, based on criteria...

  • Page 69
    ... par value data) Assets Cash and cash equivalents Restricted cash-litigation escrow (Note 3) Investment securities (Note 4) Trading Available-for-sale Settlement receivable Accounts receivable Customer collateral (Note 12) Current portion of client incentives Current portion of deferred tax assets...

  • Page 70
    Table of Contents VISA INC. CONSOLIDATED BALANCE SHEETS-(Continued) September 30, September 30, 2011 2010 (in millions, except par value data) Equity Preferred stock, $0.0001 par value, 25 shares authorized and none issued $ Class A common stock, $0.0001 par value, 2,001,622 shares authorized, 520...

  • Page 71
    ... the Years Ended September 30, 2011 2010 (in millions, except per share data) 2009 Operating Revenues Service revenues Data processing revenues International transaction revenues Other revenues Client incentives Total operating revenues Operating Expenses Personnel Network and processing Marketing...

  • Page 72
    Table of Contents VISA INC. CONSOLIDATED STATEMENTS OF OPERATIONS-(Continued) For the Years Ended September 30, 2011 2010 (in millions, except per share data) 2009 Diluted earnings per share (Note 16) Class A common stock Class B common stock Class C common stock Diluted weighted-average shares ...

  • Page 73
    Table of Contents VISA INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Years Ended September 30, 2011 2010 (in millions) 2009 Net income including non-controlling interest Other comprehensive income (loss), net of tax: Investment securities, available-for-sale Net unrealized (loss) ...

  • Page 74
    ... of class C common stock upon sale into public market Share-based compensation (Note 17) Excess tax benefit for share-based compensation Cash proceeds from exercise of stock options Restricted stock instruments settled in cash for taxes Accretion of class C (series II) common stock Cash dividends...

  • Page 75
    ... of restricted share awards Conversion of class C common stock upon sale into public market Share-based compensation (Note 17) Excess tax benefit for share-based compensation Cash proceeds from exercise of stock options Restricted stock instruments settled in cash for taxes Cash dividends declared...

  • Page 76
    ... stock units and performance shares Conversion of class C common stock upon sale into public market Share-based compensation (Note 17) Excess tax benefit for share-based compensation Cash proceeds from exercise of stock options Restricted stock instruments settled in cash for taxes Cash dividends...

  • Page 77
    ... net income including non-controlling interest to net cash provided by (used in) operating activities: Amortization of client incentives Fair value adjustment for the Visa Europe put option Share-based compensation Excess tax benefit for share-based compensation Depreciation and amortization of...

  • Page 78
    ... responsibility plan (Note 3) Cash proceeds from exercise of stock options Excess tax benefit for share-based compensation Principal payments on debt Principal payments on capital lease obligations Payment for redemption of stock Net cash used in financing activities Effect of exchange rate changes...

  • Page 79
    ... Visa U.S.A. Inc., Visa International Service Association, Visa Worldwide Pte. Limited ("VWPL"), Visa Canada Corporation, Inovant LLC and CyberSource Corporation ("CyberSource"), operate the world's largest retail electronic payments network. The Company provides its clients with payment processing...

  • Page 80
    ... of payments expected to be made beyond one year from the balance sheet date for settled claims, is classified as a non-current asset. Interest earned on escrow funds is included in investment income, net, on the consolidated statements of operations. Investments and fair value. The Company measures...

  • Page 81
    ... of market participant assumptions. Level 3 assets include the Company's auction rate securities. Level 3 liabilities include the Visa Europe put option and the earn-out related to the PlaySpan acquisition. See Note 4-Fair Value Measurements and Investments. Effective January 1, 2011, the Company...

  • Page 82
    ... designed to build payments volume, increase product acceptance and win merchant preference for transaction routing. These incentives are primarily accounted for as reductions to operating revenues or as operating expenses if a separate identifiable benefit can be established. The Company generally...

  • Page 83
    ...less than the carrying value. The Company relies on a number of factors when completing impairment assessments, including a review of discounted future cash flows, business plans and use of present value techniques. The Company has historically performed its annual impairment testing of goodwill and...

  • Page 84
    Table of Contents VISA INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) September 30, 2011 (in millions, except as noted) preferable as the earlier date allows the Company additional time to perform the annual impairment testing after its annual forecast and budget are completed and ...

