Visa 2011 Annual Report Download - page 55

Table of Contents
covenant requirements relating to a maximum level of debt to EBITDA and events of default customary for financings of this type. This facility expires on
February 15, 2013. There were no borrowings under this facility and we were in compliance with all covenants during and at the end of fiscal 2011.
U.S. commercial paper program. We maintain a $500 million U.S. commercial paper program, which provides for the issuance of unsecured debt with
maturities up to 270 days from the date of issuance at interest rates generally extended to companies with comparable 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.
Universal shelf registration statement. On May 6, 2009, we filed a registration statement with the U.S. Securities and Exchange Commission using a
shelf registration process. As permitted by the registration statement, we may, from time to time, sell shares of debt or equity securities in one or more
transactions. The registration statement expires on May 5, 2012.
Escrow account. We maintain an escrow account for use in the payment of covered litigation matters. When the Company funds the escrow account,
the shares of class B common stock held by our stockholders are subject to dilution through an adjustment to the conversion rate of the shares of class B
common stock to shares of class A common stock. See Note 3—Retrospective Responsibility Plan and Note 21—Legal Matters to our consolidated financial
statements. The balance in this account at September 30, 2011 was $2.9 billion and is reflected as restricted cash on our consolidated balance sheet. As these
funds are restricted for use solely for the purpose of making payments related to covered litigation matters, as described below under Uses of Liquidity, we do
not rely on them for other operational needs.
Credit Ratings
At September 30, 2011, our credit ratings by Standard and Poor's and Moody's were as follows:
Standard and Poor's Moody's
Debt type Rating Outlook Rating Outlook
Short-term unsecured debt A-1 Stable P-1 Stable
Long-term unsecured debt A+ Stable A1 Stable
Various factors affect our credit ratings, including changes in our operating performance, the economic environment, conditions in the electronic
payment industry, our financial position and changes in our business strategy. We do not currently foresee any reasonable circumstances under which our
credit ratings would be significantly downgraded. If a downgrade were to occur, it could adversely impact, among other things, our future borrowing costs and
access to capital markets.
Uses of Liquidity
Payments settlement. Payments settlement due from and due to issuing and acquiring clients represents our most consistent liquidity requirement. U.S.
dollar settlements are settled within the same day and do not result in a net receivable or payable balance, while settlement currencies other than the U.S.
dollar generally remain outstanding for one to two business days, consistent with industry practice for such transactions.
Covered litigation. We are parties to legal and regulatory proceedings with respect to a variety of matters, including certain litigation that we refer to as
covered litigation. As noted above, settlements
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