  • Page 85
    ...to their card programs carrying marks of the Visa brand, and are based principally upon spending on Visa-branded cards for goods and services. Current quarter service revenues are primarily assessed using a calculation of pricing applied to the prior quarter's payments volume. The Company also earns...

  • Page 86
    ... The discount rate is based on matching the duration of a pool of high quality corporate bonds to the expected benefit payment stream, and is used to determine the present value of the Company's future benefit obligations. The expected rate of return on pension plan assets considers the current and...

  • Page 87
    ...value of the contracts at the contractual rate and the value at current market rates, and generally reflects the estimated amounts that the Company would receive or pay to terminate the contracts at the reporting date based on broker quotes for the same or similar instruments. Additional disclosures...

  • Page 88
    ...all of the outstanding shares of capital stock of Visa Europe from its members. The Company is required to purchase the shares of Visa Europe no later than 285 days after exercise of the put option. The put option provides a formula for determining the purchase price of the Visa Europe shares, which...

  • Page 89
    ... the assumed P/E differential used in the calculation include material changes in the P/E ratio of Visa Inc. and those of a group of comparable companies used to estimate the forward price-to-earnings multiple applicable to Visa Europe. The Company determined the fair value of the put option to be...

  • Page 90
    ... fee, as adjusted in future periods based on the growth of the gross domestic product of the European Union, approximates fair value. In addition to the licenses, Visa Inc. provides Visa Europe with authorization, clearing and settlement services for cross-border transactions involving Visa Europe...

  • Page 91
    ... sheet date for settled claims. The following table sets forth the changes in the escrow account: Fiscal 2011 (in millions) Fiscal 2010 Balance at October 1 Funding under the plan American Express settlement payments Interest earned, less applicable taxes Balance at September 30 Less: Current...

  • Page 92
    ... 2011 Level 3 2010 Assets Cash equivalents and restricted cash Money market funds and time deposits U.S. government-sponsored debt securities Investment securities U.S. government-sponsored debt securities U.S. Treasury securities Equity securities Auction rate securities Prepaid and other current...

  • Page 93
    ... Company received proceeds of $10 million and recorded a pre-tax gain of $4 million in investment income, net, on the consolidated statements of operations. There was no substantive change to the valuation techniques and related inputs used to measure fair value during fiscal 2011. Visa Europe put...

  • Page 94
    ... the assumptions employed to measure these assets on a non-recurring basis are based on management's judgment using internal and external data, these fair value determinations are classified in level 3 of the fair value hierarchy. The Company completed its annual impairment review of its indefinite...

  • Page 95
    Table of Contents VISA INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) September 30, 2011 (in millions, except as noted) Investments Available-for-sale investments Available-for-sale investment securities, which are recorded at fair value, consist of the types of securities presented ...

  • Page 96
    ... tax purposes. Fundamo Acquisition. On June 9, 2011, the Company acquired Fundamo, a leading platform provider of mobile financial services for mobile network operators and financial institutions in developing economies. The acquisition was made to accelerate the execution of Visa's global strategy...

  • Page 97
    ... at fair value based on the assumed likelihood of the future revenue targets and other milestones being met. The Company issued non-qualified stock options to replace unvested, in-the-money stock options held by PlaySpan employees. See Note 17-Sharebased Compensation. The following table summarizes...

  • Page 98
    ... stock of CyberSource Corporation, a leading provider of electronic payment, risk management and payment security solutions to online merchants. The combination was executed to accelerate the growth of Visa's eCommerce category and enhance the value of the Company's network, product and service...

  • Page 99
    ... years from the original grant date of the CyberSource options. See Note 17-Share-based Compensation. The Company also expensed as incurred approximately $13 million of acquisition-related costs during fiscal 2010, which consisted primarily of professional fees related to closing the transaction...

  • Page 100
    ... de Defesa Econômica. The approval was received in the third quarter of fiscal 2011. Upon the approval, the Company recognized a pre-tax gain, net of transaction costs, of $85 million in the investment income, net line of the consolidated statements of operations. The amount of the gain net of...

  • Page 101
    ... Europe's franchise right represents the value of the right to franchise the use of the Visa brand, use of Visa technology and access to the overall Visa network in the European Union. The Company acquired finite-lived intangible assets related to the CyberSource, PlaySpan and Fundamo acquisitions...

  • Page 102
    ... based on credit ratings for similar notes. There was no outstanding debt to fair value at September 30, 2011. 5.60% Senior Secured Notes-Series B. In December 2002, Visa U.S.A. issued $68 million in series B senior secured notes with a maturity date of ten years. In September 2011, the Company...

  • Page 103
    ...event of settlement failures by its clients, to back up the commercial paper program and for general corporate purposes. Loans under the five-year facility may be in the form of: (1) Base Rate Advance, which will bear interest at a rate equal to the higher of the Federal Funds Rate plus 0.5% and the...

  • Page 104
    ... 2011, all employees began accruing benefits under the cash balance formula and ceased accruing benefits under any other formula. An employee's cash balance account is credited with an amount equal to 6% of eligible compensation plus interest based on 30-year Treasury securities. The funding policy...

  • Page 105
    ... benefit obligation Change in Plan Assets: Fair value of plan assets-beginning of fiscal year Actual return on plan assets Company contribution Benefit payments Fair value of plan assets-end of fiscal year Funded status at end of fiscal year Recognized in Consolidated Balance Sheets: Non-current...

  • Page 106
    ... end of year Fair value of plan assets, end of year Net periodic pension and other postretirement plan cost: $ (839) 783 (839) 783 $ (30) - (30) - $ $ Pension Benefits Fiscal 2011 2010 2009 (in millions) 2011 Other Postretirement Benefits 2010 2009 Service cost Interest cost Expected return...

  • Page 107
    ... Discount rate for benefit obligation Pension Postretirement Discount rate for net periodic benefit cost Pension Postretirement (2) Expected long-term rate of return on plan assets Rate of increase in compensation levels for: Benefit obligation Net periodic benefit cost (1) (2) (1) 2011 2010...

  • Page 108
    ... market prices in active markets. Securities classified as Level 2 include a government agency discount note, which is a short-term obligation issued at discount from par. This security is traded over-the-counter and the valuation is based on inputs derived from observable market data of related...

  • Page 109
    ... cards, travelers cheques, deposit access products, point-of-sale check service drivers and other instruments processed in accordance with the operating regulations. This indemnification creates settlement risk for the Company due to the difference in timing between the date of a payment transaction...

  • Page 110
    ... of the settlement risk guarantee is estimated using a proprietary model which considers statistically derived loss factors based on historical experience, estimated settlement exposures at period end and a standardized grading process for clients (using, where available, third-party estimates of...

  • Page 111
    ... of Contents VISA INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) September 30, 2011 (in millions, except as noted) following 12 months. The aggregate notional amount of the Company's foreign currency forward contracts outstanding in its exchange rate risk management program was $651...

  • Page 112
    ... international service revenues, are shared by geographic locations based upon the location of the merchant involved in the transaction. Revenues earned in the U.S. were approximately 56%, 58% and 58% of total operating revenues in fiscal 2011, 2010 and 2009, respectively. No individual country...

  • Page 113
    ... shares. The Company made no share repurchases in the open market during fiscal 2009. In July, 2011, the Company's board of directors authorized a new $1 billion share repurchase program. The authorization will be in effect through July 20, 2012, and the terms of the program are subject to change...

  • Page 114
    ... to the number of shares of class B or class C common stock held multiplied by the applicable conversion rate in effect on the record date. Dividends Declared. On October 18, 2011, the Company's board of directors declared a dividend in the aggregate amount of $0.22 per share of class A common stock...

  • Page 115
    ... stock based on the conversion rate in effect through the period, and (2) incremental shares of class A common stock calculated by applying the treasury stock method to the assumed exercise of employee stock options and the assumed vesting of unearned performance shares. The following table presents...

  • Page 116
    ... stock available under the EIP is delivered and all restrictions on those shares have lapsed, unless the EIP is terminated earlier by the Company's board of directors. No awards may be granted under the plan on or after 10 years from its effective date. Share-based compensation expense is recorded...

  • Page 117
    ... stock option was estimated on the date of grant using a Black-Scholes option pricing model with the following assumptions: Expected term (in years) (2) Risk-free rate of return (3) Expected volatility (4) Expected dividend yield Weighted-average fair value per option granted (1) (2) (3) (1) 2011...

  • Page 118
    ... to receive dividend equivalents but do not participate in the voting rights granted to the holders of the underlying class A common stock. The fair value and compensation cost before estimated forfeitures for RSAs and RSUs is calculated using the closing price of class A common stock on the date of...

  • Page 119
    ...-based Shares The following table summarizes the Company's performance-based shares activity for fiscal 2011: WeightedAverage Remaining Contractual Term (in years) Shares WeightedAverage Grant Date Fair Value Aggregate Intrinsic (1) Value (in millions) Outstanding at October 1, 2010 Granted...

  • Page 120
    ... to build payments volume, increase the acceptance of its products and win merchant preference for transaction routing. These agreements, with original terms ranging from one to thirteen years, can provide card issuance and/or conversion support, volume / growth targets and marketing and program...

  • Page 121
    ... be a related party for purposes of this disclosure if that entity owns more than 10% of Visa's total voting common stock at the end of the fiscal year or if an officer or employee of that entity also serves on the board of directors. In January 2011, the Company's board made the decision to reduce...

  • Page 122
    Table of Contents VISA INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) September 30, 2011 (in millions, except as noted) Income tax provision by fiscal year consisted of the following: 2011 2010 (in millions) 2009 Current: U.S. federal State and local Non-U.S. Total current taxes ...

  • Page 123
    ... substantial restrictions on the utilization of net operating losses and tax credits in the event of a corporation's ownership change, as defined in the Internal Revenue Code. Although the Company's ability to utilize the U.S. net operating loss carryforwards was limited in fiscal 2011, the Company...

  • Page 124
    ...Singapore, the Company's largest operating hub outside the U.S., beneficial changes in the geographic mix of the Company's global income, the nontaxable revaluations of the Visa Europe put option in fiscal 2011 and 2010, and the absence of additional foreign tax related to the sale of the investment...

  • Page 125
    ... tax benefits related to prior years Increases of unrecognized tax benefits related to current year Reductions to unrecognized tax benefits related to lapsing statute of limitations Ending balance at September 30 $ $ 545 $ 206 (52) 158 (7) 850 $ 439 65 - 44 (3) 545 It is the Company's policy...

  • Page 126
    ...available information, including but not limited to actions taken by the litigation committee. The current uncommitted balance of the covered litigation escrow account -$2.7 billion-was deposited by the Company primarily with a view toward resolving the Interchange Litigation. The accrual related to...

  • Page 127
    ... responsibility plan. The total settlement was recorded in fiscal 2007 at a discounted value of $1.9 billion using a rate of 4.72% over the payment term. The present value of the remaining obligation is reflected in current and long-term accrued litigation obligation on the consolidated balance...

  • Page 128
    ... order. On February 15, 2011, the court ordered that the case be stayed until 30 days following the final resolution of the appeals in the California Credit/Debit Card Tying Cases. The Interchange Litigation Kendall. On October 8, 2004, a class action lawsuit was filed by a group of merchants...

  • Page 129
    ... claims for damages based on the alleged tie of network processing services and payment guarantee services to the payment card system services; and (v) added Visa Inc. as a defendant. In addition, class plaintiffs filed a Second Supplemental Class Action Complaint (the "Supplemental Complaint...

  • Page 130
    ... later consolidated in the U.S. District Court for the Eastern District of New York, In re Visa Check/ MasterMoney Antitrust Litigation. Among other claims, the plaintiffs alleged that Visa U.S.A.'s "Honor All Cards" rule, which required merchants that accepted Visa cards to accept for payment every...

  • Page 131
    ... Visa International in connection with an asserted 1% currency conversion "fee" assessed on member financial institutions by the payment card networks on transactions involving the purchase of goods or services in a foreign currency and the disclosure of that fee (Schwartz). Plaintiffs claimed Visa...

  • Page 132
    ... or itemize any fees added to transactions because they occurred in a foreign country or involved a foreign currency and would require U.S. issuing members to disclose certain changes, if any, to exchange rate practices. Visa U.S.A. and Visa International also paid into the settlement fund $18...

  • Page 133
    ... payment including to a specific network brand or to any card product, such as a "non-reward" Visa credit card. Visa's rules always have allowed U.S. merchants to steer customers to other forms of payment and offer discounts to customers who choose to pay with cash, check or PIN debit. The new rules...

  • Page 134
    ...Honor All Cards" rule, the "no-surcharge" rule, and certain debit interchange fee practices. On August 10, 2009, Visa Inc. and Visa International filed a response to the SO. On April 26, 2010, Visa Europe announced an agreement with the European Commission, subject to public consultation, to end the...

  • Page 135
    ... appeal and pay Visa's litigation costs in exchange for Visa's withdrawal of its fee petition. CyberSource securities litigation. On April 29, 2010, an individual named Carol Ann Peters filed a class action lawsuit against CyberSource Corporation ("CyberSource"), certain of its directors, and Visa...

  • Page 136
    ... refers to the conversion of the purchase price of goods or services from one currency to another at the point of sale as agreed to by the cardholder and merchant. In New Zealand, the Commerce Commission completed its investigation and in February 2011 concluded that Visa's policies relating to DCC...

  • Page 137
    ... the investigation. U.S. ATM Access Fee Litigation. National ATM Council class action. On October 12, 2011, the National ATM Council and thirteen non-bank ATM operators filed a class action lawsuit against Visa (Visa Inc., Visa International Service Association, Visa USA, and Plus System, Inc.) and...

  • Page 138
    ... tables show selected quarterly operating results for each quarter and full year of fiscal 2011 and 2010 for Visa Inc.: Quarter Ended (unaudited) Fiscal Year 2011 Total Visa Inc. Operating revenues Operating income Net income attributable to Visa Inc. Basic earnings per share Class A common stock...

  • Page 139
    ... a system of disclosure controls and procedures (as defined in the Rules 13a-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that is designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed...

  • Page 140
    ...'s report on internal control over financial reporting, we documented and tested the design and operating effectiveness of our internal control over financial reporting. During fiscal 2011, there were no changes in our internal controls over financial reporting that occurred during the year ended...

  • Page 141
    ... website at www.investor.visa.com, under "Corporate Governance." Printed copies of these documents are also available to stockholders without charge upon written request directed to Corporate Secretary, P.O. Box 8999, San Francisco, California 94128. ITEM 11. Executive Compensation The information...

  • Page 142
    ... independence pursuant to Item 407(a) of Regulation S-K is incorporated herein by reference to the section entitled "Corporate Governance-Independence of Directors" in our Proxy Statement. ITEM 14. Principal Accountant Fees and Services The information required by this Item is incorporated herein...

  • Page 143
    Table of Contents PART IV ITEM 15. Exhibits and Financial Statement Schedules 1. Consolidated Financial Statements See Index to Consolidated Financial Statements in Item 8 of this Report. 2. Consolidated Financial Statement Schedules None. 3. The following exhibits are filed as part of this Report ...

  • Page 144
    ... duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized. VISA INC. By: Name: Title: Date: /s/ Joseph W. Saunders Joseph W. Saunders Chief Executive Officer November 17, 2011 Pursuant to the requirements of the Securities Exchange Act of...

  • Page 145
    ... specimen certificate for class C common stock of Visa Inc. (incorporated by reference to Exhibit 4.2 to the Registration Statement on Form 8-A, filed January 28, 2009) Settlement Agreement, dated June 4, 2003, by and among Visa U.S.A. Inc. and Wal-Mart, Limited Brands, Sears, Safeway, Circuit City...

  • Page 146
    ... Annual Report filed on Form 10-K for the year ended September 30, 2008 (the "September 2008 10-K")) Excess Retirement Benefit Plan (Amended and Restated Effective January 1, 2008) (incorporated by reference to Exhibit 10.32 to the September 2008 10-K) Form of Restricted Stock and Restricted Stock...

  • Page 147
    ... 10.40 to the Annual Report on Form 10-K for the year ended September 30, 2010 (the "September 2010 10-K")) Form of Visa Inc. 2007 Equity Incentive Compensation Plan Restricted Stock Award Agreement for executive officers, other than the CEO, for awards granted after November 1, 2010 (incorporated...

  • Page 148
    ... 1, 2008, effective January 1, 2011, Form of Visa Inc. 2007 Equity Incentive Compensation Plan Stock Option Award Agreement for executive officers, other than the CEO, for awards granted after November 1, 2011 Form of Visa Inc. 2007 Equity Incentive Compensation Plan Restricted Stock Award Agreement...

  • Page 149
    ...documents is to test the related format and technology and, as a result, investors should continue to rely on the official filed version of the furnished documents and not rely on this information in making investment decisions. In accordance with Rule 402 of Regulation S-T, the information in these...

  • Page 150
    ... follows: "Temporary social security supplement" means an additional monthly supplement commencing on a Participant's elected payment date and terminating on the earlier of his Normal Retirement Date or his date of death. The temporary social security supplement is the product of (a) times (b) where...

  • Page 151
    ...Benefit Service crediting under the Retirement Plan after December 31, 2010) or (ii) 25 years. To evidence the adoption of this First Amendment of the Excess Plan effective as of January 1, 2011, this document has been executed on behalf of the Visa Pension Benefits Committee by an authorized member...

  • Page 152
    ... to purchase Shares in accordance with the terms of the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan") and the Stock Option Award Agreement (the "Agreement") attached hereto. Nonqualified Stock Option Grant Date: Option Price per Share: Number of...

  • Page 153
    ... or electronic notice to the Stock Plan Administrator in a form satisfactory to the Committee specifying the number of Shares with respect to which the Option is being exercised and payment to the Company of the aggregate Option Price in accordance with Section 3(b). (b) At the time the Participant...

  • Page 154
    ... under the generally applicable retirement plan of the Company, a Subsidiary or an Affiliate under which the Participant is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the...

  • Page 155
    ... of any other applicable terms and conditions contained in the Plan and this Agreement, and not through the act of being hired, being granted the Option or acquiring Shares hereunder. 9. The Plan. By accepting any benefit under this Agreement, the Participant and any person claiming under or through...

  • Page 156
    ...rules, policies and regulations as may from time to time be adopted by the Committee. A paper copy of the Plan and the prospectus shall be provided to the Participant upon the Participant's written request to the Company at 900 Metro Center Blvd., Foster City, California 94404, Attention: Stock Plan...

  • Page 157
    ... compensation received by the Participant, Option granted and/or Shares issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company...

  • Page 158
    ... of restricted shares of common stock of the Company in accordance with the terms of the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan") and the Restricted Stock Award Agreement ("Agreement") attached hereto. Grant Date: Number of Shares of Restricted Stock...

  • Page 159
    ... terms used but not defined herein have the meaning set forth in the Visa Inc. 2007 Equity Incentive Compensation Subject to the provisions of this Agreement and the provisions of the Plan, the Company hereby grants to the Participant, pursuant to the Plan, the number of Shares of Restricted Stock...

  • Page 160
    ... under the generally applicable retirement plan of the Company, a Subsidiary or an Affiliate under which the Participant is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the...

  • Page 161
    ... supplemental taxable income ), pursuant to any procedures, and subject to any limitations as the Committee may prescribe and subject to applicable law, based on the Fair Market Value of the Shares on the payment date. The Company, a Subsidiary or an Affiliate may, in the discretion of the Committee...

  • Page 162
    ... Restricted Stock, for record dates occurring on or after the Grant Date and prior to the date any such Shares of Restricted Stock are forfeited in accordance with this Agreement, except that any dividends or distributions paid in Shares or other securities (including, without limitation, any change...

  • Page 163
    ... the Company, as that term is defined in Rule 144 under the Securities Act ("Rule 144"), the Participant may not sell the Shares received except in compliance with Rule 144. Certificates representing Shares issued to an "affiliate" of the Company may bear a legend setting forth such restrictions on...

  • Page 164
    ... compensation, Restricted Stock granted and/or Shares issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company's Clawback Policy...

  • Page 165
    ... granted the following Restricted Stock Units in accordance with the terms of the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan") and the Restricted Stock Unit Award Agreement ("Agreement") attached hereto. Restricted Stock Units Grant Date: Number of Shares...

  • Page 166
    ... is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the Period of Restriction shall lapse as to the full number of Restricted Stock Units. (c) Without Cause. Upon Termination...

  • Page 167
    ...the date of such lapse, the Company shall cause to be delivered to the Participant (a) the full number of Shares underlying the Restricted Stock Units as to which such portion of the Period of Restriction has so lapsed, (b) a cash payment determined by reference to the then-current Fair Market Value...

  • Page 168
    ... request to the Company at 900 Metro Center Blvd., Foster City, California 94404, Attention: Stock Plan Administrator. 10. Certain Defined Terms. For purposes of this Agreement, the following terms shall have the meanings set forth below: (a) "Cause" shall have the meaning set forth in the Visa...

  • Page 169
    ...Restricted Stock Unit granted, Shares issued and/or amount paid hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company's Clawback Policy...

  • Page 170
    ... of compensation, and expressly agrees that the Company may take such actions as are necessary to effectuate the Policy, any similar policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. To the extent that the terms of...

  • Page 171
    ...Agreement This PERFORMANCE SHARE AWARD AGREEMENT (this "Agreement"), dated November 5, 2011 (the "Grant Date"), is by and between VISA INC. (the "Company") and (the "Participant"), pursuant to the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan"). Capitalized terms that are...

  • Page 172
    ...") as of the end of the applicable period used for purposes of calculating this goal, as described below ("TSR Rank"). For this purpose, "Earnings Per Share" or "EPS" means the Company's fiscal year 2012 and 2013 and 2014 diluted earnings per share reported in its annual report on Form 10-K for the...

  • Page 173
    ... based on the average Base Percentage of Performance Shares Earned over the three years of the Performance Cycle and shall never exceed 200%. Performance Level Threshold Target Maximum TSR Rank 0 - 25% 50% 75% and above Adjustment Multiplier 75% 100% 125% If the Performance Level for TSR Rank falls...

  • Page 174
    ... under the generally applicable retirement plan of the Company, a Subsidiary or an Affiliate under which the Participant is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the...

  • Page 175
    ... as of the date of such Separation from Service, and (II) that number of Performance Shares subject to this Award that would have been earned as of the end of the Performance Cycle under Section 3(a)(iii), based on the deemed achievement of the Target Performance Level (within the meaning of Section...

  • Page 176
    ... of the Plan and this Agreement, and shall not give the Participant any express or implied right to be retained in the employment or service of the Company or any Subsidiary or Affiliate for any period or in any particular position or at any particular rate of compensation, nor restrict in any...

  • Page 177
    ... date on which such employment agreement expires. (c) "Good Reason" means: (i) a material reduction by the Company, a Subsidiary or an Affiliate in the Participant's rate of annual base salary from that in effect as of the Grant Date, or, if a Change of Control has occurred following the Grant Date...

  • Page 178
    ...Metro Center Blvd., Foster City, California 94404, Attention: Stock Plan Administrator, or such other address as the Company may from time to time specify. All notices to the Participant shall be addressed to the Participant at the Participant's address in the Company's records. 15. Other Plans. The...

  • Page 179
    ... granted and/or Shares issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company's Clawback Policy, as it may be amended from time...

  • Page 180
    ...Agreement This PERFORMANCE SHARE AWARD AGREEMENT (this "Agreement"), dated November 5, 2011 (the "Grant Date"), is by and between VISA INC. (the "Company") and (the "Participant"), pursuant to the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan"). Capitalized terms that are...

  • Page 181
    ...") as of the end of the applicable period used for purposes of calculating this goal, as described below ("TSR Rank"). For this purpose, "Earnings Per Share" or "EPS" means the Company's fiscal year 2012 and 2013 and 2014 diluted earnings per share reported in its annual report on Form 10-K for the...

  • Page 182
    ... based on the average Base Percentage of Performance Shares Earned over the three years of the Performance Cycle and shall never exceed 200%. Performance Level Threshold Target Maximum TSR Rank 0 - 25% 50% 75% and above Adjustment Multiplier 75% 100% 125% If the Performance Level for TSR Rank falls...

  • Page 183
    ... under the generally applicable retirement plan of the Company, a Subsidiary or an Affiliate under which the Participant is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the...

  • Page 184
    ... 3(a)(iii), as of the end of the Performance Cycle, based on the deemed achievement of the Target Performance Level (within the meaning of Section 3(a)(iii)). (ii) Separation from Service by Reason of Death, Disability, without Cause, Good Reason or Retirement After the End of the Performance Cycle...

  • Page 185
    ... of the Plan and this Agreement, and shall not give the Participant any express or implied right to be retained in the employment or service of the Company or any Subsidiary or Affiliate for any period or in any particular position or at any particular rate of compensation, nor restrict in any...

  • Page 186
    ... request to the Company at 900 Metro Center Blvd., Foster City, California 94404, Attention: Stock Plan Administrator. 12. Certain Defined Terms. For purposes of this Agreement, the following terms shall have the meanings set forth below: (a) "Cause" shall have the meaning set forth in the Visa...

  • Page 187
    ... granted and/or Shares issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company's Clawback Policy, as it may be amended from time...

  • Page 188
    ... the Policy, any similar policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. To the extent that the terms of this Agreement and the Policy or any similar policy conflict, then the terms of such policy shall prevail. Visa...

  • Page 189
    ... to purchase Shares in accordance with the terms of the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan") and the Stock Option Award Agreement ( the "Agreement" ) attached hereto. Nonqualified Stock Option Grant Date: Option Price per Share: Number...

  • Page 190
    ... or electronic notice to the Stock Plan Administrator in a form satisfactory to the Committee specifying the number of Shares with respect to which the Option is being exercised and payment to the Company of the aggregate Option Price in accordance with Section 3(b). (b) At the time the Participant...

  • Page 191
    ... under the generally applicable retirement plan of the Company, a Subsidiary or an Affiliate under which the Participant is covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the...

  • Page 192
    ...rules, policies and regulations as may from time to time be adopted by the Committee. A paper copy of the Plan and the prospectus shall be provided to the Participant upon the Participant's written request to the Company at 900 Metro Center Blvd., Foster City, California 94404, Attention: Stock Plan...

  • Page 193
    ... in such employment agreement. (b) "Good Reason" means: (i) a material reduction by the Company, a Subsidiary or an Affiliate in the Participant's rate of annual base salary from that in effect immediately prior to the Change of Control; (ii) a material reduction by the Corporation or a Subsidiary...

  • Page 194
    ... compensation received by the Participant, option granted and/or Shares issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company...

  • Page 195
    ... granted the following Restricted Stock Units in accordance with the terms of the Visa Inc. 2007 Equity Incentive Compensation Plan (the "Plan") and the Restricted Stock Unit Award Agreement ("Agreement") attached hereto. Restricted Stock Units Grant Date: Number of Shares...

  • Page 196
    ...covered in his or her home country; or (2) attainment of age sixty and five years of completed service and six months of service from the date of grant ("Retirement"), then the Period of Restriction shall lapse as to the full number of Restricted Stock Units. (c) Other Terminations. Upon Termination...

  • Page 197
    ...the date of such lapse, the Company shall cause to be delivered to the Participant (a) the full number of Shares underlying the Restricted Stock Units as to which such portion of the Period of Restriction has so lapsed, (b) a cash payment determined by reference to the then-current Fair Market Value...

  • Page 198
    ... of the foregoing definition, "Good Reason" shall at that time have such meaning as may be specified in such employment agreement. 11. Compliance with Laws and Regulations. (a) The Restricted Stock Units and the obligation of the Company to deliver Shares or cash payments hereunder shall be subject...

  • Page 199
    ...Restricted Stock Unit granted, Shares issued and/or amount paid hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company's Clawback Policy...

  • Page 200
    Exhibit 21.1 Subsidiaries of Visa Inc. as of September 30, 2011 Name Interlink Network, Inc. Visa International Service Association Visa U.S.A. Inc. Visa Worldwide Pte. Limited Country Delaware Delaware Delaware Singapore

  • Page 201
    ...consolidated statements of operations, changes in equity, comprehensive income, and cash flows for each of the years in the three-year period ended September 30, 2011, and the effectiveness of internal control over financial reporting of Visa Inc. as of September 30, 2011. /s/ KPMG LLP San Francisco...

  • Page 202
    Exhibit 31.1 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO EXCHANGE ACT RULE 13A-14(A)/15D-14(A) AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Joseph W. Saunders, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Visa Inc.; Based on my ...

  • Page 203
    Exhibit 31.2 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO EXCHANGE ACT RULE 13A-14(A)/15D-14(A) AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Byron H. Pollitt, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Visa Inc.; Based on my ...

  • Page 204
    ... In connection with the Annual Report of Visa Inc. (the "Company") on Form 10-K for the period ended September 30, 2011, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Joseph W. Saunders, Chief Executive Officer of the Company do hereby certify, pursuant...

  • Page 205
    ...2002 In connection with the Annual Report of Visa Inc. (the "Company") on Form 10-K for the period ended September 30, 2011, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Byron H. Pollitt, Chief Financial Officer of the Company do hereby certify, pursuant...